INDIANAPOLIS -- Tuesday’s state revenue forecast had several lawmakers on both sides of the aisle feeling “cautiously optimistic” heading into what is already being labeled a “contentious” budget session. Despite a slight increase in anticipated revenue for 2025 and a welcome change from tackling a nearly billion-dollar Medicaid shortfall last December, Republican lawmakers have stressed that Indiana’s budget will be tighter compared to years past. Gov.-elect Braun names new Indiana adjutant general “You’ll see a little uptick in revenue, but you also have to look at the large increase in expenses,” State Sen. Ryan Mishler (R-Mishawaka) said. ”We have to look at our expenses, specifically Medicaid.” According to Mishler, revenue next year is expected to grow by 3% (roughly $800 million). However, Medicaid expenses are also expected to go up by 6% in that same timeframe (and by 9% in 2026), potentially limiting the state’s ability to address other critical budget items like K-12 education. ”I mean, we can’t spend more than what we have,” Mishler said. ”I fear that Medicaid is going to start driving our budget and I said that two years ago…I’m even more nervous about it now.” Democrats on the State Budget Committee also acknowledged that expected revenues might not be able to cover the state’s Medicaid needs. However, they argued keeping the state’s most disabled and elderly Hoosiers on waitlists for services is not a winning solution.   “We can’t build our budget on the backs of our most vulnerable Hoosiers: children and our seniors,” State Rep. Gregory Porter (D-Indianapolis) said. According to Porter, the General Assembly should discuss the upcoming April revenue forecast ahead of time to account for the incoming Trump Administration’s proposed tariffs. ”I think we need to do it in March, because then, I think we’ll have a more holistic approach to the dollars that we have to spend here in the state,” Porter said. U.S. Rep. Spartz will not sit on committees, participate in Republican caucus in 119th Congress As for the incoming governor’s administration, Republican leaders said they will continue discussions with Governor-elect Mike Braun to find a balance between putting enough in reserves and providing critical services to Hoosiers. “Oh, we’re going to work with him, and we’ll find the right spot to land on all these issues,” State Rep. Jeff Thompson (R-Lizton) said. The next legislative session starts on Jan. 8.