House Ways and Means panel reviews FY2026 budget draft; adds surplus carve‑out for suspended earmarks

The House Committee on Ways and Means reviewed the fiscal year 2026 budget draft and debated revenue assumptions, suspensions of earmarks and a contingency to permit first‑quarter allotments if a proposed MPLT loan is not finalized by Oct. 1, 2025. The committee chair also read a newly inserted provision that would allow any excess collections above the Department of Finance’s April 1, 2025 projection to be transferred automatically to beneficiary agencies rather than remain suspended.

The discussion matters because the committee’s draft sets the baseline general revenues available for appropriation, determines whether longstanding earmarked funds are temporarily redirected to the general fund, and includes a contingency allowing agencies to receive advance allotments if external financing (the MPLT loan) does not take effect by the fiscal‑year start. Those choices affect agency operations, public‑health programs funded by earmarks, and the timing of disbursements for government services.

Committee members reviewed the bill title and standard sections and then moved through key provisions. Under section 201 (estimated revenues) the chair presented the committee’s top‑line and bottom‑line figures as read from the working document. The chair stated a debt‑service subtotal of $41,872,250. After accounting for debt service and the Department of Public Lands allocation, the chair identified $127,455,066 as the amount defined in the draft as "general revenues" available for appropriation for FY2026.

Members asked for clarity on the composition of the top number and on which base should receive the statutory 25 percent allocations referenced during debate. Representative Ralphie Mo and others discussed bond‑era accounting and prior initiatives that affect which resources are treated as distributable. Representative Roman Belventi noted the difference between stronger and weaker economic periods and said the surplus‑return language would allow intended beneficiaries to receive funds when collections exceed projections.

Section 202 (advance allotment) was discussed as a contingency measure. The provision would permit government entities to request and receive their first‑quarter allotment if the MPLT loan fails to become effective by Oct. 1, 2025, so agencies can continue operations at the start of the fiscal year. A question to confirm execution authority drew the response that the Secretary of Finance would be the official to disperse allotments; when asked whether the secretary may exercise discretion over payout order, a committee speaker confirmed, "That is correct."

Under section 203 (suspension of earmarks) members reviewed a list of earmarked items (items a through m in the working document) that the administration proposed to suspend and discussed the impact on programs funded by taxes earmarked for prevention, cancer control and similar activities. The vice chair proposed—and members approved by consensus in committee discussion—adding a provision to protect programs when actual collections exceed the Department of Finance projection. Legal counsel inserted language the chair then read aloud: "Provided further, notwithstanding any Commonwealth laws to the contrary, in the event that actual collections exceed the projected amounts as identified by the Department of Finance on 04/01/2025, any excess amount shall not be subject to suspension and shall be automatically transferred to the beneficiary entity without further legislative actions." That language was presented to the committee for agreement.

Section 204 (reporting requirements) directs the Secretary of Finance to report to the presiding officers of both houses and to the fiscal‑affairs committee chairs. Section 301 (appropriation and budget authority) lists agency allocations and notes an update that MPLT has 6 NOPs added to its account totals; the transcript does not define "NOPs" further in the meeting.

The committee did not take a final vote on the FY2026 appropriation bill during this session; the chair stated the hope of reaching consensus to prefile a final product for a full House vote. Earlier in the meeting the committee adopted the meeting agenda by motion; the motion was seconded and the chair announced, "The ayes have it. Motion is adopted." The committee recessed several times during the deliberations.

Looking ahead, the draft will continue to be edited (legal counsel was updating language on the floor), and the committee indicated it intends to resolve the remaining revenue‑base questions and return a final product for prefiling to the full House.