February 19, 2018
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State's tax revenue expected to increase by $1.3 billion above forecasts through 2021

The Economic and Revenue Forecast Council issued its sunniest report in a decade last week. Thanks to a strong economy and the recent federal tax cuts, state government is expected to see big tax receipt increases in the coming years -- $1.3 billion more than previously expected by 2021.

State revenues are projected to come in $628 million higher in the current two-year budget than the council had expected in its last forecast in November. That means the state will have nearly $45 billion to spend this biennium -- good news as legislators release their mid-biennium "off-year" budget proposals.

The forecast is equally rosy for the next biennium (2019-2021), which will see revenues up by nearly $660 million more than previously expected, pushing the state's budget up to a projected $49.1 billion.

"I think it's due to consumer confidence, that employment has been growing, the state's economy has been doing very well," said Steve Lerch, director of the council, according to The Associated Press. "The federal tax changes would be a second piece because that does increase after tax income. We assume that a chunk of that will be spent on things that are subject to the sales tax."

The news is timely, as the Senate released its supplemental budget today and the House is expected to release its plan Tuesday. Budget writers have expressed hope in expediting education spending, as called for by the state Supreme Court. They also want to cut property taxes.

"Our direction was to comply with all of our federal and state court mandates without raising taxes," said Sen. Christine Rolfes, D-Bainbridge Island, the top Senate budget-writer. "And I think we're in a position now to be able to lower them, at least temporarily."

House Republican leader Dan Kristiansen, R-Snohomish, said that while the budget report is good news, he wants lawmakers to be cautious.

"I want to make sure the decisions we're making are sustainable," he said.

The Spokesman-Review also covered the story. The full report is available here.

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