September 24, 2021
At its quarterly meeting today, the state Economic and Revenue Forecast Council (ERFC) updated its forecasts of state revenues. These new forecasts add more than $1.8 billion to the amount available over the current biennium and next bienniums.
Budget reports from legislative fiscal committees typically roll up four accounts: the general fund–state, the education legacy trust account, the Washington opportunity pathways account and the workforce education investment account. Budgeteers refer to the roll-up as “funds subject to the outlook” (NGFO). Under the four-year balanced budget requirement, positive ending balances are required for both the current and the following bienniums for the NGFO as a whole.
For the NGFO, the new estimate of revenue for the just ended for the soon to end 2019–21 biennium is $53,132 million; this is $40 million less than had been forecasted in June, when the ERFC last met. The forecast for the 2021–23 biennium increased by $927 million to $59,341 million. The forecast for the 2023–25 biennium increased by $931 million to $63,082 million.
From 2017–19 to 2019–21, the forecasted NGFO growth rate is now 15.3%. From 2019–21 to 2021–23, the forecasted NGFO growth rate is 11.7%. From 2021–23 to 2023–2025, the forecasted NGFO growth rate is 6.3%.
As always, the ERFC also adopted optimistic and pessimistic alternative revenue forecasts for the general fund–state (which produces 95% of total NGFO revenue). Under the optimistic scenario, revenue exceeds the baseline forecast by $2,962 million in 2021–23 and by $5,642 million during 2023–25. Under the pessimistic scenario, revenue falls short of the baseline forecast by $3,046 million during 2021–23 and by $5,750 million during 2023–25. The ERFC assigns a 20 percent probability to the optimistic scenario and a 30 percent probability to the pessimistic scenario.Budget , Economy.