Inslee reduces operating budget spending increase

Inslee reduces operating budget spending
Governor Jay Inslee has vetoed portions of the 2020 supplemental budget in anticipation of decreased state revenue due to the COVID-19 outbreak. Photo: freepik.com

Governor Jay Inslee signed the 2020 supplemental budget on April 3 after vetoing spending provisions in anticipation of decreased state revenue due to the COVID-19 outbreak. In total, the vetoes reduced the increase in state spending by $445 million for the next three years.

Although the vetoes avert the need for a special session, Inslee said in statement: “it is all but certain that we will need to make adjustments to our next budget cycle and we must get started now. When lawmakers approved the supplemental budget three weeks ago, the latest projections indicated the state would have nearly $3 billion in total reserves at the end of the biennium. But the state’s fiscal outlook has deteriorated dramatically since then.”

The vetoes stand in stark contrast to recent years in which the state has enjoyed billions in unanticipated revenue that, along with new taxes, has enabled lawmakers to increase spending by 59 percent since the 2013-15 biennium – a move which has drawn both concern and caution from some in Olympia.

Foreshadowing Inslee’s move was the final budget approved by the legislature several days after Inslee declared a state of emergency regarding COVID-19. The budget spent hundreds of millions of dollars less than either chamber’s initial proposals – though it still increased total spending by almost $1 billion before Inslee’s vetoes.

“A case could have been made for vetoing every bit of new spending that doesn’t support the state’s COVID-19 response,” Senate Ways and Means Ranking Member John Braun (R-20) said in a statement. “That would save more than $700 million dollars in the current budget – money that could be redeployed toward public-health or economic-recovery measures down the way or saved to lessen the budget deficit we will likely face in 2021.”

Among the provisions vetoed is $250,000 for a public bank study, which Inslee said “has already been studied at length during the past three years.”

Other vetoed items include:

  • $4 million for the Washington State Office of Equity;
  • $34 million for paraeducator training;
  • $41.3 million for the Workforce Education Investment account;
  • $50 million for the Climate Resiliency Account; and
  • $115.7 million for guidance counselors.

The extent to which the state must reduce spending will ultimately depend on the state Economic and Revenue Forecast Council (ERFC). Under the state’s balanced budget requirement, operating budget spending over a four-year period cannot exceed ERFC revenue forecasts. The council’s next revenue forecast update will be released in June.

Total state spending has increased from $33.9 billion in the 2013-15 biennium to roughly $54 billion for the current biennium with the 2020 supplemental included. Much of that added spending resulted from a 2012 State Supreme Court decision that found the state was failing to fully fund basic education.

The state now spends $12 billion more per biennium on K-12 than in the 2013-15 operating budget:

  • $7.9 billion on general apportionment;
  • $1.47 billion (or double) the amount on special education;
  • $435 million on the learning assistance program (LAP); and
  • $492 million on pupil transportation.

Other operating budget spending increases since 2013-15 include:

  • $4.6 billion on “other human services” such as the Washington Health Care Authority;
  • $330 million on government operations;
  • $1 billion on higher education spending; and
  • $800 million on the Department of Social Health Services.

The next ERFC meeting is on June 2.

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