He is one of the key legislators on an interim study committee that has a task far more difficult than even the public education stalemate that stalled a special session earlier this month and has a committee of lawmakers and stakeholders hoping to fashion a compromise that could be considered at another special legislative session in early June.
Helmick said the solution is clear. Legislators must be willing to raise taxes, pull money from existing accounts and cut spending in some areas. None of those three ideas will be an easy sell to the governor or his colleagues in the Legislature. But the savy chairman of the Senate Finance Committee is right on target with his thoughts on the solution.
Sen. Brooks McCabe, D-Kanawha, is co-chairman of the
committee. He led a similar study group in the state Senate
during the regular 2010 legislative session that could not find the answer. Delegate Steve Kominar, D-Mingo, chaired an identical committee in the House that also came up empty.
Now the combined House-Senate panel will have until next January to prepare an acceptable solution. And Gov. Joe Manchin has made it clear that if an acceptable proposal isn't ready then, he'll be prepared to call a special session later in the spring before the start of the 2011-2012 state budget year on July 1, 2011.
Years of neglect in providing the appropriations necessary to keep this mounting deficit in a manageable amount and the soaring costs of healthcare during that period make this $8 billion unfunded liability twice as large as two other problems that the Legislature has addressed successfully in the past--the Workers' Compensation Fund and the Teachers Retirement System.
The Public Employees Insurance Agency's finance board took a small step in 2009 by eliminating any retirement health insurance benefits for new state workers and public school employees hired after July 1, 2010. But that primarily is to prevent the deficit from increasing.
Privately lawmakers realize that higher taxes are going to be needed to provide sufficient money to satisfy this deficit and even then it will have to be over a period of several years. So far no specific major tax increase has been mentioned publicly. And if it's any comfort, West Virginia isn't alone in this dilemma. PEIA Chief Financial Officer Jason Haught told the legislative interim study committee last week that other states are trying to cope with this same kind of large unfunded liability for future retiree benefits.
The most promising development lately has been a federal court decision that upheld a new state law in Rhode Island that reduced retiree health care benefits on the basis that, unlike pension benefits, there is no legal guarantee for state-subsidized coverage.
Meanwhile, the West Virginia Lottery Commission faces a difficult dilemma as it considers what changes if any to make before issuing new 10-year licenses for some 8,000 limited video lottery machines in West Virginia next year. At stake is some $400 million of profits that are equally divided between the state and the 1,600 or so bars, clubs and fraternal organizations around the state that hold the licenses.
The original law in 2001 that legalized these video slot machines allows up to 9,000 licenses to be issued but the actual number of licenses issued has averaged about 8,000 and Gov. Manchin proposed earlier this year that the Lottery Commission only allow 7,500 licenses for the next decade beginning July 1, 2011.
Two lobbyists for these video lottery distributors and retailers pleaded with the Lottery Commission recently to maintain the status quo. Both Wendel Turner, whose clients include both
distributors and retailers, and George Carenbauer, representing the state Amusement and Limited Video Association, made these identical requests.
Turner suggested a reduction in the number of licenses might put some of his clients out of business while Carenbauer said that 8,000 to 8,100 licenses seems to be the "sweet spot" for a maximum profit for both the licensed operators and the state treasury. The Lottery Commission has tentatively scheduled the bid opening for the
2011-2021 licenses in mid-October.
Finally, he's only been in the state Senate since 2006 but Putnam County legislator Mike Hall is the new minority leader there. Hall was chosen by the GOP caucus last week to succeed the late Don Caruth, R-Mercer, who died May 1 less than a month before his 60th birthday. Del. John Shott, R-Mercer, was also sworn in last week to succeed Caruth as one of two senators from the 10th senatorial district.
Hall is native of Huntington and a graduate of Marshall University. He was first elected to the House of Delegates in 1994 and served there until he ran for and was elected to the state Senate four years ago. He had previously served as a minority whip in the House during the 75th Legislature (2001-2002).
Special legislative committees studied the issue without any resolution at the regular 60-day session earlier this year and now the governor has put it on the back burner for the rest of this year by announcing he will have a "major initiative" to cope with this long-term debt in his agenda for the regular 60-day legislative session in 2011.
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