California revenue is growing. So why the talk of deficits?

SACRAMENTO, Calif. (AP) — California’s economy is expanding and voters just approved billions of dollars in tax increases, yet Gov. Jerry Brown this week projected a budget deficit for the first time in four years and called for spending cuts.

So what’s going on?

The paradoxical budget picture is a result of revenue growing more slowly than economists had predicted after years of rapid increases from a hard-charging economy. While Brown expects revenue to be up 3 percent next year, the governor and lawmakers assumed revenues would be even higher when they planned the current budget, and they spent accordingly. Costs are higher than expected, too.