Walla Walla Union-Bulletin editorial: Even after new revenue forecast, state budget shortfall “remains a very serious concern.”

The September revenue forecast that halved the state budget shortfall was, the Walla Walla Union-Bulletin editorial board writes, excellent news for budget writers but it doesn’t let them off the hook. The shortfall remains large and the bump in tax collections may not extend beyond the extraordinary assistance. The editorial states,

Given the enormity of the previous projected shortfall, nearly $9 billion over the next three years, that is great news.

However, a projected shortfall of $4.2 billion remains a very serious concern.

Beyond that, a major reason the state’s economy and tax collections saw a huge spike is because of the federal stimulus money aimed at helping Americans who lost their jobs when the COVID-19 pandemic hit this spring.

Stephen Lerch, executive director of the Washington Economic and Revenue Forecast Council, attributed much of the economic improvement to federal stimulus money, particularly the one-time $1,200 checks and the additional $600 in weekly unemployment benefits, which expired in July.

Earlier, we citied a Washington Research Council analysis that pointed out that, while the shortfall can be covered with reserves, that’s only a one-time strategy and problems remain moving into the coming biennium. 

The U-B writes,

And this is why state lawmakers need to trim state spending to reduce the $4.2 billion gap between projected income and approved spending.

A $4.2 billion gap, which has the potential to grow wider if the economy tanks in the coming months as many economists are predicting, can’t be ignored now or when the Legislature goes into session in January.

Frankly, if the Legislature had been called into a special session this summer to address the looming revenue shortfall, the state would now be in an excellent financial situation.