Gov. Gregoire Priorities: Targeted Investments and Saving for the Future

For Immediate Release: December 8, 2005

Governor says we must save to keep state government on a �steady course�

SEATTLE � Gov. Chris Gregoire today lauded Washington�s strong economy but cautioned that state spending needs to be fiscally responsible, include targeted investments and prepare for any economic downturn. She said she plans to save a portion of new revenue � a result of the current economy � to keep state government on a steady course in both good times and bad.

�The economy is looking better � the housing market is booming and we are creating jobs,� said Gov.Gregoire. �There are some things that we cannot predict but we can operate a fiscally responsible government and make targeted investments that will allow us to weather a slowdown, if it occurs.�

Speaking from offices overlooking a construction site in downtown Seattle, Gov. Gregoire said the current economic recovery is long overdue for struggling Washington families, but a good sign for state investment in schools and transportation. But, as many states have learned the hard way, what goes up may come down.

�I know the economy sometimes feels like a roller coaster,� Gov. Gregoire said. �We have a responsibility to help smooth out the ride.�

Gov. Gregoire signed a two-year budget earlier this year, but official forecasts now show projected revenue to be much higher than expected.

The 2006 supplemental budget proposal the governor will release Dec. 20 primarily makes adjustments in the budget, factoring in new revenue and funding unexpected increases in required costs for public schools, public safety, programs for vulnerable children and adults, and state pensions.

Gov. Gregoire faces pressure to spend additional revenue, but said that she will propose targeted investments and save a significant portion as a cushion against a possible economic slowdown and to meet rising costs for existing state services.

�We can avoid tax increases to support existing state programs if we spend wisely and save,� the governor said. �That is the stability that I want in state government, but we are not standing still.�

Gov. Gregoire in April signed a budget aimed at improving the state�s business climate over the long term, making the state economy more resilient to changes in global and national economies. She cited improvements in public schools, expanded enrollment at state colleges and universities, increased health care coverage for children, and a long-term transportation funding plan that will make necessary safety improvements in roads and bridges.

�The state budget is a lot like a family budget,� she said. �We must make sure kids get what they need to do well in school, maintain safe and reliable transportation and, simply, pay the bills � including those you didn�t expect. And we must save now in order to manage if money gets tight.�

Gov. Gregoire next week will travel across the state to discuss targeted investments in early education, energy and other important issues facing Washington families.

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