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Tax increases becoming unavoidable in budget

A couple of weeks ago Republican leaders of the Senate and House held a joint news conference to lay out their framework for the budget. Their plan, at the time, included spending no more than the state is expected to collect in revenue next fiscal year—$4.055 billion.

The Republicans also appeared in agreement on $150 million in cuts to public education, higher education and the Department of Health and Human Resources.

But that was then.

Yes, the Senate Republicans are still holding fast to their “live-within-our-means” approach, but a number of House Republicans are taking a different tack, including House leadership.

It started last Saturday when House Finance Committee Chairman Eric Nelson rolled out a budget that spends $200 million more than what was anticipated just two weeks ago. Notably, Nelson’s plan avoids deep cuts and raises nearly $160 million in new revenue, primarily though imposition of a tax on food at three percent.

What happened?

Republicans hold 63 seats in the 100 member House, a significant majority, but it would be a mistake to view those Republicans as a monolith. Basically, the House Republicans break down into three groups.

One group wants to make deep cuts in government and not raise any taxes. Another group is leery of big cuts and would prefer to find new revenue. And a third is more flexible and could go either way.

It’s evident, however, that a majority of the House Republicans do not want to make drastic cuts in the state budget. These members worry about the schools in their districts or the constituents who receive social services.

One reason the “right-size” government approach always hits a wall is that it cannot be accomplished without significant reductions in The Big Three (public ed, higher ed, DHHR) that make up more than 70 percent of the General Revenue Budget. But consider this: How many West Virginians work in education, have family members who are in public or higher ed or have family or friends who receive social service benefits from the state?

That’s a lot of people.

So think of it this way: Would West Virginians rather pay a little more in taxes or be impacted directly or indirectly by the deep budget cuts? Given the choice, they might just opt for taxes.

In an unscientific Twitter poll I posted this week, of the 266 respondents, 57 percent said they would rather see a three percent tax on food than deeper budget cuts, while 43 percent preferred cuts.

Governor Justice’s “we-need-more-revenue” campaign must be paying off.

Nobody likes to pay more taxes, but when a block of conservative House Republicans balk at deep cuts knowing the alternative, it starts to become clear that new revenue is ultimately going to be part of the budget solution.





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