Governor Lamont Signs Biennial State Budget for 2026 and 2027

Governor Ned Lamont today announced that he has signed into law the biennial state budget bill for fiscal years 2026 and 2027, which makes historic investments to expand access to early childhood education, which is among the costliest item for families, all while holding the line on taxes.

Notable investments include:

• Early childhood education: The budget makes historic levels of investment to support Connecticut’s early childhood education system, including $417.5 million in fiscal year 2026 and $443 million in fiscal year 2027. General Fund appropriations for early childhood education are up $252.7 million between fiscal years 2018 and 2027 – a 133% increase. In addition to these investments, the budget establishes the Early Childhood Education Endowment by transferring up to $300 million of the unappropriated General Fund surplus at the close of fiscal year 2025. This endowment will be used to make more early childhood education slots available and enroll more children into the system.
• Special education: The budget makes historic levels of investments to support special education, growing by $44.9 million in fiscal year 2026 and an additional $49.9 million in fiscal year 2027, as well as capital investments of $10 million in each year. By 2027, state investments in special education will have grown by 95%.
• K-12 education: The budget fully funds Education Cost Sharing (ECS) grants for towns and cities, including a hold harmless provision that provides $8.7 million in fiscal year 2026 and $17.4 million in fiscal year 2027 to ensure that no municipality loses ECS funding over the biennium. Since Governor Lamont took office in 2019, ECS grants have grown by roughly $443 million – an 18% increases in support for K-12 public schools.
• Higher education: The budget increases funding for the Roberta B. Willis Scholarship Fund – Connecticut’s state-funded scholarship program for residents who attend in-state public and private higher education institutions – by $1.4 million in fiscal year 2026 and $16.4 million in fiscal year 2027. When combined with $15 million previously reserved for fiscal year 2026, both years of the biennium will be funded at $41 million – the highest level of state-appropriated scholarship funding in more than a decade. General Fund support for UConn is increased by an additional $49 million in fiscal year 2026 and $34 million in fiscal year 2027; UConn Health receives an additional $29 million in fiscal year 2026 and an additional $25 million in fiscal year 2027; and Connecticut State Colleges and Universities (CSCU) receives a budget increase of an additional $32 million in fiscal year 2026 and $45 million in 2027.
• Health and human service providers: The budget supports $50 million in fiscal year 2026 to annualize fiscal year 2025 increases and $126 million in fiscal year 2027 to support a 3% increase for private providers, plus an additional $30 million specific to non-DDS providers. Plus, the budget provides an additional $100.1 million to support the group home settlement over the biennium, representing a 15% increase.
• Housing: The budget provides $3.5 million in fiscal year 2026 and $5 million in fiscal year 2027 to support eviction prevention, as well as support HUBs, which are the physical locations where individuals and families get appointments to gain access to homelessness resources. Plus $6.7 million is provided, beginning in fiscal year 2027, to increase elderly and disabled RAP vouchers, as well as HeadStart on Housing Vouchers, which is a system approach to combating homelessness with the support and collaboration of private providers, state agencies, and local communities across housing, childcare, and social services.

Governor Lamont said, “This is a balanced, sensible budget that is under the spending cap, provides predictability and stability for residents, businesses, and municipalities, and holds the line on taxes while keeping us on a sound fiscal path. Importantly, it includes significant investments in our education system, beginning with historic levels of support for early childhood education, up through our K-12 public schools and our higher education institutions. It also protects our social services safety net, prioritizing our health and human services providers and increasing support for our most vulnerable residents, including seniors and those who have disabilities, who receive Medicaid. And while we are doing all of this, we are continuing to make historic and long-overdue payments into the pension system, preserving the strength of our fiscal guardrails, and making fiscally responsible investments into the rainy-day fund that will protect our state against any potential economic headwinds we may face in the future. I thank the legislature for their hard work and collaboration on this budget. While other states are increasing taxes and cutting services, economic analysts are pointing to Connecticut as an example of a state that has worked hard to maintain fiscal stability and is making the smart decisions that are critical for economic growth.”

Senate President Pro Tempore Martin M. Looney said, “This budget includes several major initiatives, including a new trust fund for early childhood education that will be transformative in getting children ready for kindergarten, and a larger investment in special education to help towns deal with ever-increasing special education costs.”

Speaker of the House Matt Ritter said, “Our budget showcases our priorities. We make critical investments in education and childcare while providing relief to thousands of working families with a $250 credit through the EITC framework. This budget was a team effort and I want to thank the chairs, Senate leaders, Governor and the staffs who worked so hard to ensure we crossed the finish line.”

Senate Majority Leader Bob Duff said, “Voting for a significant special education funding increase and prioritizing millions of dollars more in the classroom underscores our commitment to students, parents, teachers and school personnel across this state. I want to thank Senator Looney for fighting for a strong state budget, as well as Senators Osten and Fonfara, Speaker Ritter, Majority Leader Rojas, their fiscal chairs, and all our hardworking staff for negotiating a two-year budget that delivers on so many of our promises.”

House Majority Leader Jason Rojas said, “This budget represents a bold investment in Connecticut’s most vital asset: our people. It reflects our commitment to invest in our future – our youngest learners – through historic levels of funding for early childhood education and childcare as well as investments in special education and fully funding the state’s obligation to our traditional public schools. We know that when we invest in our children, we invest in the foundation of our communities. We continue to support our towns and cities by sustaining and increasing municipal aid to help relieve the pressure of property taxes and ensure that local governments can serve residents effectively. We’re also addressing some of the most urgent needs in our state, including affordable housing and transportation so people and our economy can keep moving forward.”

Senator Cathy Osten, co-chair of the Appropriations Committee, said, “This is a good budget that addresses the real issues for real people that we heard about in countless hours of public hearings – food, health care, nonprofits and education.”

State Representative Maria Horn, co-chair of the Finance, Revenue, and Bonding Committee, said, “This budget reflects the legislature’s commitment to responsible, people-first policymaking. We delivered a $250 refundable credit for working families, a $500 credit for home daycare providers, and new incentives to help families save for college – all targeted toward easing everyday costs. We also ensured small businesses can compete on a fairer playing field by modernizing our tax code and expanding support for local farms and rural economies. Even with a tough revenue forecast, we passed a balanced, forward-looking budget that supports families, strengthens our workforce, and creates a better environment for small businesses to thrive.”

The budget bill is Public Act 25-168. The 2026 fiscal year begins July 1, 2025.