Statement from Rep. Terry Nealey on Feb. 17 state revenue forecast
The Washington State Economic and Revenue Forecast Council released its state revenue forecast today. According to Chief Economist and Executive Director Steve Lerch, the General Fund-State (GF-S) revenue forecast has decreased by $67 million for the current 2015-17 biennium. The 2017-19 biennium is projected to be lower by $442 million compared to the November 2015 forecast.
General Fund-State revenues are expected to grow 10.3 percent between the 2013-15 and 2015-17 biennia and 8 percent between the 2015-17 and 2017-19 biennia.
“This is not a huge surprise and I'm not too worried. We've been fortunate that the state's economy has been on a steady, slow increase the past couple of years. However, slight adjustments and changes in the economy are normal.
“The economy across the world, and especially with our largest trading partner — China — has an impact on Washington state. China is going through some changes, so we are seeing less exports through our state. And manufacturing within our state has slowed somewhat. But it's not an enormous problem. It's a bump in the road as we go along. I'm optimistic Washington will continue to have a good, strong economy in the long run.
“Let's also keep things in perspective. A $67 million reduction in the current biennium compared to the November forecast is very small, compared to a $38 billion budget. We also have several hundred million dollars projected for the ending fund balance in the current budget, and healthy long-term reserves. So while the forecast is slightly down, it's not yet a reason to be overly concerned.
“My advice to legislative colleagues in response to this forecast is that we should avoid knee-jerk reactions, such as using it as an excuse to raise taxes, which would hurt our economy even more. We need to be cautious going forward and mindful against adding new programs or expanding government. We need to stay the course on the budget and continue to add to the Rainy Day Fund so that if we do hit a crisis down the road, we've got a cushion. Let's also continue to work for policies that strengthen the economy and put people back to work, which is the best way to help our future revenue forecasts.”
###Washington State House Republican Communications