What This Year’s Budget Reveals About Kansas’ Fiscal Health
Megan Leopold | July 23, 2026
The state budget plan that will fall into place over the next year is long in the works before the legislative session even begins. In fact, the next budget cycle begins just a few months after the session ends.
Each dollar spent within the state budget demonstrates lawmakers’ priorities. Taking a closer look at the FY 2027 budget, which began July 1, 2026, and will end June 30, 2027, we see the Legislature forced to reconcile two conflicting needs: a need to balance the budget and a need to maintain public services amidst rising costs. Beginning with agency requests, lawmakers were forced to make difficult decisions about which agency priorities they would fund and which of their own priorities they could afford to add to a budget already projected to spend into the red.
Agency Budget Requests
The budget cycle always begins with all 98 state agencies submitting funding requests for the next fiscal year. So, the process of creating the FY 2027 appropriations bill (which ultimately passed as HB 2513 in the 2026 session) officially began in the summer of 2025 as state agencies evaluated their prior year spending, any policy or programmatic changes, and agency priorities.
Each budget cycle, agencies must create two budget requests. The first request is for the remainder of the current fiscal year (FY 2026), which includes any adjustments the agency needs to make to the previous session’s budget bill. The second is the agency’s first request for FY 2027.
Each agency begins its next year’s budget (in this case, FY 2027) with their “base budget,” which is generally the funding amount they were given the previous fiscal year. Any state funding requests above that prior year amount are labeled as “enhancement requests.” Enhancement requests are typically new programs or contracts, expansions of current programs, or updates like IT improvements or increased staffing.
In the most recent budget bill, agencies’ FY 2027 budget requests included $450.4 million more from the State General Fund (SGF) as enhancement requests. In addition to enhancements, budget requests generally also include minimal additions to account for the inflating costs of certain goods or services, such as employee health insurance or gasoline.
Agencies are required to submit their budgets to the Kansas Division of Budget and Kansas Legislative Research Department by September 15, at which time the Governor reviews them and makes their recommendation in a bill that is submitted to the Legislature in early January.
Special Committee on the State Budget
Beginning in 2024, the Legislature started a new process to evaluate state funding by creating a Special Committee on the State Budget. Just as they did for the 2025 budget process, this committee met over the interim in late 2025 and heard summaries of agency budgets, which were presented by legislative staff.
In late 2025, the Special Committee only made blanket recommendations that applied to all state agencies despite having been briefed on each agency’s budget requests.
The Special Committee’s first recommendation was to delete all enhancement requests. This meant that any funding requested by the agency above the previous year’s budget was automatically deleted and agency staff would be required to advocate for these items during budget committee hearings during the legislative session. Other actions taken by the Special Committee included removing all new full-time employee positions and any pay increases that had been requested within individual agency budgets. These deletions cut approximately $450.8 million from the FY 2027 agency request before the 2026 session even began.
Consensus Caseload Estimates
Another action taken by the Special Committee was to adopt all consensus caseload estimates from the fall estimating groups. Each spring and fall, estimating groups that consist of staff from the Kansas Division of Budget, the Kansas Legislative Research Department, and applicable state agencies meet to estimate expenditures for some of the state’s largest programs.
The Human Services Consensus Group estimates expenditures for the state’s social services “entitlement programs”: SNAP, Medicaid, cash assistance, and foster care. These are the programs the state is required to offer as long as an individual meets eligibility criteria. The Education Consensus Group estimates the state’s obligation for K-12 education, and another group estimates funding for the Board of Indigents’ Defense Services (BIDS).
Each of these groups meet twice a year to update previously made estimates as new data becomes available so they may create new estimates for future years. These estimates are important because they encompass the state’s most expensive programs, and expenditures can vary greatly from year to year based on policy changes and the number of beneficiaries. The fall consensus estimates are based on data that is more recent than what agencies were able to access when creating their budgets in late summer. These estimates all provide the Legislature an opportunity to adjust the budgets of impacted agencies based on the most current available information, and lawmakers may adopt the estimates in their entirety, in part, or not at all.
When the Special Committee on State Budget adopted all fall consensus caseloads estimates in full, it resulted in an additional $90.8 million cut from the FY 2027 budget. The decrease was due to lower estimates for K-12 education ($114.6 million), which was offset by a smaller increase in estimated expenditures for Medicaid and BIDS.
The House and Senate Bills
Once the legislative session begins, the House and Senate separately look at the budget and make their own proposals based on agency requests and the Special Committee on Budget’s recommendations. Lawmakers may also consider the Governor’s proposal released in the early days of the legislative session.
Committees in both chambers begin their budget process by holding hearings on agency budgets. In 2026 in both the House and Senate, most of the adjustments to the budget consisted of adding back enhancement requests that had been deleted by the Special Committee a few months prior. While the original Senate and House bills had many similarities, they also had some significant differences, as outlined in the table below.
The Final Budget Bill
After each chamber passes its own budget proposal, three lawmakers from each side come together in a “conference committee” to negotiate their differences in their respective bills. This typically takes place near the end of the legislative session.
When the conference committee completes its work, the final bill is born. This year, while the Legislature was successful in cutting more than $306.9 million from the agencies’ requests, the final FY 2027 budget was still above what the 2025 Legislature approved for FY 2026. However, after making final adjustments to the FY 2026 budget this year, the FY 2027 spending plan is less expensive than what the state actually spent in FY 2026. (Note: The final FY 2026 budget differs from the initial approved spending due to changes made by the Legislature during the 2026 session.)
Although the FY 2027 budget is a decrease from the final FY 2026 budget, there are some factors that make the decrease look larger than it actually is. For one, some cuts made to the agencies’ requests will likely need to be added back next session. This is due to the Legislature not fully funding certain enhancement requests, such as contract nursing at the state hospitals or first year operations for the South Central Regional Mental Health Hospital. While lawmakers might hope these items will cost less than the agencies anticipated, the Legislature will likely need to add the difference when the budget is revisited in January 2027.
Second, the budget was cut by $90.8 million due to a decreased estimate of individuals enrolled in family support programs, like Medicaid or SNAP. This decrease simply represents a decrease from prior estimates and, when updated estimates are made in the fall, could very well increase, forcing the Legislature to add funds to continue fully funding these required services.
Where Were Cuts Made
While many of the agencies’ enhancement requests originally deleted by the Special Committee were added back in by the Legislature, others were only partially funded or were not funded at all. The largest monetary cut was to the Kansas State Department of Education (KSDE) where the Legislature chose to allocate $86.2 million less than what the agency requested for special education funding. The Legislature ultimately added just $6.0 million of the agency’s $92.2 million request.
Other large cuts to agency requested budgets included the following.
Where the Legislature Added
Though the focus of the 2026 session was finding ways to curb spending, there were cases when the Legislature added funding above what an agency requested. The additional funding went to a variety of needs, including several to support medical services for vulnerable populations.
Tough Choices Ahead
The final FY 2027 budget, in all its complexity, is a mixed bag of funding that will cascade down to Kansas families. The big picture, however, is that it is expected to exceed incoming revenue by $407.6 million. This imbalance of spending and revenue is occurring at the same time recently passed tax breaks are eating away at the state’s revenue.
The Kansas Constitution prohibits the Legislature from operating at a deficit. So far, the Legislature has been able to balance the budget using money from the State General Fund ending balance and the rainy day fund. While we are fortunate to have those reserves, they are not a permanent solution. Once those dollars are spent, they are gone. We cannot close an ongoing budget gap by dipping into savings year after year.
The Legislature went into the 2026 session looking for $200 million in cuts to help balance the budget. That job will get even harder for the 2027 Legislature as Kansas must take on upwards of $55 million for new costs associated with the Supplemental Nutrition Assistance Program (SNAP) and deal with more pressure on Medicaid and other essential services due to H.R. 1, the “Big, Beautiful Bill” passed by Congress last summer.
Throughout this new budget cycle, we will be watching how the Legislature juggles the conflicting need to cut spending while ensuring that important programs and services remain operational. It won’t be an easy road as lawmakers face hard decisions about whether to cut services families rely on, raise revenue, reduce provider payments, or use reserves much faster than planned.
< Back to the news listShare
