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NY Times Knows More About WV Tax Breaks than Legislators


Thursday, December 6, 2012   

CHARLESTON, W.Va. - A major New York Times investigation is pushing West Virginia lawmakers to examine the tax breaks they give to businesses. According to the Times, each year state and local governments give companies the equivalent of about $850 per West Virginian. That's one of the highest ratios in the country - equal to about one-third of the state budget.

Senate Finance Committee Chair Roman Prezioso (D-Dist. 13)) says for years he has been frustrated trying to find out how much the state gives out in tax breaks, let alone how many jobs are created in the process.

"How could the New York Times come in and do an oversight, when we as legislators can't get those answers? We want to know why a third of our total budget does not have the oversight folks say it should."

Many in the business community say the tax breaks spark economic growth and new jobs. Prezioso agrees it is probably true for some, but lawmakers have no way of knowing which ones.

During the last session, Prezioso says he refused to pass any new tax breaks. As he puts it, he "boxed them up" in his committee because the state doesn't measure how many jobs are created or how the tax programs could be made more efficient.

"I took a lot of heat: 'He must be against business.' Well, I'm not against business. We just can't continue to go down this path without having specific benchmarks."

Nine years ago, officials negotiated what is known as a "tax increment financing" deal with outdoor retailer Cabela's. The company won subsidies worth about a $150 million dollars. Prezioso says it was probably worth it, but he wonders if the state risks undermining funding for schools when it makes such deals.

"Is there a tipping point? Can you overextend the state in tax increment financing, then all of a sudden your revenues dry up, but you have all this infrastructure?"

The legislature will hold a public hearing on the issue on Dec. 12. It will start at 11 a.m. in the House of Delegates chamber at the state capitol.

The New York Times findings on West Virginia can be found at www.nytimes.com.

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