OLYMPIA, WA – The latest quarterly state revenue forecast shows Washington state’s operating budget is headed into negative territory despite this year’s passage of a state-record $12.2 billion, four-year package of tax increases.
The third-quarter forecast shows revenue collections for the 2025-27 budget cycle falling $412 million from the June forecast.
Projections for the 2027-29 budget cycle show a further $477 million drop, which, combined with the current deficit, could bring the four-year outlook to a shortfall of approximately $1.2 billion.
Sen. Chris Gildon, R-Puyallup, a council member, criticized the Democratic budget plan, saying the state’s financial position would be stronger under the Senate Republicans’ “$ave Washington” plan, which he described as a no-new-taxes approach. Gildon also noted that families in Washington paid $5,276 more in state and local taxes in 2023 than the average U.S. household, before this year’s record tax increases.
Gildon further cited additional costs not accounted for in the budget, including lawsuits, ongoing information-technology projects, and an unfunded public-employee pay raise. He suggested the Legislature and governor could call a special session to address the spending but said it is more likely the situation will be attributed to federal factors rather than state budgeting decisions.
