Proposed Budget Highlights
The governor presented his “Enduring Idaho” plan, focused on fiscal responsibility and long-term stability. The fiscal 2027 budget prioritizes critical program areas including public education, workforce development, agriculture, and public safety, while making ongoing agency spending reductions and taking other steps to ensure government expenditures will not exceed revenues. Highlights of the budget include:
Protecting Long-Term Priorities
- Protects public school funding and uses the Public Education Stabilization Fund to cover any statutorily required increase.
- Maintains funding for Idaho LAUNCH program to support high school graduates pursuing education or training for in-demand jobs.
- Preserves water infrastructure funding to secure the state’s water sovereignty and foster agriculture and energy development.
- Minimizes holdbacks and reductions for the Department of Corrections and State Police.
Rural Healthcare and Medicaid
- Directs federally funded Rural Healthcare Transformation grants to strengthen healthcare delivery, affordability and access.
- Provides funds for the Graduate Medical Residency program to help address physician shortages.
- Continues to implement Medicaid reforms including managed care procurement and work requirements.
- Recommends general fund reductions to Medicaid to control costs and improve the long-term sustainability of the program, including a 4 percent Medicaid provider rate adjustment implemented by the Department of Health and Welfare and additional options for legislative consideration to further decrease spending.
Agency Spending Reductions & Other Strategies
- Includes 3 percent reductions to ongoing general fund spending, making the mid-year cuts implemented in fiscal 2026 permanent.
- Reverts over 100 vacant positions.
- Reduces ongoing spending from the Empowering Parents grant program, as well as implements other reductions.
- Redirects interest earnings from four state accounts to the general fund for fiscal 2027.
Government Efficiency and Accountability
- Recommends a plan to clean up the state’s statutory code and reduce red tape.
- Eliminates supplemental learning funds and transportation funding for virtual schools.
- Reduces state funding for the Idaho Digital Learning Academy.
- Continues to prioritize the identification of operational efficiencies and cost-saving reforms.
Federal Tax Conformity
- Conforms with federal tax cuts in the One Big Beautiful Bill Act (OBBBA), including implementing no taxes on tips and overtime and reducing taxes for seniors.