JFAC approves more cuts

BOISE — After a lengthy meeting, the Joint Finance-Appropriations Committee voted Friday in favor of broad agency and program cuts for this year and the years ahead, recommendations that will form a bill to be voted on by both chambers of the Idaho Legislature.  

For the current fiscal year, JFAC voted to enact 4% budget cuts for state agencies. These cuts represent a 1% increase beyond the 3% cuts recommended by Gov. Brad Little in his office’s budget.

In some cases, the agency's budget reductions do not exceed those recommended initially by Little. That's the case for Medicaid, which will see $17.5 million in cuts, unchanged from a previous 4% Medicaid provider rate adjustment that is poised to reduce funding for a variety of programs, including those for behavioral health. 

As for education, Idaho’s K-12 budgets were already cut by $22.3 million this fiscal year to align with attendance data and will not see further cuts under JFAC’s recommendation.

Unlike K-12, however, public colleges and universities will not be held harmless from further cuts. These institutions are due to see their funding decline by $18.6 million between general and dedicated funds, $3.8 million more than the governor’s recommendation. The state’s community colleges are similarly due to lose $2.7 million, $683,800 more than the governor’s recommendation, according to documents from the Legislative Services Office. 

The Idaho Department of Correction and Idaho State Police will also be exempt from additional cuts beyond the governor’s recommendation, with reductions of $5.5 million and $1.9 million for these agencies, respectively.

In debate on the reductions for this fiscal year, several committee members took issue with JFAC adopting flat reduction recommendations rather than making agency-by-agency decisions.

Sen. Jim Woodward, R-Sagle, said the timing of the cuts posed a significant challenge to state agencies. 

“To take a 1% rescission right now is actually quite a bit bigger,” as a late budget cycle reduction will come after agencies have already either allocated or expended much of their funds, he said. It leaves limited and potentially drastic options for cuts before the fiscal year ends June 30.

For several committee members who voted in favor, their support for agency budget reductions was couched in the need to make room for the tax cuts in the One Big Beautiful Bill, which amounts to $155 million for this fiscal year.

“When I go back to my district and I see folks that count their change to pay for their groceries, to do things like that, these decisions don’t seem this hard to me,” Rep. Chris Bruce, R-Kuna, said.

Ongoing cuts for the years to come 

JFAC also voted to have agency cuts increase in fiscal year 2027 and be maintained on an ongoing basis. Despite a much-improved revenue picture arriving as soon as the next fiscal year — with about $150 million on the state’s bottom line according to JFAC’s own projections — the committee recommended more significant cuts of 5% for select agencies, 2% above those recommended by Little. 

In letters sent to JFAC leadership and the Legislative Services Office in late January, state agencies stated that further reductions to agency budgets will result in layoffs. JFAC documents indicated this would be the case, with 227 full-time positions removed and $143.1 million in agency spending reductions.

Sen. Melissa Wintrow, D-Boise, described the reductions Friday as an effort to right-size government at the cost of the state’s most vulnerable population, highlighting the cuts to Medicaid in particular, which could be deeper in 2027.

An additional $22 million in cuts were recommended for Medicaid by Little for the next fiscal year, which could impact a range of services, including the removal of adult dental services, the removal of home- and community-based services and the removal of the pharmacy benefit for non-expansion Medicaid adults, as was previously reported by the Idaho Press. 

“We are making way for tax cuts for the wealthy on the backs of the working poor and disabled people in the state,” Wintrow said. “It’s unforgivable.” 

About an hour after JFAC’s meeting concluded, the Senate voted to conform with a variety of federal tax changes, sending the bill to Little’s desk that will adopt tax deductions for tips, overtime and seniors at an estimated cost of $155 million in revenue starting this fiscal year, with increasing costs in the years thereafter.