California's Legislative Analyst's Office said Wednesday that "hundreds of millions of dollars" of income tax revenue assumed in the state budget are at risk if shares of Facebook Inc. remain down from their initial public offering price.

The state's nonpartisan financial and policy adviser said in a note that Gov. Jerry Brown's budget assumes expected $1.9 billion in income-tax revenue for fiscal 2012 and 2013 combined attributed to the Facebook IPO.

The Brown administration figures assumed a $35 share price for Facebook. The IPO came in at $38 but the stock is now flirting with the $20 mark.

The LAO said the revenues from the IPO are just 1% of the state's revenue projections and much of the money should still materialize, even if the company's stock remains low.

Increased trading activity from worried inside investors when the lockup period ends could help to increase state revenues as well, the analyst's office said.

"Beyond Facebook, the federal 'fiscal cliff,' volatile trends in the overall stock market, trends in consumer confidence and the economic situation in parts of Europe and Asia are significant uncertainties that could result in larger revenue decreases (or increases) than Facebook alone," the LAO said.

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