Gov. Ferguson talked with the Washington State Standard yesterday about taxes and vetoes. According to the Standard,

“There are going to be increased taxes,” he said. “There was no way to cut your way out of a $16 billion shortfall. So there’s going to have to be a balance there.”

As I wrote in January, the varying estimates of the size of the shortfall depend on different assumptions about spending and revenues. Gov. Ferguson’s $16 billion shortfall (over the outlook period) encompasses all the spending adopted last year, the increased costs due to inflation and caseload growth, and all the new spending increases passed by the Legislature this year. (His definition excludes the $7 billion in savings assumed in the Legislature’s budget.)

Gov. Ferguson is using the “forecasted revenues less the spending level I want” definition of shortfall that I discussed in my January post. I estimate that the true maintenance level shortfall—the difference between forecasted revenues and the projected cost of continuing current services—is about $8.6 billion over the outlook period.

When you take the broadest possible definition of the shortfall, as Gov. Ferguson is doing, it does seem hard to expect that cuts alone would solve the problem. But the budget could have balanced over four years without new taxes—assuming the $7 billion in savings in the budget (and the budget’s transfers from other funds), but excluding most of the new spending increases.

To the extent that taxes are necessary this year, it is to fund the new spending—not to close the maintenance level shortfall.