State cash position remains very strong
As of November 30, more than $91 billion of available "cash on hand" in treasury
As of November 30, the state treasury retains more than $91 billion of available “cash on hand” (formally referred to as “unused borrowable resources”). This incredibly strong cash position persists despite the deep tax revenue shortfalls of October and November. This figure comes from new State Controller data. The $91 billion principally comes from the state’s accounts outside the General Fund, such as the state’s fee-supported special funds.
In any year, the General Fund has periods when it lacks cash and other periods when it has more cash. As a result of this, California’s General Fund disbursements are funded seasonally with temporary lending from other state funds via the state treasury’s Pooled Money Investment Account and its subsidiary funds. Seasonal borrowing from this “bank” of the state treasury does not affect special fund operations. As of November 30, other state funds collectively have lent the General Fund $4.7 billion to maintain its cash flow operations during recent weeks, as tax revenues fell below projections.
Prior to 2015-16, the state issued short-term revenue anticipation notes (RANs) to municipal bond market investors in all but one fiscal year since the mid-1980s, with the RAN proceeds providing additional, temporary cash flow support to the General Fund.
California’s cash position continues to be among the strongest of any state in history. With more than $91 billion of unused borrowable resources currently, a historical comparison comes to mind. Fifteen years ago, as the 2008-09 fiscal crisis grew, the state treasury ended November 2008 with $4 billion of unused borrowable resources—all of it funded from external borrowing (RAN proceeds). The lack of cash on hand forced some of the most difficult budget decisions of that dark period, including a halt to many state capital projects on December 17, 2008.