As the Legislature convenes for the 2010 Regular Session, no issue looms larger than the status and future of the state budget. Lawmakers are faced with the task of approving and balancing the budget, while maintaining fiscal responsibility and the services West Virginians expect.
“Obviously it’s a very difficult year. Cash flow is relatively good but we have a major concern with long-term debt,” said Senate Finance Chairman Walt Helmick. “This year we will be okay without cutting services to West Virginians.”
To ensure a balanced budget for Fiscal Year 2010, the Governor has requested mid-year expenditure reductions of 3.4 percent, or $120 million. This percentage is deducted from the already reduced mid-year cut of $197 million for this fiscal year.
The proposed budget for FY 2011, as delivered by the Executive Branch, is approximately $4.16 billion and includes the General Revenue, Regular Lottery and Excess Lottery Funds. Included in the total is $68 million in cash surplus, which will be utilized to help fill some gaps. However, projections predict a revenue shortfall of around $120 million this year and even greater disparities in the coming years.
Next year’s budget, with all of the proposed reductions, will be balanced with a combination of cuts and an influx of one-time federal stimulus package money of $119 million, which will be used to “backfill” some of the cuts. The federal funds will go primarily to public and higher education. All states are required to spend most of their stimulus share by 2011, meaning West Virginia will have to look for other funding sources if the state’s revenues continue to feel the effects of the economic downturn. Cuts of five percent have been made to the budgets of the Legislature, Constitutional Offices, and executive agencies.
While West Virginia lawmakers are bracing for across-the-board cuts, surrounding states have been forced to take tougher steps. Three of West Virginia’s neighbors, Pennsylvania, Ohio and Virginia, are among 13 states increasing fees. They and bordering Kentucky are among 26 states that, as a result of financial problems, have laid off, furloughed or offered early retirement to state employees.
“West Virginia has been fortunate thus far to weather the financial storm much better than our surrounding neighbors,” said House Finance Chairman Harry Keith White. “We must exercise patience and continue to act in a fiscally responsible manner to ensure we can keep providing the services our citizens expect.”
The Senate and House of Delegates Finance Committees have began holding budget hearings and are diligently poring through budget requests from the various state agencies. Work will continue throughout the session and will culminate during an expected extended Budget Session.
› 2010 Senate Budget Hearing Schedule
› 2010 House Budget Hearing Schedule
