Gregoire expects more bad news before summoning lawmakers

CLE ELUM, Wash. — Washington’s economic outlook is so much more likely to get worse in the next two months that Gov. Chris Gregoire said she won’t call the Legislature into a special session until November. “It would be premature for me to call them back before the next forecast. They need to know how large the problem is,” Gregoire said today. Speaking to the annual policy summit of the Association of Washington Business, Gregoire said the state’s chief economist has told her it’s about four times more likely the state’s revenue outlook will be worse for his November forecast than it was last week. That’s when he said the state can expect a drop of about $1.4 billion from the amount the Legislature expected when it wrote the 2011-13 general fund budget. Before last week’s forecast, Gregoire told state agencies to prepare plans to cut 5 percent and 10 percent from their current appropriations. But Chief Economist Arun Raha’s forecast last week essentially blew those apart. “Neither of those would be enough,” she said. The association, which represents businesses throughout the state, is holding its annual conference at the Suncadia Lodge, a golf, winery and lodging complex on the eastern slope of the Cascades. Advocates for higher taxes on businesses are massed at the entrance, demanding an end to tax preferences — they use the term loopholes — for businesses rather than another “all cuts” budget. Gregoire didn’t mention a tax preferences of a tax hike in her talk to the business leaders, and none asked her about them in the brief question and answer session after her speech. But she left open the prospect that the state would consider some, urging the crowd “everything is on the table” — presumably taxes as well as cuts. “I’m asking you… not to draw lines in the sand,” she said.