Idaho Faces Projected Budget Deficit Despite Cuts

New report shows state revenue collections falling short, raising concerns about further budget reductions

Published on Mar. 11, 2026

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Less than two months after strong revenue collections, Idaho is once again facing a projected state budget deficit of $44.1 million for the current fiscal year 2026, according to a new report from the Idaho Legislative Services Office. The revenue shortfall comes despite 4% budget cuts for most state agencies and departments, suggesting the legislature may need to take additional steps to avoid a deficit.

Why it matters

Idaho has aggressively cut taxes in recent years, reducing state revenue by $4 billion over the past five years. This latest budget deficit raises questions about whether the state has cut too deeply, potentially impacting critical public services and programs.

The details

The revenue shortfall is due to actual state revenue collections coming in $89.5 million below the higher revenue forecast adopted by the legislature's Joint Finance-Appropriations Committee in January. Overall revenue collections are also $41.5 million less than the same time period a year ago. The legislature has options to balance the budget before the session ends in late March, but the tight timeline and limited remaining fiscal year may complicate efforts.

  • The Idaho Legislative Services Office published the new budget report on March 11, 2026.
  • The current fiscal year 2026 ends on June 30, 2026.

The players

Idaho Legislative Services Office

The nonpartisan agency that provides research and analysis to the Idaho Legislature.

Melissa Wintrow

Senate Minority Leader and member of the Joint Finance-Appropriations Committee, a Boise Democrat who criticized the legislature's tax-cutting policies.

Lori Wolff

Administrator of the Idaho Division of Financial Management, who said it is too early to project a budget deficit.

Scott Grow

Republican co-chairman of the Joint Finance-Appropriations Committee.

Josh Tanner

Republican co-chairman of the Joint Finance-Appropriations Committee who referenced a projected budget surplus in January.

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What they’re saying

“I hope people who vote are paying attention. This Legislature is not acting conservatively or reasonably. They are acting in an anti-government fashion, destroying the services we demand and need.”

— Melissa Wintrow, Senate Minority Leader (idahocapitalsun.com)

“The governor's budget recommendation is based on the revenue forecast at the close of the fiscal year, not month-to-month fluctuations. The Governor's Office does not overreact to a single month of revenue changes. February is typically a lower-revenue month, while April and June historically bring in significantly higher collections. It is too early to project a deficit for FY 26.”

— Lori Wolff, Administrator, Idaho Division of Financial Management (idahocapitalsun.com)

What’s next

The Idaho Legislature's Joint Finance-Appropriations Committee is scheduled to reconvene on Thursday, March 14, 2026 to resume working on state budgets and address the projected deficit.

The takeaway

Idaho's aggressive tax cutting in recent years has left the state vulnerable to budget deficits, even after implementing spending cuts. This latest projected shortfall highlights the difficult choices lawmakers may face in balancing the budget without further impacting critical public services.