The Washington State Economic and Revenue Forecast Council released its quarterly revenue forecast Thursday morning, and it indicated that, although there are some bright spots on the horizon, our economy is still not back on track.
The council’s executive director, Dr. Arun Raha, reported that the revenue forecast for the 2011-2013 biennium is now $122 million lower that it was just two months ago, bringing the current budget shortfall to about $2.1 billion. That’s the difference between the spending outlined in the biennial budget adopted by the Legislature earlier this year and the now-anticipated revenue for the period, allowing for an ending balance of about $400 million as a reserve.
During his report, Dr. Raha made the following points:
· Our economic recovery is threatened by events outside the state of Washington – mainly, the European debt crisis and the political gridlock in Congress.
· Washington’s employment numbers are not great – but Boeing is doing well, as is the software industry.
· State and local governments are shedding jobs, including 900 from the state’s liquor system due to the imminent privatization of hard-liquor sales under the ballot initiative approved by voters this month.
· Consumer confidence is still weak.
The Legislature will begin a special session Nov. 28 to address this budget situation. Our budget writers have been working for several weeks now developing options, finding more efficiencies and cuts, and looking for additional reforms.
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