CHARLESTON, W.Va. - State lawmakers are struggling to close a big budget hole, but a close look shows the legislature dug that pit with business tax cuts over the last eight years. Sean O'Leary with the West Virginia Center on Budget & Policy pointed out that state spending has been basically flat for some time, but the tax cuts made since 2006 are part of what is causing a budget gap of more than $200 million next year.

"We're collecting less business tax revenue this year than we did nearly 20 years ago, even before you adjust that for inflation," O'Leary said.

Revenue lost to cuts in the business franchise tax and the corporate income tax would just about equal next year's shortfall, he noted.

O'Leary said the state created a structural problem in the tax and revenue system over the last eight years with big, permanent rate reductions and phase-outs that were unaffordable.

"It's about $425 million for fiscal year 2015," he said, "so that would be balancing the budget, plus some. But it was given away in tax cuts."

Supporters of the cuts said they would spark economic activity, because more businesses would locate or expand here. There is no evidence to support that, O'Leary said, adding that taxes are only a tiny factor in a company's decision - a much smaller part than consumer demand, the cost and quality of labor, or the access to markets or raw materials.

"There's no natural gas industry coming into the state because we lowered the business franchise tax. They're coming into the state because we have natural gas," he pointed out.

The governor has asked to transfer more than $80 million from the state's rainy-day fund, and suggested cuts of another $35 million in items such as race-track subsidies. However, O'Leary said, these are one-time solutions to a permanent problem: the amount of revenue the state takes in.

"If we have to take $80 million out of the rainy-day fund this year, and we expect no revenue growth next year, we're just going to have to do it again. Until we address the structural revenue problem in the state budget, one-time fixes aren't gonna cut it," he said.

The center's latest budget report is available at www.wvpolicy.org.




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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.

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.

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.