Brad Reynolds of the Comptroller of Public Accounts told the House Committee on Ways and Means that the state’s biennial revenue available for appropriation for fiscal 2026–27 is projected at $194,600,000,000.

Reynolds said the decline from the prior biennium’s available revenue is driven largely by a falling beginning balance — the state began the 2024–25 biennium with about $39 billion but now expects a beginning balance for 2026–27 of about $23.76 billion — not by sharply lower underlying tax collections. “This is substantially leftover surplus accumulated back in 22-23 when we had historically high, inflation and historically high infusions to the state budget from federal funds that were authorized by Congress during the pandemic,” Reynolds said.

Why the severance tax change matters: Reynolds told the committee that a constitutional cap on the Economic Stabilization Fund (sometimes called the rainy day fund) will prevent routine transfers of some oil and gas severance tax revenue into that fund. He said about $5.6 billion of severance tax revenue normally allocable to the ESF in 2026–27 will instead remain in general revenue; combined with a roughly $300 million carry-forward amount for the current biennium, Reynolds said a total of about $5.9 billion will appear as additional general revenue in 2026–27.

The comptroller’s office also walked members through tax‑system details that affect forecasts. Reynolds emphasized that sales tax — the state’s largest tax source — is expected to grow about 4.5% annually in the coming biennium, slightly below historical averages because a larger share of household budgets now goes to nontaxable items such as insurance and housing costs. Reynolds called oil and gas taxes “the two most volatile taxes” in the system and warned that retaining severance taxes in general revenue will make the state’s general revenue mix somewhat more volatile.

Philip Ashley, associate deputy controller for tax administration at the Comptroller’s office, gave a brief primer on major taxes administered by the agency. He said the office administers more than 60 separate taxes and fees; the franchise (margin) tax and the sales and use tax are the two largest sources. Ashley said the franchise tax raised about $6.86 billion in fiscal 2024 and that the no‑tax‑due threshold for franchise filings was raised last session to $2,470,000 under Senate Bill 3, reducing the number of filers owed tax. He said the state collected $47.16 billion in sales tax in fiscal 2024 and reiterated that local jurisdictions may add up to 2 percentage points in local sales tax for a maximum combined rate of 8.25%.

Committee members asked agency staff for more granular incidence and filing information; Ashley pointed members to the Comptroller’s field guide publications, the tax exemptions and tax incidence report, and the sales‑tax incidence tables (cited in his handout) and offered post‑hearing follow‑up for data requests.

The presentations framed the available 2026–27 spending capacity as a combination of current‑period revenues and balances carried forward from prior biennia, with the comptroller stressing that much of the carry‑forward balance originated as temporary pandemic‑era inflows rather than a structural increase in recurring revenue. Reynolds warned that the carry‑forward is “dribbling down” and is not the same as a structural surplus.

Ending: The comptroller’s office said it would provide follow‑up data for members’ specific incidence and filers questions and left publications and detailed tables in committee materials.