Continued Receipts Above Estimate

The state controller has issued her monthly cash report for the current fiscal year through October. Receipts are running $6.3 billion above forecast levels. Almost all of the overage is coming from the personal income tax, suggesting it reflects the AI stock market boom and estimated capital gains. Sales tax receipts are in line with forecast levels suggesting the economy is performing at around projected levels.

Unused borrowable resources are down from a year ago indicating a drawdown of available reserves, but they are still at a very high level of $85.8 billion (down from $97.4 billion). So we are nowhere near the kind of budget crisis that hit the state during the Great Recession of 2008.

While the Legislative Analyst's Office continues to worry about structural budget problems in the outyears and what might happen if we have a bubble that bursts in the stock market, there will at least be members of the legislature who will observe the immediate happy results in formulating next year's budget.

The latest cash statement of the controller is at:

https://www.sco.ca.gov/Files-ARD/CASH/October2025StatementofGeneralFundCashReceiptsandDisbursements.pdf.