CHARLESTON, W.Va. — The bill that would put away any extra money the state gets from oil and natural gas severance taxes passed the state Senate unanimously Friday.

The West Virginia Future Fund would be established beginning July 1, 2014 and take 25 percent of the annual revenues in excess of $75 million from the severances taxes would be deposited in the fund.

Sen. Bob Williams, D-Taylor, told the Senate Friday the governor’s revenue projections show the Future Fund would not impact budgets this year or next year.

“We may exceed the 175 million dollar cap in (budget year) 2015-16,” Taylor said.

The bill says the money in the fund can’t be touched until 2020, only the investment income can be appropriated and the money can only be used for economic development, infrastructure and education enhancement. The state Investment Management Board would handle the investments.

The Future Fund is the idea of Senate President Jeff Kessler who has said the state needs to be saving some of the money from the Marcellus Shale drilling. Kessler and some other senators visited North Dakota last year to see how a similar fund operates in that state.

The bill that passed Friday heads to the House of Delegates for consideration.

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Comments

  • Independent View

    First, let me say that I am not a fan of Senate President Kessler.
    Secondly, what is wrong with most of you negative posters railing against taking a portion of the NG gas severance tax and saving it for the future? Your kind of thinking in DC has gotten this country 17+ trillion in debt, with no plan or intention to get the country out of debt.
    Another example, closer to home. When WV began and then increased the coal severance tax that goes into state and county coffers. What has happened? All of the county commissions that receive it began spending it as drunken soldiers on their pet projects and then, using the annual tax payments to balance their budgets as part of their county' annual operating fund. This is exactly what the majority of the posters are advocating: use the gas severance tax to plug holes in this year and future year's budgets, without a thought toward the future!
    As coal reserves dwindle and gov't regs hurt production the various county commissions continue to spend the coal severance tax like drunken sailors. What will happen to those counties when the coal severance tax dries up--file bankruptcy?
    In my opinion, any county commissioner that does not advocate saving some of the annual coal severance tax and establish a "county rainy day fun" is committing malfeasance and should be removed from office!
    As to those of you that advocate spend, spend, spend now, I ask, what do you think the next revenue stream will be that affords an opportunity to save for the future after the coal and NG severance tax has been spent to balance annual budgets, both at the county and state levels?

    • Aaron

      I'm not opposed to saving but I think we have much more urgent needs. Besides, if there is that much extra money available, why not lower tax rates and put it back in the pockets who know how to spend their money, Joe Taxpayer?

    • The bookman

      From an ideological viewpoint....+1

      From the reality that is this legislative session....-1

  • Mason County Contrarian

    Kessler should have been turned away at the North Dakota border as a security threat to West Virginia's budget.

  • Aaron

    If you read Kessler's future fund, his contention is that "in a few years when things get better" which is taking a lot for granted.

    Second, we have tremendous needs now that go far above and beyond what we are falling short of funding now.

    Our infrastructure is crumbling. Bridges and roads are in to the point that they could easily consume twice what they do now and that's just to maintain our 20th century road system.

    No one is talking about our future needs. In my opinion, roads should not be planned for today's use but instead for 50 years in the future.

    With that in mind, our road system is not adequate. The biggest investment we can make for future jobs is infrastructure. Major projects needed for future use are planing and funding connectors from west of Charleston on 64 to to 77 North of Charleston and to Corridor G somewhere south of Southridge, complete the King Coal Highway, the Coal Fields Expressway, Corridor H, Route 35, and widen Route 2 from 77 to Weirton.

    And that does't take into the bottlenecks that need address in every medium to large city in the state.

    Morgantown alone could eat several years budget. In that city alone, the state should build a bridge from the new exit at the baseball field to the end of Patterson Drive, a more direct route from the 68/79 split into the city and a bypass along the river between Star City and the downtown campus and out to 68.

    Parkersburg/Vienna needs a bypass from Grand Central Avenue to 77, Charleston/South Charleston needs to widen Jefferson Road and an back entrance into the shopping center that houses Target and Lowe's, and the bridge at Ravenswood needs direct access to the 4 lane instead of the mess it currently is

    I would say to Senator Kessler that what West Virginian's need is leadership willing to make tough promises and investments into our future, not the empty promise of a windfall check "somewhere" in the future.

    • stophating

      @Aaron

      We finally agree on something!

      One question, what mile marker is proposed as the exit for the new baseball field? I looked to see where the bridge could be located, and found myself confused.

    • Wirerowe

      Excellent comments Aaron.

    • Mason County Contrarian

      Well said, Aaron. I couldn't agree with you more. It all makes perfectly good sense to me.

      Remember that we're talking about our Legislature. Most politicians leave their good sense at the door when they enter the Capitol Building.

  • David

    The state is it a bank it is uncontstitutional to hold money like this!

  • TB

    It is not the function of government to 'save' our tax dollars. Emphasis on "our" tax dollars. Kessler is way off base as usual!

  • JTF

    Wow.

    We have massive hole in budget now, and next year, and probably year after.

    So we create a future fund to put some incoming revenue in (instead of spending it for current needs). And we lock it away so we can NEVER use the principle that we put in each year.

    And cannot start drawing out and spending interest until 2020. So no money goes in 2014, 0r 2015, hopefully some in 2016 so maybe we put $150M total in by 2020. If investment gets 10% return, then we can have $15-20MM to spend on something.

    While an untouchable $150MM sits idle and could not be used. Ever.

    Teachers, for instance, can just wait around for 6 years until 2020 and then they will be able to get a $1000 or so raise. Unless some of the $15-20M is decided to be used for economic development. Or infrastructure. Or some other education spending.

    Sounds like a plan. Not a very good one...

    • whatamoroon

      Heck, the federal government is already spending your great grandchildrens tax dollars. I say the state should spend your great grandchildrens tax dollars today too. Even if they haven't even been born yet.

  • Art

    Lt. Governor KESSLER TOUTS FUTURE FUND, SAYS WV "POOREST" STATE

    http://www.wvdaily.net/

  • Aaron

    So let's get this day. Our leaders cannot come up with a way to find next years budget but they are talking about saving money in the future?

    Are these guys serious?

    • ViennaGuy

      Absolute insanity.

    • The bookman

      Just what we need. Another Rainy Day Fund! Absurd to even bring it up at this point...you made a great point earlier about how Miley and Kessler lobbied for these leadership posts, and what abysmal failures they have turned out to be. What a train wreck!

      • stophating

        @Bookman

        +1 We are in agreemant.... How many "savings accounts" does the legislature intend to create?