In the monthly report of actual tax collections (as opposed to forecasts of tax collections) Washington’s economy is about where forecasters thought it would be.
While tax collections are up when compared to the March forecast, most of that is due to the already reported windfall from a tax amnesty program.
If one-time collections were taken out of the report on April tax collections, Washington would actually be a tad below what was expected. That’s distressing to budget writers because collections had started to tick up in February and March and there was hope for an acceleration that would signal the long predicted but not-yet-realized full recovery.
Here is what Chief Economist Arun Raha wrote in a press release that accompanied today’s report:
“The Washington economy continued to grow but at a slower pace in February and March after
fairly strong growth at the end of 2010 and early 2011. Aerospace and software are
expanding, but construction remains in a prolonged slump. Geopolitical developments in the
Middle East and North Africa (MENA) boosted oil and gasoline prices, eroding consumers’
purchasing power and confidence.
“The Japanese earthquake and tsunami continues to pose a
threat to the state’s recovery. Japan is the state’s third largest export market. Eventually
reconstruction activity will be a plus for our state’s economy but in the near term the
devastation has disrupted supply chains and reduced demand for Washington products.
Cumulatively, major General Fund-State revenues are $162.8 million (7.9%) above the March
“Adjusted for the extra revenue from the amnesty program and other one-time
payments and refunds, the cumulative variance is negative $32.5 million (1.6%).”
Here is a pdf of the may11 report. And here’s a link to Jason Hagey’s report on Raha’s speech to the Association of Washington Business (including a Osama Bin Laden joke that is funny but perhaps too soon).