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Revenue Collections Up $1.5 Billion
According to a memo from the Legislative Fiscal Bureau, âBased upon our analysis, we project the closing, net general fund balance at the end of this biennium (June 30, 2027) to be $2,373.5 million. This is $1,529.0 million above the net balance that was projected at the time of enactment of the 2025-27 biennial budgetâŠThe $1,529.0 million is the net result of: (1) an increase of $1,367.1 million in estimated tax collections; (2) an increase of $104.0 million in departmental revenues (non-tax receipts deposited in the general fund); (3) an increase of $49.9 million in sum sufficient appropriations; and (4) an increase of $107.8 million in the amounts that are estimated to lapse (revert) to the general fund.â
Medical Assistance
The memo also highlights, âAccording to the December 2025 quarterly report prepared by the Department of Health Services, the biennial GPR (general purpose revenue) appropriation for the Medical Assistance (MA) program is currently projected to end the 2025-27 biennium with a deficit of $213.2 million.â
Act 15 Hospital Assessment
The memo says, âAdditionally, preliminary federal guidance from the Centers for Medicare and Medicaid (CMS) has created some uncertainty about the allowability of changes to Wisconsin's hospital assessment and access payments as authorized under 2025 Act 15. Specifically, Act 15 increased the amount to be collected as part of the hospital assessment and subsequently used to: (a) increase payments to hospitals; and (b) offset GPR funding for the Medical Assistance program in the 2025-27 biennium. In the event that this increase is disallowed by CMS, the result would be both a reduction of MA trust fund revenues available to offset GPR costs for the program as a whole, and an increase in GPR expenditures for hospital payments, for a total GPR shortfall of $396 million annually ($792 million in the 2025-27 biennium). CMS indicated that this matter will be addressed through formal rule making procedures, and thus will be subject to provisions of notice and public comment. Pending additional information from the federal government, the allowability of the Act 15 changes is not currently known.â
National Economy
The memo states, âThis office prepared revenue estimates for the 2025-27 biennium in January 2025 based on the January 2025 S&P Global Market Intelligence (S&P Global) forecast for the U.S. economy. S&P Global anticipated that the U.S. would experience below-potential real gross domestic product (GDP) growth of 2.0%. The forecast predicted that the odds of an economic slowdown without causing a recession remained favorable, despite policies under the Trump Administration that were generally expected to increase inflation, slow the pace of monetary policy easing, and contribute to a stronger dollar and tighter financial conditions.â
Governor Gives Legislature a 2026 Priority List
Governor Evers sent a letter to the Legislature providing a list of things he would like to see addressed in 2026 before the Legislature adjourns. That includes:
1. Property Tax Relief
- The Governor proposes over $1 billion in property tax relief, targeting working families, seniors, and veterans.
- Key measures include:
- Freezing property taxes for seniors and veterans to help them remain in their homes.
- Increasing state aid to schools, which can reduce the local property tax burden.
- Expanding credits for homeowners, seniors, and veterans to provide direct financial relief.
2. Education and Kids
- The Governor calls for full funding of special education reimbursement rates, as previously agreed upon in bipartisan negotiations.
- Recommends making appropriations âsum sufficient,â meaning funding would automatically adjust to meet actual needs, ensuring schools always have the resources required for special education and other critical services.
3. Lowering Costs for Families and Seniors
- Proposes exempting basic family needs from sales tax, including:
- Diapers,
- Over-the-counter medications, and
- Menstrual products.
- Seeks to fund the Health Food Incentive Program, which would help FoodShare (SNAP) recipients afford more groceries, reducing food insecurity and supporting family budgets.
4. Healthcare Reforms
- Plans to cap insulin copays, making this essential medication more affordable.
- Proposes measures to:
- Crack down on surprise medical billing and price gouging.
- Increase transparency and consumer protections in healthcare.
- Audit insurers with high claim denial rates.
- Create a consumer protection office focused on healthcare issues.
- Calls for extending postpartum Medicaid coverage to 12 months, supporting maternal and infant health.
5. Support for Farmers and Veterans
- Requests funding to keep Veterans Housing and Recovery Program facilities open, ensuring continued support for homeless and at-risk veterans.
- Proposes eliminating caps and increasing funding for:
- Agricultural export programs, helping Wisconsin farmers reach new markets.
- Meat processing workforce programs, addressing labor shortages and supporting local food systems.
6. Clean Water and Natural Resources
- Urges the release of $125 million already approved for PFAS (per- and polyfluoroalkyl substances) contamination cleanup, addressing a critical public health and environmental issue.
- Supports reauthorizing the Knowles-Nelson Stewardship Program, which funds conservation and outdoor recreation projects across the state.
7. Affordable Housing and Workforce
- Supports legislation to cut red tape for affordable housing projects, making it easier to build and access affordable homes.
- Advocates for restoring resources for license and credential processing, helping workers enter the workforce more quickly.
- Proposes allowing retirees to return to public service without suspending their annuity, increasing workforce flexibility and capacity.
8. FoodShare and SNAP
- Calls for investment in quality control to reduce payment errors in the FoodShare program, aiming to avoid federal penalties and ensure program integrity.
9. Justice System and Public Safety
- Seeks comprehensive corrections reform, including:
- Closing outdated correctional facilities.
- Investing in vocational training for citizens reentering society after incarceration.
- Requests funding to support victims of crime and combat domestic violence.
- Proposes gun safety measures, such as:
- Red flag laws to temporarily remove firearms from individuals deemed a risk.
- Universal background checks for gun purchases.
- Closing loopholes that allow domestic abusers to access firearms.
Legislative Session
Assembly:
- Tuesday, January 20th and Thursday, January 22nd
- Likely Tuesday and Thursday in February (2/10, 2/12, 2/17, and 2/19)
Senate:
- Wednesday, January 21st
- Once in February
- Once in March
State of the State - Tuesday, February 17th
State of the Tribes - Not yet announced, but usually in February
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