Colorado state government faces a continuing dim fiscal picture heading into next year as a slowing economy, rising costs and the rollout of tariffs weigh on forecasters, according to projections released Monday.

The new forecasts preview what was already expected to be a need for another round of budget cuts. They also project a gap in state tax refunds due to a drop in tax revenue and a relatively high risk of a recession over the next year.

State economists with the legislative branch expect lawmakers will begin nearly $800 million in the hole when they start drafting the 2026-27 fiscal year’s budget if they absorb projections for spending on Medicaid, higher education, salary increases for state employees and other rising costs. That gap between projected revenue and costs would come

See Full Page