Revenue collections and forecast continue to lag pre-pandemic levels

OLYMPIA – Washington’s projected Near General Fund revenue collections for the 2019–21 state budget have increased by more than $634 million, according to estimates released today by the Washington State Economic and Revenue Forecast Council.

“We are facing mixed signals about the future, with revenues running above the previous forecast but significant uncertainty around the coronavirus pandemic,” said Steve Lerch, forecast council executive director. “This forecast update reflects some difficult choices.”

Total Near General Fund revenues are now projected at nearly $51 billion for the current two-year state budget cycle, which began July 1, 2019. The increase in projected revenues would leave the state with a net surplus of nearly $1.8 billion — including reserves — at the end of biennium.

The council also increased the Near General Fund forecast for the next biennium (2021–23) by more than $328 million. The council projects Near General Fund revenues will total nearly $54.7 billion for the next biennium, which begins July 1, 2021.

The state’s revenue projection fell sharply during the early months of the pandemic, but has since recovered significantly. Still, the state’s revenue projection for the two biennia remains more than $3.3 billion below what it was before the pandemic hit.

The state took a number of steps last spring to reduce spending in the current budget. These included canceling scheduled pay raises for many of the state’s highest-paid employees, requiring regular furloughs for most state employees and imposing freezes on hiring, personal services contracts and equipment purchases.

Gov. Jay Inslee will unveil his 2021–23 operating, capital and transportation budgets in December. OFM Director David Schumacher said the governor’s budget decisions will focus on helping as many Washingtonians as possible during this unprecedented time.

“The pandemic continues to take a toll on the lives and livelihoods of people across our state,” Schumacher said. “The governor’s budgets will reflect our new economic reality and the need to help the businesses and unemployed workers hardest hit by the pandemic.”