Yesterday’s official state revenue forecast added $2 billion to anticipated tax collections for the current biennium, effectively halving the shortfall projected last June. The Seattle Times today reports on the forecast and how key lawmakers are responding to the good news. Joseph O’Sullivan writes,
If it holds, the improved economic picture means fewer difficult decisions for Washington lawmakers as they write the next state operating budget. That two-year spending blueprint touches every corner of Washington, funding parks, prisons, K-12 schools, and mental-health and foster-care programs.
But a slew of industries — from hotels and restaurants, to construction and air travel — still struggle, said Stephen Lerch, executive director of the council.
Lerch attributed much of the economic improvement to federal stimulus money, particularly the onetime $1,200 checks and the additional $600 in weekly unemployment benefits, which expired in July.
That “if it holds” qualifier will be on a lot of minds as the pandemic continues into the fall. And the loss of the additional federal unemployment money may cause a slowdown in consumer spending.
Qualifiers aside, though, lawmakers reacted positively to the improved projections. The ST reports,
In a statement, Sen. Christine Rolfes, D-Bainbridge Island, said the forecast indicated that, “Washington’s diverse economy is showing signs of resilience.”
“While we will still face many challenges ahead, there are some extremely positive signals for our state’s financial picture in this forecast and it represents an enormous step in shoring up our state’s projected budget deficit,” said Rolfes, the chief Senate Democratic budget writer.
The Senate’s Republican budget lead, who has repeatedly called for a special session, still believes one is necessary.
In a statement Wednesday, Sen. John Braun, R-Centralia, said a special session was still necessary.
“While the state’s economy is in a better place now than it was during the second quarter, that’s little consolation for the employers who are still stifled by a restart plan that occasionally lurches forward but generally seems to be in a holding pattern,” said Braun in a statement.
“We should be meeting in a special session right now, to reprioritize spending and put the budget on a better course for the nine months left in the biennium,” added Braun, the chief GOP Senate budget writer.
More on the forecast at the Washington Research Council blog.
Yesterday, as we reported on the improved outlook, we asked for your thoughts on how lawmakers should respond. If you’ve not yet responded, please, take our survey.