Legislature Accepts Governor’s Revenue Projection for 2015-16 Budget Agreement
The 2015-16 budget agreement between the Governor and the Legislature accepts the revenue projection that was included in the Governor’s May Revision in lieu of the nonpartisan Legislative Analyst’s Office’s (LAO) revenue projection, which the Legislature had used in its original version of the budget package. For 2015-16, the budget agreement anticipates $115 billion in General Fund revenues, excluding a $1.85 billion transfer to the Budget Stabilization Account (BSA), the state’s rainy day fund. This transfer is required by Proposition 2, which California voters approved in November 2014. On the expenditures side of the 2015-16 budget, Proposition 2 also requires that an equal amount – that is, $1.85 billion – be allocated to paying down budgetary debt. Before accounting for the transfer to the BSA, the budget agreement’s revenue figure is about $3 billion below the LAO’s pre-transfer revenue projection. While the Governor’s and the LAO’s projections have been similar in recent years, the LAO’s projections have been closer to actual revenues collected.