CA AB1740

Establishes the Budget Deficit Savings Account in the State Treasury to provide an additional reserve mechanism for economic downturns beyond the existing Budget Stabilization Account.

Allows funds to be deposited into the account only after meeting constitutional debt payments and Budget Stabilization Account contributions, with deposits occurring on October 1st of each fiscal year.

Restricts withdrawals from the account to fiscal years with a state budget deficit and limits annual appropriations to no more than 50 percent of the account balance.

Specifies that funds may only be used to maintain existing budget funding levels during deficits and defines "state budget deficit" as inadequate estimated resources compared to the highest General Fund expenditures from the three most recent Budget Acts, adjusted for cost of living and population growth.

Prohibits funds in the account from being counted as "General Fund revenues" for purposes of Revenue and Taxation Code Sections 6051.4 and 6051.45.