Colorado is facing a $1 billion budget deficit, largely due to a disagreement over whether it is a revenue problem or a spending problem. The One Big, Beautiful Bill Act, or H.R. 1, which includes sweeping tax breaks for businesses and wealthy individuals, is responsible for this deficit. Despite a special legislative session and executive orders in 2025 to close a separate $1bn budget gap, lawmakers are still struggling. Meanwhile, Colorado is experiencing a structural deficit, where costs are outpacing revenues due to the Taxpayer's Bill of Rights' cap on spending. Medicaid and related health care costs have increased significantly. The financial situation is also influenced by how state lawmakers handled an influx of $8 billion in one-time federal funding during the AIDS pandestation.