OPBlog: Higher Ed Junction

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November Revenue Forecast Estimates Continued Growth

Fri, 2016-11-18 09:48

November Revenue Forecast Estimates Continued Growth

On Wednesday, the Washington state Economic and Revenue Forecast Council released its November revenue forecast, which projected a slight increase to General Fund-State (GF-S) collections over the September revenue forecast. The GF-S revenue forecast increased by $215 million for the current 2015-17 biennium and $137 million for the 2017-19 biennium.

  • Final GF-S revenue collections for the 2013-15 biennium were $33.666 billion.
  • Total projected GF-S revenue for the 2015-17 biennium is now $37.980 billion, 12.8 percent more than the 2013-15 biennium.
  • Total projected GF-S revenue for the 2017-19 biennium is now $40.514 billion, 6.7 percent more than the 2015-17 biennium.
  • Total projected GF-S revenue for the 2019-21 biennium is now $43.656 billion, 7.8 percent more than the 2017-19 biennium.

Behind the numbers:

  • The forecast attributes the higher projections due mainly to increases in retail sales tax and Real Estate Excise Tax (REET) collections.
  • The forecast includes slightly stronger personal income and employment but lower housing permits.
  • Concerns cited in the forecast include slow global and U.S. Economic Growth, weak labor productivity growth and uncertainty regarding fiscal and trade policy.
  • Washington state employment is up by 13,500 net new jobs in September and October.

According to an article in the Tacoma News Tribune, this additional tax revenue will contribute to a 2017-19 state budget that is expected to be more than $40 billion. David Schumacher, Director of the Governor’s Office of Financial Management, stated that this increase in revenue “always helps, but it doesn’t solve the huge problems we’re facing.” One of the biggest problems Schumacher referred to is the Washington state Supreme Court’s mandate to increase K-12 education spending (McCleary v. State of Washington). While there is current debate about the estimated cost of complying with McCleary, the most commonly cited estimate is approximately $3.5 billion, and in Schumacher’s opinion “there’s broad agreement that we’re that neighborhood.”

Governor Jay Inslee will use this revenue forecast and estimates for complying with McCleary when crafting his state budget proposal, which will be released in mid-December in advance of the 2017 legislative session. Stay tuned to the OPBlog for updates on the Governor’s budget proposal when it is released.

OPBlog: Introduction

Thu, 2016-10-27 14:55

OPBlog: Introduction

Hello! My name is Matthew Schoenfeld and I am the 2016-2017 Legislative Analysis Intern with the Office of Planning & Budgeting. I am currently studying for a Master in Public Administration at the Evans School of Public Policy & Governance. I also conducted my undergraduate studies here at UW, earning my BA in Political Science and Law, Societies and Justice. Throughout the school year, I will be updating this blog with posts involving various higher education topics. Post may include, but are not limited to: federal and state legislative issues, reports discussing current trends in higher education, and UW-specific policy initiatives. I am excited to join the team and keep the UW community updated on what’s happening in the world of higher education.

 

Please contact me at mschoenf@uw.edu with any questions or feedback you may have. Thank you so much for reading!

September Revenue Forecast Anticipates Continued Moderate Growth

Thu, 2016-09-22 11:57

September Revenue Forecast Anticipates Continued Moderate Growth

Yesterday, the Economic and Revenue Forecast Council (ERFC) released its September revenue forecast, which increased projected General Fund-State (GF-S) collections by $334 million for the current 2015-17 biennium and by $125 million for the upcoming 2017-19 biennium. As a reminder, there will be one more revenue forecast in November before Governor Inslee releases his proposed 2017-19 biennial budget in anticipation of the 2017 legislative session.

Here is a quick summary of the total projected GF-S revenue for each biennium:

  • $37.765 billion for the 2015-17 biennium, 12.2 percent more than 2013-15
  • $40.377 billion for the 2017-19 biennium, 6.9 percent more than 2015-17
  • $43.630 billion for the 2019-21 biennium, 8.1 percent more than 2017-19

Behind the numbers:

  • Revenue collections from June to September were $225 million higher than forecasted in June, but over half of that increase was attributed to several large (and one-time) audit-related payments of past-due taxes.
  • This forecast noted slightly stronger personal income and employment compared to the June forecast.
  • Strong retail sales, housing construction, and real estate excise tax (REET) collections continue to create positive revenue trends.
  • Risks to the revenue forecast include weak labor productivity and slow economic growth (both in the U.S. and globally).

Any excess revenue collected in the 2015-17 biennium will contribute to reserves (est. $1.8 Billion) that will be available to spend in the 2017-19 biennium, however, the state continues to face significant budgetary challenges in complying with the State Supreme Court’s orders to fully fund K-12 education.

Stay tuned to the OPBlog for updates on revenue forecasts and the upcoming 2017 legislative session.

UW’s 2017-19 State Operating Budget Request

Thu, 2016-09-15 14:40

UW’s 2017-19 State Operating Budget Request

On September 15, 2016, OPB submitted the UW’s 2017-19 state operating budget request to the Governor’s Office of Financial Management. The UW is mindful of the continuing budget challenges facing the state of Washington and, thus, has limited its budget requests to the 11 most essential and strategic state investments for the 2017-19 biennium. These, along with a variety of mandatory reports and forms that make up a biennial state budget submission, are available on our website at the following location:  2017-19 Operating Budget Request

Here is a brief summary of our requests:

Maintenance Level

  1. Maintenance & Operations: For the Intellectual House, Burke Museum, Computer Science & Engineering expansion and UW Tacoma Urban Solutions facilities.
  2. WWAMI Spokane Continuation: To continue the recent increase of 20 UW medical students in Spokane to years three and four of their education program. The existing biennial budget funds these students for years one and two of the program.
  3. Marijuana Research: For additional marijuana research funding that was authorized in legislation during the 2015-17 biennium.
  4. Occupational Health Internship Management: For one full‐time staff member to help meet accreditation needs in the Dept. of Environmental and Occupational Health Sciences.

Performance Level

  1. Competitive Compensation and Retention: For 4 percent salary and benefit increases in FY18 and FY19 for faculty and professional staff. Separate decision packages will be submitted for employees covered under collective bargaining agreements.
  2. Maintenance & Operations: For the Nano Engineering & Science Building and the Life Sciences Building.
  3. WWAMI Spokane Expansion: To expand the UW’s medical student education program in Spokane by an additional 20 students per cohort, starting in FY 2018.
  4. Tri-Campus Student Success Initiative: To expand programs at all three campuses that improve access, retention, graduation and career preparation, with an emphasis on first generation, low-income, underrepresented minority and transfer students—especially those in STEM fields.
  5. RIDE Expansion Bridge: To permit RIDE students to spend their second year of dental education in Spokane, rather than returning to Seattle. This program is in partnership with Eastern Washington University.
  6. High-Demand Enrollments: To expand instructional capacity and enrollment at all three campuses in high-demand fields, such as engineering, computer science, ocean engineering and cyber operations.
  7. Regenerative Medicine Institute: To support the Institute’s scientific cores, add new faculty, provide pilot grants to leverage federal research grants, support student research training and provide translational bridge awards to convert research breakthroughs into products with commercial potential.
  • Additional Attachment: A request for a transportation budget appropriation for a Washington State Research Vessel to be operated by the UW and used by local, state, federal and tribal agencies.

Please contact Jed Bradley or Becka Johnson Poppe if you have questions.

OPB