LAO Releases their Fiscal Outlook

This week, the Legislative Analyst’s Office (LAO) released their annual forecast for upcoming fiscal years. With the current economic projections and budget commitments, the LAO projects 2017-18 will continue to be a positive year, with an estimate of $11.5 billion in total reserves. Medi-Cal spending and General Fund costs are predicted to increase, in 2017-18 largely due to caseload growth and per-enrollee costs and the start of state share of cost for the ACA optional expansion population, which begins in 2017.

It is important to note that this report does not reflect potential changes in federal policy in light of the recent election. The LAO does recognize that federal policy changes would significantly impact these projections.

The Governor will release his budget plan in January.