Volcker Alliance rates Washington near top for good budget practices. House and Senate release budget proposals today.

The Volcker Alliance has again rated Washington among the top states for “truth and integrity in state budgeting.” 

This report marks the Volcker Alliance’s third annual assessment of the budget practices of the fifty US states. Covering fiscal 2017, 2018, and 2019, the study grades states’ success in pursuing transparent and fiscally sustainable procedures as they attempt to keep revenues and expenditures in balance from the beginning to the end of each year. 

As in our 2017 and 2018 reports, we give states grades of A to D-minus, the lowest possible mark, for their practices in five building blocks of budgeting.

The five are budget forecasting, budget maneuvers, legacy costs, reserve funds and budget transparency.

From the Washington snapshot.

WASHINGTON SCORED A averages in budget forecasting, budget maneuvers, and reserve funds for fiscal 2017 through 2019. The only state receiving more top marks was Hawaii, which averaged an A in four of five categories.

The state’s lowest mark came in legacy costs, but even that showed improvement.

Washington improved its legacy cost grade, which rose to a C average for the 2017–19 period from a D for 2016–18. The category covers public worker pensions and other postemployment ben- efits (OPEB), principally health care. Pensions were 94 percent funded in 2018, 24 percentage points above the total for all states. While statutory contributions for fiscal 2017 and 2018 fell short of actuaries’ recommendations, the annual employer contribution rates were updated in fiscal 2019 to provide slightly more than the actuarially determined contribution. But the state still lags in its annual payments for OPEB.

Emily Makings with the Washington Research Council writes,

As we wrote last year, Washington does have good budget sustainability requirements, especially when they’re followed. And SSB 6660, which would strengthen the four-year balanced budget requirement and repeal the state expenditure limit, was passed by the Senate on Feb. 14.

She adds an important caveat,

But note that the factors considered in the grades do not include the amount of time the public has to digest the budgets before they are voted on. Budget proposals are often made and voted on within a very short time span. This may be especially so this year: According to Rachel La Corte of the AP, both the House and Senate supplemental operating budget proposals will be released on Monday (they don’t typically make their proposals the same day). The House proposal will be available at noon and will be heard in the Appropriations Committee at 3:30 that afternoon. The Ways and Means Committee will hear the Senate proposal Monday at 3:30 as well.

Here are links to the House and Senate hearings.