New brief: The State Should Avoid Tapping Reserves While Revenues Are Growing
A potential recession is a major risk to the state revenue forecast, but Washington’s strong budget sustainability practices—including the budget stabilization account (BSA, or the rainy day fund)—will help the state through a downturn. However, in 2021, despite not facing a revenue shortfall, the Legislature swept the BSA. (Pursuant to the constitution, this required only […]
New brief: Washington’s Business Taxes Continue to Exceed National Average
Washington state’s businesses bore much of the tax burden for fiscal year 2020, delivering nearly half of state and local tax revenue. Nationally, Washington’s business taxes were the 9th highest per employee, the 32nd largest as a share of economic activity, and the 17th greatest as a share of total state and local tax revenue. […]
New brief: Cash Deficits in the Paid Family and Medical Leave Program Signal Additional Tax Increases Ahead
Washington’s paid family and medical leave (PFML) program is one of the first in the nation. PFML benefits are funded by a premium that is assessed on employee wages, up to the Social Security cap ($147,000 in 2022). From 2019 through 2021, the premium rate was 0.4%; it was increased to 0.6% this year. The […]
New brief: Historically Large Supplemental Budget Also Sets Aside Significant (But Unprotected) Reserves
With the 2022 supplemental operating budget, 2021–23 appropriations from funds subject to the outlook (NGFO) are 24.3% higher than 2019–21. That is the largest biennial increase going back at least to the early 1990s. (The average biennial spending growth was 9.1% from 1993–95 through 2019–21.) Further, this is the first time a mid-biennium supplemental budget […]
New brief: Biennial-Sized Spending in a Supplemental Year: Comparing the Senate- and House-Passed Budgets
The Senate- and House-passed supplemental operating budgets would spend almost all of the $13.8 billion surplus in funds subject to the outlook. Compared to the enacted 2021–23 biennial budget, appropriations would increase by 7.7% in the Senate-passed budget and by 10.6% in the House-passed budget. Compared to 2019–21, revised 2021–23 appropriations would increase by 23.3% […]
New brief: Minimal Losses to Local Revenues in 2020 Are Largely Offset by Additional Federal Relief
Local government taxes and revenues were largely sustained in 2020. State taxes increased by 4.2% in FY 2020 and by 11.7% in FY 2021. Meanwhile, in CY 2020, taxes grew by 5.3% in Washington’s counties and fell by 2.9% in Washington’s cities. However, from 2010 through 2017, city tax growth exceeded that of the state. […]
New brief: A Surplus of $11.249 Billion: Gov. Inslee Would Increase Spending, but a Sustainable Budget Could Include Tax Reductions
We estimate that the state surplus in funds subject to the outlook (NGFO) is now $11.249 billion over four years. On top of that, the state has one-time funds: $1.0 billion in the Washington rescue plan transition account, $1.273 billion in general federal relief funds, and about $1.2 billion in the budget stabilization account. This […]
New brief: How Should the State Spend Its Substantial Surplus?
When the 2021–23 operating budget was enacted, it left an unrestricted ending balance for funds subject to the outlook (NGFO) of $83 million in 2023–25. With ever improving revenue forecasts and new, lower spending assumptions, we estimate that the unrestricted NGFO ending balance is now $8.649 billion. Additionally, the budget stabilization account (BSA, or the […]
New brief: Should Washington Be in the Long-Term Care Insurance Business?
Key dates for Washington’s long-term care insurance program—and its accompanying payroll tax—are fast approaching. Beginning Jan. 1, 2022, a payroll tax of 0.58% will be levied on every employee’s wages. The tax is expected to generate revenues of more than $1 billion a year. Long-term services and supports trust (LTSST) benefits will then be available […]
New economic profile: The Economic Contribution of Washington State’s Petroleum Refining Industry in 2019
We have updated our report on the impact of Washington’s five major petroleum refiners on the state’s economy. In 2019, the refiners directly provided 2,050 full-time jobs, paying an annual average wage of $148,683. In addition, the refiners employed, at high wages, 3,643 contract workers on an average day, doing maintenance, capital repair and capital […]
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