The $2.6 billion revenue shortfall created by the recession has generated no shortage of ideas about how to change Washington’s budget and tax structure to ensure important public systems and structures — like schools, public safety, and transportation, to name just three — stay intact. Most proposals include three possibilities: 1) revenue increases (by ending tax preferences or raising tax rates); 2) federal aid; and 3) spending cuts. Today’s News and Views offers a taste of each:

The $700 million question: Will state officials get serious about closing tax loopholes? | On Tuesday, January 12, after Gregoire introduced her budget to the Senate’s Ways and Means Committee, a perplexed State Senator Debbie Regala (D-Tacoma) asked why the Governor hadn’t suggested closing more loopholes to deal with the state’s disastrous revenue situation. Gregoire replied, “It sounds simple but I found it difficult to do.”  Maybe Gregoire should ask for some help from Marilyn Watkins, Policy Director of the Economic Opportunity Institute (EOI), a liberal think-tank in Seattle. | More: Olympia Newswire

Budget problem gets worse with federal funding? An explanation | Bryan Moore, nonpartisan staff for the Senate Ways & Means Committee, gave a budget presentation to the Senate Early Learning and K-12 Education Committee. Part of it included a a side-by-side comparison of how the solution of the 2010 budget shortfall could affect budgets down the road. | More: Capitol Record

A recount on state GOP’s budget ideas | From listening to the outraged talk of Republican lawmakers, you’d think that Gov. Chris Gregoire and Democratic legislative leaders could readily close the $2.6 billion budget deficit without new revenues if they’d just eliminate scheduled pay hikes for unionized state employees. But “there’s not a whole lot of money there,” according to the State Office of Financial Management. | More: Crosscut