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Lawmakers drowning in sea of budget numbers

There’s the old joke about the accountant applying for a job.  The boss hands the applicant a piece of paper with a series of numbers and asks, “What do these add up to?”  The accountant replies, “What do you want them to add up to?”

The state Legislature and Governor Justice seem trapped in a budget stalemate because they cannot agree on numbers, and there are a lot of numbers floating around the Capitol.

One of the biggest disputes is over the proposed approximately 20 percent reduction in the state income tax rates.  Supporters say those cuts will allow taxpayers to keep more of their money and stimulate the economy, but opponents worry lower rates will mean a shortfall in tax collections, higher taxes in other areas and possibly a budget crisis in future years.

The problem is the two sides can argue about this forever because the numbers of these competing views are fungible.  Mark Muchow, the state’s Deputy Revenue Secretary, has done his best to keep up with the near constant changes in the varying tax proposal so he can give lawmakers his best estimates, but even he confessed during a committee meeting Tuesday that he’s having trouble keeping all the numbers straight.

It’s all gotten way too complicated. The mixture of economic theories, personal agendas, questionable math and weariness are making for a sour soup. A chef once told me when cooking every time you think of adding an ingredient, take one out.  Less is more, and maybe that’s a lesson lawmakers and the Governor can apply.

Go back to the basics, and start by forgetting about tax reform proposals… at least for now. It’s too complicated and the potential impacts—positive or negative—are not clearly understood.  West Virginia’s antiquated tax code badly needs updated, but that should be the focus of a special session or the primary bill in the regular session, not cobbled together under the looming deadline of a government shutdown.

Postponing a reduction in the state income tax rates would be a major disappointment for the Governor and Senate Republican leaders. They want to “go big,” and they see this as an opportunity.  But their chances of success were reduced last week when the House of Delegates voted 74-17 with bi-partisan support to pass a revenue bill without the income tax rate reductions.  And now Senate Democrats are wary of the income tax reduction plan as well.

Next, key lawmakers and the Governor could employ some basic negotiating structure.  Get out the Venn diagram for compromise, find points of agreement, commit to them, and then take them off the table. One of the consistent problems with the negotiations has been that issues re-emerge even after one side thought they were already settled.

And finally, all parties should accept the premise that shutting down the government is not an option.  Turning off the lights to the state would not end the need to adopt a budget, so what’s the point? Politicians, by their nature, worry about their next election and every lawmaker—regardless of party—would have to answer for a shutdown.

 





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