California Running Out of Cash, Governor Declares Emergency

Blaming COVID-19, California Governor Gavin Newsom on Thursday declared a budget emergency as the state tries to come up with a balanced budget by July 1. By making the declaration, the governor opens the door to tapping the state’s rainy day fund to help defray the expected $54-billion hole in the budget, but they’ve got a long way to go.

California expects to use $16 billion from the rainy day fund over three years, which is a good boost, but won’t fill the gap left by the expected 25% decline in personal income tax, the 27% decline in sales tax, and the 23% decline in corporate tax.

And as if falling revenue wasn’t enough, the state anticipates spending about $13 billion more on unexpected expenses related to the pandemic.

California isn’t alone. States across the nation expect the fiscal year coming to an end on June 30 and the next one to be financially challenging, which means one thing. Many will come knocking on Uncle Sam’s door, looking for a federal bailout.

Hold onto your wallet. This could get really expensive.

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Comments (3)

  1. Steve Ford

    Yeah……..short on cash i see..? Expecting a bail out now that you wasted millions on immigrant payments. Mr Newsome you need to reevaluate and get a grip your politics Before you can be eligible to manage money at a governors level. I live in a neighborhood in Texas where 80% of these new homeowners are recent and X California people fleeing your state. I suggest you step down and allow a conservative with more common sense to save that beautiful state.

  2. Palmer

    If Newsom would stop spending so much money on illegal immigrants, we probably would have to worry about the budget! All the healthcare he gives them, stimulus money, free food, free everything! Did he really think the money would just keep flowing in??? He needs to go! So does Pelosi 💯

  3. Paula Teel

    California was bankrupt years before the pandemic ever existed, as are all Democrat ran states! If the Democrat states would of taken lessons, from elected REPUBLICANS,, they would not be needing bailouts, now would they? For years, if you check your history books, the Democrat party has wasted tax payers money, to promote themselves, (only for the vote & to fill the pockets of Democrat Elected officials)! Where the Republican party has wisely used tax payers money as it should be used! (on the American Tax payer directly) So tell the AMERICAN, REPUBLICAN Ran States, why is it that the Elected Democrat states are Broke? Maybe the Elected Democrat officials, should donate their Salaries back to the citizens in their districts, like the POTUS TRUMP has, to show they are their, as their oath they take states, to serve & protect the AMERICAN ppl in their districts, not themselves!!

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