CHARLESTON — Whether West Virginia University and Marshall University will be hit with multi-million-dollar revenue cuts in the 2021-22 state budget could become a little clearer Friday, when the House of Delegates considers pending amendments to the House version of the budget bill.
House Bill 2022 would cut WVU’s appropriation from $97.02 million to $79.02 million, and would cut Marshall from $46.76 million to $36.76 million. However, it would backfill those cuts using $28 million of what is expected to be more than $200 million in surplus funds from the 2020-21 budget year.
In the Senate’s version of the budget measure (Senate Bill 125), WVU would be cut by $12 million and Marshall’s cut would be $6 million — but those cuts would not be made up with surplus money.
“It’s just tragic, when we’re taking more money from the exact area we should be putting more money into,” Sen. Ron Stollings, D-Boone, said during a Senate Finance Committee meeting Wednesday to advance the bill
He noted that state higher education has been targeted for budget cuts year after year.
“This ends up on the backs of West Virginia’s students and potential students in the form of higher tuition and, in some cases, closes the door to higher education,” he said.
Sen. Michael Maroney, R-Marshall, said the cuts are particularly galling considering that the Senate recently approved legislation directing $10 million in state Lottery funds to be used for facility improvements at West Virginia’s racetrack casinos.
“To subsidize our casino industry, and then to take money away from the colleges bothers me,” he said.
The Senate cuts would reduce WVU’s appropriation by 10.8% and Marshall’s appropriation by 12.2%.
Pending in the House is an amendment, submitted by Del. John Doyle, D-Jefferson, and 12 other Democrat delegates, to fully restore funding for WVU and Marshall in the general revenue budget.
However, also pending is an amendment from Del. Brandon Steele, R-Raleigh, and Geoff Foster, R-Putnam, that would strike the sections of the House budget plan committing $18 million in budget surplus to make the two institutions whole.
Through March, the state had a $235 million revenue surplus for the 2020-21 budget year, and that amount is expected to grow over the final three months of the budget year, with the influx of new federal stimulus funds through the American Rescue Plan Act, and with state income tax returns due by May 15.
Pending bills to roll back state personal income tax rates are driving the budget cuts in the House and Senate plans.
The House budget measure cuts Gov. Jim Justice’s proposed $4.569 billion general revenue budget by $82 million in anticipation of losing $75 million in revenue from income tax cuts for the first half-year of a House plan to phase out the tax in annual multiples of $150 million per year (House Bill 3300).
The Senate’s plan cuts $79 million from Justice’s budget, and uses $34 million of the 2020-21 budget surplus to partially backfill some of the cuts.
The Senate Finance Committee on Tuesday hopped up the House’s proposed income tax phase-out with a first-year cut of $1.09 billion. Although the Senate plan would make up for about $900 million of that reduction in sales tax and other tax hikes, the Senate budget plan also cuts spending in anticipation of steep drops in state revenue.
Currently, personal income tax is the largest single source of state tax revenue, bringing in about $2.1 billion, accounting for about 43% of total general revenue.
Traditionally, the differences in the House and Senate versions of the budget would be worked out in a House-Senate conference committee but, in the past couple of years, the chambers have worked out compromises on the Budget Bill without going into conference.
Currently, items where both bills match, and points where they disagree include:
- Both bills cut funding for the newly elevated Department of Tourism from $14 million in the governor’s budget to $7 million, but both fund the second $7 million through surplus money.
- Both bills cut funding for the Milton flood wall from $21 million to $7 million, but both provide the remaining $14 million from surplus.
- Both bills cut funding for the MARC commuter rail service in the Eastern Panhandle by $2.8 million, and neither uses surplus to restore that amount.
That comes 15 months after the Justice administration, working with the Legislature and county and municipal governments, negotiated a funding plan to keep the Maryland-based passenger rail service operating.
- The Senate bill zeroes out $3.8 million in funding for the Educational Broadcasting Authority, which operates West Virginia Public Broadcasting, while the House bill fully funds it.
Public Broadcasting has been on the budget-cutting block before. In 2017, Justice’s proposal zeroed out EBA funding, money that was mostly restored in the final budget plan. The Senate bill creates a new account, providing $300,000 for Mountain Stage, a national radio program that is funded under the EBA umbrella.
- For all state agencies not specifically singled out for spending cuts, the Senate budget bill imposes 1.5% across-the-board cuts, amounting to $21.24 million.