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.




get more stories like this via email

Even in a stable economy, consumers in Wisconsin and elsewhere still express pessimism and advocates said a key federal agency working on issues like unfair business practices cannot risk losing resources needed to help consumers.

To avoid a government shutdown, Congress has to approve a new federal budget by month's end. Over the summer, House Republicans floated cuts in certain areas, including a 27% funding cut for the Federal Trade Commission.

Erin Witte, director of consumer protection for the Consumer Federation of America, said the timing could not be worse for such a move.

"We've seen people talk a lot about feeling like their costs are increased in lots of ways," Witte pointed out. "The FTC's work is really aimed at trying to lower a lot of those costs, to bring some fairness back to the process."

Last month, the agency co-hosted the first meeting of a task force about whether companies are price-gouging and the effect on consumers. GOP leaders on the Appropriations Committee said they want a financial services bill prioritizing combating terrorism-money activity, maintaining the integrity of financial markets and spurring small business growth.

Witte contends the FTC has made progress in standing up for consumers with great efficiency. She pointed to the proposed "click to cancel" rule, which would remove barriers for people worried about recurring charges for an unwanted subscription for a service or product.

"That would make it as easy for someone to cancel a subscription as it is to sign up for it," Witte explained. "That proposal has gotten thousands of comments from consumers about how much time they are wasting on things like unnecessary subscriptions."

The state-level organization Opportunity Wisconsin has also cited concerns about consumer protections being gutted. It called on Congress to pass clean funding bills without extreme provisions it said would "hurt Wisconsin families." It is unclear if any of the budget ideas floated over the past several months will find their way into a final spending plan.

Congress is back from recess and lawmakers are hearing from producers about getting a new Farm Bill passed with the latest deadline looming.

North Dakota farmers were among those who traveled to Washington, D.C., to demand progress. More than two dozen North Dakota Farmers Union members were part of a large contingent getting face-to-face time with federal lawmakers this week.

The Farm Bill, last updated in 2018, needs to be reauthorized by the end of the month or elements of the current version will expire.

Bob Kuylen, a farmer from the western half of the state, said the uncertainty comes as small-to-mid-sized producers face the prospect of dwindling profits.

"Inputs are awful high and we're down there in prices quite a ways," Kuylen pointed out.

A glut of crops and other products on the market are resulting in smaller financial returns for the farmers who grow them. The Union said a stronger safety net in a new Farm Bill could make losses easier to absorb. However, with the fall election approaching and a federal budget also needing a vote, complications are mounting in getting the agricultural policy reauthorized.

The Farm Bill also funds key initiatives to address hunger relief like the Supplemental Nutrition Assistance Program. Kuylen noted it shows the sweeping policy touches a lot of facets within the food production system, affecting many Americans.

"Eighty-two percent of the Farm Bill is nutrition," Kuylen explained. "Farmers get a very small part of the Farm Bill. You know, it covers things like conservation programs."

The statistic he cited is reported by the Congressional Research Service. Union voices said the urgency comes as farmers also deal with rising machinery costs and corporate consolidation within agriculture. Last fall, Congress approved a one-year extension of the Farm Bill, prompting fears lawmakers would again let negotiations drag on until the last minute.

West Virginia lawmakers will convene for a Special Session on Sept. 30, with the state's child care crisis, proposed income tax cuts and supplemental appropriations on the agenda.

The Mountain State's spending on child care is much lower than neighboring states and has steadily declined over the past decade, according to the West Virginia Center on Budget and Policy. It is estimated the parents of around 26,000 children currently lack affordable child care options.

Gov. Jim Justice is reiterating his push for child care tax credits.

"Absolutely try to get our tax break across the finish line with child care," Justice urged. "There's supplemental appropriations that need to be done, and we need to get the money out the door."

Previous bills proposing a child care tax credit for households with incomes less than $65,000 a year have stalled in the Legislature. The Biden administration has said the state needs to contribute between $20 million and $30 million to keep a federal subsidy program afloat for the next year, to direct money to child care centers, making costs more affordable for families.

The governor is also proposing another 5% income tax cut.

"We need another tax break," Justice contended. "I'm very, very hopeful and optimistic that we're going to be able to get it through."

According to state data, tax revenue collections for August were lower than expected at around $403 million and down from last August, when $410 million in tax revenue was collected.

Support for this reporting was provided by The Carnegie Corporation of New York.