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West Virginia state budget

West Virginia's Gov. Earl Ray Tomblin signed the state's $11.6 billion FY2013 budget into law on March 22, 2012.^[1]

West Virginia has a total state debt of approximately $22,941,837,000 when calculated by adding the total of outstanding official debt, pension and other post-employment benefits (OPEB) liabilities, Unemployment Trust Fund loans, and the budget gap. ^[2]

See also: The West Virginia State Budget on State Budget Solutions

[edit] FY2013 State Budget

Gov. Earl Ray Tomblin signed the state's $11.6 billion FY2013 budget into law on March 22, 2012.^[5] The governor used his line-item veto power Wednesday to trim $13.5 million from the budget, citing economic uncertainty nationally to conclude the state must keep permanent budget increases to a minimum.^[5] Items the governor vetoed included:^[6]

• cut pay and benefit raises for State Police civilian employees by $1.05 million;
• cut funding for expenses at the Racing Commission nearly in half, by $696,800;
• all $510,000 budgeted for equipment at the state Contractor Licensing Board;
• reducing revenues from the lottery for the Development Office by $410,000.

Legislative budget

The state Senate approved the $11.6 billion spending plan on a 34-0 vote while the [[ballotpedia:West Virginia House of Delegates|House] voted 85-15 to approve the budget on March 16, 2011. The budget increases spending 2 percent over the FY2012 budget.^[7] The legislative budget increased the the Medicaid Trust Fund by $170 million more than FY2012, which is $14 million more than the governor had requested.^[8]

Governor's proposed budget

The govern proposed FY2013 state budget general fund of $4.55 billion, an increase of $15 million over FY2012. The proposed budget does not include any tax increases, and goes forward with about $80 million of previously approved tax cuts, including a $50 million reduction in state sales tax collections on food.^{[9] [10]}

The budget does not include pay raises for state employees.^[11]

Revenue

The governor's proposed budget relies on tax collections of $4.1 billion. It also relies on surplus and lottery proceeds to boost revenue.^[11]

Medicaid

The share of the budget for Medicaid will rise $111 million to $500 million due to a decline in federal Medicaid funds from a 4-to-1 to a 3-to-1 match of state dollars, and federal health-care mandates that will add 170,000 individuals to the program.^[9] The 2013-2014 state budget will require $650 million for Medicaid.^[12]

State Budget Office director Mike McKown said in Jan. 2011 that if lawmakers keep everything at current levels and funded all programs the way they were at the start of 2012, the 2013 state budget would be about $225 million short. The $225 million deficit is primarily due to rising enrollment in and costs for Medicaid. The governor's administration said that raising taxes to close the gap is not an option but it would consider tapping into the $800 million-plus rainy day fund.^[13]

[edit] FY2012 State Budget

Better than expected tax revenues through FY2011 means a brighter revenue picture for the FY2012 budget, and a potential surplus to keep it balanced, meaning that the state could avoid raiding emergency reserves or making such painful choices as program cuts, tax hikes and public worker layoffs.^[14]

A conference committee composed of members from both the House of Delegates and Senate hammered out the differences between the budget bills passed by both chambers, and developed a budget that they said did not vary greatly from the governor's proposed budget. ^[15] The legislature passed its budget bill on March 18, 2011.^[16]

The budget passed by the legislature uses a general revenue estimate of $4.014 billion, which is $1.5 million less than what was initially introduced by acting Governor Earl Ray Tomblin, but up by about $270 million from FY2011.^[16]

Highlights of the bill include:

• $100 million to casinos who plan to use the money to buy slot machines^[16]
• $40 million increase in motor vehicle fees^[16]
• pay raises for state employees
• pay hikes for mine inspectors, although it did not include inspectors for Marcellus shale which had been requested by the governor
• increased funding for public libraries, increased funding for the needs-based higher education grant program
• a fully funded public employee retirement fund, with $426 million going toward unfunded liabilities

Rainy Day Funds

As of Sept. 15, 2011, the state's two rainy day funds, when combined, totaled $818.3 million — more than 20 percent of general revenue spending.^[17]

[edit] Tomblin's Proposed Budget

Acting Gov. Earl Ray Tomblin proposed a state spending plan for FY2012 of more than $4 billion on Jan. 12, 2011, the opening day of the legislative session. It does not impose any new tax increases.^[18] It includes a reduction in the state sales tax on groceries, from 3 to 2%.^[18]

The budget includes one-time salary enhancements of $800 for schoolteachers, who will also receive their annual step increment pay increases of $580, and $500 for school service personnel.^[18] It also provides a 2% salary enhancement, with a minimum payment of $500, for state and higher education employees, which would cost a total of $47.5 million.^[18] The administration said it was not prepared to give permanent pay raises, which would cost $47.5 million a year in future budgets, given uncertainties about the economy.^[18]

The budget does not include money to pay down the $8 billion unfunded liability for future health care benefits for retired state and public school employees.^[18]

It maintains Medicaid funding at the current level of $370.6 million despite estimates that the state's contribution will need to increase by $200 million by 2014.^[18]

The proposed budget also includes:

• $2.5 million to subsidize substantial increases in Workers' Compensation premiums for volunteer fire departments around the state.

• $11.5 million to the state Public Defenders Office, to pay court-appointed attorneys.

• $12 million to Division of Corrections. About half of that would be spent on capital improvements at state prisons and day reporting centers. The other $6 million would be for payments to the Regional Jail Authority for housing Corrections inmates in the regional jails.

• Nearly $1 million to the state Office of Miners' Health and Safety, to hire 12 new underground mine inspectors.^[18]

The governor's proposed FY2012 budget can be found here.

Marcellus Shale Inspector Funds After the legislature failed to reach an agreement on new regulations for the types of drilling used to extract gas from the shale, the governor requested an additional $2 million to hire up to 10 inspectors to help monitor the the growing number of drilling operating tapping into Marcellus shale. The legislature did not include the $2 million in the budget and said that the governor's request would be best addressed through a separate supplemental bill.^[19]

[edit] Budget transparency

• See sample transparency legislation at the Sunshine Standard

West Virginia currently has limited transparency. The West Virginia legislature website posts information about state grant awards here, but unfortunately "The Budget & Spending Transparency Act," which would have created greater spending transparency, did not pass during the 2009 legislative session. However, in state legislator Kelli Sobonya's own words, "I will reintroduce this bill [The Budget & Spending Transparency Act] again next session for consideration."^[20]

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
TransparencyWV.org	Y	Y	N	Y	Y	N

See also: Evaluation of West Virginia state website

[edit] Independent transparency sites

West Virginia University students compiled this report finding that the state is a "laggard" in the area of budget transparency and making recommendations for increased transparency, including, "All agencies, boards and commissions should make their budget requests and presentations available online. There should be common standards for agency disclosures across state government to make sure that information is available to the public in an easy-to-find manner. Setting online public disclosure standards that match those of other states with high marks for transparency and accountability."^[21]

[edit] FY2011 State Budget

Find the state’s FY2011 Comprehensive Annual Financial Report (CAFR) compiled by the state government here.

Halfway through FY2011, state tax collections had generated $1.9 billion, which is 9% more than originally projected.^[14] The state has forecast collecting at least $3.7 billion by June 30, 2011.^[14]

The legislature approved the FY2011 budget when it passed Senate Bill 213 on March 20, 2010.^[22]

The West Virginia Center for Budget and Policy and the firm Downstream Strategies informed the House-Senate legislative interim subcommittee their report estimating that the coal industry cost the state budget more than it provided, with coal industry revenues at $600 million during the 2009 budget year, and costs of $97.4 million more.^[23]

General Revenue Fund Appropriations^[24]

FY2011 monthly revenue estimates can be found here.

[edit] Budget Background

West Virginia's fiscal year begins July 1 and ends June 30 of the following year. Agency budget requests are submitted by September, after which the Governor compiles his recommendation for the new fiscal year. Officials revenue estimates are completed by November prior to the Governor's final budget recommendations. Governor submits the budget the second Wednesday in January to the Legislature who proceed to hold a series of hearings from January through March.; in a year following a gubernatorial election, the date is extended to the second Wednesday in February.^[25][26]

[edit] Accounting Principles

Main article: West Virginia government accounting principles

The West Virginia State Auditor's Office is responsible for examining state and local governments and school boards as well as paying all the state's bills. Glen B. Gainer III has been elected State Auditor every four years since 1992. County audit reports are published online, but the site is not user friendly to the public being geared towards state agency use.^[27]

The Institute for Truth in Accounting (IFTA) rates West Virginia “Tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider West Virginia's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[28] West Virginia's CAFRs are publications of the West Virginia Department of Administration, Finance Division, Financial Accounting and Reporting Section. Ross Taylor is State Comptroller and Director of the Finance Division.

[edit] Stimulus

West Virginia has received $1 billion in federal funding.^[30]

[edit] Public Employees

Main article: West Virginia public employee salaries

Main article: West Virginia public pensions

According to 2008 Census data, the state of West Virginia and local governments in the state employed a total of 117,327 people.^[31] Of those employees, 93,289 were full-time employees receiving a net pay of $288,640,423 per month and 24,038 were part-time employees paid $20,440,633 per month.^[31] More than 57% of those employees, or 67,113 employees, were in education or higher education.^[31]

[edit] External links

[edit] Additional reading

• Governor Joe Manchin,"State of the state address 2009,"January 19, 2009

[edit] References

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