Governor Jim Justice decided to cut just $27 million in spending as part of his proposed $4.5 billion general revenue budget for next year. Justice, who now has two versions of his spending plan to consider, wants to make up for most of the expected $500 million shortfall by raising taxes.
He does, however, say he’s open to more cuts as long as they don’t cripple the state. Republican leaders have been working on finding significant cuts. Here are some of the cuts being discussed and estimates on how much they would save. It’s not the whole list, but it is indicative of where the GOP leaders are looking to save money.
—The Governor’s proposed Save our State Fund. Savings: $105 million.
—Smoothing out payments to the teacher retirement system. Savings: $43 million.
—Continuation of former Gov. Tomblin’s midyear budget cuts: Savings: $25 million.
—State funding for dog racing and race track modernization fund. Savings: $24 million.
—The classroom teacher pay raise. Savings: $21 million.
—Elimination of some unfilled state government vacancies. Savings: $10 million.
—Courtesy Patrol. Savings: $5 million.
–Elimination of the Office of Education and the Arts. Savings: $4 million
—Funding for fairs and festivals. Savings $3 million.
Those cuts could save an estimated $240 million, and that’s before you look at the Big Three—Public Education, Higher Education and the DHHR, which make up more than 70 percent of the budget, but that’s also where the cutting becomes more difficult.
Every one percent cut to the school aid formula, which directly impacts public schools, saves $11 million, and each one percent cut to higher ed saves $3.4 million. DHHR cuts are often difficult to calculate because much of the spending draws down a federal match. Education and DHHR have strong constituency groups that would fight hard to maintain funding.
Republicans are also intrigued by the possibility of sweeping “re-appropriated balances” from constitutional officers and state agencies. These are funds appropriated in previous budget years that were unused, and that the agencies hold in reserve. By one estimate, those accounts could hold as much as $150 million, with an estimated $20 million having been appropriated at least five years ago.
GOP leaders want to lay down the cuts first before considering tax increases. However, Republicans cannot get to $500 million without substantial reductions to education and social services, which may make some of Governor Justice’s tax proposals more palatable.