The Senate met briefly at Noon on Monday to convene the Second Special Session of 2019. Three bills, which will first be considered in the House of Delegates, are listed on the Governor’s Call.
The Senate committee on confirmations is meeting at 3 p.m. in room 208W, and confirmations to the full Senate has been made a special order of business for today at 4 p.m.
The Senate is in recess until 4 p.m.
The West Virginia House of Delegates met Monday, convening the Second Extraordinary Session of 2019, referring three bills to committee.
Gov. Jim Justice called the special session last week, listing three bills on the call, found here.
Two bills were referred to House Finance, which is meeting at 1 p.m. Monday – House Bill 211, relating to the Tourism Development Act; and House Bill 213, supplementing, amending, decreasing and increasing items of the existing appropriations from the State Road Fund.
One bill – House Bill 212, relating to expungement of DUI offenses – was referred to House Judiciary, which is also meeting at 1 p.m. Monday.
The House will reconvene at 7 p.m.
Delegate T. Kevan Bartlett took the oath of office in a Monday afternoon ceremony in the House of Delegates chamber.
West Virginia Supreme Court Justice Tim Armstead administered the oath of office. Bartlett, of Sissonville, serves in the 39th district, which covers part of Kanawha County.
Gov. Jim Justice appointed Bartlett last week to fill the vacancy created by the passing of Delegate Sharon Malcolm.
The state Conservation Agency’s executive director asked legislators to keep the agency’s budget intact for the next fiscal year in order to maintain momentum on fixing and maintaining aging dams.
In Tuesday afternoon’s Joint Legislative Committee on Flooding, Brian Farkas, executive director for the West Virginia Conservation Agency, outlined issues with dams in West Virginia.
Farkas said there are 170 high-hazard small watershed dams, which he estimated provides close to $100 million in flood protection a year. About 60% of West Virginia residents are protected by dams.
More than half of these structures, he said, do not meet current design standards. He explained that when dams were built, they were under a certain hazard qualification. However, as more people and industry moved below these dams, that made the classification a higher hazard. To replace these dams would cost more than $1.7 billion.
Dams have structural issues as well. Farkas estimated close to 80% are 50 years or older. As these structures get older, they can develop seeps and slips, problems with the toe drains not functioning, problems with the trash racks not working efficiently, and outlook channels submerged under sediment or water.
Farkas said addressing seeps and slips on eight dams has an estimated engineering cost of $447,625. Fixing or repairing toe drains, which collect water moving through channels into a draining system, is estimated to cost $111,000. Farkas said 12 of these toe drains cannot be found and 10 need barriers to keep animals out.
Replacing and rebuilding 21 trash racks which collect debris, has an estimated cost of $436,000.
Outlook channels, which are concrete structures allowing water to pass through the structure, have an average cost of $5,000 per dam.
Costs for routine maintenance, including cutting grass or keeping trees from growing on the embankments, have been increasing every year. Farkas estimated for 2019, the cost is $965,000.
Farkas said no federal money is available for repairs. The National Resources Conservation Service provides money to rehabilitate dams. This could cost between $101 million and $500 million to rehabilitate 104 structures. There is a federal cost share of 65/35 so West Virginia would need to come up with $35 million to $175 million as a match, Farkas said.
The Legislature allocated an additional $3 million in the 2020 fiscal year to address dams. Farkas mentioned two in particular—the Upper Buffalo No. 4 and the South Fork dam – which both have contracts in place. Farkas asked legislators not to cut the agency’s budget.
“This kind of work is not one and done,” Farkas said. “It takes a couple of years to get the momentum going and to get contracts. … It may take a year or more but we need resources,” he said.
“They’re old and they’re getting older,” Farkas later said. “There is an opportunity to continue their existence and lifespan but we need to invest in them. I understand a lot of challenges face the Legislature daily. … What we’re asking is this is a public safety issue. This is important for flooding issues. Mitigating is just as important as anything else.”
National Guard Major General James Hoyer told legislators progress has been made on RISE cases and West Virginia has been taken off the FEMA manual drawdown process.
In Tuesday’s Joint Legislative Committee on Flooding, Hoyer and Mike Todorovich, director of the West Virginia Division of Homeland Security and Emergency Services, updated legislators on RISE cases.
RISE currently has 388 active cases, 348 of those cases have contracts awarded for construction, 32 are in the purchasing process, and eight remain. Hoyer said cases are churning through and as those eight go through the process, more will come up behind them.
“Where we are now, VOAD (Voluntary Organizations Active in Disaster) informed me there are a total of 1,384 cases out there, 400 to review to determine if any are eligible even though they may have been told otherwise,” Hoyer said.
Hoyer told the committee additional staff have been hired, who are going through about 45 cases per week.
“We have a path forward to get through all of those,” he said.
Since June, active cases have gone down from 479 to 397 last month, and down to 348 this month. Last month, Hoyer told the Flooding committee some of the cases have come off the list because reviewing cases found that some had duplicated benefits or had income levels outside of HUD (the U.S. Department of Housing and Urban Development) requirements for funding.
A requirement under the Fair Housing Act is to conduct outreach related to slum and blight approval. Hoyer said right now, November 1 is the date to take houses down and contractors have been awarded. An objective, Hoyer said, is to put 60 foundations in place before winter.
Hoyer said seven bridges have been completed. He mentioned one bridge is currently on hold in Clendenin. The bridge serves 17 families. However, before construction can take place, a mussel study needs to be done. The cost, he said, is $27,000.
“If we don’t complete that before Oct. 1, we have to wait until April because of the timeline related to mussel spawning,” Hoyer said. “We are working with the DOH (Division of Highways), who has a group of people to help us meet requirements for Fish and Wildlife and HUD.”
Todorovich updated the committee on FEMA, saying West Virginia has completed requirements needed to come off the manual drawdown process. According to a news release from the West Virginia Division of Homeland Security and Emergency Management, the process was in place starting November 2015 and by being released from manual drawdown, the division will be able to operate more efficiently.
Todorovich explained there were two reasons for the release from manual drawdown – completing policies required and completing the monitoring program, which were both deemed satisfactory.
There are two lingering issues with school constructions, Todorovich said. In Clendenin, mineral rights disputes have put construction on hold and in Nicholas County, the footprint of land from the school increased by 10 acres, which was more than originally listed.
For hazard mitigation funds, Todorovich, said he believed the first bid of mitigation money could be in 45 days. He clarified this is 45 days until funds are dispersed. He did not expect to see projects completed for three to four months.
West Virginia Supreme Court Justice Tim Armstead administers the oath of office to new Delegate Trenton Barnhart Monday morning in the House chamber. Barhart will serve in the 7th District, which covers Pleasants and Ritchie counties.
A DNR biologist said southern West Virginia counties could see major economic returns from elk re-introduction, once completed.
In Tuesday’s Joint Oversight Commission on Workforce Investment for Economic Development, DNR biologist Randy Kelley updated legislators on elk re-introduction efforts and the effects this could have on southern West Virginia’s economy.
Kelley explained elk were native to West Virginia. However, the Civil War had a major effect on elk’s habitat in the Northeast.
In 2015, the Legislature passed House Bill 2515, bringing elk to southern West Virginia counties of McDowell, Wyoming, Mingo, Wayne, Logan, Lincoln, and Boone counties. The Mountain State introduced 24 elk in 2016.
West Virginia was not the first state to re-introduce elk. Kelley detailed efforts in Pennsylvania, which has more than 1,000 elk. Virginia has an elk zone in three counties in the northwestern part of the state. Virginia re-introduced elk in 2013, has about 250 elk and does not allow hunting at this time, he said.
Kentucky, however, is the model for eastern elk re-introduction, Kelley said. Kentucky started re-introducing elk in the 1990s, bringing 1,500 elk from seven western states. Kelly told legislators that Kentucky has the largest free-range elk herd in the eastern United States at 13,000 animals in a 16-county zone.
West Virginia established a five-year management plan to properly manage wildlife in the state with the goal of providing a self-sustaining herd in the southern counties.
West Virginia’s current elk population is 80, Kelley said. Some problems have been chronic wasting disease found in deer along with brain worms that have infected elk.
Kelley said the southern part of the state could see economic returns. He cited surrounding states’ numbers including Pennsylvania, which drew 57,000 visitors the first year and Kentucky, which initially estimated an $18 million effect on the communities.
Kelley stressed that these are not just hunting numbers. These are tourism figures as well. Although there have not been economic predicting studies in West Virginia, Kelley said the state could expect $1.1 million to $2.4 million per county per year once completed.
Kelley mentioned elk viewing tours at Chief Logan State Park. Although visitors are not guaranteed to see elk, 90% of those who took the tour reported seeing them. Kelley said half of the people reported the tour as their first visit to Chief Logan State Park. This year, he said, there are 25 tours scheduled and all are sold out.
The West Virginia Deputy Revenue Secretary said a soft energy sector has affected revenue collections and state agencies could face a possible mid-year budget cut.
The Joint Standing Committee on Finance heard from Deputy Revenue Secretary Mark Muchow on the 2019 and 2020 fiscal years. The committee also heard a proposed interim bill that would reduce taxes on hard cider.
According to the Education and Finance 2019 Legislative Review, at the beginning of this fiscal year, the projected General Revenue estimate was $4.4 billion and the governor increased the estimate four times throughout the year, coming to a total of $4.7 billion.
The state ended the 2019 fiscal year with $36.8 million in surplus – with half going to the Rainy Day Fund and leftover funds going to partially fund the Medicaid appropriation.
Muchow said revenue for July and August, the first two months of the new fiscal year, missed estimates by about $49.8 million with severance tax being the major slowdown. Muchow explained the energy sector has been soft and exports have been down. He further explained that revenue for natural gas has been down 48% from last year and coal has been down 30%. He said the forecast assumed one to two pipelines under construction – the Atlantic Coast Pipeline and the Mountaineer Pipeline.
Muchow said $70 million was borrowed from the Rainy Day Fund but repaid on September 18.
He said state agencies could possibly prepare for a potential 4% mid-year budget cut.
The committee also discussed an interim bill to reduce taxes on hard cider. Hard cider is primarily made from fermenting apples but other fruits are sometimes added. It has a lower ABV than wine and does not include apple-flavored alcoholic beverages or hard lemonades, which would be classified as beer.
Currently, hard cider is taxed at the same rate as wine, which is 98.6 cents per gallon. Beer is taxed at a rate of 17.7 cents per gallon. The proposed bill would put cider between wine and beer for the tax rate, cutting the rate from 98.6 cents per gallon to 22.6 cents per gallon.
Under the proposed bill, cider would still be classified as wine and other restrictions such as licensing and age restrictions would still apply.
The bill would dedicate money collected from taxes on cider to the Agriculture and Development Fund to foster growth of apples and other fruits. The proposed bill also would allow growlers for cider.
Anoop Bhasin, counsel for the West Virginia Alcohol Beverage Control Administration, compared West Virginia’s current rate with neighboring states. In Kentucky, hard cider greater than 6.9% ABV is taxed like wine at 50 cents per gallon. Hard cider up to 6.9% is taxed like beer at 8 cents per gallon.
In Maryland, beer and cider are taxed at the same rate at 9 cents per gallon.
In Ohio, like Kentucky, cider is taxed according to ABV. Hard cider up to 6% ABV is taxed at 24 cents per gallon while cider between the range of 6% and 14% ABV is taxed like wine at 32 cents per gallon.
In Virginia, cider is taxed at 8 cents per liter.
Bhasin also outlined the federal classifications. Hard cider gets a special tax rate as long as it has 0.64 grams of carbon dioxide per 100 mililiters and contains at least 0.5% and less than 8.5% ABV. There have been proposals to increase the carbonation values and also permit other additives such as fruit or honey to ciders but they have not yet been approved.
Brad Glover and Brooke Glover, owners of Swilled Dog Hard Cider in Pendleton County, told lawmakers how this bill would affect their business.
Brad Glover explained hard cider is projected to be a $2.5 billion industry in 2019 and the industry is expecting significant growth. The market share is mostly, about 98%, national brands but regional brands are growing at an annualized rate of 25%, Glover said.
The Glovers founded their company in 2016. He said West Virginia is in the early stages of developing its hard cider industry. The company uses a significant amount of West Virginia apples. Glover explained West Virginia ranks ninth in apple production.
Glover said the reason this bill is needed is because it will reduce the barriers to enter the hard cider industry in West Virginia. He explained the money going toward cultivating and encouraging apple production is also essential. Hard ciders use certain types of apples that are higher in tannin than a dessert apple. He explained that hard cider companies can have a lot of access to apples but finding the right apples is crucial.
Workers have finished removing three rows of large limestone blocks from the spring line. This will allow workers to get to the area behind the blocks to install water-proofing measures. Until now, water cascaded down the dome, seeping behind the limestone blocks, and making its way into the rotunda area, causing damage.
Maj. Gen. James Hoyer updated the Joint Committee on Flooding Wednesday on the progress of home construction and rehabilitation for homes destroyed or damaged from the 2016 floods.
Hoyer said case management numbers have fluctuated for a few reasons. He noted 500 cases closed out by a previous contractor are now being reviewed to see whether they could be re-opened. Hoyer pointed out two-to-three cases, in particular, that the contractor closed but had no reason listed for that closure. He said there also were cases of smaller dollar amounts that could be reopened.
Since June, active cases have gone down from 479 to 397. Hoyer said some of those cases have come off the list because duplication of benefits found upon review and some cases had income levels outside of HUD requirements for funding.
Of those active cases, 250 are reconstructions, 39 are rehabilitations, 100 are mobile home replacements, eight are unassigned projects, and 59 have been completed. There have been 314 cases awarded contracts for work, 42 are in the request for proposal process, and 41 cases in the review process that Hoyer estimates will go to purchasing by the end of the month.
Hoyer also told the committee there have been challenges in getting vendors to bid for the projects. Only two to three vendors have been bidding on these projects.
