CHARLESTON, W.Va. -- The West Virginia Legislature is getting closer to securing the revenue the state needs. But Ted Boettner, executive director with the West Virginia Center on Budget and Policy, says lawmakers aren't there yet.
Bills have passed in the House and Senate that would increase state revenue by as much as $150 million, mostly through raising and expanding the sales tax. But Boettner said they're still $100 million short for this fiscal year - and even more for next year.
"There is a tremendous amount of unfinished business. If they don't address it this year, it's highly unlikely they will next year during an election year,” Boettner said. "And at that point you're going to talk about major cuts to Medicaid, closing down several universities."
Boettner said next year's shortfall could be $140 million, depending on new revenue forecasts due this week. Some lawmakers have called for many more cuts to balance the budget. But Boettner noted that after years of budget tightening, even the Legislature has been unable to come up with enough politically viable cuts to close the gap.
Lawmakers are due back in Charleston on Tuesday.
With the revenue bills that look likely to pass, the state's budget crisis seems to be approaching a more manageable level. And Boettner said he's pleased the House is firmly opposed to what he called the "foolish plan" to phase out the state income tax when the state is running in the red.
Senate leaders had argued that enough revenue would come from additional growth sparked by the tax cuts to make up for the losses. But Boettner said House leaders recognized that as a false hope.
"Fortunately, the House rejected the Senate's offer to cut the income tax by 20 percent and repeal it. The House would like to instead focus on the sales tax,” he said.
The West Virginia Center on Budget and Policy has long argued that the state should raise the taxes on tobacco and sugary drinks. But Boettner said that doesn't seem likely now.
"But when it comes to soda and cigarettes, unfortunately they haven't looked upon those again to raise,” he said. "But that would be a step in the right direction that would not only bring in revenue, but also improve our state's health."
The governor has yet to add the budget to the list of items that can be discussed during the current special session. Right now, discussions are limited to the revenue side.
More information is available at WVPolicy.org.
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A new report brands Connecticut's tax system as "regressive" for low- to middle-income residents and uses a report from the state to make its point.
The Connecticut Voices for Children report reviewed the state's Tax Incidence Study, in which one of the biggest findings is how property taxes contribute to a regressive system. Because a town's mill rate does not adjust based on a tax filer's income, low- to middle-income residents spend more on housing as a percentage of their budget than those with higher incomes.
Patrick O'Brien, research and policy director of Connecticut Voices for Children and the report's author, pointed out Connecticut could have a more fair tax system by implementing a few policy changes.
"One, eliminate and/or close the state's tax gap, which was shown likely primarily benefits high-income and wealthy tax filers. Two, eliminate and/or reduce regressive tax expenditures. And three, possibly increase personal income tax rates on high-income and wealthy tax filers," O'Brien outlined.
He argued the new revenue could then be used to provide tax cuts for lower and middle-income households, and could help with creating a state-level child tax credit. One thing to note is the state's report was based on data from 2020.
O'Brien acknowledged the state has made changes to its tax system since then but the Connecticut Voices for Children report showed despite the new cuts, the tax system is still regressive.
The report detailed the effects of the state tax system beyond its residents. Connecticut has only recently come in second behind Massachusetts for income inequality.
O'Brien emphasized it is only exacerbated by the regressive tax system.
"This is really hurting the economic well-being of the state's low- and middle-income tax filers, and that, in turn, ultimately ends up hurting economic growth in the state as well," O'Brien contended. "It can have multiple effects that we're trying to address."
The report recommended creating a task force to ensure all future reports from the Department of Revenue Services have all the required information to get a thorough picture of the state tax system. The most recent report faced criticism for lacking some data.
Disclosure: Connecticut Voices for Children contributes to our fund for reporting on Budget Policy & Priorities, Children's Issues, Education, and Juvenile Justice. If you would like to help support news in the public interest,
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While three initiatives received the go-ahead to appear on Washington's November ballot at the end the legislative session last week, three that have already been approved could also have a big impact on the state.
These measures could have an especially big effect on funding in the state. Executive director of Fuse Washington, Aaron Ostrom, said they also have a few more things in common.
"They're all funded by the same Republican mega donor, Brian Heywood, and all sponsored by the MAGA Republican Party Chair Jim Walsh," said Ostrom. "The second thing about them is that all three are deliberately deceptive and misleading. And then the third thing about these three is they all seek to cut billions of dollars in funding for critical public priorities."
The initiatives would repeal the state's capital gains tax, undo the Climate Commitment Act, and would make optional the WA Cares program - which helps people save for long-term care.
Heywood says he's backing these measures because no one in the state is challenging Democrats on taxes and other policies.
Ostrom said the initiative that would repeal the capital gains tax for profits of more than $250,000 - which fewer than 4,000 people paid last year - would leave a big hole in the state's budget, costing nearly $900 million a year.
"Initiative 2109 would repeal the capital gains tax," said Ostrom, "which would take billions of dollars in funding from child care and schools to give a tax cut to Washington's wealthiest."
Supporters of I-2109 say it is essentially an income tax, which is barred in the Washington state constitution. However, the state Supreme Court upheld the tax as constitutional in a ruling last year.
Ostrom said he believes all three initiatives are a threat to the state.
"These three initiatives would devastate funding for our kids and schools," said Ostrom. "They would dismantle our protections against air and water pollution, and they repeal efforts to care for our seniors."
Disclosure: Fuse Washington contributes to our fund for reporting on Climate Change/Air Quality, Health Issues, Human Rights/Racial Justice, Social Justice. If you would like to help support news in the public interest,
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Virginia child advocates are calling on state lawmakers to improve school funding.
The concern grew when several bills focused on building up school mental health failed in their respective General Assembly committees. The state is ranked 48th for youth mental health by Mental Health America.
Cat Atkinson, mental health policy analyst at Voices for Virginia's Children, said given the ongoing youth mental health crisis, now is the time for action.
"Having mental health professionals in our schools creates a space where, one, our young people are able to be where they're comfortable," Atkinson recommended. "They have built relationships with staff and are able to be in their schools, and to be able to have their needs met in a place where they are consistently."
The mental health staff funding bills failed or were continued to the 2025 session due to high costs. Combined, the bills would have called for around $120 million to be spent in the 2025 and 2026 budgets.
Beyond money, a long-term workforce shortage is depriving schools of having proper mental health staff. A KFF report found 48% of schools nationally have insufficient access to licensed mental health professionals.
The funding inconsistencies affect more than just mental-health services. A 2023 report found not only are school divisions getting less funding than most other states, but Virginia is still using the Great Recession as a benchmark for cost-reduction measures.
Atkinson pointed out a lack of funding affects not just schools.
"The trickle-down effect of our state underfunding public schools places a burden on the local communities," Atkinson argued. "Which leaves the quality of our young people's education to depend entirely on the neighborhoods they reside in."
She added the current situation is not equitable because community resources across regions vary significantly, but noted there are other ways to get mental health care in schools.
In 2023, the General Assembly passed Senate Bill 1300, which requires teachers to get trauma-informed care training every three years. Gov. Glenn Youngkin's Right Help, Right Now plan would also bolster school and community mental health needs.
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