May 11, 2007
A front page story in this morning’s Olympian notes that state revenue collections have been $141 million “higher” than expected since the last revenue forecast update in March. As the article indicates, the March forecast presumed that the weakening housing sector would be a significant drag on consumer spending and state revenue growth. Strong aerospace and software sectors and overall good job growth seem to be countering the housing effects.
The higher revenue collections are not “official” until they are incorporated into the next revenue forecast update which is scheduled for June 14. Based on the budget enacted by the legislature last month, the ending reserve was projected to be $724 million. The additional revenue collections received over the past two months would increase the total budget reserve to $865 million.
The state revenue forecast will be adjusted again in September and November before the Governor submits her 2008 supplemental budget recommendations to the legislature in December.