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Gov. Justice says new budget hurts WV families

Justice sat down for interviews with news outlets throughout the state Thursday and Friday, saying he wasn’t pleased with the proceedings and results of a 22-day special legislative session and giving his perspective of what happened leading to the passage of a $4.225 billion budget for fiscal year 2018, which he said would hurt families throughout the state.
Justice did say he was proud of his $3 billion roads plan that he in the past has said will bring 48,000 jobs to the state as well as education reforms that took place during the regular legislative session, which ended April 9.
Justice talked with staff at The Herald-Dispatch for about 35 minutes Friday, and a portion of his comments are included below.
For background, Justice’s roads plan includes broadening the authority of the West Virginia Parkways Authority to establish more toll roads throughout the state, and establishing a one-time annual EZ Pass user fee for West Virginia drivers, which would keep them from having to pay through the West Virginia Turnpike toll booths.
It also is supported by increases to the state’s gas tax, some Division of Motor Vehicles fees, and the privilege tax on buying a car from 5 percent to 6 percent.
The revenue from those fees will be used to patch or otherwise improve existing roads and bridges.
Justice also has set Saturday, Oct. 7, for a special election to allow for West Virginia voters to approve a bond sale to further finance additional road construction projects throughout the state.
On Friday, Justice also called out lawmakers, specifically Democrats in the House of Delegates, for the failure of tax reform proposals during the special legislative session that began May 4 and ended June 26.
The budget passed by lawmakers was bolstered somewhat by budget estimates that showed a revenue surplus for 2018, but it largely included cuts to higher education and fairs and festivals throughout the state. A portion of the surplus money will be used to backfill the state’s Medicaid program if the surplus comes to fruition.
To date, officials at Marshall University, West Virginia University and West Virginia State University have increased tuition in response to the cuts.
Lawmakers spent the better part of the special session debating tax reform measures to provide revenue for the state. All of the proposed measures ultimately failed.
Among the tax reform measures they debated were altering the income tax rates and structures, increasing the sales tax rate, and allowing the sales tax to be charged on currently exempt services and goods.
The most contentious points of conversation during the special session were the proposed changes to the state’s personal income tax structure, including lowering the income tax rate by 20 percent, which was most enthusiastically pursued by Justice and Republican leaders in the Senate and most strictly objected by members of the House and Senate Democrats.
All of the tax reform proposals were lumped into one bill during the session, so among the now-dead tax reform that lawmakers disagreed on were measures they did agree on.
The agreed-upon measures included the elimination of the income tax on military retirement income and the elimination of income tax on Social Security income for certain households.
Other agreed-upon provisions included an increase in the personal income tax exemption for certain households and an increase in the historic building rehabilitation tax credit.
Since the end of the session, House Speaker Tim Armstead, R-Kanawha, and Senate President Mitch Carmichael, R-Jackson, said they were willing to reconsider tax reform measures when the Legislature meets again for its regular session in 2018. Both men expressed their frustration that a tax reform deal wasn’t reached.
Here are some excerpts of the governor’s comments:

Budget reaction

Well, guys, we’re on day one of the new budget. If you’re wanting my feelings, it’s just this.
I could be a politician, and I could stand up on a box, and I could say, “Well, look at what I accomplished. Look at the great roads jobs, and look at the great roads package and all the goodness it’s going to bring. It’s going to bring tens of thousands of jobs. It’s going to bring all kinds of revenue to our state. Not only that, it’s going to bring new roads and fix old roads, and it’s going to give us the opportunity to bring manufacturing and tourism to our state, and glory, glory, hallelujah.”
And I could stand back up on the box, and I could say, “Look at what we accomplished from the standpoint of education. We got rid of this needless testing and Smarter Balanced. We got rid of things that are attributed to grading our schools A-F. I’m very proud to stand staunchly behind my feelings that education ought to be our centerpiece.”
But on the other hand, I can’t be a politician, and I can’t get out of my mind that if you really unnecessarily hurt a family, especially in my great state, that I thought was totally unnecessary, and it was, one family is too much.
We hurt hundreds of thousands of families, and regardless of whether you guys believe that’s the story or not, I know that’s the story.
And the reality is real simple. You’re seeing it happen right before your eyes, Marshall raising tuition by 9 percent and WVU by 5 and others following suit. That’s nothing but a tax, guys. It’s nothing but a tax that was unnecessary to have happen.
We absolutely – there’s nothing, zero, with the exception of our roads plan or the exception of the gains I’m talking about in regard to education. If you take away, and unfortunately I’ve said this many times, but politics move people toward being ego centered, and I am anything but that.
In the political arena, you’re expected to stand up and say, “I did I did ,” and I’m uncomfortable with that.
If you remove the roads package and the education components, somebody, pray tell, what did we do?
And I can’t identify anything we’ve done. Other than, just for political gains, all we did was hurt our people more.
Guys, I can’t do anything except tell you the absolute truth, and here’s the truth: As much as it may hurt or whatever, this is the truth.

Almost had a deal

At one point in time during this special session, we had the deal done. Armstead, even though he didn’t want to do it, was willing to deliver 26 to 30 of his votes. They didn’t want to do it, but we had the deal done.
Now, from the standpoint of the Senate, they wanted the P.I.T. (personal income tax), and absolutely we wallered it down and negotiated and negotiated and compromised and compromised and compromised.
I give Mitch Carmichael kudos beyond kudos, but (the Senate) was ready to go at 5-5-5-5 (Reporter’s note: Justice is referring to a plan to lower the income tax in 5 percent increments over a period of time as long as certain financial and economic events take place) and with the poorest people getting a rebate check. Not a tax cut, a rebate check.
And then in addition to that, there were triggers in between all those five, and the wealthy people beyond $150,000, they didn’t get the benefit of this.
The Senate’s ready to go. The House is ready to deliver 26 to 30 votes. We were going with a 6.35 consumer sales tax, and everything was go.
And what happened? The Democrats dove in the ditch. The House Democrats dove in the ditch.
The very people that should’ve tried to protect their constituents, and I pleaded with them. I said, “Guys, do you realize who is going to get hurt here? There’s going to be real pain. The universities are going to get hit. The teachers are going to get hit. The miners are going to get hit. Absolutely, the DHHR, the Medicaid is going to get hammered.
At the end of the day, we’re going to lose our Social Security exemption for our elderly. We’re going to lose our veterans exemption. At the end of the day, we’re going to walk away from the ability to fix this terrible drug epidemic.”
We had built into this thing this 5 percent fee for all of the successful bidders for this road work to pay. Now, we had that done. The contractors were on board with it because they’re going to get so much work, it’s unbelievable. At the end of the day, they would’ve sharpened their pencils on the bidding process and we would’ve gotten that for free.
Now, that money would’ve amounted to probably close to $150 million that we could’ve put more money into social workers and treatment facilities. We could’ve done something really significant to curb or stop this terrible drug epidemic that’s going on within our state and cannibalizing us.
What did we do? What did we do?
We threw it all away, every bit of it, every single last bit of it right out the window. I mean, think about it. If that’s not the story for our people, then I don’t get it.


Now, Justice can stand up on his soapbox and say how great he is with the roads and education, but really and truly, if you’re a family with an income under $10,000, you could’ve gotten a rebate check of $150 and a tax reduction in addition to that. Our people don’t know that.
Our veterans, the people that absolutely have given us everything we have in life, we just threw them to the curb.
Now, the next thing that’s going to happen, you have hocus-pocus money, and that’s it. Guys, it’s hocus-pocus money to backfill DHHR or Medicaid. Now, we’re going to sit back and maybe blame the federal government if we have a problem with Medicaid.
Now, I am telling you without any question, the Medicaid dollars are not going to be there because they are made-up money.
They took our accounting numbers of $24 million of surplus and just said because they need $58 million to backfill Medicaid, they said, “We’re just going to raise that to $82 million.”
Well, I mean, where does that come from?
And if all of this isn’t bad enough, then what we did was this: We stripped every single dollar out of tourism. We absolutely walked away from this historical tax credit. We stripped every dollar out of tourism. Now, we’re looking at the possibility of even having to close our entire tourism department.
There’s a guy, and I’ve said this over and over, but there’s a guy in South Carolina. His name is Tom Floyd, and Tom Floyd oftentimes looks at me and says, “Any frog that’s not proud of his own pond isn’t much of a frog.”
Well, you think about it. If we can’t be proud enough of West Virginia to market West Virginia, we must not be much of a frog.
So, the long and short of it is just this, guys. Our out-year numbers are a catastrophe. We are hurting people right in front of our eyes right now with our kids coming to our higher ed, because of tuition increases, because we can’t squeeze any more juice out of the fruit, because we’ve hammered higher ed over and over.

Looking back

And my last of my last I would say to you all is just this. If you say, “Well, Justice should’ve been more of a politician,” I would say back to you, “What have the politicians got you so far?”
You know, how are you liking what you’ve had for years and years and years before Justice ever came along? How’s it working for us?
What happened last go-round with (former Gov. Earl Ray Tomblin)? You know he’d been in as a politician forever. What happened? He spent 23 days (in a special legislative session in 2016), and we passed the cigarette tax.
What happened in the years prior to that?
We lived off the Rainy Day Fund until we drained it to no man’s land, and we absolutely got nothing done – no hope, no prosperity, no plan, no nothing. And every time we turned around, we kicked the can a little further down the road, we got a bigger hole and we had to address it.
Listen, guys, I just got to the party, and the party I walked into had a $497 million deficit. We’ve done nothing but kick the can down the road.
Justice came up with this roads idea that will save our bacon, and it will absolutely save our bacon.
Now, is Justice delighted by that? Well, sure. But is Justice going to say look at what he did, as most politicians would? No, I’m not, because Justice cares too much about this family, and Justice doesn’t want anything for Justice.
All Justice wants is goodness for our families, and in this situation, our families got absolutely shortchanged like you can’t even imagine. And they got that from politicians on both sides of the aisle, and it’s a crying, pitiful shame.

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