State budget writers receive good news
Thanks to the recent passage of federal tax reform the state is projected to have more than 20,000 new jobs per year and approximately $85 million in additional revenue for the budget. This according to the state's Chief Economist Steve Lerch. Lerch provided this good news to the Senate Ways & Means Committee yesterday. Here are additional details from his presentation:
- "Assuming JCT estimate of tax reform impact on employment of 0.6%, Washington employment would be roughly 20,000 to 21,000 jobs per year higher than our November 2017 forecast. For 2018, this would mean total nonfarm employment of 3,440,000 in Washington.
- Assuming JCT estimate of tax reform impact on business investment of 0.9%, Washington business capital investment would be $500 to $700 million higher in 2018.
- Washington share of personal tax cuts in 2018 would be roughly $3.3 billion, or 0.8% of personal income.
- Ballpark impact on revenue collections in 2018: $85 million."
Lerch also told the Ways & Means Committee the state's November revenue forecast didn't assume passage of federal tax reform. This means the state's February revenue forecast will likely include these projected higher state job and revenue growth numbers as result of its adoption.
Already state monthly revenue collections were coming in above the November forecast as noted by the January monthly update:
- "Major General Fund-State (GF-S) revenue collections for the December 11, 2017 - January 10, 2018 collection period came in $87.8 million (5.9%) above the November forecast.
- Cumulatively, collections are now $121.4 million (3.4%) higher than forecasted."
Even before this good news the November revenue forecast showed that state revenue was projected to grow "13.7% between the 2015-17 and 2017-19 biennia."
The legislature's 2018 supplemental budget proposals will likely be available soon after the February 15 revenue forecast.
One side note on yesterday's Senate Ways & Means hearing, the committee heard remote testimony from a policy analyst out of Washington D.C. It is good to see the Senate continue to provide this opportunity but it would be even better if average citizens across Washington could also provide remote testimony. Currently no hearings are scheduled in the Senate offering general remote testimony. There is potentially exciting news developing, however, as reported by the Columbia Basin Herald:
"The state Senate has had remote testimony since the launch of a pilot project in 2014. Though the House has lagged behind, House Republican Caucus Chair Rep. Matt Shea, R-Spokane Valley, said that both legislative chambers will likely see remote testimony by the 2019 session.
Shea said he has been working with the chief clerk of the House to fix the technical barriers to implementing video-conferencing. Though details are still being finalized, testimony would likely be broadcast from the city halls of population centers, such as Spokane, Shea said."