Armstead suggests House GOP is coming together — and budget deal is not

CHARLESTON, W.Va. — Speaker Tim Armstead says the Republican caucus in the House is more united than it’s ever been over its opposition to a budget package being promoted by Gov. Jim Justice.

Armstead also said he thinks support for the possible budget deal is coming apart.

“We’re continuing our discussions because I truly feel as we move through the discussion of his plan that it’s beginning to unravel,” Armstead said today on MetroNews’ “Talkline.” “I think there are concerns about different aspects of it.”

Justice’s administration has been directly involved in talks with Senate President Mitch Carmichael about a budget that blends ideas from both.

That budget package would step down the state income tax, as desired by the Republican majority in the Senate. But it keeps elements of Justice’s proposals such as increased gas taxes and DMV fees for infrastructure projects, plus an increased state sales tax.

That package, so far, has included a corporate activities tax that Justice backs as a way to ensure business plays a part in solving the state’s fiscal problems. Republicans in both houses say the tax is anti-business.

The package also includes a tiered severance tax system that has been a point of contention.

“You put this many things together, people think this brings people on board,” Armstead said. “I think they’re losing people on this plan because as they begin to learn the impact of the severance tax on coal jobs in our state there are a number of people concerned about that.

“The 7 percent sales tax and the CAT tax, people are beginning to have concerns about it. In the Democratic party, I think they’re having concerns about what the income tax would mean as it impacts certain wage earners.”

Armstead went on to say, “I can’t say whether they have lost support for it, but there are a number of people expressing concerns about some aspects of it. As the discussions have gone along, I don’t think they have built support. I think they’ve lost support.”

The Speaker has been active on his social media accounts in recent days, using Facebook to outline a number of concerns about Justice’s budget package. He also has used Twitter to press accusations that the administration has frozen the House out of the budget conversation.

Armstead says he met with Justice chief of staff Nick Casey on April 17 but was told afterward that the administration would be dealing only with the Senate. Since then, no talks have occurred between the administration and the House, Armstead said today.

“We’ve already been isolated,” Armstead, R-Kanawha, said today on “Talkline.” “They don’t want to hear us. They don’t want to talk to us. In that sense, I think they’re just going down the wrong direction.”

He said that as time has gone on following the regular session and as positions have hardened, the Republican caucus in the House seems more and more united against the governor’s budget proposal. He also noted Democratic concern about the fairness of changing income tax rates.

“If they send it over, it’s going to come up for a vote and we’ll see where the will is. I don’t think you’d have all the D’s vote for that. I know some of the concerns they have, and I’d be surprised, particularly if they don’t think it’s going to pass,” Armstead said.

“Our caucus is more united than at any time in the last 60 days. They’re united because they have great concerns about this plan. They’d don’t believe this plan is the right way to go. This plan, I don’t see a pathway that it passes.”

Justice has also discussed the positions of Armstead and the House Republicans in recent days.

Speaking Tuesday from the North Central Regional Business Summit, Justice said Armstead and the House have been included in budget discussions.

“We’ve met with Tim over and over and over and over and over,” Justice said. “For anything you’d read, oh you know, ‘Justice is going to meet with Carmichael and I’ve been left in the dark,’ that’s hogwash.”

Justice said his administration has experienced better mutual understanding with Carmichael. He said there’s a basic difference of economic philosophy with Armstead, who has advocated removing sales tax exemptions for some economic sectors.

“Mitch gets it. He understand what we’ve got to do. He gets it. The problem with myself and Tim is he believes — I can summarize it real quick — he believes he can broaden the base and take away the exemptions,” Justice said in Fairmont.

“Basically what that’s going to do is direct use taxes. That’s business taxing business. Now if you can go for that then you need to be calling Tim and encouraging him. But I bet my life that you can’t go for that once you really know what’s what. And I bet the business community will do back flips back, double, triple.”

The governor also expressed doubt over an earlier House proposal that would have lowered the state sales tax. Justice said doing so would knock an even bigger hole in the state budget.

“I can’t get Tim off the bubble,” Justice said. “I just can’t get him off the bubble.”

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