Colorado Budget Gap Nears $1.5B As Revenue Forecast Slides

By: Marianne Goodland | The Denver Gazette

The latest revenue forecasts from economists in both the governor’s office and the Colorado legislature show that the state’s budget predicament has worsened — by hundreds of millions of dollars more.

That, in turn, means cuts programs and services in next year’s fiscal budget will go much deeper.

The state’s fiscal predicament also means no refunds for Colorado residents.

Economists with the Legislative Council downgraded the forecast for the 2026-27 fiscal year by another $643 million, bringing the total shortfall to nearly $1.5 billion.

What’s driving the downgrade? General fund revenues — dollars that come from tax collections for individual and corporate income tax, and sales and use taxes — came in lower for fiscal year 2025-26. The tax collection is $354 million less than was estimated in December.

The estimate for 2026-27 is also coming in lower than the December forecast by about $143 million, according to the latest numbers.

The March forecasts remain unpredictable, in part due to changes in tax law enacted by Congress and the Trump administration, according to budget analysts.

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