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JFAC and LSO warn of thin ending balances; urge caution on one-time fixes
Summary
Keith Bybee of JFAC presented long-term general-fund trends showing large program growth over a decade and said the legislature faces a choice between temporary fixes and structural balance; LSO updated revenue scenarios and warned a small margin could evaporate with forecast changes.
Keith Bybee, Division Manager for Budget Policy Analysis, presented JFAC’s view of general fund revenues and appropriations and highlighted structural-balance concerns for the legislature.
Bybee showed 10-year program growth and noted adult and juvenile corrections budgets grew roughly 65% over the period, Medicaid almost 100% and public schools about 90%. He explained LSO adjustments for inflation and per-capita spending and said recent revenue updates have reduced projected FY26 revenue by about $300 million compared with earlier projections. Using scenario modeling, Bybee said the governor’s recommended budget is balanced but leaves a thin margin and that decisions on conformity bills (e.g., HB559) and temporary reductions will determine ending balances for FY26–FY27.
Committee members asked for inflation context and whether revenue assumptions should be restored; Bybee and others discussed options including temporary reductions in spending and the risks of relying on one-time fund draws. The presentation framed the committee’s workload in the session as balancing policy requests against constrained revenue scenarios.
