RFC projects modest current-biennium change, large revenue bump in FY29 driven by new income tax

Executive Director Dave Reich told the Economic and Revenue Forecast Council that the RFC’s revised models produced only modest net changes for the current biennium but a substantial increase in the out years largely driven by the expected first-year receipts from the new individual income tax.

“For the record, I'm Dave Reich, the executive director of the RFC, and we're here to present to you our updated revenue forecast for the operating budget or the new general funds, for September,” Reich said as he opened the Council’s presentation. He walked the Council through U.S. and Washington models, scenario weighting and how assumptions for oil, tariffs and the labor market feed into revenue projections.

Reich said the general fund for the current biennium was down roughly $55,000,000 while the Education Legacy Trust Account rose about $123,000,000 — netting a small $22,000,000 increase across the current biennium. He highlighted the larger change in the next biennium: “the general fund is up about 524,000,000,” driven primarily by the projected individual income tax collections in fiscal year 2029.

The presentation stressed wide uncertainty: Reich described optimistic and pessimistic alternative scenarios and the influence of international events and trade policy on inflation and revenues. He emphasized that short-term inflows — including some large capital gains receipts in fiscal 2026 — can materially alter year-to-year growth rates and that the RFC will update assumptions again in November.