CHARLESTON, W.Va. — The majority leader in the West Virginia House of Delegates is “not surprised” that Gov. Earl Ray Tomblin is implementing mid-year budget cuts for state agencies that will work out to about two percent for most departments and divisions.
“It certainly seems like necessary action by the governor,” said House Majority Leader Daryl Cowles (R-Morgan, 58).
Altogether, the cuts add up to about $59.8 million including about $11 million, or roughly one percent, from the School Aid Formula which funds public education and a $25 million, one-time Medicaid reduction.
An additional $25.5 million, currently dedicated to the Workers Compensation Debt Reduction Fund, is also being redirected. A state hiring freeze will continue and all nonessential travel for state employees remains restricted.
“As a mid-year situation, we’re very limited in what actions the governor can take,” explained Chris Stadelman, chief of staff for the Tomblin Administration.
“We looked at a four percent cut last year, this is not as dramatic, and tried to take the action early enough that the agencies, including higher ed, have about two-thirds of their fiscal year left in which to try to absorb that.”
As of Nov. 2, revenue collections were $87.4 million below estimates. In October, the consumer sales tax and corporate net income tax collections saw the largest performance shortfalls compared with expectations.
Faced with those numbers, in Tomblin’s view, the budget cuts are the “responsible thing to do,” according to Stadelman, with Inauguration Day for Governor-elect Jim Justice in less than two months.
“He (Governor Tomblin) certainly does not want to leave Governor-elect Justice with any more financial difficulties than we’re already aware the new Legislature and the new administration will be facing,” Stadelman said.
The two percent reduction may not be the last of the necessary money-saving measures for the current budget year.
“We still project an additional deficit going forward, hopefully that doesn’t come to pass,” Stadelman said. “The negative numbers have subsided somewhat. We don’t know that this will take care of everything, but at least gives the agencies some time to deal with that.”
This fiscal year continues through the end of June 2017.
In all, Tomblin has reduced the state budget by $400 million dollars, or ten percent, during the past four years, he noted.
Earlier this year, the Legislature approved a tobacco tax increase, but did not address other revenue measures Tomblin had proposed, including a telecommunications tax.
“If we had additional revenue, there would be fewer cuts,” Stadelman said during an appearance on Wednesday’s MetroNews “Talkline.”
In September, legislative leaders created the bipartisan Joint Committee on Government Efficiency, Transparency and Accountability, or GATE, Committee for a full review of the full state government structure.
Committee members are working to identify ways to consolidate, streamline or make wholesale reforms to improve government efficiency and reduce costs.
Going forward, “I think we have a good crew in the Legislature and we’re focused on finding that balance and finding the best way forward that treats the taxpayer fairly,” Cowles said.