This morning, the non-partisan Economic and Revenue Forecast Council (ERFC) released its quarterly forecast of state revenues and economic activity. This forecast provides the Legislature with the final data needed to finalize supplemental operating, capital, and transportation budgets. I expect House and Senate budget proposals to emerge over the next week.
The Economic and Revenue forecasts continue to show Washington’s economy on a remarkable rebound from pandemic-related curtailments.
- The forecast predicts Washington will outperform the national economy in both personal income growth and employment for 2022-2025.
- State revenues are now forecast to increase by $1.453 billion in the current biennium (to $61 billion) and increase by $1.3 billion in the following biennium (see slide below)
- Additionally, Washington has $1.3 billion in federal COVID relief funds still available for general fund appropriations.
- On a cautious note, the EFRC showed that in January, prices rose at the fastest pace since 1982 (see slide below). They comment that inflation is expected to ease as supply chain disruptions are ironed out.
- Finally, the EFRC predicts Washington’s economy will continue to grow jobs at a healthy pace over the next four years.
This forecast will ease concerns by some legislators about transferring state general fund revenues to bolster funding for new transportation projects.