Lawmakers on Sunday evening finalized the bulk of the state’s $7.36 billion budget for the next fiscal year to fund state agencies and signaled they will conclude their 2026 session by the end of the week.
Legislators still have to pass final budgets on Monday for roughly eight state agencies, but they are on track to spend roughly $225 million more on state services than the current year, or about a 3% increase.
House and Senate leaders told reporters that state spending is growing this year primarily because they’re giving teachers a $2,000 pay raise and pumping more money into the state’s Medicaid program.
Senate Appropriations Chairman Briggs Hopson, a Republican from Vicksburg, said lawmakers had very little wiggle room left for other large spending items once an increase in Medicaid and education spending was factored into the overall budget.
But Sen. Hob Bryan, a Democrat from Amory, said state money is spread thin over the needs of state agencies largely because of recent tax cuts and the ongoing phase-out of the state income tax passed last year.
“It’s very obvious this budget is the first splash of water from what could be a Category 5 hurricane,” Bryan said. “These are self-inflicted structural deficiencies.”
Below are agreed amounts lawmakers said they reached on major state agency budgets over the weekend:
AgencyCurrentNewChange/%K-12 education$3.336B$3.458B$121M/3.64%Medicaid$1.004B$1.170B$165M/16.4%Health Dept.$101M$97.5M($3.5M)/-3.45%DHS$152.9M$103.3M($49.6M)/-32.4%Mental health$279M$297.1M$18.4M/6.6%Corrections$452.2M$434.3M($17.9M)/-3.96%Universities$914.5M$918M$3.5M/0.38%Comm. colleges$299.4M$350.2M$51M/17%Public Safety$186.7M$170.8M($15.9M)/-8.49%Total general fund$7.142B$7.368B$225M/3.16%Some other highlights from Sunday night’s budget work includes:
K-12 education budget still not passed
The House did not join the Senate in passing the proposed framework for a $3.4-billion K-12 education budget, an increase of about $121 million over the current year. The House skipped over the education budget because the Senate had at that point failed to deliver a report on agreements negotiators reached on other education policies, House lawmakers told Mississippi Today.
After the House skipped over the education budget bill on Sunday, Senate Education Chairman Dennis DeBar hand-delivered the “conference report” for general education legislation, which includes a teacher pay raise proposal and changes to math and literacy programs, about three hours after the House began plowing through its appropriations calendar.
“I don’t know why they wouldn’t pass it yet,” DeBar said. “Everything I have discussed in the appropriations bill is in that conference report, and a few other things that we incorporated.”
The Senate education chairman did not explain why the Senate hadn’t already sent the House a report for general education legislation by the time lawmakers reconvened on Sunday afternoon, only that the report had been in “drafting.”
House Education Vice Chairman Kent McCarty, a Republican from Hattiesburg, said the House was not going to approve the massive education budget without reviewing legislative agreements on a host of other education priorities.
“We received the conference report just before 5 p.m. on Sunday evening,” McCarty said. “The budget came up on the calendar hours before. So no, we’re not going to vote on a budget that accounts for half of the general fund and spends millions of new dollars on new programs for literacy, math, and teacher pay without even having a chance to read the conference report that authorizes those programs.”
The House can still pass the K-12 education budget on Monday before a deadline for appropriations and revenue bills. If it doesn’t approve the education budget, lawmakers would have to push back deadlines or come back in a special session to approve an education budget.
Medicaid costs spike
Both chambers voted to spend $1.17 billion to fund the Mississippi Division of Medicaid, the second largest expense for a state that struggles with abject poverty and poor health.
Lawmakers were stunned earlier this year by the division’s initial request for a $390-million increase in state funding over the current year, despite the state Medicaid program’s enrollment dropping to its lowest level in over a decade.
Lawmakers were also baffled, in part, because of a $160-million discrepancy between the agency’s request and a November budget proposal from Gov. Tate Reeves, whose office oversees the Division of Medicaid.
But House and Senate leaders ultimately settled on funding the agency at a $165 million increase from the current year, and also provided an extra $35 million to cover a shortfall in this year’s budget.
A big reason why the state is having to spend more state dollars on funding the agency is that federal pandemic relief dollars that for years bolstered it are now depleted.
Hopson said providing more state funds to the Division of Medicaid left very little wiggle room in the budget for other spending increases.
“Medicaid is always an item that we never know exactly what it’s going to be, but you just base it on the best estimates,” Hopson said.
The agency’s budget increase this year is covered in part with $100 million in capital expense money, or cash reserves, something Hopson said was the first time in recent years that the Legislature has spent what lawmakers call “one-time money” on recurring expenses.
Additional child care assistance stripped from DHS
Lawmakers approved a nearly $50 million cut to the budget for the Department of Human Services, which provides public assistance programs and social services for children, low-income individuals and families.
Both chambers voted to spend about $103 million on the agency, a 32% reduction from this year’s $152 million appropriation. The diminished spending on human services prompted opposition from House Democrats, who took umbrage with the removal of a provision that would have appropriated an additional $15 million in child care assistance.
“If we are not providing money for child care assistance, parents are not going to be able to go to work,” said Rep. Zakiya Summers, a Democrat from Jackson.
Rep. Clay Deweese, a Republican from Oxford, said the overall reduction to DHS’s budget was the result of one-time federal money drying up this year. Justifying the removal of additional child care funding, Deweese said lawmakers were constrained by other costs, such as the increase for Medicaid this year.
“It is difficult putting this together,” Deweese said. “This is how this year’s budget came in, and this is what both chambers agreed upon.”
Rep. John Hines, a Democrat from Greenville, said the Legislature’s decision not to approve the additional child care funding was indefensible given Mississippi’s high concentration of residents living in poverty.
“I don’t know why it is so hard in the poorest state in this country to take care of working-class people,” Hines said.
Reform on prison spending dies in negotiations
Lawmakers approved a slight reduction to the budget for the Mississippi Department of Corrections, reversing an earlier framework that would have resulted in more spending on state prisons.
Under the new budget agreement, Mississippi will spend $434 million on the Department of Corrections, nearly $18 million less than the current fiscal year.
Efforts by House Corrections Chairwoman Becky Currie, a Republican from Brookhaven, to condition the agency’s spending on reforms to prison health care policies did not survive negotiations with the Senate.
The Senate has blocked proposals to improve health care in Mississippi’s prisons, some of which have come to light through an ongoing Mississippi Today investigation.
Currie said she plans to try again next year.
“Next year is the last year of the term, and I’m looking forward not backward,” Currie said. “I’ve tried hard, it is very frustrating, but all we can do is look forward. We have to fix this.”
A smoother budget process
This year’s budget process appears to be remarkably smoother so far than last year’s, when lawmakers failed to adopt a budget because of political fighting between the two legislative chambers.
Gov. Tate Reeves was then forced to call legislators into a special session during the summer last year to pass a budget.
Political pundits wondered if the same thing would happen again this year, considering the two chambers had killed the other’s main legislative priorities. But it appears budget negotiators have avoided much of the political infighting that plagued last year’s budget.
“I’ve been doing this for about six years now, and this is the smoothest I’ve ever seen it go,” House Appropriations Committee E Chairman Karl Oliver said.
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