Washington to have a projected $1.4 billion shortfall by the end of the biennium

This morning the state’s Economic and Revenue Forecast Council projected drastic decreases in state revenue—the estimate indicates revenues for the 2019-21 biennium will be down by about $4.5 billion. The sharp drop in revenue is attributable to the unprecedented COVID-19 crisis, which has sent the national economy into a recession.

The subsequent 2021-23 biennium’s projected revenues are also projected to be down by $4.3 billion, equating to a nearly $9 billion drop over three years. This dramatic decline in revenue will leave the state with a $1.4 billion shortfall in the current budget, even when considering federal stimulus money.

Ahead of the budget projections this morning, Governor Inslee announced cancellation of pay raises for those exempt or management service state employees, who were scheduled to receive three percent pay raise, and over 40,000 state employees will have to take furloughs. These furloughs of one day a week in July, will equal about a 20-percent pay cut that month, and are to be followed by one furlough day a month through the fall. Inslee also called on higher education institutions and separately elected officials to adopt these measures as well.

Even with all these cost cutting measures being taken now, the state will face further cuts to spending. What does this mean for the most important programs to ports—programs ports rely on to help create and sustain jobs in their communities? WPPA staff is currently analyzing the data released today and will need to review further details being released later in the week about specific budgets. We will plan to have a detailed message about what ports can expect going forward by Friday, June 19th.

As always, we continue to advocate for ports’ critical role in revitalizing Washington’s economy – the ultimate solution to the state’s budget crisis -- and will ensure lawmakers and other state-level decision makers understand what programs and services are key to this vital function ports play.