By LINDA HARRIS
The Exponent Telegram
CHARLESTON, W.Va. — With the Mountain State’s budget bleeding red ink, an out-of-control opioid epidemic and decaying infrastructure, Clarksburg City Manager Martin Howe sums up the 2017 legislative session with one word: Crucial.
“On a state level, I think the priority is the budget from a marketability standpoint for the state and for the state to be able to invest or (attract) future investments,” Howe said. “But on a local level, we want the state to continue to invest in infrastructure and create an environment to allow for economic development to happen.”
Lawmakers face a herculean task when the regular session begins Wednesday.
“It’s going to be painful,” Charles Town Mayor Peggy Smith said. “But I think most people realize we have to do something. Cuts will have to be made, but you can’t dwell on those. You have to dwell on how you can increase revenue so we can bring services back. That’s how I look at it.”
Smith said, however, that she looks forward to seeing what the Legislature and Gov. Jim Justice will do.
“We’re just like other cities across West Virginia — we’re all looking for revenue,” Smith said.
“Instead of saying, ‘Cut this’ and ‘Cut that,’ we need to start looking at how we can increase the revenue. There are going to be things people may not agree on, but there are revenue producers out there and we need to be thinking outside the box,” Smith said.
Howe said the state’s first priority has to be plugging the gaping, half-billion-dollar hole in its budget.
“This session is going to be crucial from a financial standpoint,” he said. “It will ultimately impact every decision thereafter — to what services can be provided to new programs that can be implemented, and how (cuts) trickle down and impact state employees all the way down to the services offered by counties and municipalities. It all revolves around the fiscal status of the state.”
Painful though it will be, Howe said, to be effective, budget reductions “cannot be one-time reductions. They have to be periodic in nature for several years to keep the budget balanced.”
“I wouldn’t say we’re nervous. I think we’re optimistic,” he said. “I guess with new leadership, you’re going to (tend to) be optimistic about what can be presented and the relationship that can be built upon with the legislative body, as well as in working with municipalities and county officials.”
Howe said municipalities are hoping lawmakers boost the tax credit for historic properties.
“It’s a statewide initiative,” he said. “We’d like to see the historic tax credit increased from 10 percent to 25 percent. The goal is to entice developers to re-purpose and utilize properties within historical districts and increase the value of properties that may have been ignored or the values decreased due to the exorbitant cost to rehabilitate the structures.
“By increasing the credit, it actually places us equal to and competitive to many surrounding states that currently offer 25 percent tax credits to property owners or investors.”
And Howe said there’s no question that “opioid use is at the top of our radar in North Central West Virginia.”
“I think opioid use affects all walks of life, all economic statuses. It’s definitely a problem within Harrison County, as well as surrounding counties,” he said. “And it’s not specifically in terms of the people who are unemployed — it’s also of concern for employers whose employees may be using these drugs. Mainly we (need help) to find appropriate treatment centers to assist in combating the issue, as well as implementing educational components because, obviously, law enforcement cannot combat the entire issue.”
Fairmont City Manager Robin Gomez says the state’s biggest problem isn’t how to cut spending, but how to spur growth.
“The state has to figure out (how to achieve) growth,” he said. “Growth in economy, growth in population can’t hurt; growth in investments, growth in existing businesses, growth in how we portray ourselves to our neighbors and in the entire mid-Atlantic region.”
Gomez said he’s sure efficiencies can be found, but the state also must figure out how to generate revenue as well. And with the start of the new fiscal year just five months away, Gomez said lawmakers must take time to look at West Virginia’s fee structures and tax exemptions, as well as reductions in force.
Fixing the economy will fix much of what ails West Virginia, he added, including the drug problem.
“We need to employ people,” he said. “Now, they have nothing else to do. People need to be doing something, that’s where work and education come in to play.”
With a “little creativity, a little innovation,” West Virginia can attract more outside investment “and try to maintain, even see a little growth in our revenue,” he said.
“I’m hopeful our state is going in the right direction,” he added. “There are tremendous opportunities here that West Virginia needs to take advantage of, even beyond this region and throughout the country. There are lots of opportunities, lots of things happening in the Mountain State.”
Charles Town, a bedroom community of just over 5,000 residents, is quintessential small-town America. Founded in 1786 by Charles Washington, youngest brother of President George Washington, Charles Town’s biggest industries are tourism and horse racing; its biggest problem, revenue.
“Once they come here, people fall in love with it,” Smith said. “We’re a friendly, laid-back community with lots to do. Our problem, right now, is a decline in revenue. Hollywood Casino, with the big MGM (National Harbor) casino opening up (in Maryland), is seeing about a 20 percent decrease in revenue.
“It’s the same problem across the state — declining income. We’ve got to think about how we can increase revenue.”
Smith said people gravitate to Charles Town for a reason.
“They want to be safe. That’s why they move here,” Smith said. “They want a safe environment, so that’s high on the priority list for us. I think they also want nice amenities. They want to have nice places to shop, but they don’t want all the traffic involved with large cities.”
Smith said West Virginia communities need more help in the war on drugs, particularly on the treatment side.
“We’ve got to be able to treat the drug problem, and right now the Eastern Panhandle is very lacking,” she said. “I guess the whole state is like that, but we have no facilities here at all.”
For the first time in decades, the state’s northernmost counties are poised to reap the benefits of an industrial boom: Shell plans to begin construction this year on its $6 billion ethane cracker in Monaca, Pa., a 20-minute drive from Hancock County. Another firm, PTT Global America, is considering a nearly $6 billion investment in an ethane cracker in Dilles Bottom, Ohio, minutes from Ohio County.
Brooke County’s 5.7 percent unemployment rate and Hancock County’s 5.6 percent unemployment “continue to reflect the increase in investment and construction activity in the Panhandle since 10-year highs of 13.3 percent (Brooke) and 13.7 percent (Hancock) were recorded in February 2010,” Ford said.
“I think what’s exciting for folks in the economic development community is that we have two businessmen — a governor and secretary of commerce — at the helm,” he added. “They’ve both been very successful in business and industry here in West Virginia … and obviously they’ve felt the impacts of our regulatory environment. (The question is) how can we apply what they’ve learned doing business here in West Virginia?”
Ford said being hamstrung by a leaky budget isn’t the end of the world.
“My motto is if you don’t have money, you have to think,” he said. “I’ve always worked in environments where there was no money, no staff and no resources. That’s pretty much been life working in Appalachia.”
He said the investment community needs to see “continued improvement in our business regulatory environment, continued support in making sure we have programs in place to create a (trained) workforce.”
“And we need to continue to develop regulations that can help with identifying, acquiring and repurposing environmentally-challenged properties because of the growth, rapid growth, in the energy and chemical industries, particularly in the Northern Panhandle and also around Charleston,” Ford said.
Mark Glyptis, president of United Steelworkers union local 2911 and a Weirton native, said the deficit is a worry.
“You’re not going to solve the budget problem in two or three years; it’s got to be a long-term solution, and I think the legislators understand that,” Glyptis said. “I just hope the right financial experts are brought in and they come up with a plan that gets us out of this debt situation and creates jobs — family-sustaining industrial jobs. That’s going to have to happen over a period of time; obviously, we have to get our finances in position first.”
Glyptis said the Mountain State has much to offer, “we just have to be creative in how we deal with potential investors.”
“I’m hoping the Legislature makes us more attractive than what’s been done in the past,” he said. “Businesses look at West Virginia, but there are other states offering more than we are offering. Short-term sacrifice can bring long-term, meaningful gains. I’m hoping the governor and legislators are going to be more creative.”
New Cumberland Mayor Linda McNeil said she’s hoping legislators recognize problems peculiar to her community — specifically, heavy truck traffic on narrow, difficult-to-navigate Route 2. The roadbed is crumbling under the weight of the trucks.
“At the most vulnerable point, where it’s visibly eroding, if one of those semis goes over (the hill), right below is a Columbia Gas pumping station,” McNeil said. “That’s what I’m trying to prevent.”
McNeil insists it’s imperative for state officials to find the funds to relocate Route 2 around the trouble spots, which include two 90-degree turns. The estimated price tag is $10 million.
“It’s going to cost a lot of money to do it, no doubt about it,” she said. “But it can be recouped within a short amount of time; it will do nothing but enhance the whole state … we just have to make sure they’re prioritized. Of course, everyone thinks their project is most important but when you look at the economic benefits that will come with prioritizing things.”
Outdated infrastructure tops Wellsburg Mayor Sue Simonetti’s priority list.
“The biggest problem we’re facing is outdated water and sewer lines,” Simonetti said, pointing out three water projects are in progress, each of them costing well over $1 million. “Our water system is over 100 years old and we continue to have breaks. We just put patches on them. We’ve got to look at replacing lines and getting up to date, but it’s going to be a big hit, and who is going to pay for it? Our residents. The money’s not out there — there might be low interest rates, but it’s all loans.”
Streets and sidewalks also need significant upgrades.
“Oil and gas industry has pushed the price for paving materials up for us also,” she points out. “We don’t have that money in our budget, we just don’t. The increase in the cost of materials is really hurting us, and we’re not really recovering anything from the oil and gas boom. We don’t have any property that has oil and gas on it.”