While we hesitate to call it a windfall, yesterday’s revenue forecast did add a lot of money to anticipated receipts through the next biennium.
Before we look at the AP coverage of the forecast, we want to highlight the Washington Research Council’s chart at the top of this post showing the growth in inflation-adjusted per capita state spending growth over time. WRC senior analyst Emily Makings writes,
From 1970 to 2021, real (adjusted for inflation) per capita operating spending from state funds increased by 134.6%. (This includes the NGFO and state funds in other dedicated accounts.) Meanwhile, over the same period, real per capita spending from all funds (including federal funds) increased by 220.4%.
There’s more discussion and another chart at the WRC post. Makings points out,
Because Washington is a wealthy state, the enormous growth in per capita spending has been accomplished even as spending as a share of personal income has held fairly steady going back to 1970.
That’s a remarkable trajectory.
The Associated Press reports on the forecast and lawmakers’ reactions.
As Washington lawmakers prepare to release their supplemental budget proposals, they received news Wednesday that state revenue projections increased by more than $2.7 billion than originally expected through mid-2025.
Recall that this is on top of an anticipated surplus of more than $11 billion. So you might think everyone would be quite pleased and prospects for tax relief would be improved. The AP reports,
Republican legislative members of the Economic and Revenue Forecast Council said in response to the strong growth, tax cuts should be part of any final budget plan presented by majority Democrats.
Lawmakers are more than halfway through the 60-day legislative session that started Jan. 10, and the Senate is expected to release its supplemental budget plan early next week, followed by the House.
Reactions from key budget writers:
“This is a larger adjustment to the budget than I think any of us anticipated, fortunately to the good,” said Sen. Christine Rolfes, the chief budget writer for Senate Democrats and a member of the council.
But she still expressed caution about how to use the influx of revenue, citing ongoing uncertainty about inflation and other potential unknowns that could affect state coffers in the future.
“I think we’re in a good place to be able to meet the challenges coming ahead of us over the next few years,” she said.
A comfortable cushion, for sure.
