With unusually high levels of uncertainty circling around the federal funding that buoys more than $16 billion of the state budget, Gov. Maura Healey's finance secretary said Thursday that federal cuts would be too big of a problem for the executive branch to solve on its own.

"We're going to have to sit down collectively and do it, because I can tell you, the problem is going to be too big for any one branch to think that they'll have a proposal to solve it," Administration and Finance Secretary Matthew Gorzkowicz said during a budget hearing before the Ways and Means Committees on Thursday.

Gorzkowicz added, "It's going to require legislation. It's going to require, perhaps looking at appropriations and looking at resources. Maybe we have to reallocate resources differently than we have in the past. But it's not — the executive branch is not going to have the ability to do it all."

The state has more than $8 billion stocked away in a rainy day fund, but state tax collections continue to rise and Senate Ways and Means Chairman Michael Rodrigues indicated last week that he may hesitate to tap into it, even in light of federal cuts.

"We must forego any immediate temptation that may hurt our state's long-term economic health, while carefully identifying and assessing areas of concerns where we, as a commonwealth, may need to shoulder the burden in the absence of federal support," Rodrigues said.

Serious concerns over the federal revenues that support state spending were a major theme of the first annual budget hearing, which also touched on the "new normal" of moderate revenue growth similar to pre-pandemic levels, and cost growth exceeding inflation in several areas of government spending.

President Donald Trump sent shockwaves throughout state government when he announced in January that he would freeze federal grants and other congressionally approved government programs. The administration rescinded the memo that froze federal financial assistance, and it was then blocked by two federal judges, but the administration is focused on downsizing government and says it still plans to revisit the plan in the future.

"We are stepping back, and we're taking a more comprehensive look and trying to just understand, based on proposals that are being advanced from Washington, what the impact on the state will be," Gorzkowicz told reporters after the budget hearing Thursday.

He continued, "As you can imagine, those proposals are changing, and it's been difficult to try to get information about some of the details behind those proposals. But we're working with the Cabinet, we're working with all levels of government to just understand what those proposals might be, to try to run some scenarios and some modeling to understand that impact."

The finance secretary said there might not be much the state can do to make up for lost federal funding.

"And let's be clear, there may not be the ability to backstop much of what we're seeing, but to the extent that we have to look at existing resources or make changes, we're going to need the partnership with the Legislature to do that. They have the power to legislate and appropriate," he said.

Healey referred several times over the course of the hearing to reports Thursday that Trump may sign an executive order to disband the U.S. Department of Education.

Doing so, she said, would cut funding for students in Massachusetts who receive special education services, Title I grants for low-income families and other education dollars in Bay State schools.

"We as a state are not going to be able to absorb or make up for cuts that come from a federal administration," she told reporters about the possible elimination of the Department of Education. Earlier, she said, "So, it's just to say we've got to keep real-time awareness in terms of what's out there, what's coming down, whether it's by executive order or some other like DOGE-y whatever, exercise."

Healey and her team weren't the only ones concerned about federal funding cuts affecting the state budget.

"This committee also has to build a budget for the looming fear of what might come next from the federal government, that is unpredictable, to put it mildly," said House Ways and Means Chairman Aaron Michlewitz.

He continued, "It is our job to cut out the noise, no matter how loud that may be, and produce a budget that provides the services that our constituents rely upon, while also being ready to pivot if necessary."

Michlewitz's counterpart in the Senate, Michael Rodrigues, said it's "all hands on deck moment" due to "threats from Washington to cut federal funding in areas like health care and education, or tariffs that will drive up the cost of delivery for our residents."

While budgetwriters try to anticipate possible federal actions, they are also contending with a return to modest revenue growth after several years of substantial collections that coincided with big state spending increases.

Revenue collections in fiscal year 2025 have outperformed expectations, and budgetwriters plan for more growth in fiscal 2026 — but tax collections have still flattened compared to years when state coffers were injected with billions of pandemic-related federal grants.

"We know that revenues, despite the early pandemic, have plateaued. They've return to slower, more steady growth, consistent with the way tax collections worked pre-pandemic," Rodrigues said. "It's crucial that we exercise fiscal discipline, remain vigilant and course correct when prudent."

Despite slowing revenue growth, Healey's budget maintains popular pandemic-era programs that were originally paid for with COVID-related dollars from the federal government, including $475 million in grants for early education and care providers and $170 million for universal free school meals.

During the pandemic, the federal government also expanded Medicaid eligibility, which brought more Bay Staters onto the rolls of its MassHealth program. That was followed by an eligibility redetermination effort that reduced enrollment. Five years later though, enrollment in MassHealth stands at about 2.2 million — 260,000 more members than it had at the beginning of the pandemic.

Gorzkowicz referred to MassHealth's inflated rolls several times over the course of his testimony on Thursday, pointing out that the public insurance program is the most expensive line item in the budget. Additionally, MassHealth members' acuity is much higher, he said.

"There are a few things that are growing greater than the rate of inflation — and when I say greater than the rate of inflation, I mean two or three times greater than the rate of inflation. But they are also things that we have made priorities, whether its the Student Opportunity Act, MassHealth, K-12 universal meals, [early education and care] grants. These are things that are putting pressure on the budget, but things, collectively, that over the last five years we have made priorities," he said.

Republicans in Washington are looking at major spending cuts in Medicaid, which could sever revenue supports for MassHealth, forcing state officials to reevaluate the massive program.

To keep up with spending priorities, Healey's budget relies on about $1 billion in one-time revenues, though the administration says it plans to mitigate that by replenishing some trust funds and reserves.

Rep. John Marsi of Dudley asked about the sustainability of relying one one-time sources of revenue, and planning for a possible future where tax collections don't keep up with state spending.

Gorzkowicz responded that his team constructed the budget with fiscal years 2027 and 2028 in mind, and reiterated they have a plan to replenish some of the reserves through shuffling money available in trust funds.

He added, however, that next budget year, they'll have to be "deliberate and thoughtful" about how much spending is sustainable.

"As we go into '27, we have to start thinking about what is sustainable and what is reasonable, given the revenue environment we're in," he said. "So we are very aware of the use of one-timers, and very deliberate and thoughtful about how we plan to grow out of those one-timers in '27 and '28, or again, replenish them, so that we have a multi-year approach towards balancing the budget."