Letter to Senator Leno on State Spending

The General Fund has different responsibilities today than it did in 2007 and, therefore, the level of General Fund spending today is not easily comparable to that discussed in our November 2007 Fiscal Outlook. In several key areas of public services, the state has shifted funding responsibilities from the General Fund to (1) other state and local government accounts or (2) individuals and families. Because of these shifts, current General Fund spending arguably is understated relative to what might have been expected prior to the recession. . . In a hypothetical world in which none of the shifts above occurred and the General Fund still paid for all of these expenses, General Fund spending in 2015-16 might be somewhere between $125 billion and $130 billion, much higher than the $113 billion reflected in the Governor’s recent spending proposal.

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