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Budget dam breaks; House approves tobacco tax, new spending plan

CHARLESTON, W.Va. — The special session of the legislature could end Tuesday with a new state budget headed to the governor’s desk for his signature averting a state government shutdown.

The House of Delegates passed the budget bill (SB1013) Monday afternoon with bipartisan support 84-15. The spending plan includes a 65-cent increase in the tobacco tax. The tax increase was approved in a separate bill (SB1012) before the budget vote. It also had bipartisan support. It was approved on a 63-35 vote with 42 Republicans and 21 Democrats voting for the measure.

MORE Read tobacco tax roll call vote here

The Senate agreed to a change the House made in the tobacco tax bill and sent it to the desk of Gov. Earl Ray Tomblin Monday evening. Senators are expected to take up the budget bill in their Tuesday morning floor session.

Gov. Tomblin’s promise to add $15 million to funding for the Public Employees Insurance Agency, reducing premium increases for retirees from 12 percent to six percent, was a key in getting the bills through the House.

Both Republicans and Democrats spoke in favor of the plans during Monday’s floor session. House Minority Leader Tim Miley (D-Harrison) called it a compromise.

“It’s okay to have philosophical differences. It’s okay to advocate for or against certain positions, but at some point we need to get done what we can get done…done,” Miley said.

But Del. Mike Folk (R-Berkeley) called increasing taxes “Washington coming to West Virginia.”

“This is nothing more than bipartisan legal plunder so we can keep the growth of this state government continuing to get bigger and bigger as our population gets smaller and smaller,” Folk said.

House of Delegates Speaker Tim Armstead (R-Kanawha) said after a lot of hard work including much give and take the new spending plan is a balanced approach.

“Revenue measures, it’s cuts, it’s sweeps and it’s Rainy Day,” Armstead said. “No one is going to get exactly what they want when you bring all of those to the table.”

The tobacco tax increase, which will make most of its money by increasing the tax on cigarettes from the current 45-cents a pack to $1.20 a pack, is projected to bring in about $100 million a year. The budget plan takes less than $70 from the Rainy Day Fund. Lawmakers faces filling a projected $270 million revenue hole in the new fiscal year.

Some delegates said the House missed its opportunity to implement deeper budget cuts.

“There’s about a half-billion dollars of excess special revenue funds that would be available for appropriation. We could, in fact, make this budget whole with dollars that are in the capitol, that are on account available for usage. Unfortunately, we do not have the willingness to do that,” Del. Marty Gearheart (R-Mercer) said.

Del. Don Perdue (D-Wayne) called the budget bill a “drive by attempt.”

“The problem with those drive-by’s that we hear about is, very often, there’s collateral damage,” Perdue said.

The House passed budget amendments to allocate an additional $500,000 to Blue Ridge Community and Technical College and to fund the Center For Professional Development which was zeroed out in the governor’s budget. The budget bill may have to go back and forth a few times between the House and Senate chambers Tuesday to iron out the differences. Most believe there will be no need for a conference committee.

Also Tuesday, four more bills from Tomblin will be considered including the two PEIA measures.

The governor released the following statement Monday evening:

“I appreciate the work of all those involved in passing a budget that addresses the state’s finances in a responsible manner during difficult times, particularly the bipartisan support that led to the passage of my proposed 65-cent cigarette tax today. This revenue will help address issues with not only the Fiscal Year 2017 budget but projected deficits in future years.

“Based on this afternoon’s votes in the House of Delegates, I am expanding the special session call to include two bills that will address PEIA funding, and I look forward to similar support for both these measures. I also am including two additional issues in the amended call, both of which appear to have widespread support in both the Senate and House of Delegates.”

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