Department of Finance briefs Board of Equalization on governor's 2025–26 budget, flags wildfire funding and volatility risks

Erica Lee, deputy director at the California Department of Finance, told the Board of Equalization on Feb. 19 that the governor's proposed 2025–26 budget is balanced for the budget year and includes targeted funds for wildfire response.

Lee said the administration now projects about $16,500,000,000 more in revenues across the budget window compared with last year’s forecast and proposed total spending of about $322,000,000,000 ($229,000,000,000 of that in the general fund). “We have seen stronger than anticipated performance of the economy, stock market and cash receipts,” Lee said during the board meeting.

Why it matters: The presentation framed how near-term revenues and big disaster-response commitments interact with long-term fiscal risks. Department officials flagged the state’s heavy revenue volatility — driven by progressive personal income tax receipts and stock-market sensitivity — and warned that federal policy changes could significantly affect federal funds that California…