A better way to deal with WV's budget woes

There's a lot at stake in the current debate over the state budget. It could affect kids, seniors, students, veterans and working families for years to come. Below, by way of friends at the WV Center on Budget and Policy and other allies, are some simple suggestions for fixing the problem and easy action steps you can take:

The state budget fight is a complicated mess. It's time to simplify.

Right now, we have no actual bill, but the last version we saw would have included the greatest tax cut for the rich in recent West Virginia history. To pay for it, lawmakers are talking about a wide range of bad ideas: a $94 million cut to public education, complicated tax increases, and even a food tax. Even with all these maneuvers, one lawmaker told us that we should still expect to see a deficit of over $200 million as soon as next year.

There is another way. We call it the Better Budget Framework for West Virginia. For the last 3 weeks, we have been talking to citizen leaders and lawmakers on both sides of the aisle - including members of Democratic and Republican leadership.  The budget framework below represents a simple way to get out of this mess.

It includes just 4 steps:

• Increase the sales tax from 6 percent to 6.5 percent.

• Do what other states have done and close sales tax loopholes, by expanding the sales tax to industries that have been exempt (telecommunications, digital downloads, personal services, electronic data processing,  personalized health fitness, contracting services, technical evaluations).

• Institute a fair share tax of 1 percent on income over $200,000.

• Institute a refundable 5 percent Earned Income Tax Credit, for working families - to incentivize work and make the plan less regressive.

This plan would generate roughly $270 million in revenue, on par with the targets set by other plans. Here are 10 benefits of the simple, better budget plan:

1. No cuts to K-12 education.
2. No tax cuts for the rich.
3. Fewer tax increases on working families, then the latest "compromise" plan.
4. No cuts to the Promise scholarship, and no new cuts to Higher Education.
5. No cuts to public broadcasting, the Women's Commission, or the arts.
6. No government shutdown.
7. No big new deficit in 2019.
8. No complicated triggers.
9. No food tax increase or other complicated tax increases.
10. No cuts to hospitals and health care.

To be clear, this budget framework is not perfect.  It's pragmatic. When we talked with lawmakers from both sides of the aisle, these were the priorities they listed. Like any good compromise, everyone will find something not to like in it -- including our own organizations and partners. We call it a framework, because some of the details could be tweaked (for instance, we'd be happy to see a sugar-sweetened beverage tax in exchange for a lower sales tax) and you would still get the same 10 core benefits.

Please click here to ask your lawmakers to sign-on to the Better Budget Framework, and help stop us from going the way of Kansas. Now is not the time for the greatest tax cut for the rich in West Virginia history.  It is not the time for complicated maneuvers.  It is not the time to subject ourselves to a decade of budget deficits.

Please encourage lawmakers to sign on to the Simple Plan.

It is up to us to Protect West Virginia!

Protect West Virginia is a grassroots coalition of more than 300 individuals and 30 organizations who oppose further budget cuts that harm our communities and who want to connect West Virginia values to state budget priorities.

Making sense where there isn't a lot

If you've been trying to make sense of the budget mess in the state capitol, good luck. Here are a couple of news articles that lay out the basics, one from MetroNews and one from the Gazette-Mail. Short version: it's a mess and there's a lot at stake.

Here's my take on it, as published in a Gazette op-ed this week: 

Gov. Jim Justice seems confident that a deal on the state budget is within reach, having told those attending a news conference, “I think we’re on a pathway to pass a budget that’s going to be really special.”

Of course, things could be “special” in all kinds of ways.

I really appreciate the governor’s sustained effort on behalf of a budget that benefits all West Virginians and doesn’t throw any of us under the bus (not to mention the fact that he raised the bar significantly on any and all future news conferences involving visual props).

While I understand the desire to reach a deal with the Republican Legislature, I hope the result isn’t a “compromise” that would hurt working families while giving a tax cut to the wealthy and causing more serious fiscal problems down the road.

Some elements of a proposed “compromise” proposal now being discussed are pretty ominous. These include major cuts to the state’s income tax, which is the only tax based on the ability to pay; increases in regressive consumer taxes; and the promise of long-term and ongoing budget deficits that could further slash the things we need to thrive in the years to come.

As Brad McElhinny reported for Metro News, the proposed compromise would “raise revenue up to $50 million for the coming fiscal year but cut revenue by $170 million each of the following two years, an analysis says.”

An assessment by Mark Muchow, deputy secretary of the Department of Revenue, estimates that, by 2020, this will cause a revenue decline of $220 million due to income tax cuts. This would come on top of year after year of major budget cuts.

On top of that, the Institute on Taxation and Economic Policy found that the proposed compromise would raise taxes for the bottom 80 percent of West Virginia households, while cutting them for the wealthiest 20. The biggest winners would be the wealthiest 1 percent, who would see a cut of over $3,700.

This comes at a time when revenue increases are needed for the things we value most: schools, higher education, infrastructure, kids, seniors, veterans, parks, recreation, etc.

It’s one thing to raise revenue to maintain our quality of life, but making the tax system more unfair to low-income families in order to give yet another break to those who don’t need it is just wrong.

As Sean O’Leary, from the West Virginia Center on Budget & Policy, recently tweeted, “If WV is going to increase taxes on working families, it should be for investing in schools, roads. Not to pay for tax cuts on the wealthy.”

What West Virginia needs is a compromise that doesn’t compromise our future.

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Easy action alert to protect WV

If you live in WV and want to do a good deed for the day, here's your chance. Call Gov. Jim Justice's office at 304-558-2000 and tell whoever answers that you want the governor to veto the bad budget passed by the legislature and fight for one good for WV kids, families and seniors. Don't forget to thank him for his work on this so far.

Also, if you're around Charleston, which I won't be, show up to support a decent budget tomorrow (Thursday, April 13) at 2:00 in the lower rotunda of the capitol. The governor is expected to make an important announcement about the budget at that time.

You can read more here,

A taxing question

The latest Front Porch program/podcast is about the proposal by the majority in the WV senate to replace the state's relatively progressive income tax with a regressive consumption tax. It's no surprise that I'm against it, for reasons mentioned on the podcast. I was pleased to learn, however, that my conservative counterpart on the program doesn't think it's a great idea either. You can get down in the weeds here.

Meanwhile, if you haven't already, click on Protect WV and sign up for alerts on the state's ongoing budget battles. Drastic cuts would adversely impact the quality of life for all West Virginians. We're talking jobs, roads, education and school services, higher ed, vocational training and workforce development, programs for kids and seniors, state parks, natural resources, and all the rest.

 Here's the action page. And, while we're at it, here's a budget calculator where you can come up with your own solution to balance the state budget.

This tax and budget stuff is a huge issue and one that could have as significant impact on our state as actions at the federal level.

Heads up!

It's understandable that a lot of attention is focused on the...stuff rolling out of Washington these days. But there's a huge threat at the state level and politicians of both parties talk about the need to slash the state budget, which has already been cut for the last several years.

Now it's even more serious. We're talking serious damage to the things that make life livable here..

There's no such need. They can easily raise revenue to protect schools, kids, seniors, higher ed, job training, parks, tourism, public safety and all that. It's a matter of choice.

I urge everyone in WV who cares about any of that to check out www.protectwv.org, learn about what's at stake, sign up to keep up and show up.

For West Virginians, this crosses divides. Whether you love or hate Trump, you probably know someone who goes to or works at a public school or college, have a favorite state park, go to a library, drive on roads, and care about public safety. Etc.

It's on. Now.

#protectWV #nofailedstate