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California Spending Cap Triggers Deficit Despite Record Revenue

May 24, 2022, 10:35 PM

California Gov. Gavin Newsom’s proposals to use billions in excess revenue on one-time expenses may avoid triggering a 1970s law meant to constrain per-capita spending this year, but that won’t last long, the Legislature’s nonpartisan fiscal and policy analyst said Tuesday.

The Democratic governor said May 13 that he wanted to spend tens of billions on infrastructure, Covid-19 and drought emergencies, and refunds to vehicle owners. Those are all allowable ways to stay under the state appropriations limit (SAL)—approved by voters in 1978—that dictates what lawmakers can do with extra money.

The excess money is coming from ...