OPINION — The most important thing about the enacted state budget for next fiscal year isn’t what is in it and what got left out. Nor whether Gov. Katie Hobbs or GOP legislators got the better of the negotiations.
Those are important things, substantively and politically. But the most important thing is how shaky of a foundation the budget is built on.
The new fiscal year begins each July and is denoted by the year in which it ends. The FY 2026 budget began with a carryforward surplus from FY 2025 of nearly $1.4 billion. For the general fund, the Legislature and governor swept another $155 million from other state reserve accounts. However, the projected surplus carrying forward into FY 2027 is just $773 million.
