Playing 'Carnac the Magnificent' on the budget

March 28, 2012

Today marks day 188 since Governor Gregoire called on lawmakers to balance the budget. Based on this report from the Associated Press, surpassing 200 days without a balanced budget doesn't seem too far fetched:

The special session is now more than half over, and legislative action thus far has been 'pro forma,' meaning no floor votes or committee meetings have taken place, and most of the lawmakers are not at the Capitol.

Most of the action has between leadership and budget writers, who have been working behind the scenes and having regular meetings with the governor and her budget director in efforts to strike a deal.

If lawmakers aren't able to reach a deal, there are two options: Gregoire either calls them back for another special session, or she decides instead to make across-the-board cuts to state programs, something she has repeatedly said she won't do because of concerns about deep cuts — especially in areas of public safety.

Senate Democrats' chief budget writer, Sen. Ed Murray, said Wednesday that they'll probably know better whether another special session will be needed within the next few days.

'I think every day we're here, it's closer to that possibility,' he said.

If lawmakers get called back again, it would be the third special session for lawmakers to deal with the supplemental budget. They spent nearly three weeks in a special session that ended mid-December, weeks before the regular session started in January.

Trying my best Johnny Carson impersonation of Carnac the Magnificent, I pulled this answer out of my budget envelope back on March 8 concerning what to expect during the special session:

They leave, no agreement reached, Governor issues an executive order that takes effect July 1 (after revenue forecast) for across the board cuts unless Legislature comes back and fixes budget in hopes they get about $300 million in the June forecast to take away the apportionment and pension issue and then come back for a special session.

Hopefully I'm wrong but so far I get to keep my feather hat.

As for the new proposed accounting change for local sales tax revenue:

  • Making the accounting change for cash management purposes – fine
  • Assuming the $238 million in money owed to local governments is available for state spending – bad; budgeting as usual with duct tape and barbed wire.

If after making this accounting change (monthly transfer instead of daily) there truly is $238 million in excess funds, that money should be returned to local governments as a one-time windfall since it is local tax revenue instead of being booked for the state’s reserves.

If that can’t occur one has to wonder whether the money is truly available for state spending in the first place.

Lawmakers must ultimately adopt a sustainable budget balanced within the revenue forecast without using any gimmicks (felony, misdemeanor, creative, or otherwise).