10:06am: Talkline with Hoppy Kercheval

Governor expresses caution about spending millions of anticipated year-end dollars

West Virginia’s government is running ahead of its general revenue estimates by hundreds of millions of dollars. Soon, state leaders will make choices about how to use that money.

In rejecting a gas tax holiday this week, Gov. Jim Justice said he wants to be sure to continue investing in West Virginia’s roads.

Gov. Jim Justice

“You know where I’ve stood before,” the governor said this week. “I’ve thought about it and I do still contend the very best thing, the very best thing is to keep our money going toward our roads and fixing slips and guard rails and things that make West Virginia better.”

This is the final month of the fiscal year, and the most recent budget update showed that state government’s general fund is $1.1 billion above projections.

Each year, the Legislature sets priorities in advance for funding to take place if there’s more money than anticipated. At the end of the regular session, lawmakers approved hundreds of millions of dollars in possible spending.

That included $600 million aimed toward development loans through the Department of Economic Development, $100 million for the governor’s civil contingency fund to be used as matching funds for federal earmarks and $50 million for a mining reclamation insurance mutual just established by the Legislature.

The budget also included the possibility of setting aside $256 million for personal income tax cuts on down the line. But the governor used his line item veto on that provision, saying a corresponding bill defining the tax cut proposal had not passed and that there was no specific fund for the money to go into.

In early May, lawmakers passed a $250 million supplemental appropriation to provide matching grants for water and sewer upgrades.

So even with all that, state officials still have more unaccounted revenue likely to come in, if monthly trends continue.

The state Road Fund, which is built on sources like gas taxes and DMV fees, is down almost $75 million so far this fiscal year. So one decision state leaders could make is a transfer of general revenue into the Road Fund.

In briefings this week, Justice said the state must be cautious in its approach to the unaccounted windfall in this year’s budget. “We’ve got to be careful that we make the prudent (decisions) and we push the right buttons,” he said.

House Finance Chairman Eric Householder, R-Berkeley, said he’s considering the best use of a possible $300 million in year-end surplus during an appearance on Panhandle Live on WEPM Radio. He said the year-end surplus could be as much as $1.2 billion to $1.3 billion.

“Here in July — maybe late July or August — I suspect there will be a special session to decide how some of that money will be spent,” Householder said.

Householder said he’s interested in more legislative control of budgetary matters, including official revenue estimates.

“Currently, we only have a finite amount of revenue that comes into the state. So I’ve said for the last year now, let’s sit down and talk about what are the priorities of the state. With this finite amount of revenue that’s coming in, what do we want to spend our revenue on? Allow the Legislature to set the revenue estimates. Allow the Legislature to create the budget.

“I think it would be to the state taxpayers’ benefit if we could do overall budget reform and decide what are the priorities and how we’re going to spend that money.”





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