December 18, 2008

Gregoire proposes an almost-balanced, no-new-taxes budget

By Amber Gunn

Olympia—Today Governor Christine Gregoire released her 2009-11 budget proposal, a budget she described as “ugly.” She addressed what is speculated to be a $5.1-$6 billion gap between expected revenue and planned spending by making cuts in such things as the state’s Basic Health Plan, post-secondary education, the state’s Film Office, as well as closing of a number of state parks.

Governor Gregoire acknowledged that it’s time for state government to “live within its means.” We applaud her “no new taxes” budget and hope that the legislature will take the same position. For her to have a budget that truly lives within our means, she will need to reduce spending by another $500 million. This is the difference between the state’s revenue forecast and her budget proposal.

The latest revenue forecast indicates the state will have $30.1 billion to spend for the 2009-11 budget, 5 percent more than current revenue. But planned increases in spending would outpace that by billions, which is where the budget gap comes in.

“Lawmakers have approved spending increases of 33 percent over the last four years, so living within the taxpayers’ reduced means right now is difficult for them. They will have to get used to dealing with reality, just like we are,” said Bob Williams, President of the Evergreen Freedom Foundation.

“The solution for this is pretty simple,” said Amber Gunn, economic analyst for the Evergreen Freedom Foundation. “The first order of business for the legislature is to pass a supplemental budget to permanently reduce the current budget by $500 million—that’s just1.5%—and this would multiply into a $2.5 billion savings over the next two years.”

“Second,” noted Gunn, “this is the time to get serious about the priorities of government. If the Ways and Means and Appropriation Committees divide themselves into POG groups (Priorities of Government), they could work with agencies and legislative members of policy committees to responsibly prioritize state spending.”

Gunn continued, “Revenue growth has slowed from the historically high increases of recent years, but the legislature will have $300 million more to spend for the next budget, or $890 million more when the governor's savings are included. It is not a crisis; it is not a cut. It is simply less growth than planned.”


General Fund Budget and Revenue Growth
(Dollars in Billions)



*Proposed by Governor


More information:
How to build a sustainable budget

Amber Gunn is Director of EFF’s Economic Policy Center. She serves as a voting member on the American Legislative Exchange Council’s Tax and Fiscal Policy Task Force and is often consulted by media outlets and legislative staff for issue briefs and policy analysis. Prior to joining EFF full time, she was a Charles G. Koch Fellow in partnership with the State Policy Network. Amber holds a B.A. in Political Science and Spanish from the University of Washington.

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