Brady PieperColorado is prioritizing funding for infrastructure, higher education and health care in a new budget for fiscal year (FY) 2025-26.
The state’s General Assembly has approved a new spending plan to support the government’s operations, agencies and services, which includes $43.9 billion in total investments over the next year. Expanding funding for some of the state’s most pressing needs, the new budget will be presented to Gov. Jared Polis, who is expected to grant final approval.
The new budget, also referred to as the Long Bill, includes 61 additional bills to guide the budget-making process and establish statutory changes. Reviewing the governor’s proposal, state lawmakers anticipate the new Long Bill and supplemental bills will provide Coloradans a new balanced budget that maintains essential programs and services.
The state legislature cannot run a deficit when creating a new budget, according to state law. However, this FY26 budget features financial easements that reduce an estimated $1.2 billion funding gap while protecting vital services, such as K-12 education, public transportation and Medicaid.
While the state’s new budget does cut funding from some existing services and programs, the overall financial plan will inject billions of dollars into Colorado’s infrastructure, economy and public health and safety initiatives.
The largest year-to-year change in the new budget will affect the health care industry, which remains the top priority for some state lawmakers. Funding for health care policy and financing is expected to rise by an estimated $352.6 million to a total just over $5.5 billion, or a 6.8% increase from FY25.
Within this category, the budget provides a 1.6% increase to Medicaid provider rates and protects Coloradans from restrictive eligibility requirements. Residents on Medicaid will also be afforded dental care under the state’s budget proposal.
Education is also one of the largest priorities under the state’s new budget and supplemental bills. Over the next year, the general fund will obligate an additional $150 million for K-12 districts to equip schools with full funding under the constitution, according to state officials.
The new investments in education will bring the state’s spending per pupil from $8,123 to $11,852 from the 2018-2019 school year.
Higher education facilities are earmarked for a $40 million increase for FY26, or a 2.5% increase from the previous year. This legislative cycle will also restrict higher education facilities’ ability to raise tuition by more than 3.5% for in-state students.
While Colorado is renowned for its scenic views, towering mountain peaks and vibrant state parks, the new budget will allocate $52 million in new investments to maintain and invigorate these sites. The funding will support projects that protect critical habitats, maintain park facilities and strengthen park infrastructure and safety.
Building on this effort, the state will look to expand funding for water conservation and resource management projects, ensuring Coloradans reliable access to clean drinking water.
Notably, amid federal funding freezes and delayed or cancelled grant obligations, Colorado’s new budget, in conjunction with SB25-269 and HB25-1321, will set aside over $4.6 million to protect the state from federal actions that could undermine the state’s sovereignty. A portion of this funding will be directed to the Attorney General’s Office to fight federal actions and protect existing grants.
Having received approval from both the House and Senate, Gov. Jared Polis will evaluate the new budget in the coming weeks. If the governor approves the legislation, the new budget will be enacted for the next FY, commencing July 1.
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