Washington Roundtable Review of State Fiscal Practices Emphasizes Need to Restrain Spending Growth,
Build State Reserve

SEATTLE – FEBRUARY 14, 2006 – Washington state lawmakers should be cautious about increasing spending in the 2006 supplemental budget and save a significant portion of the current surplus to offset future deficits and deferred obligations.  That is the conclusion of an annual review of state fiscal practices, which the Washington Roundtable released today.

“Washington enjoys a surplus this year and we may see an increase is revenue projections tomorrow, but we will still face a deficit in 2007-09,” said Steve Mullin, Washington Roundtable president, “If lawmakers are able to restrain spending growth and focus on targeted priorities, as Governor Gregoire has encouraged them to do, they will have an opportunity to bring stability and sustainability back to the state budget.”

The Roundtable’s 2006 Fiscal Management Performance Review analyzes state performance against specific benchmarks.  Key findings include:

 

• At 10.4 percent, the carry-forward leading into the next biennium is the highest it has been in the last decade. 
• Growth is health care spending is more than triple that of growth in the state general fund.  This level of health care spending growth is unsustainable and it is eating away at funding for other priority services.
• The reserve as adopted in the 2005-07 biennial budget was dangerously low.  Revenue growth has created a surplus in 2006, the majority of which the state should save to offset future deficits and better prepare for future emergencies or unforeseen expenses.

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