CHARLESTON — Federal stimulus dollars and a recent pension funding change have allowed West Virginia’s Senate to tweak the upcoming state budget by $248 million.
But the amended budget bill unanimously passed Wednesday still cuts general revenue spending by $47 million from what the Legislature passed last year.
When the 60-day session began in January, Gov. Joe Manchin proposed a spending plan for the budget year starting July 1 that totaled around $11.3 billion. It included $3.7 billion backed by general tax revenues, $525 million from lottery proceeds and $4.3 billion from federal funds.
At Manchin’s request, the Senate added $266 million in stimulus-related funds, including $140 million to shore up the long-struggling State Road Fund. The governor revised his revenue estimate for that fund by that amount on Tuesday, to reflect expected, additional federal dollars earmarked for highway needs. He also added $20 million from this potential source to the State Road Fund for the current budget year.
“There have been rumblings about it,” said state Budget Director Mike McKown. “There’s no bill yet, but if they pass one we would be ready to go.”
Manchin also recommended changes last week to his budget proposal that reflect the decision by the Consolidated Public Retirement Board to revisit the premiums it charges.
State agencies and other public employers with enrolled workers pay these amounts toward their pension benefits. Counties in particular had balked at the initially proposed 6 percent premium hike. The board last week instead increased it by 1.5 percent, to 12.5 percent.
The board adopted an accounting method known as smoothing. That will require additional premium changes for the next several years to correspond with the pension funds’ investment earnings. But is also allowed him to free up nearly $15 million from general revenue to spend elsewhere in the budget.
Manchin’s recommended updates also reduce the state’s share of public school funding by $10.5 million, to reflect better-than-expected property tax revenues earmarked for education.
The Senate adopted the governor’s suggested changes, as did the House Finance Committee when it advanced an amended version of his budget bill Wednesday. Manchin issued an order Wednesday extending the Legislature’s time in Charleston by one week to allow the two chambers to negotiate and pass a compromise spending plan.
Completing a new budget typically takes a week or so beyond the regular session — except for last year. Uncertain when the state might hit bottom from the recession’s effects, lawmakers delayed work on a final bill for more than a month.
Manchin’s original budget had proposed spending up to $25 million from any leftover lottery funds toward a proposed state government-wide computer-based system meant to share financial, personnel and other records. The Senate kept that language in its bill, while House Finance removed it.
Other lottery funds, meanwhile, and stimulus dollars are offsetting much of the general revenue cuts Manchin had ordered for the proposed budget — 4 percent for education and 5 percent for most other agencies. These revenue sources are easing the task facing West Virginia lawmakers when compared to many of their counterparts elsewhere. The National Conference of State Legislatures estimated in December that the states had to cut a total of $21.9 billion from their upcoming budgets to avoid deficits.
