California sees revenue uptick, but not enough to erase its chronic budget deficit

In the four months since the Legislature and Gov. Gavin Newsom enacted a new state budget, revenues – primarily from personal income taxes — have outstripped expectations by several billion dollars.

The uptick has buoyed hopes within the Capitol that California’s chronic budget deficits might disappear if the revenue surge continues. That would spare Newsom and legislators from having to dream up more accounting gimmicks, deferrals and loans to cover the gap between income and outgo.

However, the Legislature’s fiscal advisor, Legislative Analyst Gabe Petek, threw cold water on those rosy scenarios Wednesday. He sees recent revenue gains as a spike driven by an artificial intelligence boomlet in Silicon Valley that’s likely to implode, as have previous tech-related bubbles.

“With so much