Governor’s "keeping promises" budget keeps structural balance while funding education, transportation and wildfire response

Laurie Wolf, administrator of the Division of Financial Management, told the Joint Finance and Appropriation Committee on Jan. 8 that the governor’s executive budget is a "keeping promises" budget that maintains a conservative revenue forecast while funding education, transportation, wildfire response and other priorities.

The proposal projects an ending general fund balance of about $383 million for fiscal 2025 and $227 million for fiscal 2026 after recommended expenditures. It includes $151 million in recommended enhancements for FY 2026, a $59 million transfer to the state budget stabilization fund and a $50 million transfer to the public education stabilization fund, and it holds $100 million for potential tax relief.

Why it matters: the governor frames the request as balancing near-term tax relief with investments intended to address long-term capacity and public-safety needs — higher teacher pay and school supports, transportation projects, workforce and housing programs, water and wildfire funding, and cyber-security upgrades.

Wolf said the administration used a conservative revenue estimate in updating the budget and emphasized maintaining a structural balance. "We as always took a conservative approach to how we put this budget together," she said.

Key numbers and posture

- Total recommended enhancements for FY 2026: about $151 million (ongoing and one-time combined). - Held for tax relief:…