- Associated Press - Wednesday, April 19, 2017

Recent editorials from West Virginia newspapers:

___

April 18

The Charleston Gazette-Mail on residents’ support of fair taxation to keep programs:

It is not just for West Virginia to cut $300 million a year in taxes paid by businesses, many of them out-of-state interests, and then turn around and balance the budget on the backs of all the people living here, in the form of higher income taxes, sales taxes and fees. It is not just, but amazingly, it is what West Virginia residents keep saying they want.

In comments, letters to the editor and at least one poll, West Virginians say they would rather pay more themselves than see important functions of the state further erode, or break down altogether because of budget cuts.

People, it seems, want to have confidence that emergency responders will come when they call, that their schools will open, that someone will be there to keep the fecal coliform out of the drinking water. Oh, and if the people, acting collectively as the state of West Virginia, could set something aside for the future, the way of all good grandparents, that would be ideal. Think road building and repair. Think educational opportunities that launch young adults into meaningful, gainful employment.

Governing by the ideology of all tax cuts all the time doesn’t work. West Virginia residents and taxpayers know it. Do members of the Legislature and their out-of-state political bosses?

Some ideals, however, should guide the public budget. A top one is that those who can afford to pay more should pay more. This is done intelligently and fairly through state income tax.

In West Virginia, even people who are not in the top tax brackets, people who clip coupons and don’t buy a new car (or phone) at the first itch for one, would pay more for the common good.

That doesn’t mean anyone wants to waste their money. People want things to function properly, without all the drama and uncertainty of recent years.

The just thing would be for the Legislature to approve a budget that preserves essential state functions, that builds up the state’s Rainy Day savings and that pays off old irresponsible debts (a legacy of bad grandparents). To be fair to all those West Virginians working to make a living here, the Legislature should restore some part of the business taxes that were cut, strategically and carefully, of course.

Early on, Gov. Jim Justice suggested a 0.2 percent tax on business receipts. Alternatively, the state could restore a corporate net income tax, which takes expenses into account and taxes profit rather than just gross receipts. Or, the state could revisit the business franchise tax, which formerly taxed businesses more as their debt fell and their balance sheets improved. That’s good for around $200 million, by some estimates.

Another part of the solution is to raise taxes on the highest incomes, another 3 percent on household income over $200,000, for example. For a person making $201,000 a year, such an increase would amount to another $30 a year in state taxes, but would raise about $96 million for the state and not harm a soul for whom $30 would be a real hardship.

Other possibilities include raising the natural gas and oil severance tax. Sales taxes are tricky because they can easily harm border-area merchants and fall disproportionately on the poorest residents. But a few make sense - digital downloads of books and music; cellphones; problematic substances that contribute to public health expenses, such as opioids, alcohol, tobacco and sugary drinks; and someday, marijuana.

In December, the West Virginia Center on Budget & Policy polled 603 residents statewide and found 70 percent were willing to pay more to avoid further cuts in state government (with a margin of error of plus or minus 4 percentage points).Residents understand there is an unsustainable formula at work. West Virginia is spending down its Rainy Day funds, cutting important activities, not taking in enough to cover expenses and has nothing left to invest in the future. Paying fair taxes is a civic duty that moves the state where its residents want to go.

If people opposed balancing the budget by cuts alone four months ago, imagine how many more will feel that way when doors close, layoffs come, paychecks stop and the effects ripple through the rest of the economy.

Online: https://www.wvgazettemail.com/

___

April 18

The Daily Mail of Charleston on Gov. Justice’s budget bill veto announcement:

West Virginia Gov. Jim Justice made history with his much acclaimed “major budget announcement” Thursday by being - as far as we know (and hope) - the only state executive - or anyone for that matter - to bring a pile of “bullcrap” (his word) into the Capitol building and use it as a prop to make a point in a speech.

In a planned, formal news conference in the Capitol rotunda, surrounded by “who’s who of all our state,” the state’s 36th governor vetoed the budget bill that both the House of Delegates and the state Senate had passed during the one-day extended session of the 83rd Legislature.

During the announcement, the state chief, sounding like he was giving a half-time pep talk to a poorly performing high school basketball team, explained his problems with the budget through a series of talking points written on two white boards.

He dramatically drew an X through each talking point and moved on. Up to that point, the Big Guy was on a roll, making his points well and drawing viewers to the logical conclusion: the event would end with a budget veto.

As he moved from the white boards to the dais, there were three covered silver serving dishes on a table beside him - looking as if they had come from a prestigious restaurant at his Greenbrier resort.

Referencing the folksy statements he made about the proposed budget in the waning days of the session, he raised the cover from the first dish to reveal an empty hamburger bun. He said, “What we have in this budget is not a nothingburger.” Then he uncovered the second dish, “It’s not a mayonnaise sandwich,” revealing the same.

Then he dramatically lifted the cover of the third dish to reveal a substance that, through the video stream, looked exactly like what he said it was: “What we have (in the budget passed by the Legislature) is nothing more than a bunch of political you-know-what.”

He then signed a veto order, calling on the Legislature to “stop the silliness.”

He made no word during the event of when he would call a special session; no word of what he would propose in a revised budget to entice the GOP-led Legislature to agree; no talk of moving the state forward. He showed no evidence of a willingness to work with legislators to solve the fiscal crisis and redirect the state toward long-term growth.

We don’t know whether the governor is now ashamed for such a disgusting display of political immaturity. But we do know that many West Virginians are.

Perhaps as a billionaire business executive, Jim Justice is accustomed to being surrounded by sycophants, who quickly answer “yes, sir” and agree to his every word. But the role of governor is much different. In this role, he is not the boss of anyone but those in the executive branch.

He and the state’s other elected leaders answer to the citizens of West Virginia and must work together. It takes a different kind of leadership skill to be governor than to be a business executive.

At 66 years old - but only three months into the role as governor - Jim Justice needs to grow up. He needs to learn quickly to lead the state through the use of wisdom and collaboration, and not by dragging it down to what he showed to be his level - bullcrap.

Online: https://www.wvgazettemail.com/

___

April 16

The Herald-Dispatch of Huntington on lawmakers inability to pass legislation a historic-building tax credit:

West Virginia’s lawmakers, looking squarely at a $500 million budget deficit, spent plenty of time during the recent legislative session talking about how sparking economic activity is the longer-term answer to the state’s financial struggles. There’s no question they are correct about that; lack of economic growth and the decline in the coal industry in particular has hurt the state’s revenue picture.

So it was disappointing to see that the legislature was unable to make one change in state law that might have fueled more business investment, created more jobs and added to the state’s coffers to some degree - with no significant cost.

Senate Bill 238 called for increasing the tax credit for rehabilitating historic commercial buildings from the current 10 percent of qualified project costs to 25 percent starting next year. It was a change sought by various groups, including city officials and developers in Huntington.

Their reasoning was simple: A larger tax credit could be the difference in whether a project is considered financially feasible by people hoping to upgrade or give new life to an historic building. In short, its supporters saw it as a means to spark more economic activity.

The Senate approved the measure, but House of Delegates amended the legislation to phase in the higher tax credit rate over three years. Then came the sticking point: The House also amended the bill to limit the total of tax credits in any given year to $5 million. The Senate wouldn’t go along with the annual cap, so the bill died when the legislative session ended April 8.

Why put a cap on economic growth?

In Huntington, for example, a group of local investors announced in February an initiative to promote the city as a retirement destination with hopes of investing up to $50 million in upgrading nearly a dozen older, historic buildings in the downtown. Key to pushing that vision toward reality is a larger tax credit that would help make their plans more financially doable, they said. But the $5 million cap on tax credits would limit eligible rehabilitation work to only $20 million in a year’s time. If Huntington’s project got off the ground and eventually consumed all the tax credits allowed in a given year, what about the rest of the state?

As it stands now, investment in rehabilitating historic buildings in West Virginia is relatively meager. According to a federal government analysis, about $6.7 million in expenditures on five projects completed in the 2015-2016 fiscal year qualified for historic tax credits in West Virginia. We should only wish that the level of investment would reach $20 million and even more in the years to come. That might be possible if the state would increase the tax credit to 25 percent, the level it is in most neighboring states.

Keep in mind that allowing a bigger tax credit does not mean the state will have to write checks to those who have invested. It’s a credit against taxes due. That may mean the state initially loses out on some tax revenue, but the amount would be minuscule in relation to the state’s overall budget - and to the potential growth in investment that might occur. A government analysis of the 2014-2015 fiscal year showed that historic rehabilitation investments totaling $7.5 million in West Virginia created 144 jobs, generated $5.2 million in income and nearly $1.7 million in taxes, including more than $1.2 million in state taxes. Those numbers would no doubt get bigger if more investment occurs.

The legislature’s failure to pass the higher tax credit was a missed opportunity. Let’s hope lawmakers will rectify this mistake next year.

Online: https://www.herald-dispatch.com/

___

LOAD COMMENTS ()

 

Click to Read More

Click to Hide