California’s budgetary deficit is headed toward a record $73 billion during the 2024 fiscal year under Democratic Gov. Gavin Newsom, according to a new report released by the state’s nonpartisan Legislative Analyst’s Office (LAO).
LAO’s Tuesday report found that California’s deficit would actually be $15 billion higher than the $58 billion the office had initially predicted. State revenues, which LAO projects will decline by $24 billion, are driving the increase in the state’s budgetary deficit, according to the LAO report.
The report’s projection coincides with large numbers of taxpayers, one of California’s primary sources of revenue, leaving the state.
The state’s population dropped by about 75,400 between July 2022 and July 2023, according to census data.
Many of the people leaving California are taking significant resources with them. California experienced a net loss of more than 27,000 tax filers with an adjusted gross income of over $200,000 between 2020 and 2021, according to the Tax Foundation.
The state saw a total net loss of about 158,000 taxpayers during the same period, the largest loss among all 50 states and the District of Columbia, according to the Tax Foundation.
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Many Californians are moving to Florida, which the Tax Foundation says had the greatest net increase in taxpayers between 2020 and 2021. Florida had a budget surplus in 2023, according to Politico.
California was also just recently in good fiscal health, boasting a $97.5 billion surplus in 2022, according to CalMatters. That surplus morphed into a deficit of $31.5 billion in 2023.
LAO floated reductions in spending as one possible solution to addressing the state’s budget deficit. California is set to spend $208 billion in 2024, according to Newsom’s proposed budget, which is less than what the state spent in 2023.
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Some pundits have floated Newsom as a possible alternative to President Joe Biden to run on the Democratic ticket in the 2024 general election. Newsom, however, has indicated that he will not run.
A spokesperson for Newsom did not immediately respond to the Daily Caller News Foundation’s request for comment.
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