Washington state budget (2009-2010)

Washington's faces a $5.3 billion budget shortfall through June 2013 and lawmakers were working in a special session to draft the state's FY2012-13 state budget that would eliminate that shortfall.^[1]

For the budget year, the Washington state legislature passed a state budget on April 13, 2010, at the conclusion of a special session.^[2] On May 4, 2010, Gov. Christine Gregoire signed a revenue package that nets roughly $780 million to avoid deeper cuts in education, health care and human services, which adjusted the previously passed two-year state budget, which lasts through mid-2011.^[3] Gregoire, a second-term Democrat, said the tax package was a reasonable response to the estimated $2.8 billion budget deficit that the Democrat-controlled Legislature confronted in its recently concluded special session.^[3] Two other special sessions were required to close a projected $1.1 billion shortfall in FY2011 and in a special session had made cuts in funding to K-12 schools, colleges and universities, and social services.^[4]

Washington had total state debt of $30,455,510,003 when calculated by adding the total of outstanding debt, pension and OPEB UAAL’s, unemployment trust funds and the 2010 budget gap as of July 2010.^[5]

2009-11 Biennial State Budget[edit]

See also: Archived Washington state budgets

Since December 2010, the state Legislature had worked to close a projected $1.1 billion shortfall in FY2011 and in a special session had made cuts in funding to K-12 schools, colleges and universities, and social services.^[8]

Special Sessions[edit]

With the state facing a $550 million deficit despite prior cost cutting, the legislature negotiated a deal to address the deficit by cutting funding to several state programs, including the state's health-care program for the poor and aid for the disabled, and also transferring funds from other programs. The plan cuts the deficit by about $370 million, with about $242 million in cuts and $125 million in transfers.^[9]

In Dec. 2010, the National Conference of State Legislatures said that the state faced a midyear shortfall of $1.1 billion, which represents 7.1% of the FY2011 state budget.^[10] Lawmakers met in a special session in December 2010 and cut about $590 million from that shortfall.^[11] House Democrats released a budget bill on January 18, 2011, which would trim another $340 million by cutting $216.5 million and transferring $123.8 million from other sources.^[11] Treasurer Jim McIntire, who had argued for swift budget-balancing to preserve the state's credit rating.^[11]

Gov. Gregoire signed an order on September 13, 2010, that would require budget cuts.^[12][13] The cuts would be around 6.3%^[14], which was required to balance the budget before the end of the fiscal year in June 2011.^[12] The legislature can make adjustments when it returns in January 2011.^[12] As part of those cuts, state agencies eliminated 725 jobs, with most of the layoffs occurring at the Department of Social and Health Services.^[15]

Gov. Gregoire signed on May 19, 2009, the 2009–11 biennial budget passed by the Washington State Legislature that addressed a potential $9 billion shortfall (March 2009 estimate) for the coming two-year period.^[16] Gov. Gregoire referred to the state's revenue shortfall from November 2008 as being "pushed off a cliff." In November 2009 the Governor announced, "The state was now facing a new shortfall estimated at around $1.7 billion (estimates as high as $2 billion over its two-year biennium) that must be closed in the 2010 supplemental budget," which she would propose in December^[17] and asking all state agencies to report the impact of a 2% to 5% cut in their FY 2010 budgets.^[18]

The budget eliminates nearly $755 million from state programs.^[2] The governor warned that some 1,500 workers would be laid off because of budget cuts and the state was closing or downsizing five youth or adult corrections facilities for the first time in years.^[3] The budget also relies on federal funds totally approximately $625 million and roughly $600 million in fund transfers and reserves.^[3] Gregoire vetoed transfers of money away from the state insurance commissioner's office and a fund for biotechnology research and reduced the legislature's planned reserves by about $30 million.^[3] Tax increased in the budget were expected to raise approximately $780 million in revenue, mostly from taxes.^[2] The budget leaves around $480 million in reserves to guard against higher-than-expected state costs or drops in tax collections.^[2]

Shortly after passage of the budget, the governor floated ideas for raising revenue, including privatizing the ferry system and selling naming rights to highways or rest stop in response to news that the state faces a projected shortfall of about $3 billion for the next biennial budget. The governor noted that tax streams may not rebound to pre-recession levels for a very long time and assembled experts to focus on budget issues.^[19]

Tax increased in the budget were expected to raise approximately $780 million in revenue, mostly from taxes.^[2] Highlights of those taxes in the new budget included:

• extend the state sales tax to bottled water, candy and gum^[20]
• two-cents more per can tax on soda pop^[20]
• 28 cents more tax per six-pack of mass produced beer, although microbrews were exempt^[20][3]
• $1 more tax on cigarettes^[20][3]

The 2009–11 biennial budget signed in May 2009 closed the $9 billion shortfall by:^[21]

• $3.3 billion in program cuts
• $3 billion with the federal Recovery Act funds
• $2.1 billion by freezing state pay levels and transferring funds
• $400 million from the state's Rainy Day Fund
• $300 million from early reductions

The $3.3 Billion in Cuts and Efficiencies included:

• $600 million in K-12 through class size increased.
• $557 million in higher education by reducing 1,800 employees and raising tuition 14% (universities), 7% (community colleges) per year.
• $386 million through administrative or across-the-board cuts.
• $255 million from Basic Health Plan by increasing premiums 70% and reducing enrollment by 36,000 (36%).
• $127 million in payments to hospitals.
• $130 million from Corrections, including $73 million by reducing beds and community supervision.

Sources of the estimated $2 billion shortfall:^[22]
Revenues declines

• $686 million June forecast
• $238 million September forecast
• $237 million tax lawsuit
• $32 million October revenue collections
• $65 million November revenue collections

$1.26 billion subtotal
Costs rising, issues emerging

• $659 million increased demand for health care, schools, prisons
• $12 million forest fires, landslides, dam failures, other possible emergencies
• $71 million lawsuits blocking planned cuts

$742 million subtotal

Gov. Gregoire's November 16, 2009 presentation The Budget Story outlined 70%, $21.6 billion as "protected" and $9.3 billion as "non-protected" categories for the $31 billion 2009–11 biennial budget. The non-protected areas listed for cuts in Gov. Gregoire's presentation are:^[23][24]

• Mental health and developmental disabilities services: $1.6 billion
• Prisons/community supervision of offenders: $1.6 billion
• Care for low-income elderly: $1.3 billion
• Economic support for low-income families: $1.1 billion
• K-12 non-basic education funding (class size reduction, others): $635 million
• Higher education: $500 million (most was financial aid)
• Juvenile corrections: $198 million

The budget timeline is:^[25][26]

• Mid-December Governor’s Supplemental Budget released
• January 11, 2010 the 2010 Legislature's Regular Session begins
• Feb. 18, 2010 revenue forecast released
• March 11, 2010 session adjourns

Ballot Initiatives[edit]

The Nov. 2, 2010, election featured initiatives and a referendum, all of which could alter the state budget landscape.^[27] Many would lessen the stream of money flowing into the state treasury, although the income tax on high-earning residents would bring in additional funds.^[27]

• Initiative 1098 proposes to tax income above $200,000 a year for individuals and $400,000 for couples. It would raise $1.58 billion in new net revenues in calendar year 2012 and could grow to $2.28 billion in 2013.^[27] If passed, it would face legal challenges.^[27]

• Initiative 1107 was a measure to repeal temporary taxes on soda and bottled water as well as a permanent sales tax on candy. If it passes, it would erase $107.8 million in projected revenues in 2012 and $109.7 million in 2013.^[27]

• Initiative 1100 was one of two liquor-privatization proposals, and this one, if passed, would shut down state-run liquor stores and a distribution center by the end of 2011.^[27]

• Referendum 52 was a measure provided for an energy-upgrade for public schools and buildings under which the soda tax would take effect in 2014, which was expected to generate at least $33.9 million the first year.^[27]

• Initiative 1105 was the second liquor-privatization measure on the ballot. It would shut down state-run stores and distribution facilities by April 2012.^[27]

• Initiative 1082 would allow private insurers compete in the state's workers’ compensation market.^[27]

• Initiative 1053,would require a two-thirds supermajority vote for any Legislature-enacted tax increase to pass, but it allows an option to put the measure to a public vote. It essentially restores the two-thirds vote requirement that was in effect after voter passage of I-960 but was suspended by majority Democrats this year through mid-2011.^[27]

Budget background[edit]

See also: Washington state budget and finances

Washington operates on a biennium budget. The biennium included a 24-month period from July 1st of odd-numbered years to June 30th of odd-numbered years, such as the 2009-11 biennium, which runs from July 1, 2009 to June 30, 2011. According to state law the Governor was required to submit a budget recommendation by December. Although the biennium included two fiscal years, an approved budget the legislature can modify the budget through changes to the original appropriations. This can be done in any legislative session. Since 1979 the House and the Senate enact revisions annually to the state’s biennial budget. These revisions were referred to as supplemental budgets.^[28]

The Economic and Revenue Forecast Council was composed of representatives from both the legislative and executive branches. Each fiscal quarter, the Council adopts an official forecast of General Fund-State (GF-S) revenues for the current and (at some point) the ensuing biennia. These forecasts, together with any reserves left over from previous biennia, determine the financial resources available to support estimated expenditures.^[29]

Sources of State Revenues − All Governmental Funds 2009-11 Biennium Estimates^[30]

Budget figures[edit]

The state's budget shortfall had increased to $2.8 billion.^[31]

General Fund^[33]

Fiscal 2010 Tax Collections Compared With Projections Used in Adopting Fiscal 2010 Budgets (Millions)^[33]

See also: Washington state budget (2008-2009)

Accounting principles[edit]

See also: Washington government accounting principles

Washington State Auditor's Office looks at financial information and compliance with state, federal and local laws on the part of all local governments, including schools, and all state agencies, including institutions of higher education. The State Auditor's Office publishes its audit reports online. The State Auditor's Office was established in the state's Constitution as part of the executive branch of state government. Washington citizens elect the State Auditor to four‑year terms. Brian Sonntag had been State Auditor since first elected in 1992.^[34][35]

The Institute for Truth in Accounting (IFTA) rates Washington “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA did not consider Washington's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis did not included significant liabilities for the pension plans and for other post employment benefits, such as health care.^[36] Washington's CAFRs were publications of the Washington Office of Financial Management in accordance with Revised Code of Washington 43.88.027. Victor A. Moore was appointed Director of OFM in January 2005. The Office of Financial Management:^[37][38]

• Plays a central role in budget planning, policy development, and fiscal administration for the executive branch.
• Prepares the executive budget proposal and monitors budget implementation.
• Maintains state government's statewide accounting systems, central books of accounts, and financial databases while also providing accounting services to state agencies.
• Oversees statewide personal service contracting activities.
• Conducts executive policy research and develops legislation to support the Governor's policy goals.
• provided estimates of state and local population, monitors changes in the state economy and labor force, and conducts research on a variety of issues affecting the state budget and public policy.
• provided a comprehensive risk management program for all state agencies.

Budget transparency[edit]

The State of Washington had an official spending database online, thanks to the passage of Washington Senate Bill 6818, Promoting Transparency in State Expenditures, a bill that had mandated the creation of such a database by January 1, 2009.^[40][41]

The following table was helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
Washington State Fiscal Information		N	N	N		N

See also: Evaluation of Washington state website

On July 19, 2010, Gov. Gregoire launched a website called Transforming Washington's Budget for citizens to contribute their ideas. The site said, "We know you've got ideas on how to transform the budget and we want to hear them. Share the ideas that matter to you."^[42] The governor also held public hearings on the budget.^[43][44]

Public employee salary information[edit]

One man by the name of Louis Bloom had assembled (via FOIA) a very thorough listing of 2007 Washington State Employees, Job Title and Salaries.^[45]

See also[edit]

Washington government sector lobbying

Washington public pensions

Washington state budget and finances

External links[edit]

• Transforming Washington's Budget, where citizens can contribute their ideas.

Additional reading[edit]

• Gov. Gregoire's 2009-2011 budget proposal

Footnotes[edit]

v • e Budget policy Budget background Government budgets • Cost of state transparency websites • State budget issues • Public employee salaries • Public pensions • States with spending online • Glossary of state budget terms • Total state expenditures • State spending by function as a percent of total expenditures State budget and finance pages Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming Tax policy background Personal income tax • Sales tax • Corporate income tax • Property tax • Excise taxes • Estate and inheritance taxes • Capital gains tax State tax policy pages Alabama • Alaska • Arizona • Arkansas • California • Colorado • Connecticut • Delaware • Florida • Georgia • Hawaii • Idaho • Illinois • Indiana • Iowa • Kansas • Kentucky • Louisiana • Maine • Maryland • Massachusetts • Michigan • Minnesota • Mississippi • Missouri • Montana • Nebraska • Nevada • New Hampshire • New Jersey • New Mexico • New York • North Carolina • North Dakota • Ohio • Oklahoma • Oregon • Pennsylvania • Rhode Island • South Carolina • South Dakota • Tennessee • Texas • Utah • Vermont • Virginia • Washington • West Virginia • Wisconsin • Wyoming Comparative analysis of state debt Federal outlays to state government (2014-2017) • State tax revenue projections and shortfalls (2020-2021) • Proportion of state government general revenues from the federal government (2014-2018) • State debt per capita (2014-2018) • State unfunded public pension liabilities, 2003-2018

	v • e State of Washington Olympia (capital)
Elections	What's on my ballot? | Elections in 2025 | How to vote | How to run for office | Ballot measures
Government	Who represents me? | U.S. President | U.S. Congress | Federal courts | State executives | State legislature | State and local courts | Counties | Cities | School districts | Public policy