March Forecast Shows Colorado's Economy Is Resilient Despite Increased Costs From Tariffs, International Instability

DENVER ~ In Denver, the Governor's Office of State Planning and Budget presented its March 2026 Economic Forecast to the Joint Budget Committee. The forecast, which was released today, shows that despite challenges such as increased costs on families from Trump's illegal tariffs, international instability, and supply chain impacts from the war in Iran, Colorado's economy remains resilient.

Governor Polis addressed the forecast, stating that while the state has not fully recovered from the effects of tariff taxes, there is still concern about a potential recession. However, he reassured that their balanced budget proposal includes healthy reserves to protect against any future economic downturn.

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The current year's economic growth forecast has been revised up from previous projections. However, higher prices resulting from tariffs have led to a decrease in consumer demand and economic growth. The Office of State Planning and Budget (OSPB) projects a 40% chance of recession in the next year and an even higher risk a year from now.

As previously predicted, revenue growth levels are expected to turn off the Family Affordability Tax Credit (FATC) and expansions of the Earned Income Tax Credit (EITC) in Tax Year 2027. However, this is not finalized until the December 2026 forecast. OSPB also projects TABOR surpluses of $711.1 million in FY 2026-27 and $515.6 million in FY 2027-28.

Additionally, OSPB forecasts that the General Fund will be $13.7 million above the proposed 13 percent statutory reserved level in FY 2025-26.

The full forecast report, along with slides and supplemental materials, can be viewed by the public for further information on Colorado's economic outlook.

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