CHARLESTON, W.Va. – West Virginia faces another budget gap next year, but experts say much of it could be made up by figuring out which tax breaks are not living up to their promises.
The state expects a $300 million shortfall in 2014, and the governor has told agencies to expect another round of steep spending cuts.
Sean O'Leary, a policy analyst with the West Virginia Center on Budget and Policy, says the state should first look at tax breaks that reduce revenue.
He asserts the state does a very poor job of tracking how much the various tax breaks cost, let alone which ones are worthwhile.
"I think we could close a significant part of that budget gap if we actually took the time to come up with a number of these tax expenditures and ask the question, are they working?" he says.
The state estimates a tax credit on alternative-fuel vehicles, including flex-fuel cars and trucks, has cost a $100 million. That was much more than expected.
O'Leary says there are many other tax breaks that deserve more attention.
Last year, O'Leary was one of the authors of a West Virginia Center on Budget and Policy report on the dozens of tax breaks intended to speed economic growth. He says the center found the state didn't even know how much tax breaks cost each year, let alone how many jobs they spark.
"If it's to create jobs, are we creating jobs?” he asks. “If it's to encourage coal production, is it encouraging coal production?
“We don't ask these questions and we don't even know the true cost of all these tax expenditures."
Tax-break supporters say they do help the state promote economic development.
But officials including the secretary of commerce and the chair of the Senate Finance Committee have in the past publicly said the current level of oversight is lacking.
O'Leary cites a severance tax break that mine companies get for taking coal out of thin seams.
"Is that an activity we want to encourage?” he questions. “Is that helping the coal industry?
“Is it encouraging more production or is that something that's occurring naturally? We don't know, but we do know that it's costing $75 million a year, and growing each year."
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Pennsylvania's budget deadline is looming on Thursday. Gov. Tom Wolf is calling for a minimum-wage increase that would get the state to $15 an hour by 2028.
A new brief gives a profile of the workers who would benefit.
The analysis from Keystone Research Center found an estimated 1.46 million Pennsylvania workers would see higher wages through the increase.
Keystone Research Center Senior Research Analyst Claire Kovach said the workers who would most benefit are the ones who were deemed essential during the pandemic, such as those in health care, retail, social services and more.
She said the state minimum wage has been stagnant for far too long.
"One of the minimum wage jobs that I worked 12 years ago is still advertised at $7.25 per hour today," said Kovach. "So the minimum wage worker who stands where I stood a dozen years ago, they're getting paid a wage with around 25% less buying power than I was back then."
The increase to $15 by 2028 would amount to a $3,800 raise for the average-year round worker, Kovach said.
If passed, the gradual increase would start with a boost to $12 an hour in July. Opponents to a minimum wage increase are concerned about the costs to businesses.
The brief also finds that across the proposed minimum wage increase from July 2022 to July 2028, an estimated $30 billion would be put back into the state economy.
Kovach added that with inflation climbing and more Pennsylvanians experiencing financial insecurity, an increased minimum wage could be a lifeline for families.
"There's an interesting thing that happens when you give low-wage workers a raise," said Kovach. "They don't store this money in off-shore accounts. This money is spent directly back into the economy and actually generates more economic movement and more economic benefits for communities than some other economic stimulus items."
The Massachusetts Institute of Technology's Living Wage calculator shows that today, a single adult in Pennsylvania needs to earn nearly $17 per hour to support themselves - while a single adult with one child needs nearly $33 per hour to support their family.
Disclosure: Keystone Research Center, Inc. contributes to our fund for reporting on Budget Policy & Priorities, Livable Wages/Working Families. If you would like to help support news in the public interest,
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There are fewer than five months to go until the November General Election, in which Pennsylvania voters will select a new governor and U.S. Senator.
A new poll commissioned by AARP Pennsylvania showed how residents over 50 are feeling about the candidates and the issues. In the 2018 midterm elections, Pennsylvanians age 50 years and older made up 61% of all voters in the state.
The AARP poll includes views about this year's political races, including the contest for governor, with Democratic Attorney General Josh Shapiro and Sen, Doug Mastriano, R-Franklin. Shapiro leads Mastriano by three points.
Bob Ward, partner and pollster at Fabrizio Ward, said for voters over 50, it is an even closer race.
"There's a one-point lead for Shapiro over Mastriano," Ward reported. "And so, 50-plus voters, due to their size but also sort of the competitive nature of where the election is in the governor's race, will be impactful. Candidates need to pay attention to what's important to these voters."
In the Senate race, Democratic Lieutenant Gov. John Fetterman has a six percentage-point lead over Republican TV personality Mehmet Oz. And 77% of those polled believe the state is "moving in the wrong direction."
Some 30% of Pennsylvania voters polled said the economy is working well for them. However, one of their biggest concerns, which may influence their votes in November, is rising prices. For Republicans polled, it is their highest priority, while Democrats cite gun safety as their top issue.
Matt Hogan, partner and pollster at Impact Research, said the results also show inflation is still a cross-party worry.
"When we test it on its own and ask them to rate the importance, we certainly see it's a dominant issue with Democrats as well, it just doesn't rise to quite the top when we ask them to pick which is the most important," Hogan explained. "We definitely see a surge in guns [as an important issue] following Uvalde."
Other issues emerging as important to voters include immigration for Republicans, and abortion access and honesty in government for Democrats. The survey, which reached nearly 1,400 likely Pennsylvania voters, was conducted this month via landline, cellphone and text message.
Disclosure: AARP Pennsylvania contributes to our fund for reporting on Budget Policy & Priorities, Consumer Issues, Livable Wages/Working Families, and Senior Issues. If you would like to help support news in the public interest,
click here.
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The Tennessee Titans are slated to get a new Nashville stadium, which experts are calling the most expensive publicly financed NFL stadium in the country, to replace the more than 20-year-old Nissan Stadium.
A new report by the Sycamore Institute said the Titans, along with the National Football League, plan to contribute $700 million, and the City of Nashville will cover the remaining $1 billion in construction costs.
Eric Harkness, executive director of the Sycamore Institute, said stadiums rarely generate enough new economic activity to offset public subsidies, and communities should examine whether the money could be better spent on schools, transportation or housing.
"Dollar-for-dollar, these investments don't pay for themselves," Harkness asserted. "It's really important to consider what those opportunity costs are."
Supporters of stadium building argue it provides jobs and spurs local economies through consumer spending and tourism. According to the report, since 2021, state and local lawmakers have approved spending taxpayer dollars for at least five pro-sports venues in Nashville, Knoxville and Chattanooga.
Harkness added he understands stadiums may have other, non-economic impacts, such as fostering a sense of community and identity.
"And I think a lot of it boils down to that sense of civic pride," Harkness acknowledged. "Wanting to make our city be a more national gem."
According to the report, nationwide, the share of direct public financing for NFL stadiums has dropped over the past 35 years. One study estimates taxpayers covered about 75% of construction costs between 1987 and 2008, compared with 25% in the years after.
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