The Washington State Capitol in Olympia: Rigid partisanship means any shift in control is unforeseeable.

OLYMPIA — Agricultural products exported from Washington rose in late summer, joining some other sectors of the economy in surpassing expectations and improving the fiscal outlook for state government.

Farm exports were 9.2% higher in July, August and September compared to the same period a year ago, the State Economic and Revenue Forecast Council reported Wednesday.

Even though Gov. Jay Inslee reimposed some business restrictions this month, the council projected that general tax collections for the next two-year budget cycle will increase to $52.6 billion, or 7.2% above the current budget. The budget cycle begins July 1.

The council’s executive director, Steve Lerch, presented the report to a panel of two Democratic and two Republican legislators who serve on budget and tax writing committees.

Although projected revenues for the next biennium are down $1.5 billion from pre-coronavirus estimates, the outlook has vastly improved since June. Counting reserves, the state general fund does not have a deficit.

New taxes, or not?

Sen. John Braun, R-Chehalis, said the forecast shows the state doesn’t need to raise taxes. “I think there’s a very solid foundation to balance the budget without additional revenue,” he said.

Democrats said it was too early to say. Lawmakers will have to wait until the March revenue forecast to know the budget outlook for the following two years, they said.

Washington Farm Bureau President Mike LaPlant said last week he expects lawmakers to seek more revenue.

“I think there’s going to be a real big push for taxes, fees, whatever,” said LaPlant, speaking via video conference at the Farm Bureau’s virtual convention.

“I don’t think there’s going to be any way to stop it myself. I guarantee, we’ll try [to block tax hikes],” he said.

Washington’s unemployment rate was 6% in October, down from a high of 16.3% in April. The private sector added 32,400 jobs in September.

GOP defends covid response

Braun bristled at the idea that some Republican lawmakers aren’t taking the pandemic seriously enough. He said businesses have labored to stay safe and stay open.

“There seems to be zero appreciation to what we’ve done to drive our economy forward,” he said.

Construction, retail sales and real estate transactions have surpassed expectations, as has marijuana sales. “They’ve really been quite strong since April,” Lerch said.

Federal stimulus payments increased personal incomes in the spring. Lerch said the lack of a new stimulus package and a spike in covid-19 cases are threats to the budget outlook.

Washington health officials renewed their pleas for residents to avoid contact with anyone outside their households. “By taking action, we can flatten the curve again,” Health Secretary John Wiesman said last week.

Braun and Kalama Rep. Ed Orcutt, the top-ranking Republican on the House Finance Committee, renewed Republican calls for the Legislature to meet in special session.

Republicans have proposed more than a dozen measures, including a $500 million aid package to small businesses, tax incentives to manufacture personal protection equipment and a moratorium on rules from the Department of Ecology.

Relief needed

The Legislature will convene for a regular session Jan. 11. Orcutt said some small businesses can’t wait for relief.

“They’re going to be suffering between now and when we come into session in January,” he said. “I really think we’re making a big mistake not stepping up and doing something.”

Democrats said the federal government can do more to help businesses than the state.

“The state government doesn’t print money. The federal government prints money,” said Brainbridge Island Democrat Christine Rolfes, the chairwoman of the Ways and Means Committee.