Washington’s projected Near General Fund revenue collections through 2029 decreased by $39 million overall from the June 2024 forecast, according to estimates released today by the Washington State Economic and Revenue Forecast Council.

The forecast is comprised of revenue estimates for the current biennium (2023–25), which ends June 30, 2025, the next biennium (2025–27) and the subsequent biennium (2027–29).

Projected collections for the 2023–25 state budget decreased by $49 million to just below $66.5 billion — about a 0.1% decrease from the June 2024 forecast.

This forecast also estimates revenue for the next biennium (2025–27) at around $71.6 billion, an increase of $79 million, or about 0.1%, from the June forecast.

The forecast revenue for the 2027–29 biennium is reduced by $69 million.

According to the forecast council, the changes in the forecast are primarily the result of a reduced sales tax forecast due to a lower construction forecast, partially offset by stronger revenue from business and operations tax and the real estate excise tax.

Quotes

“Washington’s Near General Fund revenue is projected to be only minimally changed from the last forecast, with revenue growth anticipated to pick up due to continued employment and personal income growth, and moderating inflation,” said Dave Reich, forecast council executive director.

"We will face significant challenges in meeting all our obligations in our next budget,” noted Pat Sullivan, Office of Financial Management director. “There are some tough fiscal choices ahead.”

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.

Transportation revenues also projected

Today marked the first time the revenue forecast for the transportation budget was made by ERFC, for approval by the newly formed Transportation Economic and Revenue Forecast Council. The council was created in a bill enacted in 2023, ESHB 1838.

Compared to the previous forecast in June, projected revenues for the transportation budget are decreased by $137 million (2.0%) for 2023–25, and decreased by $294 million (4.0%) to around $7.1 billion for the 2025–27 biennium.

What’s next

• The next revenue forecast is scheduled for November 20, 2024. Revenue review meetings are broadcast on TVW, with scheduling details available beforehand on the ERFC website.
• OFM has begun work on Gov. Jay Inslee’s proposed 2025–27 budget, which will be rolled out in December.

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 and transportation budgets. 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.