• Washington State released its audited financial statements for the year ending June 30, 2017.
  • Higher general fund revenues led to an increased total fund balance, though the unrestricted portion declined modestly
  • The state's pension funding level of 88% is among the top 20% of U.S. states and territories

General fund year-over-year performance
Fiscal year ending Jun 30, 2016 Jun 30, 2017 Change % Change
Revenues and expenses
Revenues 31,137,700,000 33,146,055,000 +2,008,355,000 +6.4%
Expenses 30,121,251,000 31,718,517,000 +1,597,266,000 +5.3%
Revenues over expenses 1,016,449,000 1,427,538,000 +411,089,000 +40.4%
Transfers in 577,490,000 712,773,000 +135,283,000 +23.4%
Transfers out -1,205,463,000 -1,299,758,000 -94,295,000 n/a
Net revenues including transfers 388,476,000 840,553,000 +452,077,000 +116.4%
Net revenue margin 1.2% 2.5% +1.3%
Fund balances
Nonspendable 45,578,000 42,922,000 -2,656,000 -5.8%
Restricted 558,708,000 1,658,761,000 +1,100,053,000 +196.9%
Committed 114,958,000 140,905,000 +25,947,000 +22.6%
Assigned 1,155,952,000 1,257,952,000 +102,000,000 +8.8%
Unassigned 1,355,071,000 1,100,552,000 -254,519,000 -18.8%
Total general fund balance 3,230,267,000 4,201,092,000 +970,825,000 +30.1%
Total fund balance over expenses 10.7% 13.2% +2.5%
Unrestricted fund balance 2,625,981,000 2,499,409,000 -126,572,000 -4.8%
Unrestricted fund balance over expenses 8.7% 7.9% -0.8%

Washington's general fund revenues increased 6.4% in fiscal year 2017, driven by growth in sales taxes, federal grants, and other revenues. Expenses increased a lower 5.3%, leading to an increase in the state's total general fund balance of 30%. The balance represents 13.2% of general fund expenses. The unrestricted portion of this balance (including committed, assigned and unassigned balances) fell modestly to 7.9% of expenses. This level of unrestricted fund balance puts Washington in the 65th percentile among states.

Year-over-year ratio analysis
Fiscal year ending Jun 30, 2016 Jun 30, 2017 Change
Fund balance ratios
Total fund balance over revenues 10.4% 12.7% +2.3%
Total fund balance over expenses 10.7% 13.2% +2.5%
Unrestricted fund balance over revenues 8.4% 7.5% -0.9%
Unrestricted fund balance over expenses 8.7% 7.9% -0.8%
Cash and investments over expenses 8.2% 9.2% +1.0%
Revenue and expense ratios
Net revenue margin 1.2% 2.5% +1.3%
Debt ratios
Debt over governmental revenues 54.2% 52.2% -2.0%
Governmental debt per capita 3,241 3,309 +68
Pension ratios
Net pension liability over revenues (governmental) 6.0% 8.4% +2.4%
Pension funded ratio 91.5% 88.2% -3.3%
Pension ADC percent contributed n/a 100.5% n/a
OPEB ratios
OPEB UAAL over revenues 10.3% 10.0% -0.3%
OPEB funded ratio 0.0% 0.0% +0.0%
OPEB percent contributed 15.9% 18.0% +2.1%

Debt levels high

Governmental debt increased slightly in 2017, though higher governmental revenues led to a decline in debt over revenues. Debt represented 52% of governmental revenues in 2017, putting Washington in the 13th percentile (with a higher percentile representing a lower debt burden).

Relative Analysis
Ratio Value Median Percentile
Fund balance ratios
Total fund balance over revenues 12.7% 11.4% 55
Total fund balance over expenses 13.2% 10.9% 57
Unrestricted fund balance over revenues 7.5% 6.2% 58
Unrestricted fund balance over expenses 7.9% 6.3% 59
Assigned and unassigned fund balance over revenues 7.1% 3.4% 65
Assigned and unassigned fund balance over expenses 7.4% 3.3% 65
Cash and investments over expenses 9.2% 11.8% 40
Revenue and expense ratios
Revenue growth, year-over-year 6.4% 2.5% 87
Expense growth, year-over-year 5.3% 3.5% 32
Net revenue margin 2.5% -0.5% 81
Debt ratios
Debt over governmental revenues 52.2% 22.5% 13
Governmental debt per capita 3,309 987 10
Pension ratios
Pension funded ratio 88.2% 71.1% 85
Net pension liability over revenues (governmental) 8.4% 15.3% 73
Pension ADC over primary government revenues 1.1% 1.7% 62
Pension contribution over primary government revenues 1.1% 1.7% 62
OPEB ratios
OPEB funded ratio 0.0% 1.0% 22
OPEB UAAL over revenues 10.0% 13.2% 57

Pension burden manageable

Washington's pension burden remains manageable relative to other states. The funded ratio (blended across 11 plans) was 88.2% in fiscal year 2017, down from 91.5% in 2016. The governmental net pension liability over revenues totaled 8.4%, putting Washington in the 73rd percentile among states.