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California Governor Jerry Brown …
(Reuters) - California's budget deficit will swell to nearly $7 billion greater than expected due to weak tax revenues and slow progress in cutting spending, Governor Jerry Brown said on Saturday.
Brown said the shortfall for the state's 2012-2013 fiscal year now stands at $16 billion, up from a previous estimate of $9.2 billion made in January.
"We are now facing a $16 billion shortfall, not the $9 billion we thought in January," Brown announced in a video posted on YouTube. "This means we will have to go much further and make cuts far greater than I asked for at the beginning of the year."
Brown is due to present on Monday a new budget proposal for the next fiscal year starting in July. In it, he said, he will outline how to eliminate the deficit.
California could receive a windfall from the planned initial public offering of online social media firm Facebook, which is aiming to raise as much as $12 billion when launched next week.
Revenues from Facebook stock options held by people living in California could reach around $2 billion, according to municipal bond analysts who say that the final amount will depend on how the shares trade on the market.
