Federal Funds Stress Test Act

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Policy Status

  • Type: Model Policy
  • Status: Draft
  • Date Introduced: July 24, 2026

Task Forces

  • Tax and Fiscal Policy Task Force

    • Tags

  • 2026 Annual Meeting

    • Summary

    This model policy directs the relevant legislative fiscal staff (here called “Legislative Fiscal Analyst”) to conduct budget stress tests and submit to a Federalism Commission or other appropriate body the results that relate to federal funds. That body is to make recommendations regarding those federal funds portions of the budge stress tests. It requires a center at a state institution of higher learning to create and maintain a publicly available dashboard that visualizes state dependency on federal funds and model economic scenarios to inform federal funds contingency planning.   
    Draft

    Federal Funds Stress Test Act

    1. In consultation with the [Federalism Commission] and subject to legislative appropriation, the [Center at a State Institution of Higher Learning] shall:
      • (a) create and maintain a digital dashboard that visualizes the risk of federal funds reductions and the state’s dependency on federal funds
      • (b) ensure the dashboard is publicly available, user-friendly, and dynamic;
      • (c) identify, curate, clean, and securely warehouse funding data relevant to creating and maintaining the dashboard;
      • (d) continuously monitor and update the dashboard’s data and functionality to ensure accuracy and compliance with this section;
      • (e) model economic scenarios to help the state plan for potential reductions in federal funds; and
      • (f) upon request, report to the Federalism Commission regarding the duties described in this section
    2. The [Office of the Legislative Fiscal Analyst], beginning in [year] and repeating every three years after [year] shall prepare a budget stress test that, in consultation with the [Governor’s Office of Planning and Budget]:
      • (a) compares estimated future revenue to and expenditure from major funds and tax types under various potential economic conditions
      • (b) analyzes the economic and policy risks associated with funding for the Medicaid program and expansions of the Medicaid Program;
      • (c) measures value at risk; and
      • (d) recommends budgetary actions to manage risk;
      • (a) Except as provided in Subsection (3)(b), the [Legislative Fiscal Analyst] shall submit to the [Appropriations Committee] the results of the budget stress test described in Section (2).
      • (b) The [Legislative Fiscal Analyst] shall submit to the [Federalism Commission] the portions of the results of the budget stress test that relate to federal funds.
    4. Upon receipt of the budget stress test results described in Subsection (3), the [Federalism Commission] shall review the results and make any related legislative recommendations to the [Appropriations Committee].