California Proposes Higher Rainy Day Fund Cap, San Diego Taps Reserves

• California proposes Prop. 2 to increase the rainy day fund cap from 10% to 20%.
• San Diego used its rainy-day fund to cover a $4.7 million budget deficit for fiscal year 2026.
• This is the first time in over a decade that San Diego has drawn from its reserves.
• California's booming stock market has brought in billions in unexpected tax revenue.
• San Diego awaits reimbursement from the state's office of emergency services.