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State Budget A Little Bearish

The California Legislative Analyst's Office says state expenses are climbing and revenues are dipping. It's anticipating a $1.9B budget shortfall for the state by year end, a $8B shortfall for next year, and more to come. The main blame? Tech stocks. Enron. The slumping real estate market, specifically its current and future effects on property taxes and housing starts. Per the LAO's report, the 2007-2008 budget called for 10% property tax growth. Reality check: looks like it'll come in around 8.7%, and continue shrinking for a few years. Seems small, but each 1% of that stat translates to about $450 million.