Washington

An economic slowdown partially fueled by tariff turmoil has forced West Coast states to lower revenue projections and slash budgets.

Washington lawmakers delivered a balanced budget after tweaking program cuts and tax increase plans multiple times.

Both states' governors said they will appeal the FEMA denials, which comes amid concern the Trump adminstration is hobbling the emergency response agency.

Districts most vulnerable to cuts in federal programs are those already struggling from enrollment declines and other challenges.

Lawmakers have until late this month to decide on a mix of cuts and taxes acceptable to the governor to close a $16 billion shortfall over the next two budgets.

Washington Gov. Bob Ferguson told lawmakers approving an unsustainable budget would put bond ratings at risk.

Washington's latest official state revenue forecast lopped almost $900 million from projected collections over the next four years.

Issuance in the Far West was up 30.8% year-over-year to $98.9 billion. Muni market observers say issuers tried to beat the uncertainties of the election.

The change, which marked a move away from recent norms, was made since President Donald Trump took office on Jan. 20, the people told Reuters.

The muni market saw $507.585 billion of debt issued in 2024, up 31.8% from $385.061 in 2023. This surpasses the previous record of $484.601 billion in 2020 by more than $20 billion, per LSEG data.

In Jim McIntire's two terms as state treasurer, he sought to broaden the retail reach of state bond sales and advocated a lower state debt limit.

Issuers in five Far West states increased their borrowing the first half of the year, while four saw sizable decreases.

In the first half of 2024, winding-down federal aid, a resurgence of Build America Bond refundings and election uncertainty have contributed to the surge in issuance, said James Welch, a portfolio manager at Principal Asset Management.

Demand for the increased supply has been "solid" if nearly largely reliant on income-oriented small lot buyers, noted Municipal Market Analytics, Inc. Partner Matt Fabian. Through last week, buyers continued to be separately managed account/retail in size.

More funding went to oil and gas subsidies than into green energy projects in recent years, according to panelists at Milken Institute's Global Conference.

The pace of the issuance and the increase of refundings, surging 59.6% in the first quarter of 2024, have also led some firms to up their overall 2024 issuance projections.

The eight-year, $1.35 billion property tax levy would have to be approved by the City Council before going to voters in November.

The Washington state island hospital's financial turmoil brought rating downgrades from Moody's Ratings.

The calendar is led by several high-profile deals, including $2.7 billion of GOs from California, $1.5 billion from New York City and $1.1 billion from Washington. High-yield gets another dose of unrated project finance debt from Miami Worldcenter Project tax increment revenue bonds. The Bond Buyer 30-day visible supply sits at $12.06 billion.

The Washington refunding deal is built on an extraordinary optional redemption of Build America Bonds despite criticism from investors who hold them.