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State revenue forecast: Almost flat

OLYMPIA -- Washington might collect about $96 million more in taxes over the next 17 months than previously projected, which isn't much in a $30 billion budget. Relatively speaking, the revenue forecast is flat.

That was good news for Democratic legislators trying to fix a budget problem that for several years has grown every few months with a new economic forecast.

"Flat is the new awesome," Rep, Ross Hunter, D-Medina, the chairman of the House Ways and Means Committee, said this morning as figures were released.

More important than the relatively tiny uptick in revenues -- this quarter's projected rise is less than last quarter's projected drop of $143 million, state Budget Director Marty Brown noted -- is a drop in the demand for state services, which helps on the other side of the General Fund budget's balance sheet. That's about $330 million less than Gov. Chris Gregoire assumed in November when preparing a new budget for the fiscal period that lasts through June 2013 and called for cuts and a temporary tax increase to fill the growing gap in the budget.

"The draconian cuts seem to shrink somewhat," Sen. Ed Murray, D-Seattle, the chairman of the Senate Ways and Means Committee, said.

It's too soon to tell how much, Murray and Hunter said. Legislators need to factor both figures, the lower demand for some state services and the slightly higher state revenue, into budgets they've been working on since before the session started. "It's a cascade of numbers...You change one, all of the others change as well," Hunter said.

Also unknown, in light of the change in projected revenue and expenses, is whether the Legislature will agree with Gregoire's request to put the sales tax increase on the ballot. Adding the $330 million in projected caseload demands and the extra $96 million in projected revenue creates an amount close to what the sales tax increase would have generated for the rest of the biennium.

"It's a question," Murray said. "A week ago, I would have said it's not a question."

Rep. Ed Orcutt, R-Kalama, chairman of the Economic and Revenue Forecast Council, disagreed. A tax increase "never should have been a question in the first place," he said.

House Republicans are scheduled to announce their budget proposal Friday. House Democrats will announce theirs early next week and a Senate budget proposal, which could have support from members of both parties, will be announced the week after. The session is scheduled to end March 7.

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Jim Camden
Jim Camden joined The Spokesman-Review in 1981. He is currently the political reporter and state government reporter in the newspaper's Olympia bureau office.

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