Governor’s Proposed Budget Sees Big Deficit, and It Could Get Worse
The state’s reservoirs may be filling from historic rainfall, but the budget coffers are not enjoying a similar downpour. Gov. Newsom this week (Jan. 10) unveiled his proposed 2023 budget, which projects a $22.5 billion deficit stemming from a significant drop in revenue. And, the situation could get worse. Just today (Jan. 13), the state Legislative Analyst Office projected that revenues could fall even further.
In a statement released Tuesday, Bay Area Council President and CEO Jim Wunderman praised the Governor for making difficult choices, holding the line on spending and avoiding dipping into existing reserves. However, Wunderman expressed concern about proposed spending cuts in housing and homelessness, transportation and a variety of climate-related areas, including drought resilience.
Those concerns were amplified in a letter the Council sent to Gov. Newsom highlighting the fiscal cliff facing many public transit systems as they struggle to recover ridership following the pandemic and the prospect of massive service cuts without additional funding. On homelessness, the Council applauded the Governor’s strong words to cities and counties that, armed with billions of new state funding in recent years, to make greater progress.