WV tax department struggles with vacancies

CHARLESTON, W.Va. — Staff shortages driven by low salaries are making it difficult for the West Virginia Tax Department to effectively perform its duties, its assistant commissioner told the House Finance Committee on Friday.

“We’re at a critical juncture, in a lot of ways,” Danny Morgan said during the Department of Revenue budget hearings.

Morgan said the Tax Department has lost 18 percent of its personnel since 2013, and is having difficulty filling vacancies because of low salaries and concern that potential severe state budget cuts will result in layoffs.

He said the public probably notices the staff shortages most when they call Taxpayer Services, which is down to 18 service representatives, resulting in call wait times of up to two hours.

“The fact of the matter is, I have 18 people trying to answer 350,000 calls,” Morgan said, referring to the annual number of calls the office receives. “It’s not an ideal situation. We’d like to be able to get to calls faster.”

Similarly, the department has a shortage of auditors, because the low starting salary of $29,400 contributes to high turnover.

“They leave because the private sector — and even a lot of public-sector organizations — pay a lot more,” Morgan said. “You can get your 18 months in here, get your foot in the door, and double your salary.”

He said the shortage of auditors costs the state, noting that each $1 spent in the auditing section translates into $200 in tax assessment collections.

He said the department, which has absorbed general revenue budget cuts of nearly 20 percent since 2013, is proposing a retention incentive plan that would give new hires 5 percent annual raises and provide salary adjustments for employees with five or more years of service.

Also during the budget presentation:

Revenue Secretary Dave Hardy said February tax collection was “essentially flat,” which is actually an improvement over the early months of the 2016-17 budget year, when collection fell short of estimates, creating the current $123 million shortfall.

While state tax collection has stabilized in recent months, Hardy said the rebound is not to the point of reducing the amount of the budget deficit.

Lottery Director Alan Larrick said proposed legislation to increase the maximum number of machines permitted at Limited Video Lottery locations could produce an additional $10 million to $12 million in revenue.

Currently, bars and clubs may have a maximum of five LVL machines, while fraternal organizations may have up to 10 machines. The legislation would increase those maximums to seven and 12, allowing for more machines in the best-performing locations.

Reach Phil Kabler at [email protected], 304-348-1220 or follow @PhilKabler on Twitter.