Overview
- The 2026–2027 balance is now projected at $3.7 billion, up $1.3 billion from the prior estimate, driven by a slightly stronger economy and more volatile revenue sources.
- For 2028–2029, the forecast shows a $377 million general fund balance while noting a significant structural imbalance as spending growth outpaces revenue through FY2029.
- Uncertainty stems from federal moves, including a newly announced $259 million halt in Medicaid reimbursements and earlier CMS warnings that put up to about $2 billion at risk.
- Fraud concerns remain a focal point but are not yet quantified in the outlook, as auditors work to clarify potential losses cited by state leaders.
- Lawmakers face pressure to set priorities for the session, with House GOP leaders urging tax conformity and rejecting tax hikes as January revenues also came in about $500 million above projections.