AP NEWS

Senate passes budget plan

March 7, 2019

CHARLESTON — On a party-line 20-14 vote, the West Virginia Senate on Wednesday passed and returned to the House of Delegates the 2019-20 budget bill — sans $67.7 million for pay raises for teachers and school service personnel and a total of $15 million in funding enhancements for state two-and four-year colleges.

Although the working budget bill is House Bill 2020, the Senate on Tuesday replaced the contents of the bill with the Senate’s version of the budget plan, setting the path to get the bill into a House-Senate conference committee to resolve the differences between the two versions of the budget.

Although negotiations continue behind the scenes, time is running out for the teacher pay raise with the so-called “clean” pay raise bill (HB 2730). Unlike pay raises for most state employees, which are built into personnel line items in the budget bill, pay raises for teachers and service personnel requires passage of legislation.

Meanwhile, a key Senate bill item is a $110 million appropriation of general revenue funds for secondary road maintenance, although the bill creating the special road repair fund has been amended in the House Finance Committee to remove the funding appropriation (SB 522).

Conferees will also have to sort through a total of $65.39 million in tax cuts proposed by the two houses, the largest being a proposal to phase down the severance tax on steam coal, which as currently amended would result in a $20 million loss of revenue in the 2019-20 budget (HB 3142).

Also pending are House bills to redirect 2 1/2 percent of severance taxes on low-producing natural gas and oil wells into a state fund to plug abandoned wells, at a cost of $16 million a year (HB 2673), and to restore the state film tax credit at an estimated maximum cost of $10 million a year (HB 2491).

Senate bills pending, meanwhile, would cut taxes by a total of $15.89 million, including an estimated $7.38 million under legislation that would provide tax incentives to encourage local governments to consolidate (SB 117), and to eliminate the state tax on life insurance annuities at a cost of $4.56 million (SB 30).

Also pending is legislation that would exempt Social Security retirement benefits from state income taxes, a plan that would ultimately cost the state about $25 million a year (HB 2001). However, since the exemption is phased in and takes effect in the 2020 tax year, it would have no impact on the 2019-20 state budget.

Budget conferees could begin meeting as early as Thursday, March 7, although they would be on a tight timeframe to reach an agreement in order to pass the budget bill before the regular session ends Saturday, March 9. Last year marked the first time in 32 years that the Legislature passed the budget bill without going into an extended budget session.