California budget shortfall now topping $10 billion, analyst says |

California budget shortfall now topping $10 billion, analyst says

SACRAMENTO (AP) ” California’s budget picture has deteriorated significantly since the summer, with the state now facing a nearly $10 billion shortfall.

Wednesday’s report by the state’s nonpartisan legislative analyst confirms speculation that a slowing housing market and other factors have eroded revenue in the state’s annual spending plan.

As recently as August, Governor Arnold Schwarzenegger touted his plan as a balanced budget.

Without immediate fixes, the state’s $4.1 billion reserve will evaporate. Department heads already have been asked to prepare for a 10 percent spending cut.

The analyst also predicted that California will be billions of dollars in the red by the time lawmakers vote on a new spending plan next summer.

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