April 24, 2021
The conference report for the operating budget would appropriate $52.562 billion for 2019–21 (a decrease of 2.1% from the 2020 supplemental, but an increase of 17.6% over 2017–19) and $59.193 billion for 2021–23 (an increase of 12.6% over revised 2019–21 appropriations). These figures are in terms of funds subject to the outlook (NGFO); they fall between the amounts included in the budgets previously passed by the Senate and House.
However, the conference report would appropriate $122.633 billion from all funds in 2021–23. That’s 9.1% over revised 2019–21 appropriations, and it’s more than either the Senate- or House-passed budget would have appropriated from all funds.
The budget balances over four years, leaving an unrestricted ending fund balance of $98 million in 2023–25. As in the House-passed budget, it balances without assuming 4.5% revenue growth in the second biennium. (We wrote about the Senate- and House-passed budgets here.) The budget assumes passage of the capital gains tax (as amended in conference yesterday), which is estimated to increase NGFO revenues by $415 million in 2021–23 and by $840 million in 2023–25. The budget also assumes passage of SB 5315 (captive insurance), and E2SHB 1277 (a non-NGFO recording fee to fund housing programs).
The budget drains the budget stabilization account (BSA, or the rainy day fund) in 2019–21. Of the $1.820 billion transferred to the general fund–state, $1.0 billion would then be transferred to the new Washington rescue plan transition account. As we noted in our brief on the budgets, this is effectively a shadow reserve account that is not subject to constitutional restrictions.
The spending numbers above do not include the billions in federal relief funds that are flowing to Washington. One pot of federal relief money is the Coronavirus state fiscal recovery fund (CSFRF), from which Washington is expected to get $4.253 billion. From the CSFRF, the conference report appropriates $2.034 billion in the operating budget, $1 billion in the transportation budget, and $400 million in the capital budget. (This means there is about $819 million unallocated at this time.)
Interestingly, there are two contingent appropriations. The CSFRF is used to fund ESSB 5478 (unemployment insurance tax relief); if that is not a permissible use of the fund, the $500 million for the bill will be funded from the WA rescue plan transition account. Second, if E2SHB 1277 is not enacted, the appropriations funded with the revenues from the bill would instead be funded by the CSFRF ($272 million) and the WA rescue plan transition account ($20 million).Categories: Budget.
Tags: 2019-21 , 2021-23