Budget leaders: 320 million reasons to avert shutdown ?>

Budget leaders: 320 million reasons to avert shutdown

dollarsignRelieved budget writers say Washington should be able to avoid a government shutdown, after getting the year’s best revenue news, new, more robust revenue projections and a $90 million reduction in expected caseload costs.

State budget Director David Schumacher and budget writers from both houses and both parties said the $320 million one-day windfall should break the Olympia logjam that had threatened to trigger a partial government shutdown if no budget were produced by June 30.  Senate budget Chairman Andy Hill and House counterpart Ross Hunter said they expect quick action to resolve budget and revenue differences.

The second special session was in Day 7 on Tuesday.

Both chambers have pledged to add a huge infusion of money to K-12, perhaps $1 billion, and have agreed to restore the 3 percent pay cut that state employees have absorbed in the past two years. The Senate, governed by a coalition of 23 minority Republicans and two Democrats, has tried to hold the line on new or extended taxes or repeal of tax exemptions; the Democratic-controlled House has suggested some tax extensions and repeal of some exemptions.

Chief economist Steve Lerch told the state Economic &  Revenue Forecast Council the forecast for the current biennium (ending June 30) should be $110 million higher than predicted in March.  The council also added $121 million to the forecast of the 2013-15 biennium that begins July 1.  That news was coupled with word from a separate Caseload Forecast Council that caseload costs (such as K-12 enrollment, prison headcounts and Medicaid costs) would be $90 million less than forecast in March.

Both Hill and Hunter said the $320 million figure isn’t that large a number (roughly 1 percent compared with the $33 billion state budget), but still can be a game-changer. Said Hill: “It should break the logjam. I would think we could move fairly quickly.”

Just hours earlier, Schumacher’s agency was collecting plans from the agencies and statewide elected officials on their shutdown plans in the event the budget deal didn’t come together in time to avert the state version of a “fiscal cliff.”  Without a General Fund budget, agencies cannot legally spend or incumber general taxes — meaning most agencies would have to go dark.

 

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