DES MOINES, Iowa (Gray Media Iowa State Capitol Bureau) — Iowa state revenue fell about 9% in 2026 compared to 2025, according to state forecasters. But, the state is expected to bring in more money in 2027.
The Revenue Estimating Conference met today to update its projections for the current fiscal year.
Officials estimate Iowa will bring in around 3% more total revenue this fiscal year, up from what was predicted in March. Iowa is still facing a billion dollar budget deficit.
The governor’s top financial advisor, Kraig Paulsen, said despite the loss, the state will have a strong budget next year.
“All I’ve got is the data in front of me and I would say the state doesn’t have a revenue problem,” said the director of the Department of Management. “And we’re clearly in an extremely strong cash position. Assuming we continue to see the growth which is what we all agreed to in this meeting, I think the state is in a great spot.”
Jennifer Acton with the Legislative Services Agency said there are still concerns for 2027. The agency expects the price of diesel, tariffs and delayed harvest to impact revenue.
Fiscal year 2027 will also be the first full year President Donald Trump’s One Big Beautiful Bill has been in effect, which lowers corporate tax rates.
The state’s property tax revenue will cap in 2027, which could impact revenue, though it was not discussed at today’s meeting.
Iowa Senate Minority Leader Janice Weiner criticized Republican lawmakers, saying “the majority party has no plan for the level of revenue growth needed to get us out of the hole they dug.”
The governor said, “For nearly ten years, my administration and the Republican-led legislature have prioritized the type of fiscal responsibility and conservative, pro-growth policies that generate measurable results. Today, Iowa’s economy is well positioned to sustain growth, maintain stability, and continue to invest in the priorities Iowans value most.”
The conference will meet again in December to determine how much the state will have for the budget with a newly elected governor.
Isabella Warren covers state government and politics for Gray Media-owned stations in Iowa. Email her at isabella.warren@kcrg.com ; and follow her on Facebook at Isabella Warren TV on X/Twitter @isabellaw_gray , and on Instagram @IsabellaWarrenTV.
