This afternoon, the Healey-Driscoll administration released its Fiscal Year (FY) 2027 budget proposal. The $63.36 billion spending plan increases spending over the FY 2026 General Appropriations Act (GAA) by $2.3 billion (3.8 percent) and over the administration’s estimated spending level for FY 2026 by $668 million (1.1 percent).

In FY 2027, the state budget development process is notable for the sizeable budget gap resulting from stagnating revenue collections, spending growth for non-discretionary programs, and the recent increases in the use of one-time solutions to balance the budget. The Healey administration appears to rely on approximately $3.4 billion in spending and revenue solutions to close a projected budget gap that is initially estimated by MTF to exceed $3.3 billion.

As in FY 2026, the administration has also filed a supplemental budget proposal to spend $1.15 billion in surplus surtax revenue currently held in the Education and Transportation Innovation and Capital Fund. In FY 2027, these resources are increasingly relied upon to support operating budget expenses related to education and transportation. In the relevant spending sections below, this report summarizes the supplemental budget investments and how they relate to the Governor’s operating budget recommendations.