For the next 120 days, Colorado lawmakers will navigate another massive budget hole, the reality of likely Medicaid cuts and pressure to address ongoing affordability challenges — all while combating a federal government that has increasingly targeted the state. Democrats, who hold large majoritie s in the state House and Senate, will also maneuver disputes within their caucus and pending ethics complaints. Term-limited Gov. Jared Polis, who is on the sidelines of the race to succeed him, will seek to put a stamp on his final year of signing (or vetoing) bills. All of that — and electoral politics — will serve as the backdrop as the General Assembly convenes Wednesday in Denver, setting the stage for what may be “the most unique session” in recent memory, as Senate Minority Leader Cleave Simpson, an Alamosa Republican, put it. Besides Polis, three of the four top legislative Democrats are in their final year. Meanwhile, a slew of lawmakers will juggle the day-to-day work of lawmaking while they jockey for election to statewide office or to seats in Washington, D.C. Here’s a look at several top issues facing the 100 lawmakers as they gavel in for four months of work at the state Capitol. Gov. Polis’ last ride Heading into his eighth and final regular session as governor, Polis gave Senate Democrats some advice earlier this week. “You can work with me on things that you think I might sign that other future governors might not. It’s kind of a good opportunity,” he quipped. “At the same time, you can also do nothing, if it’s something I don’t support — you can also wait until the new governor (takes office) and maybe they will (support it).” A president or a governor’s final, lame duck year is typically the nadir of their political power, and lawmakers have already started bucking Polis more often. But his comment was emblematic of his relationship with the legislature, which fellow Democrats have controlled for the entirety of his two terms in office. He has been open with veto threats — at times issuing them before the session even started — and has sought to shape and negotiate legislation before it reaches his desk. Legislators have privately joked about keeping prospective bill ideas in their desks, waiting for Polis’ successor to enter office before dusting them off. Polis’ approach to President Donald Trump, a Republican, has further strained his relationship with legislative Democrats. The governor praised Robert F. Kennedy Jr., Trump’s pick for health secretary, shortly after the presidential election, and he has taken a less-pointed public stance against the nation’s chief executive than some of his Democratic contemporaries. Other state officials, including lawmakers, remain worried that Polis will grant an early prison release to former Mesa County Clerk Tina Peters, a Trump ally. And Polis’ efforts to sidestep a state law that he signed — aimed at preventing data-sharing with federal immigration authorities — sparked a lawsuit and further criticism. As President Trump targets Colorado, its Democrats — and some Republicans — struggle to play defense On Monday, after Polis offered his advice, Senate Democrats peppered him with questions about Peters, about his efforts to work with U.S. Immigration and Customs Enforcement and about his celebration of Trump’s recent military intervention in Venezuela. How the relationship between Polis and lawmakers develops will color the entire session. Theirs is a necessarily symbiotic pairing: Lawmakers need the governor to sign their bills, and the governor needs lawmakers to carry and pass his agenda. Polis told Senate Democrats on Monday that he would focus on housing -- where he has recently found more common ground with lawmakers -- and would support a returning bill that would allow nonprofit groups and schools to build housing on their land. “He wants to go out strong. He wants to go out continuing the legacy for the good work that he’s done for the last seven years,” Senate President James Coleman said. Issues that split Polis from the legislature will also return. A Democratic-priority bill aimed at easing labor union negotiations is back after Polis vetoed the same bill in June. His staff members told lawmakers Monday that another bill, which would establish a state-level office of workplace safety, would also be “a challenge" for Polis. Bills proposing to regulate social media and artificial intelligence are also set for returns, even as Polis has sought to steer the longstanding AI debate toward less-regulated waters. A package of immigration bills is also in the works. “I think you’ll see the governor having a lot less weight in the building, and just (see) more willingness than ever before to buck the governor and go against the governor,” said Sen. Matt Ball, a Denver Democrat. “But by the same token, the governor still has the veto pen, and so that’ll still be there.” From left, Senate Majority Leader Robert Rodriguez, Senate President James Coleman, House Speaker Julie McCluskie and House Majority Leader Monica Duran talk before the start of a press conference about the 2026 legislative session at the Colorado State Capitol in Denver on Jan. 13, 2026. (Photo by RJ Sangosti/The Denver Post) ‘Severe’ budget environment For the third straight legislative session -- plus August’s special session -- lawmakers will need to decide where to cut the budget to make room for ballooning Medicaid costs. Officials forecast this year's cuts won't be as heavy, dollar-wise, as the past rounds -- settling at $700 million to $800 million rather than the $1 billion-plus savings lawmakers needed to find then. But those cuts are all cumulative, and legislative leaders warn that the relatively easy decisions on where to trim have already been made. “There’s a lot of difficult conversations ahead,” House Speaker Julie McCluskie said. McCluskie has recently given voice to a quietly building position among Democratic leaders: The Taxpayer's Bill of Rights needs to be reformed. She defended the state constitutional amendment’s mandate that voters be asked to approve tax increases, but she said the spending cap set by TABOR, based on inflation and population growth, needs to change to accommodate an “older and grayer" -- and more Medicaid-dependent -- Colorado. Any change to TABOR would need a vote from the people. Republican leaders, however, argue for more spending cuts and better prioritization of spending. Simpson, the Republican Senate leader, said his caucus would fight any changes to the state tax code that break with rolling conformity to federal tax policy, as when state leaders preemptively passed a law last year that opted Colorado out of a federal change exempting overtime pay from taxes. His caucus sees that as an end-run around TABOR’s requirement to take tax increases to voters. "The big question is going to be: How are we going to address the budget shortfall? Are we going to look at actually cutting spending, or are we going to look at raising revenue?" said House Minority Leader Jarvis Caldwell, that chamber's top Republican. "Obviously, I'm in the cutting-spending category there." Democrats, too, have warned that the budget situation demands cuts. "We’re going to unfund some of my bills that I passed," Sen. Judy Amabile, a Boulder Democrat and member of the Joint Budget Committee, told Senate colleagues Monday. "We’re going to unfund some of the bills you all passed. That is going to happen." Legislative leaders address members of the media during a news conference to talk about the start of the 2026 legislative session at Colorado State Capitol in Denver on Jan. 13, 2026. (Photo by RJ Sangosti/The Denver Post) Medicaid cuts 'are going to suck' More than one in five Coloradans rely on Medicaid, the low-income health insurance program, and it makes up more than a third of the state’s $18 billion general fund budget. With legislative leaders hoping to keep K-12 education funding untouched, they’ll have to look to Medicaid cuts to bridge the budget gap. To keep up with Medicaid demand, the state would need to add about $600 million to its budget, according to projections from the governor's office. Polis instead has proposed a $300 million increase -- an amount that still dwarfs the total budgets of several state agencies. In effect, it means that some part of Medicaid -- the number of people served, the benefits they receive or the amount paid to health care providers who serve Medicaid patients -- will need to be cut, even if the budget itself increases. After Amabile said Medicaid and behavioral health programs would be cut, other Democrats wondered about dipping further into the state’s reserves to backfill the shortfall and avoid cutting social services. “These cuts are going to suck,” Sen. Kyle Mullica, of Thornton, said. Sen. Jeff Bridges, also on the Joint Budget Committee, warned against dipping more into the state’s piggy bank, a backstop during recessions. Polis has already proposed taking some money from the reserves, and any additional withdrawals will put the state in a difficult position should the economy tumble. “If we hit a real recession, then what we have in the reserves … won't even last a year,” he warned. “Like, we are just totally (expletive), and the people of Colorado are (expletive).” The Colorado State Capitol in Denver on Jan. 13, 2026. (Photo by RJ Sangosti/The Denver Post) An 'uphill battle' with Trump administration? The start of the legislative session coincides with a recent barrage of executive actions by the Trump administration targeting federal funding for the state. Most recently, the Republican president has sought to freeze assistance for low-income families over unspecified allegations of fraud in Colorado. A federal judge paused that action last week, but worries of further funding freezes and other federal actions seen as contrary to state priorities hang over Democratic leaders. In the days leading up to the session's start, Democratic lawmakers repeatedly said they would focus on combating administrative actions. At least three immigration bills -- including one that would allow people to sue ICE agents for violations of constitutional rights -- are expected to be introduced. “There is a collective mood with the people that I talk to in my communities, in the areas that I represent, of just this darkness,” said McCluskie, a Dillon Democrat. “This weight. We wake up every day with some new destabilizing decision, some new hate-driven policy effort from the administration. "That, coupled with the level of political violence that we’ve seen, it is a moment for us to rise above.” If the Trump administration’s freezes on Temporary Assistance for Needy Families or the Supplemental Nutrition Assistance Program hold, the state won’t be able to make up the difference, Coleman said. Instead, lawmakers will need to minimize the effects and be strategic about what they can do, Coleman said. “We have to figure out a way to not damage certain services that we have here at the state,” he said. “We’re going to have to make cuts, but be strategic about what cuts we have to make.” Conflict among Democrats For much of the fall, the legislature’s 66-member Democratic caucus has been roiled by the fallout from a retreat organized by a small caucus of 18 lawmakers who generally are more moderate. In October, the “Opportunity Caucus” gathered in Vail, raised an undisclosed amount of money from organizations that paid an undisclosed fee to attend, and were supported, in part, by a prominent dark-money group that had helped elect several of them in 2024. The retreat sparked criticism from other Democrats and spurred the filing of more than a dozen ethics complaints against Opportunity Caucus members. The caucus has pushed back, accusing its critics of Trump-esque attacks and arguing in legal filings that its members didn’t violate state law. “Any caucus's intent is to raise money for the purposes of your caucus,” Sen. Lindsey Daugherty, an Arvada Democrat and the caucus’s chair, said last week. “And for the purpose of our caucus, that is down to our mission of affordability and accessibility and trying to figure out what the real issues are facing Colorado, which we just don’t think is happening right now.” Related Articles Broomfield councilman, Adams County school board member appointed to Colorado House Democratic lawmakers will resurrect vetoed labor bill with an eye toward Colorado’s next governor Broomfield Democrat will replace late Sen. Faith Winter after winning vacancy appointment State complaint says Loveland rep used campaign funds on personal expenses A greater threat to Colorado’s elections than Tina Peters? (Opinion) Tensions have simmered for months as Democrats navigate the range of ideologies in their broad majorities -- 43-22 in the House and 23-12 in the Senate. When House Democratic leadership brought in a third party to moderate a discussion about the division in November, Opportunity Caucus members refused to speak on the advice of their lawyers. Senate Democrats brought in an outside facilitator to hold their own internal discussion Monday. But Opportunity Caucus members again largely didn’t participate, lawmakers said, and legislators from both sides said afterward that the divide hadn’t been bridged. Some lobbyists have said privately that some Democratic lawmakers have refused to work on bills together because of their internal affiliations. Primary fights against some caucus members are already beginning to spin up. Outwardly, lawmakers on either side of the divide have said they hope Democrats will unite around priority bills. Rep. Sean Camacho, a Denver Democrat and Opportunity Caucus member, said that while tensions were normal in politics, he expected lawmakers would enter the Capitol as professionals and would be "laser-focused" on their agenda. Ball, who isn't a member of that caucus, said it was unclear how the issue would play out. "It could swing from people spite-voting against fellow Democrats, because they either are or aren’t members of the Opportunity Caucus," he said, "to basically not changing anything and people vote the same way they typically vote on different bills. I have no clue. It feels really unsettled." Stay up-to-date with Colorado Politics by signing up for our weekly newsletter, The Spot. ...read more read less