10:06am: Talkline with Hoppy Kercheval

Governor and senators come to the table on tax cut, but not to an agreement

A couple of weeks ago, Gov. Jim Justice and state Senate leaders weren’t in the same ballpark on changing the state’s tax code. Now they’re at least in the same room.

That doesn’t mean the governor’s proposal for a 50 percent tax cut over three years is a slam dunk, but at least on Day 2 of the regular legislative session senators were willing to talk.

“We all have to work together. Like each other or not like each other, we have to work together,” Justice said on MetroNews’ “Talkline,” following a breakfast meeting with key legislators.

The meeting included the governor, the state revenue secretary, House leaders like the Finance chairman and Senate President Craig Blair, Senate Majority Leader Tom Takubo and Senate Finance Chairman Eric Tarr.

On the breakfast menu were eggs, pastries and biscuits and gravy. On the table was the tax cut.

House leaders have been receptive to the tax cut so far. In fact, the governor’s bill was already primed to run Thursday afternoon in the House Finance Committee.

But in the Senate, hard feelings remain after the fight over Amendment Two, which would have opened the door for lawmakers to cut personal property taxes, including those on vehicles and what businesses pay on machinery, equipment and inventory. The governor thought the amendment was irresponsible, and Senate leaders thought it would encourage development.

Going into this legislative session, Senate leaders have described acting independently of the governor on the budget and tax proposals. They have described a hybrid that would provide credits for a range of personal property taxes while also moving toward personal income tax reductions.

Today, Senate Finance Chairman Eric Tarr came away from the meeting willing to continue discussions but not ready to commit to the governor’s proposal. “We had a conversation” was his first description of what took place.

“We left it with, ‘We’ll take a look at it and talk again later,'” Tarr said.

Yet Tarr went on to say agreeing to a tax plan could be easier with only two entities involved — the House and the Senate — without the “third leg” to complicate matters.

“I think it would be best, with mega majorities on the Senate side and the House side got together and decided what we want to do and take the third leg out of it and get it done,” Tarr said.

“I just don’t see that there’s a necessity to have that block in the road. I think the negotiation would happen a lot faster. Happy to talk to him, but the things we’ve seen in the past from this governor, it’s really difficult to believe what he’s going to say when it comes to negotiation.”

Tarr questioned whether the governor’s plan could stand in the way of other tax cuts in other areas — and also whether it’s based on the strength of one-time money.

“Whatever we do, we need to do it safely,” he said.

Justice, speaking on “Talkline,” said he’d made sure to ask his advisers to project the potential effects of the tax proposal even if the economy dives into¬† recession or if energy prices plummet. He also emphasized that he’d forgotten in his State of the State address to describe establishing a $700 million “rainy day fund” to be “an insurance policy if we have any level of shortfall.”

“We are rock solid to do this,” Justice said.





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