Senate alters House budget with different revenue estimates, tax splits and targeted restorations

Michael Caine, the legislative budget assistant, briefed the Senate Finance-related parties on the Senate's changes to the House-passed biennial budget, saying the Senate's revenue estimates and policy choices left the Education Trust Fund and the rainy day fund in different positions than the House plan.

The overview explained that Senate revenues for fiscal years 2025'27 were roughly $416 million higher on base estimates than the House's numbers, but after interfund splits and other adjustments the net difference between the House and Senate proposals over the three-year period was about $237 million. Caine attributed much of the variance to differences in estimates for video lottery terminal (VLT) revenue and to alternative splits of business, tobacco and real estate transfer taxes between the general fund and the Education Trust Fund.

Why it matters: the revenue and split differences change how much each fund can appropriate and whether the rainy day fund must cover shortfalls. The Senate's approach produced a positive Education Trust Fund balance going into 2027 and a larger rainy day fund balance under its estimates; the House proposal required a larger transfer from the general fund to bring the Education Trust Fund balance to zero.

Caine walked the group through the surplus statement and schedule 2 adjustments that underpin the two bodies' competing positions. He said…