The official state revenue forecast released today is little changed from the September report.

Overall changes to the revenue forecast are slight. Forecasted revenue for the current biennium has been increased by $8 million, with a $31 million positive variance in collections since the September forecast partially offset by a weaker forecast going forward. Forecasted revenues for the 2013-15 and 2015-17 biennia have been decreased, but by relatively small amounts.

The forecast for the 2013-15 biennium has been decreased by $88 million and the forecast for the 2015-17 biennium has been decreased by $163 million. Both reductions represented less than one-half of one percent of biennial revenue. Forecasted GF-S revenue is now $30.477 billion for the current biennium, $32.561 billion for the 2013-15 biennium and $35.355 billion for the 2015-17 biennium.

Risks remain high, with a 35 percent probability assigned to the pessimistic alternative. 

Today the Economic and Revenue Forecast Council also presented the four-year budget outlook, as required by legislation. (Background here.) Again, no big surprises. Before applying reserve funds, the state faces a $904 million deficit in 2013-15 and a $1,072 shortfall in 2015-17. 

It's worse than that, however, because the estimated do not include funding to meet the increased support for K-12 education called for by the state Supreme Court's McCleary decision. Most analysts peg the downpayment for that at $1 billion. Here's the relevant discussion in the outlook methodology:

…this excludes the costs of policy enhancements, including new collective bargaining agreements not approved by the Legislature, other proposed compensation increases, costs of any adverse court rulings within 90 days of each respective legislative session, and the phase-in of K-12 McCleary related funding.  

And of course there's the need to provide a reserve cushion. Consider the shortfall in the neighborhood of $1.5-$2.0 billion in the 13-15 biennium. It's a pricey neighborhood.

Next month the governor will release her final biennial budget, the likely starting point for the Inslee administration. She's said it will contain tax increases. 

(reposted from 11/14/12)