Senate Finance Chairman Eric Tarr says state budget items may be revisited over the next few months, but he proposes a cautious approach to spending on health and human services.
Gov. Jim Justice, a Republican, has said he’ll soon call a special session over state financial matters, especially over human services priorities. Democrats in the House of Delegates, during a Monday press conference, underscored their position that funding needs to be addressed.
During the final hours of the regular legislative session, lawmakers passed a $4.96 billion general revenue budget. Justice signed the budget bill days later but called it a “dog’s mess” because of some funding priorities that were left out.
Tarr defended the budget as it was put together at the time, but acknowledged an upcoming return to consider more financial matters. He described earlier financial uncertainty over the possibility that an economic trigger could prompt additional income tax cuts plus doubt over whether West Virginia could be on the hook by the federal government over millions of dollars in education spending.
“I think what we did is very appropriate,” Tarr, R-Putnam, said today on MetroNews’ “Talkline.” “In May, I think we’ll probably go back and revisit some of these things once we have a better forecast on some of the things that were less certain for us.”
But in Tarr’s judgment, the state has already exceeded the base spending it could afford for next year.
“We really shouldn’t have grown the budget any more than about $77 million more than we did last year,” he said. “We ended up growing base spending more — closer to about $200 million, instead of $77 million.”
He reiterated that financial matters could be more clear by the time of the special session. “We’ll be able to make transfers to areas where we may have overappropriated to areas where we may have underappropriated,” he said.
A major area of allocation that has changed is health and human services funding. The Legislature broke apart the $7 billion Department of Health and Human Resources last year into three agencies. Tarr said the budgeting process is now more specific too.
In the past, he said, agency leaders were able to transfer funding within the big department — and it was unclear from the outside where the money was going.
“So essentially, the legislature had yielded its power of appropriation blindly to a bureaucrat,” Tarr said.
The breakup of the big agency into three made it more difficult to make those transfers. Beyond that, Tarr said, a single line of appropriation became as much as 25 lines of appropriation, “so we could go in and see exactly what they’re spending on.”
In the past, he said, the agency was able to take appropriations for medical services, intended to be for Medicaid expenses, and transfer the money to state hospitals to pay for contract nursing — a $100 million expense.
Tarr said Medicaid enrollment is declining as people come off pandemic-era rolls. “So I don’t think we underappropriated it as a whole,” he said.
The level of detail in health and human resources sections of the budget should better allow lawmakers to determine where money should be shifted, he said. That could allow lawmakers to transfer money later, perhaps even after the new fiscal year is underway.
“What I do expect is when we come back and look at it again in the fiscal year — not May; I think that’s going to be later in the fiscal year when we actually get into the ’25 fiscal year — when we get into that, I think we’re going to be able to see in some places we still overappropriated and in other places we might have underappropriated.”
The progressive West Virginia Center on Budget & Policy think tank, in a budget analysis, described deep cuts to the state’s Medicaid funding. The budget for the coming fiscal year leaves Medicaid with a shortfall of about $147, according to the center’s analysis.
“Because Medicaid is a state-federal matching program, each dollar reduction in state funds forfeits federal dollars,” analysts at the center wrote.
“All told, the reduction in state Medicaid funding in the FY 2025 enacted budget compared with the governor’s budget proposal could reduce the total Medicaid budget by $628 million, or almost 12 percent of the entire Medicaid program.”
Democrats who gathered to discuss the upcoming special session said such funding should be restored.
“When you have such a high population relative to any other state that receives Medicaid and you think we’re playing with those benefits, There’s no good reason for that,” said Delegate John Williams, D-Monongalia.
Speaking on MetroNews’ “Talkline,” Delegate Mike Pushkin, D-Kanawha, called for full funding of health and human services.
“We need to focus on the budget,” Pushkin said. “There were huge cuts to Medicaid and, most notably, most severe, cuts to the IDD waiver program. That’s the waiver program for individuals with intellectual and developmental disabilities. That’s money through Medicaid to help their families better take care of them, keep them in a home environment.”
Governor Justice, in a briefing a couple of weeks ago, made similar points.
“We have hundreds of thousands of people in West Virginia that are going to be affected — can you imagine, can you imagine the good work that we did and now we could possibly hurt those folks,” said Justice, going on to list additional programs meant to support the state’s vulnerable population.
“Why did we do it? Why in the world did we do it?” Justice said, expressing concern about federal matching dollars.