State Forecast Projects $1.34 Billion Maine Budget Gap for 2027-29

Maine faces a projected shortfall of $1.085 billion in its General Fund for the budget cycle starting July 1, 2027, and ending June 30, 2029, according to a state forecast released September 30 and described by the Maine Policy Institute, a nonprofit research group.

Adding a $256.7 million shortfall in the Highway Fund brings the total structural gap to roughly $1.34 billion, the institute said. It defined that as the distance between expected revenue and what current services cost under existing law, and cautioned that the estimate is a baseline that could shift.

Projected General Fund spending grows to $13.26 billion, up from roughly $12 billion now, while revenue is expected to total about $12.17 billion, the institute said. The institute cited about $345 million in added MaineCare costs, $280.7 million to hold the state's 55% K-12 share, and about $150.6 million for preschool special education. The forecast assumes every enacted tax change, including the 2% income surcharge, stays in place.

The institute said an earlier four-year forecast put the General Fund gap at $636.7 million. Its 2026 Maine Policy Blueprint lists at least $1.03 billion in estimated two-year savings across state agencies. The next governor must submit a balanced budget by February 5, 2027, the institute said.

This story was first reported by Maine Policy Institute.