CHARLESTON — Taking advantage of several years of excess tax revenues, Gov. Jim Justice told the entire state Wednesday that he would return those monies back to West Virginians through several tax cuts. 

Justice gave his seventh State of the State address Wednesday night in the House of Delegates chamber in front of the public, lawmakers, and state officials.  

“There’s so much good going on in the state, we can’t fit it all in,” Justice said. “It’s an incredible day to be a West Virginian.” 

The state netted more than $526 million after ending fiscal year 2022 in June with more than $1.3 billion in surplus tax revenue. The state already has more than $833 million in surplus tax revenue through the first six months of the current fiscal year as of December, with lawmakers expecting the state to exceed $1.8 billion in surplus tax revenue by end of the fiscal year this June. 

Justice said the record-breaking tax surpluses provide the state the opportunity to begin returning some of those dollars in the form of historic tax breaks. He proposed a 50% reduction in the personal income tax, an increase for the 10% cut he proposed over the summer.  

“We’re going to have to aggressively look at our income tax,” Justice said. “We have the opportunity to do something monumental at this moment.” 

Justice said the cut would take three years to implement, beginning with 30% next tax year, and 10% in year two and year three. During the previous fiscal year, personal income tax collections were $2.502 billion, making up more than 42% of the $5.887 billion the state collected in the general revenue fund that year. If fully implemented, a 50% cut in the personal income tax could return $800 million to taxpayers. 

Justice also said he would keep to his word and introduce a rebate for residents for their motor vehicle tangible personal property taxes. If passed, residents would be able to receive a rebate when they file their state taxes each year. The rebate would return approximately $145 million to taxpayers. The state would reimburse county governments and school systems that receive those tax revenues. 

“I sent the bill. I did exactly what I promised,” Justice said. 

Justice presented another relatively flat general revenue budget for lawmakers to consider over the next 60 days of the 2023 legislative session. His budget for fiscal year 2024 beginning in July is $4.884 billion, 5% more than the $4.645 billion general revenue budget for the fiscal year 2023 passed by lawmakers last year. 

“When things are wonderful as they are right now, we have to be prudent,” Justice said. “I want to mind the store, absolutely. I want to do what is right from a businessman’s standpoint.” 

Officials with the state Department of Revenue briefed the media on the details on the fiscal year 2024 budget prior to the start of Justice’s State of the State address. The budget bill includes another 5% average pay raise for state employees, teachers and school personnel, and state troopers at a cost of $115 million. It will make Justice’s fourth 5% pay raise for state workers. Another $45 million covers an increase in the state school aid formula. 

The budget also includes $59 million for the Public Employees Insurance Agency to cover the cost of increasing reimbursements to in-state healthcare providers. Wheeling Hospital announced last week it would stop accepting PEIA effective July 1 because in-state reimbursement rates are less than what PEIA pays out-of-state healthcare providers. The state Senate also passed a bill Wednesday to require PEIA to reimburse providers at a rate of 110% of similar services offered by Medicare. 

Justice proposed a one-time bonus of $1,500 for retired state employees over the age of 70, additional funding for the state’s food banks and senior centers, putting an additional $10 million in a program to recruit and retain nurses in the state, and providing $1 million for crisis pregnancy centers. Justice asked for lawmakers to pass a locality pay bill to provide higher pay to correctional officers on border counties. And Justice wants to offer a one-time program to over veterans a $5,000 incentive to return to West Virginia. 

With the state Department of Health and Human Resources in the headlines, Justice said he wants to hear the idea of lawmakers on how to improve the struggling department but asked lawmakers to listen to him and the interim DHHR team. The state Senate passed a bill earlier Wednesday to split DHHR into three separate departments.  

Justice appointed Dr. Jeffrey Coben, the associate vice president for health affairs at West Virginia University and Dean of the School of Public Health, as interim DHHR secretary late last year. Dr. Clay Marsh, chancellor and executive dean for Health Sciences at WVU, and James Hoyer, a WVU senior associate vice president, will also serve as advisers to Justice on DHHR matters.  

“We can make it better,” Justice said. “It didn’t get in this mess over the last couple of years. This is a culmination of a problem that’s been there many, many, many, many decades. We can make it better.” 

With more than $607 million left in American Rescue Plan Act funds, Justice said $500 million should go to the economic development impact fund. The state received more than $3.5 billion in ARPA funds last year, which can be used for COVID-19-related expenses and certain kinds of infrastructure improvements. Justice also called for updating and consolidated the state’s various labs at a cost of $250 million, splitting the cost between 2023 and 2024. 

Justice praised new jobs and manufacturing companies coming to the state in 2022. According to the Department of Commerce, 29 new businesses said they were coming to the state in between January 2022 and Wednesday, representing a total investment of $6.19 billion and creating more than 3,300 jobs. Justice announced two new companies, including TLC Specialties. The company will construct two facilities in New Martinsville to manufacture food ingredients — a $150 million investment that will create 200 jobs. 

“Just think when every single bit of this is done, think of what you’ve created,” Justice said. “You’ve created our grandchildren’s jobs … now, they’re going to be in West Virginia.” 

With just two years left in his second term as governor, Justice reminded the state where it was when he first took office in 2017, the state’s progress over the past six years, and his optimism for the state going forward. 

“If we reflect back on the past and we’re fair, we can say we didn’t have anywhere to turn,” Justice said. “How did this goodness happen? I believe it happened by the goodness of God above … I believe he is guiding this state every step of the way.” 

Justice is limited to two consecutive terms as governor. He teased a possible run for U.S. Senate in 2024 during his State of the State. 

“I won’t be your governor a whole lot longer, but I surely won’t go away,” Justice said. “You’ll probably either be able to find me at home or you may find me in Washington. But I’ll try to watch as best I can and help as best I can.”