April 27, 2026

Moody’s Puts WA ST At Risk

The Agency says The State’s Finances are negative due to it’s “reliance on reserves and budget gimmicks.”

That is a clear warning that its reliance on Reserves Cons and Taxes to balance the budget endangers the State’s strong credit rating, which could make thing worse.

Moody’s, one of the big three credit rating agencies, just showed deep concern with the State’s knack to enact budgets that spend more money than it takes in, and uses reserves and other measures to make ends meet even though Taxes are continually raised.

If the current budgeting approach continues, Washington will be less able to “absorb unexpected revenue or expenditure shocks” that might occur, the ratings agency noted.

In the recent sessions, Lawmakers and Gov Ferguson wrestled with multibillion-dollar shortfalls  as State revenue growth isn’t keeping pace with the spending like that Zero Fare Transit that locals love so much.

Gov Ferguson just signed a roughly $79.4 billion plan that made adjustments to the $77.8 billion two-year budget Lawmakers passed last year, which covers spending until June 30, 2027.

In the meantime, the State is facing a deficit in the next budget cycle with total reserves predicted to dip to 1.4% by the end of the 2028 fiscal year.

Ferguson and Democrats are counting on the new tax on households with annual incomes above $1 million to provide a stabilizing stream of revenue. But collections won’t begin for three years, presuming the tax is upheld in court and at the ballot box, hopefully it is not and huge cuts are made instead.

Moody’s said its revised outlook “reflects rising downside risks to the State’s financial flexibility given continued reliance on one-time budget solutions to support General Fund spending, a projected narrowing of budgetary reserves and ongoing legal challenges to new revenues intended to help restore budget balance.”

Meanwhile, Republicans have consistently and loudly criticized Democrats for moving too quickly to spend down reserves and use gimmicks to balance the budget, rather than make tougher choices on how tax dollars are spent and the lack of budget cuts to unnecessary spending.

April 27, 2026 5:01am