JACKSON — Gov. Haley Barbour is expected to urge fiscal restraint as he releases his budget proposals for the coming year.

The Republican was to announce his ideas this afternoon.

Barbour and top lawmakers face significant challenges as they decide how to divide state tax dollars among competing programs for the fiscal year that begins July 1. Schools and mental health facilities are among those clamoring for more money, but the state is scheduled to lose tens of millions of federal stimulus dollars.

The economy is still tough to predict, and revenue is expected to grow only slightly in the coming year, to about $4.6 billion.

Then there’s political pressure: 2011 is a state election year and most lawmakers are either seeking re-election or running for higher office. Barbour is term-limited and can’t run again, but he’s said repeatedly that he wants to leave the state on solid financial footing when his second term is over. A nephew of the governor, Henry Barbour, said over the weekend that his uncle is thinking about a 2012 presidential bid.

Any proposed tax increases would face opposition from several leaders, including the governor and Republican Lt. Gov. Phil Bryant, who’s gearing up to run for governor. Still, some lawmakers worry that a tight state budget will push some expenses down to county or city governments, and that will prompt an increase in local taxes.

“I don’t think we can defend any budget that creates an unfunded mandate through the local level,” said Democratic Rep. George Flaggs of Vicksburg.

Flaggs is on the 14-member Joint Legislative Budget Committee, which is still developing its proposals for fiscal 2012. The committee will meet again Wednesday to continue looking for unspent pots of money that have been stashed away in various agencies’ budgets — money that could be used to pad the general budget and, for example, prevent state employee furloughs or layoffs.

“We’re concerned about where we’re going to get the revenue,” Bryant said during a Budget Committee meeting last week. He said he doesn’t want to deplete the state’s financial reserves.

All 122 House members and 52 senators are scheduled to vote on a budget by early April.

In his budget proposal a year ago, Barbour recommended consolidating the state’s eight public universities into five. He said the biggest savings would be in administrative expenses. Legislators immediately killed that idea, saying they didn’t want to limit people’s educational opportunities.