More Money

Yesterday the Washington State Economic and Revenue Forecast Council released revenue projections for the current and upcoming biennia.  Last week the Council met and voted to move the June forecast up to mid-May.

This is the last forecast before the end of the current fiscal year. The forecast predicts the state will collect $106 million more than expected in fees and taxes for the 2013-2015 budget biennium, which ends this June 30. In addition, the state can anticipate $309 million more in taxes and fees than expected for the 2015-2017 budget biennium, which begin this July 1.

The forecast is expected to spur negotiations on the Hill.  Legislative leaders exchanged budget offers last week and plan to continue negotiating and exchanging offers this week.  The current 30-day special session ends May 28.

June Revenue Forecast in May? Possibly

Today the Economic and Revenue Forecast Council announced a meeting for tomorrow. The sole agenda item is to consider the timing of the next revenue forecast. Currently the next forecast is scheduled to be released on June 17.

In the past week bipartisan support has emerged to consider moving the June forecast up.  Policymakers are concerned that the June date is too late as the Legislature continues to work to reach a compromise budget.

 

Revenue Forecast Early; Slight Uptick

On Friday the Washington Economic and Revenue Forecast Council released the most recent revenue report.  Revenue projections through 2017 have increased by $274 million. This raises the 2015-17 state budget to $37 billion.

Amid the good news was the stark reminder that the Legislature still must find a way to deal with I-1351 to lower class sizes – which would create an estimated $2 billion budget shortfall.  Even if the Legislature suspends or even sends the initiative back to the voters, policymakers must still find a way to fund the McCleary decision.

This session policymakers moved the revenue forecast up a month in an effort to move the budget process along.  The next revenue forecast will be released in June.

November Economic and Revenue Forecast Released

Last week the Washington State Economic and Revenue Forecast Council released the November revenue forecast.

The recent forecast shows an increase of $115 million in Near General Fund revenue for the current two-year budget.  Near General Fund collections are now projected to total $34.07 billion for the current biennium (2013-15).  In addition the forecast also projected a $275 million increase for the next biennium (2015-17); totaling $36.98 billion for 2015-17.

However the revenue forecast announced today, even with the increases, is insufficient to offset the costs of new caseload and enrollment projections announced earlier this year.

The Caseload Forecast Council projected Washington would have nearly 11,000 more K-12 students by the end of the next biennium. The council also projects the state will have 36,500 more Medicaid recipients than previously forecast as well as more children in foster care and more criminal offenders under community supervision.

Gov. Jay Inslee’s proposed 2015–17 budget will be released in December. The next revenue forecast will be released in March 2015.

Quarterly Revenue Forecast Released

This afternoon the Washington State Economic and Revenue Forecast Council released the June revenue forecast.

The forecast shows that the general fund revenue forecast will increase by $157 million for 2013-15.The forecast for the 2015-17 biennium also increased by $238 million.

The Washington economy continues to grow slowly,  with employment rising in most sectors except aerospace and federal government.

The next revenue forecast is scheduled for release in September.

 

Revenue Forecast Released

This morning the Washington State Economic and Revenue Forecast Council released the February revenue forecast.

The forecast shows that the biennial budget will experience a slight increase in revenues – $30 million – compared to the last forecast in November.

General Fund collections are expected to total $33 billion for the current biennium. The forecast for the 2015-17 biennium also increased by $82 million. This includes a projected increase of $51 million from marijuana production and sales, the first time this item has been included in the forecast. The total General Fund for 2015-17 is expected to be $35.7 million for the 2015-17 biennium. The initial forecast for 2017-19 projects a total of $38.7 billion.

Though the forecast shows the state moving in a positive direction, the news was mixed. The Office of Financial Management stated that revenue collections had not grown enough to trigger an automatic 1 percent pay increase for many state employees. The 2013-15 state budget included language that reflects current collective bargaining agreements with unions which would trigger a 1 percent salary increase as a result of increased state economic activity. The February forecast would need to be at least $200 million higher than what was forecast in September 2012. Revenue growth only increased by $11.7 million over this period.

The next revenue forecast is scheduled for release in June.

Revenue Forecast Released in the Black with Little Wiggle Room

This morning the Washington Economic & Revenue Forecast Council approved a November forecast that increased slightly by $368 million for 2013-15. The increase is the result of a slow-recovering economy and tax changes approved by the Legislature.

Overall the increase gives the state about $862.7 million in total general-fund reserves for the current budget. Though good news given the deep declines in revenue over the past few years, the positive forecast does not change course, in many policymaker’s minds,  for the upcoming supplemental session. In other words a session geared towards technical changes and not new major investments.

This cautious approach may well be supported given pending litigation on state employee pensions that in the worst case could hit the state with a$1.3 billion price tag.

September Revenue Forecast Up

This morning the Washington Economic and Revenue Forecast Council met to hear the latest revenue projections for the state.

According to State Economist Steve Lerch the combined effect of a recovering economy and tax changes approved by the Legislature this past session are expected to generate $368 million in additional revenue for the biennium. Approximately $123 million is due to actions taken by the Legislature with regard to tax breaks and tax reforms.

In addition the forecast predicts an additional $342 million in new revenue for 2015-17, the majority of which ($249 million) is due to legislative and other non-economic factors.

Lerch stated “There has been little dramatic change in the economy since our last forecast and we continue to expect a slowly improving economy…While we still anticipate an expanding housing market, higher mortgage rates and home prices will slow activity relative to our June forecast.”

Revenue Forecast Released; May Be the News Necessary to Reach Final Budget

This morning the Washington Revenue Forecast Council met for the release of the quarterly revenue forecast.

The forecast projects that the state will take in $231 million more than was expected – $100 million for 2011-13 and $121 million for 2013-15.  In addition the release of the caseload forecast this afternoon is expected to provide $90 million in relief. This good news may be the push needed for the Legislature to strike a final budget and head home.

Throughout the legislative session and the first special session budget negotiators have been stuck trying to reach a deal for additional revenue (House) and reform legislation (Senate). The projected increase in the revenue forecast may allow for the case to be made that additional revenue is not needed and in turn no reform (such as workers compensation and K-12) would be necessary at this time in exchange for revenue.