(The Center Square) – Gov. Tony Evers’ budget proposal would spend down more than $4 billion of the state’s expected $4.3 billion surplus if it is enacted, according to a new analysis from Wisconsin Policy Forum.

The surplus has been spent down by $2.8 billion over the past two years after an influx of federal funding during COVID-19 pandemic led the surplus to rise to over $7 billion before the state’s current biennial budget was enacted.

The analysis comes after Rep. Mark Born, R-Beaver Dam, estimated that Evers’ proposal would lead to $3 billion in tax increases over the two-year span as well.

The budget proposal included $25.49 billion in state general fund spending in fiscal year 2026, which would represent a 19.2% increase from the current fiscal year. The proposal then would have $24.99 billion in spending in fiscal 2017, according to Wisconsin Policy Forum.

General fund spending uses state taxes such as income and sales tax that covers spending such as K-12 and higher education, health care, state prisons and local aids and property tax relief.

“Some further use of the state’s massive surplus is expected and welcome given the state’s many challenges,” the budget brief says. “But taxpayers have good reason to watch both sides in this process carefully to ensure the final budget does not erode too many of the state’s hard-won financial gains.”

The largest proposed budgetary increases are for K-12 education with a $34 billion increase to the Department of Public Instruction over two years with $1.1 billion additional to local governments and tax relief, $691.6 million more to the University of Wisconsin system, $601.2 million additional to the Department of Children and Families for child care, $522.3 million additional to the Department of Corrections to cover rising costs from employee raises and other factors and $422 million additional to the state’s Public Service Commission for broadband expansion.

“Some ongoing drawdown of the state surplus to meet the needs of Wisconsin residents is expected and appropriate in the 2025-27 budget,” the analysis says. “The question is how much. Under the governor’s proposal, the state would increase general fund taxes by more than $2 billion but still end up using most of the remaining balance in the fund to help cover new spending on K-12 and higher education, child care, aid to local governments and a variety of other priorities.”