Seattle’s revenue forecast anticipates slowing growth, but general fund revenues are expected to be higher than assumed in the adopted budget
Yesterday Seattle’s Office of Economic and Revenue Forecasts presented the city’s August revenue forecast. It includes updated estimates of general fund revenues and “general fund adjacent” taxes (e.g., the payroll expense tax and the real estate excise tax) for 2023 and 2024. The forecast notes that, compared to the April forecast, general fund revenues are […]
August 10 , 2023 - Emily Makings
Why is Seattle considering new revenue?
As I wrote yesterday, a work group in Seattle has come up with nine options for new revenue for the city. The following chart is from the revenue work group’s report. It shows that the city increased general fund spending in recent years above the amount of available ongoing revenues (even though revenues have been […]
August 09 , 2023 - Emily Makings
Seattle’s Revenue Stabilization Work Group offers nine new tax ideas, including a local capital gains tax and changes to the payroll expense tax
Last year, the City of Seattle established a Revenue Stabilization Work Group to “evaluate and pursue innovative options to stabilize revenue and look for opportunities to reduce the regressive nature of Seattle’s tax system on low-income, working, and middle-class residents.” This is in response to a structural deficit in the city’s general fund. The work […]
July 14 , 2023 - Emily Makings
Capital gains revenues and the June forecast
As Kriss wrote last month, the June revenue forecast for funds subject to the outlook (NGFO) is up over the outlook period (2021–23, 2023–25, and 2025–27) compared to the March forecast. Additionally, NGFO revenues are expected to grow by 2.4% in 2023–25 and by 6.8% in 2025–27. (However, adjusted for inflation, revenues are expected to […]
July 11 , 2023 - Emily Makings
Washington’s state and local taxes and spending per capita ranked 14th and 13th highest among the states in 2021
The two main ways to compare taxes and spending across states are per capita and as a share of personal income. The U.S. Census Bureau released state and local finance data for fiscal year 2021 a few weeks ago. According to the data, Washington’s state and local taxes per capita increased 8.2% to $6,663 in […]
June 30 , 2023 - Emily Makings
Happy Fiscal New Year’s Eve!
Today is the last day of state fiscal year 2023 and the last day of the 2021–23 biennium. Tomorrow is the first day of the 2023–25 biennium, which comprises fiscal years 2024 and 2025. The operating budget and other legislation enacted this year appropriated $69.804 billion from funds subject to the outlook (NGFO) for 2023–25, […]
June 29 , 2023 - Emily Makings
No paid family and medical leave deficits in sight, after cash influx from state general fund
The paid family and medical leave program has been in deficit several times since Spring 2022. (Our report about the program’s problems is here.) The monthly ending balance of the family and medical leave insurance (FMLI) account has been negative six times, including this April (see the chart below). At the April meeting of the […]
June 26 , 2023 - WRC
New brief: Seattle’s Payroll Expense Tax is Highly Concentrated and Shaping Up to Be a Volatile Revenue Source
The City of Seattle adopted the payroll expense tax (PET) in July 2020. The rate of the tax varies from 0.7%–2.4% depending on the total payroll expense of a business and the amount of an employee’s compensation. The PET is the city’s fourth-largest tax source, behind property, business and occupation, and retail sales taxes. In […]
June 14 , 2023 - Emily Makings
Capital gains tax revenues, school construction, and volatility
As I wrote last month, capital gains tax collections for FY 2023 were significantly higher than forecasted. By statute, the first $500 million collected in a year will go to the education legacy trust account (ELTA), a fund subject to the outlook (NGFO). Anything over that will go to the common school construction account (CSCA). […]
May 25 , 2023 - Emily Makings
Capital gains tax collections have come in higher than anticipated
The state’s March 2023 revenue forecast assumes that capital gains tax revenues will total $248.0 million in fiscal year 2023 (which ends on June 30). All of that would go to the education legacy trust account (ELTA). By statute, the first $500 million (adjusted for inflation annually) in collections goes to the ELTA (which is […]