Revenue Estimating Conference approves FY25–27 revenue estimates and transfers; reserves remain full

The Revenue Estimating Conference on March 13, 2025, approved Legislative Services Agency (LSA) revenue estimates for fiscal years 2025, 2026 and 2027 and authorized transfers of gambling revenue and interest to the Rebuild Iowa Infrastructure Fund, conference members said.

The conference’s action confirms the state has sufficient revenue to meet FY2025 appropriations and sets the initial spending thresholds for FY2026 and FY2027, officials said. Conference participants also reported that reserve funds remain fully funded.

Jennifer Acton, director of the Fiscal Services Division, opened the conference with an economic overview. “Up to this point the national economy has been performing stronger than expected and Iowa's economy has proven resilient,” Acton said, noting that consumer confidence fell in February and that economic conditions are showing signs of slowing. Acton cited a February 2025 consumer price index of 2.8% and a national unemployment rate of about 4.1%, and said Iowa’s unemployment rate was about 3.2%.

An unnamed executive-branch representative, speaking for the Governor’s office, summarized the fiscal implications for state budgeting. The representative said the conference “confirms the state has the necessary revenue to meet the FY25 appropriations made last legislative session” and noted that “the reserve funds are full at $961,000,000. Taxpayer Relief Fund has a balance of over $3,750,000,000, and the carry forward from the previous fiscal year was $1,900,000,000.” The representative added that the tax cuts enacted last session are having their expected effect and that the executive branch, legislative branch and LSA projections were within 2% of one another for FY2026.

The conference then took four formal actions by voice vote. The body approved LSA estimates for FY2025, approved LSA estimates for FY2026, adopted an FY2027 general fund estimate that the conference recorded as a 5.3% increase for FY2027 (a figure the group agreed on as a midpoint among submitted estimates), and approved the proposed amounts for gambling revenue transfers and interest earned on reserve funds to the Rebuild Iowa Infrastructure Fund. Each motion was seconded and adopted by the conference; the meeting record describes the votes as voice votes with the chair noting “the ayes do have it.”

Votes at a glance

- Approve LSA general fund estimates for FY2025 — Motion made and adopted by voice vote; outcome: approved.

- Approve LSA general fund estimates for FY2026 — Motion made and adopted by voice vote; outcome: approved.

- Adopt FY2027 general fund estimate at +5.3% (conference midpoint) — Motion made and adopted by voice vote; outcome: approved.

- Approve FY2025 and FY2026 transfers of gambling revenues and interest to the Rebuild Iowa Infrastructure Fund — Motion made and adopted by voice vote; outcome: approved.

Discussion and context

Speakers repeatedly emphasized the continued uncertainty in national and state economic conditions, including potential impacts from tariffs and volatility in commodity markets. Conference members described the state’s fiscal posture as “cautiously optimistic” while noting that revenue growth is slowing as the full effect of recent tax rate reductions is realized.

Officials identified areas to watch for future revenue projections, including changes in consumer spending, interest-rate movements, manufacturing and agriculture sector performance, and potential trade actions affecting commodity prices. Conference members did not adopt any contingent or conditional directions beyond approving the estimates and transfers on the agenda.

The conference adjourned after the votes.