OLYMPIA – Washington’s projected Near General Fund revenue collections for the 2023–25 state budget decreased by $477 million to around $66.5 billion — about a 0.7% decrease from the February 2023 projection, according to estimates released today by the Washington State Economic and Revenue Forecast Council.

This forecast also estimates the Near General Fund revenue for the next biennium (2025–27) at around $71.5 billion, a decrease of $189 million, or about 0.3%, from the February forecast. The next biennium begins July 1, 2025. This brings the total decrease in the forecast over the four-year period to around $666 million.

According to Forecast Council, the reduction in projected revenue comes from a lower forecast of home construction, personal income, and lower receipts of capital gains tax than was projected in February.

Quotes

“While revenue growth has slowed, Washington personal income and employment forecasts suggest faster growth ahead,” noted Dave Reich, executive director of the Economic and Revenue Forecast Council. “However, the latest revisions since the February forecast include downward revisions over both the 2023–2025 and 2025–27 biennia.”

Why it matters

The forecasts for Near General Fund revenue collections are critical signals regarding the state’s fiscal health and availability of resources for various state services. The Legislature is required by law to enact an operating budget that is balanced over four years, and the Near General Fund accounts for most of that state operating budget.

A guide to the Washington state budget process can be found on the OFM website.

What’s next

• State agencies will submit budget requests to OFM in September, for consideration for the Governor Jay Inslee’s 2023–25 biennial budget proposal to the Legislature.
• The next revenue forecast is scheduled for September 27, 2024. Revenue review meetings are broadcast on TVW, with scheduling details available beforehand on the ERFC website.

About the Economic and Revenue Forecast Council:

The Economic and Revenue Forecast Council supports statewide goals by accurately forecasting economic activity and state tax revenue for Washington state.  ERFC is comprised of both legislative and executive members and the State Treasurer. Four times a year the organization adopts a bipartisan revenue forecast that is then used to build the state operating budget. The ERFC is also charged with providing the state budget outlook to increase transparency and to promote state government financial stability.

About the Office of Financial Management:

The Office of Financial Management provides vital information, fiscal services and policy support that the governor, Legislature and state agencies need to serve the people of Washington.