California may never see "hundreds of millions" in Facebook-related tax dollars necessary to balance the state budget as investors spurn the social media giant, the state's top fiscal analyst warned Wednesday.

After its first earnings report failed to energize investors last week, Menlo Park-based Facebook closed Wednesday trading at $20.88 per share. The new low has sunk 45 percent below the company's initial $38 share price.

The nonpartisan Legislative Analyst's Office said Wednesday that "if the company's stock price remains depressed, hundreds of millions of income tax dollars assumed in the 2012-13 state budget plan are at risk."

Gov. Jerry Brown and state lawmakers are counting on Facebook stock transactions to generate $1.9 billion in income tax revenue through June – or $1.5 billion if voters reject higher taxes on upper-income earners.

State fiscal officials are anxiously awaiting where Facebook will trade in November, when another round of insiders will have stock transactions that result in an income tax bill. The Analyst's Office says California still will reap a sizable amount of tax dollars from Facebook, but possibly not as much as had been assumed.

The state Department of Finance had based its May forecast on a $35 per share Facebook stock price in November. In a more aggressive projection, the Analyst's Office had assumed in May that the price would reach $42 in November and generate $2.1 billion for the state budget.

"Given where the price is and that it's been weak recently, it's one of the risks that's out there," said Jason Sisney, who tracks revenues for the Analyst's Office.

The report highlights the volatility of California's tax system, which depends heavily on income taxes from wealthy earners who have capital gains income.

Sisney said his office issued its update Wednesday after receiving a steady stream of questions from media across the world as Facebook's stock price has dropped since shares began trading in May.

"I mean, I get questions from Berlin and Amsterdam about it," Sisney said.

Finance spokesman H.D. Palmer said his department doesn't have immediate concerns. "The issue is not where the share price is now – it's where it's going relative to November."

Palmer noted that Finance underestimated the share price by $3 per share for the initial offering, when top insiders incurred a tax liability for their opening-day transactions.

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