WA revenue projections plunge $1.2 billion

WA revenue projections plunge $1.2 billion

More dire news for the state Legislature and Governor Gregoire:  The multibillion-dollar budget hole has gotten about $1.2 billion worse.  Washington’s projected deficit is now calculated at well over $5 billion.

The state’s anemic economy and the huge budget gap will dominate the upcoming legislative session, and Sen. Joe Zarelli and other lawmakers are urging that an emergency session be held next month to get a head start on more cuts.  The governor already has ordered across-the-board cuts of over 6 percent, and agencies are preparing for the prospect of additional deep cutbacks.

Voters this month approved Tim Eyman’s Initiative 1053 to require a supermajority vote in both houses to raise taxes in Olympia, and the Legislature’s anti-tax contingent has grown.

The state’s chief economist, Arun Raha, presenting the dark news to the Economic and Revenue Forecast Council at the Capitol on Thursday, said the economy is “off life support, but still in intensive care.”

The forecast, adopted by the bipartisan panel of legislators and Gregoire’s budget and revenue directors, predicts that $28.1 billion will flow into state coffers in this biennium, which ends June 30. That is $385 million less than the September forecast, and takes into account a $63.5 million loss in revenue due to voter approval of a pop-tax rollback via I-1107.

And for the upcoming two-year budget cycle, beginning next July 1, Raha’s forecast is for $809 million less than predicted — down $218 million in pop, candy and bottled water taxes that won’t be collected, and $591 million due to the weaker economic outlook.

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