By Carolyn Said
As California faces a ballooning deficit — now up to a staggering $68 billion — the state must act to balance its budget, including potentially reducing funding for schools and community colleges, the Legislative Analyst’s Office said in a report Thursday. But the nonpartisan group said its recommendations would preserve the state’s essential services, and could be implemented in a way to minimize disruption to schools.
The LAO pointed to nearly $24 billion in reserves that California could tap, as well as ways to reduce spending on schools and community colleges, saving $17 billion. Reductions to one‑time spending could save about another $10 billion, it said.
“These options and some others, like cost shifts, would allow the Legislature to solve most of the deficit largely without impacting the state’s core ongoing service level,” the group said.
“Mounting economic headwinds have pushed the state’s economy into a downturn,” it said, cautioning that the future will continue to be tight.
“The state’s reserves are unlikely to be sufficient to cover the state’s multiyear deficits—which average $30 billion per year under our estimates,” the report said. “These deficits likely necessitate ongoing spending reductions, revenue increases, or both.”
Therefore, it is suggesting that lawmakers preserve half of general purpose reserves as a cushion for tough times ahead.
Source: San Francisco Chronicle