The great W.Va. budget balancing game

By Brad McElhinny in News

Let’s play a game, just for pretendsies. It’ll be a fun money-management game! Just like Monopoly, Life or Careers.

This game is called, Fill the $400 Million Hole in West Virginia’s Budget. For you experienced players, we can bump up the amount to $500 million.

A week ago, during a monthly financial call with reporters, state Revenue Secretary Bob Kiss laid out the rules.

br“If you don’t fix it – and the only way to fix it is to have additional revenues or spend less – if you don’t fix it, over time, it will devastate the state’s finances,” Kiss said.

Oh, that’s easy, you say. Government is wasteful. We can make cuts!

On one level, you are correct, my friend. Cutting could be done. But government has been cutting already. Remember, you’ve got to get to $400 million. Will your well-intentioned, rational, laser-focused trimming be enough? Or might you have apply a hacksaw?

Let’s say you whack the entire Promise Scholarship. That’s $47.5 million, so you’ll have made about 10 percent of your goal. Just 90 percent to go! But if this game has repercussions, you’ve angered middle class West Virginia families and eliminated a tool to encourage pursuit of higher education.

This might not be as easy as we thought. We might have to raise taxes.

But last year, Governor Earl Ray Tomblin suggested some and the only one that went anywhere was an increased tobacco tax – and even that was like pulling teeth. Also, with West Virginia’s broader economic struggles, can state residents and businesses afford more taxes?

We have a new, incoming governor, though, and maybe he’s got some ideas.

During a debate this fall, Jim Justice touted several possibilities to provide temporary relief to the state budget, including sweeping accounts, the hope of a federal subsidy meant to promote the timber industry, a trend toward rising metallurgic coal prices and a short-term loan of, you know, hundreds of millions of dollars.

Justice said doing so would buy the state time to more broadly boost its economic development.

“The alternative is cut, cut, cut or tax, tax, tax – and I don’t believe in either of those,” Justice said.

For you ‘Star Trek’ nerds out there, this move is called the “Kobayashi Maru,” where, up against a no-win situation, you simply change the rules of the game. Jim Justice is totally pulling out the Captain Kirk playbook here.

On the other hand, Justice’s newly-named chief of staff, Nick Casey, has hinted that tax increases might have to be part of the mix.

When the Legislature really gets going on February 8, the governor will hand his suggestions to the state Legislature, which will have to make the actual, hard decisions.

This week I was part of a panel discussion that included legislators like Mike Hall, the Senate Finance chairman.

The good news is, Hall said the Legislature will need to get busy on the budget early, rather than noticing they’re three quarters of the way around the game board before a strategy kicks in.

With the shape West Virginia is in, legislators have a serious problem on their hands. Dealing with this gargantuan budget hole won’t be fun.

Aren’t you glad you’re not those guys?