Washington economists forecast an increase in state revenue in the current budget cycle, as well as the two that follow.
The state can expect to collect about $30.5 billion in the current two-year budget cycle, which is $29 million more than June’s forecast, the Economic and Revenue Forecast Council announced today in its quarterly forecast. The 2011-2013 biennium ends in July 2013.
The council’s executive director, Stephen Lerch, said there’s been positive growth in housing and auto sales. On the downside, exports are declining and job growth has been “very very slow,” Lerch said.
Consumers are paying down big chunks of debt, but that means they aren’t going out and making new purchases — which is something to “watch for,” given the state’s reliance on sales tax, Lerch said.
Liquor sales have jumped widely since stores were privatized in June. In May, liquor stores saw a 27 percent spike in sales as restaurants and consumers stocked up. Sales dropped steeply in June, then rebounded in July. Lerch said he’s raised the forecast on revenue from liquor, but it’s “hard to say where the trend is going on liquor sales.”
Budget director Stan Marshburn said the state is still expecting a $500 million shortfall in the current biennium. “This forecast changes it by $50 million, so the problem remains about the same,” he said.
As for 2013-2015, economists are forecasting revenue of about $32.6 billion, which is $23 million more than expected.
For the first time, economists also looked at the 2015-2017 biennium and expect the state will be able to collect $35.5 billion — an 8.8 percent increase.
Watch the full meeting below: