CHARLESTON, W.Va. — West Virginia ended the fiscal year with revenue collections $29.9 Million dollars below estimate. However, the state was able to cover the shortfall with a couple of moves during the fiscal year.
The legislature’s one time $70 Million dollar appropriation of money from a traffic account and mid-year budget cuts which included a state hiring freeze helped the state finish the year in the black. Once the savings and appropriation were factored in, state revenue officials say there was a surplus of about three-Million dollars which the legislature will appropriate. The level of that surplus may grow by the time the legislature convenes in January.
“One of the things that generated the savings was a hiring freeze implemented by the governor,” said State Revenue Secretary Bob Kiss. “That hiring freeze is being extended indefinitely.”
It marked a second straight fiscal year with negative growth in state revenues. Although small, Deputy Revenue Secretary Mark Muchow said he couldn’t recall two negative years back to back.
“Fiscal year ’14 was the second consecutive year we saw a decline in general revenue collections from a prior year,” he said. “Maybe in the Great Depression, but I can’t recall two years where we had a revenue decline.”
The bright spot which left revenue officials optimistic was the month of June.
“June numbers were pretty good,” said Muchow. “They allowed us to transfer $11 Million back into the income tax refund reserve account.”
June collections were $27.4 Million dollars above the estimate and an increase of 25 percent over last June’s collections. June saw growth in both personal income tax and sales tax collections. Muchow said those were two positive signs headed into Fiscal Year ’15.
The struggles of the coal industry and the boom in the natural gas industry were also reflected in the year’s collections.
“We had pretty good growth in severance taxes, but all that growth was in natural gas,” Muchow said. “Natural gas severance tax collections doubled, but coal severance continued to decline.”