Blog

Notes from the first meeting of the new committee on budget transparency and fiscal sustainability

The Joint Legislative-Executive Committee on Budget Transparency and Fiscal Sustainability—created in the 2026 supplemental budget—met for the first time on Monday. The state has contracted with Pew to support the committee and provide research on budget practices in Washington and other states. The meeting included a good staff presentation on the budget, including discussions of […]

New report: 2026 Fiscal Management Performance Review

The Washington Research Council considers budget sustainability to be a primary objective of state fiscal policy and key to our state’s fiscal health, the certainty of government services, and the competitiveness of Washington’s economy. This new periodic review of the state’s fiscal performance will evaluate Washington’s operating budget on multiple factors, including Spending Growth Sustainability, […]

The state isn’t the only government in Washington facing increasing liability costs

As I’ve written, the growing deficit in the state’s self-insurance liability account (SILA) is a significant problem for the state budget. Indemnity payouts have increased dramatically in recent years. According to the Office of Financial Management, the ending balance in SILA was -$963.9 million for FY 2026. That’s the ninth year in a row the […]

What to make of the high capital gains tax collections for tax year 2025?

The Department of Revenue reported last month that capital gains tax collections for tax year 2025, which were collected in April and May 2026, totaled over $1.5 billion. (This is not the final number. All taxpayers must submit estimated payments in April, but taxpayers with filing extensions will finalize their payments in October 2026.) According […]

Happy Fiscal New Year!

Today is the first day of fiscal year 2027, which is the second year of the 2025–27 biennium. Washington’s current budget troubles are the direct result of the Legislature appropriating significantly more than was expected in revenues in 2023–25. Ultimately, actual spending from funds subject to the outlook (NGFO) in that biennium exceeded ongoing NGFO […]

Slower economic activity reduces the revenue forecast, but the budget outlook improves given capital gains tax revenues

The Economic and Revenue Forecast Council (ERFC) estimates that revenues from funds subject to the outlook (NGFO) will total $76.237 billion in 2025–27, $82.164 billion in 2027–29, and $91.739 billion in 2029–31. The new revenue forecast incorporates all the legislative changes made during the 2026 session, including the adoption of the income tax. Economic changes […]

Adopted pension contribution rates could save the state $325 million in 2027–29

On Tuesday, the Pension Funding Council adopted 2027–29 employer contribution rates for state pension plans. The rates for 2027–29, as calculated by the Office of the State Actuary (OSA), are expected to decline compared to 2025–27. OSA estimates that the adopted rates will reduce state spending by $325 million in 2027–29 (compared to current rates). […]

State liability account shortfall grows

Jim Brunner of the Seattle Times reports that the Office of Financial Management (OFM) has authorized the state’s self-insurance liability account (SILA) “to be in a temporary cash deficiency of up to $1.7 billion” in 2025–27. At this time last year, the state had authorized a temporary cash deficiency in the account of up to […]

New brief: With the Income Tax, Washington Adds a New, Volatile Layer of Taxation

Under ESSB 6346, a 9.9% tax will be imposed on Washington income over $1 million beginning Jan. 1, 2028. All the provisions in the bill, including the tax rate and the $1 million standard deduction, are statutory, so they could be changed by the Legislature at any time. The determination of taxable income begins with […]

Transportation revenue forecast is down again

According to the Transportation Economic and Revenue Forecast Council, transportation revenues are forecasted to total $8.705 billion in 2025–27, $10.617 billion in 2027–29, and $10.004 billion in 2029–31. Over the three-biennia period, this is $434.6 million less than expected in the February 2026 forecast. The 2026 supplemental transportation budget had balanced through 2029–31. Today’s reduction […]