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Budget impasse continues as legislative session nears end

By Jim Ross

The Exponent Telegram of Clarksburg

CHARLESTON, W.Va. — With a week left in the regular session of the Legislature, the question remains whether the House of Delegates will agree to a tax increase or if it will hold firm to a promise of no new taxes.

The State Senate this week passed a tax bill that used a proposal that Gov. Jim Justice had given up on. Republicans in the Senate said they did not like the plan, but they voted for it anyway so a tax proposal could be kept alive for consideration before the session ends.

Senate Finance Committee Chairman Mike Hall, R-Putnam, said that day, “I’m in an awkward spot today. That is to support this bill and keep the process moving.”

Democrats in the Senate refused to support it because it was an old proposal.

Minority Leader Roman Prezioso, D-Marion, noted that projections said the tax proposal voted on by the Senate would increase revenue in the short term but would cause decreased revenue in later years. Sen. Corey Palumbo, D-Kanawha, said the bill would shift the tax burden from upper-income families to middle- and lower-income ones.

It was almost a party line vote, with one Republican voting against the plan and one Democrat voting for it. With the House having killed its own tax proposal, the Senate version is all that’s left on the table.

House Minority Leader Tim Miley, D-Harrison, on Friday noted that the governor now wants a one-fourth of 1 percent increase in the existing 6 percent sales tax, while the Senate bill would increase the sales tax to 7 percent and place a 3.5 percent sales tax on food.

“The irony hasn’t been lost on me,” Miley said.

The governor had public events in the Capitol Thursday and Friday to rally support for his plan. The first was a news conference Thursday where he said budget talks had broken down, and he was offering a choice to legislators.

“We got right to the altar, and we couldn’t make a decision,” he said.

Justice said even with the budget cuts that have already been approved, he needs another $45 million in revenue to bring it all into balance. He offered two solutions. One is increasing the sales tax by another one-fourth of 1 percent to bring it to 6.25 percent. That’s an extra penny for every $4 spent, which should be pain-free, he said. The other is a tax on soft drinks and cigarettes.

“We don’t need them both. We only need one,” he said.

Starting the budget process all over at this late date “would be catastrophic to our state,” Justice said.

“We need to do our job, vote and go home.”

Without voting a tax increase and relying only on cuts, Republicans will have to go home and explain to people why some parks are closed or why Concord University shut down, Justice said. The governor said he would veto any bill that paralyzes the state.

“There’s no need on either side for standing and beating your chest. Now is when cool heads need to think, be smart, have wisdom, work together and finish this up.”

Friday morning, Justice had another news conference, this one in cooperation with the West Virginia Center on Budget and Policy. The news conference included several speakers, such as Stephen Smith, executive director of the West Virginia Healthy Kids and Family Coalition.

Smith said proposed cuts to public education would mean a loss of funding of about $79 million for schools. At the county level, that would be a $9.3 million cut in funding for books, teachers and programs in Kanawha Couty, about $2.659 million in Putnam County and $3.288 million in Cabell County, he said.

Justice addressed his remarks to 46 elementary and middle school-aged children from Cabell County who are part of a performing jump rope team called the Village Magic.

Gathering the children near him, Justice said, “We’re close to passing a budget, but close doesn’t mean anything.”

He gave some children pennies and asked if they would be willing to spend an extra penny on every $4 purchase if that helped a poor child in their class. He told them about the choices that may have to be made by some families who fall on hard times and don’t have government programs to turn to for help because of budget cuts, even if it means having grandma sleep on the front porch, where she could die.

Justice said he was sitting on a four-legged stool to illustrate the four parts of his proposal. One is having businesses pay an additional $12.50 in taxes for every $5,000 they take in. The second leg is the additional penny on every $4 in purchases people make. Then there is a tax on the wealthy that would amount to an extra $500 for a family that earns $200,000, he said.

The fourth leg is cutbacks in government, he said.

Justice told the children, “You need to let your voices be heard.”

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