Wading into the numbers…

Senate Democrats pleased with the rising economic tide

The tides of Washington’s economy continue to flow. For the sixth straight quarter, our state has collected revenue far above projected levels:

• $959.5 million in June of 2006;
• $107.3 million in February of 2006;
• $304.9 million in November of 2005;
• $492.9 million in September of 2005;
• $450.1 million in June of 2005; and
• $739.4 million in March 2005.

Washington has collected $85 million above projections in the past month alone. Senate Democrats point to the sound budgeting and investment strategies of the past two years for this great news. We’ve taken bold steps to ripen economic conditions for a host of businesses, including:

• Creating more work-force training opportunities;
• Jump-starting our state’s biofuel and alternative energy industries;
• Targeting tax incentives to the aerospace, semiconductor, aluminum and motion picture industries; and
• Giving tax cuts to small businesses.

At the same time, we recognize that – all clichés to the contrary – a rising tide doesn’t raise all ships. That’s why we paid for needed programs today – and avoided paying higher financial and human costs tomorrow – by:

• Providing senior prescription drug co-pays;
• Adding 5,000 enrollments to the Basic Health Program;
• Putting the state on a plan to insure all children by 2010;
• Investing in the life science breakthroughs of tomorrow;
• Adding 8,500 higher education enrollment slots;
• Expanding college financial aid;
• Streamlining the state’s WorkFirst program;
• Strengthening our mental health system;
• Improving treatment for substance abusers; and
• Accelerating cleanup of toxic sites around the Puget Sound.

Washington’s rising economic tides have allowed Senate Democrats to do so much over the past two years to improve the quality of life in our community, and bring that quality of life to more and more people.

Yet we recognize that, as with all tides, there is both ebb and flow. The construction market is beginning to wane, although collections from sales, business and other taxes — which comprise the majority of the windfall — are still robust. Even still, revenues cannot be expected to flow at this rate.

That’s why we took the responsible action of setting aside $825 million this year for that eventual leveling off. We deposited these funds into three accounts to pay for the fastest-growing costs in state government: pensions, education and health services. These funds, combined with the latest revenue surge, raise Washington’s reserves to more than $1.5 billion for the next biennium.

Senate Democrats are pleased with this amount, but caution that our state may have reached its high water mark. We are mindful that continued prudence in budgeting is necessary.

We look forward to the recommendations that will be issued by two blue ribbon groups: Washington Learns, on education, and the Commission on Health Care Costs and Access. And we know that a number of other funding requests will be made in session convening in January. We will balance these and other requests — and build upon our savings — to ensure a prosperous future for all our citizens.