The Consensus Forecasting Group (CFG) met this week to revise the state’s general fund revenue estimates for fiscal years 2027 and 2028.
The CFG is a statutorily required, independent panel of members with economic expertise whose estimates are relied upon by the General Assembly in developing the biennial state budget.
The meeting was called after FY2026 receipts exceeded the official estimate by $476.6 million, corporate income tax collections saw an unusually large increase in July, and quarterly revenue estimates began to diverge from the original forecast.
CFG members expressed concerns about the uncertainty surrounding the forecast and the potential need to reconvene after additional months of revenue data become available. As a cautious approach, the group adopted a pessimistic forecast scenario, which projected less revenue growth than the control and optimistic scenarios.
In December 2025, official CFG estimates projected a 0.5% decrease in general fund revenue in FY2027 to $15.896 billion followed by a 2.2% increase in FY2028 to $16.247 billion. The General Assembly used these estimates when developing and passing the FY2027-28 biennial budget – HB 500.
Despite using the pessimistic scenario, the revised forecast shows significantly stronger revenue growth in FY2027 and relatively flat growth in FY2028.
The CFG revised the FY2027 general fund estimate to $16.894 billion, a 5.7% increase over FY2026. The revised estimate is $997.9 million higher than the December estimate.
A significant driver of the increase is an expected $499.9 million in additional corporate income tax revenue compared with the December estimate. The forecast also projects strong sales tax growth with sales tax revenue expected to increase by 5% in FY2027.
The CFG also revised the FY2028 general fund estimate to $16.955 billion, $708 million higher than the December estimate. The increase is partly driven by higher-than-expected sales tax revenue, with the revised estimate increasing projected FY2028 sales tax revenue by $294.6 million.
