Despite surplus, analyst warns of California ‘fiscal cliff’

By ADAM BEAM
Associated Press

SACRAMENTO, Calif. (AP) — California’s nonpartisan legislative analyst says the state could be headed toward a fiscal cliff despite a record-breaking budget surplus. Gov. Gavin Newsom announced a $97.5 billion surplus on Friday. The Legislative Analyst’s Office said Monday that Newsom’s proposal would leave the state about $25 billion over a constitutional spending limit next year. The analyst said that could require budget cuts. California Department of Finance spokesman H.D. Palmer noted Newsom’s budget proposal leaves the state in a good position to handle the problem. California would have billions of dollars in reserve. And he said the state could cut back on one-time spending if necessary.