(The Center Square) – California’s annual state spending is up 50% per capita, or $106.3 billion, since 2019, the first year Gov. Gavin Newsom took office, highlighting the state’s growing budget woes.
According to taxpayer advocates, the state government has increased spending, despite the state’s constitutionally-mandated balanced budget requirement, by over-estimating future revenues.
“The Newsom administration and the Legislature have been recklessly over-projecting revenue to meet the requirement for a balanced budget while increasing spending. They have not been honest with the public about the cost of meeting the state’s renewable energy targets, the cost of new entitlement programs, or the cost of increasingly lucrative contracts for public employees,” wrote Howard Jarvis Taxpayers Association Vice President of Communications Susan Shelley in an email to The Center Square. “Instead they’ve used accounting trickery that would make Enron blush.”
In the 2019-2020 fiscal year, the state estimated it would receive $143 billion in personal, sales and use, and corporate (Big Three) tax revenue, and spend $215 billion overall; it received $139 billion in the aforementioned tax revenue and spent $209 billion.
The state posted higher than expected revenues while COVID-era funds lasted through the 2022-2023 fiscal years, but have since returned to lower than expected revenue.
In the 2023-2024 fiscal year, the state estimated it would receive $194 billion in Big Three revenue, and spend $311 billion overall; it received $193 billion and spent $332 billion overall.
While data for the 2024-2025 fiscal year that ended on July 31, 2025 is not yet available, the state faced a $73 billion revenue shortfall, requiring fund shifts and cuts to meet the state’s balanced budget requirement.
The state-funded Legislative Analyst’s Office projects ongoing deficits of tens of billions of dollars due to the state’s spending growth, and lack of spending cuts for ongoing commitments.
California Gov. Gavin Newsom’s office did not respond to The Center Square by the time of publication.
