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By Steven Allen Adams
For The Inter-Mountain
CHARLESTON -- For West Virginia politics, 2023 was a year that saw one of its major figures announce a retirement, the state bringing in record tax revenues and historic tax cuts and several scandals involving executive branch agencies.
MANCHIN ANNOUNCES
RETIREMENT
U.S. Sen. Joe Manchin, D-W.Va., announced in November that he would not seek re-election in 2024, choosing to retire at the end of his term.
"After months of deliberation and long conversations with my family, I believe in my heart of hearts that I have accomplished what I set out to do for West Virginia," Manchin said in a statement last month. "I have made one of the toughest decisions of my life and decided that I will not be running for re-election to the United States Senate...."
Manchin, 76, first won the seat in a special election in 2010 to succeed former U.S. Sen. Robert C. Byrd who died that same year. He defeated Republican Morgantown businessman and media mogul John Raese in 2010 and 2012, and a challenge from Republican Attorney General Patrick Morrisey in 2018.
Manchin plans to spend the next several months touring the country as part of a new moderate political advocacy group created by his daughter, former pharmaceutical CEO Heather Bresch. Manchin, who has been whispered about as a potential third party presidential candidate, will be in New Hampshire -- an early presidential primary state -- in January for a political event.
"...What I will be doing is traveling the country and speaking out to see if there is an interest in creating a movement to mobilize the middle and bring Americans together," Manchin said.
Senate Minority Leader Mitch McConnell, R-Ky., recruited Gov. Jim Justice to run for Manchin's Senate seat, entering the race in April. Justice, who is limited to two terms as governor and entering his final year in office, was already endorsed by West Virginia's second senator - Shelley Moore Capito, R-W.Va. - and former Republican president Donald Trump, who is seeking a second term after being defeated in 2020 by Democratic President Joe Biden.
"I want to tell you tonight I'm officially announcing my candidacy for the United States Senate, and I will absolutely promise you to God above that I will do the job, and I will do a job that will make you proud," Justice said at his campaign announcement at his Greenbrier Resort in April.
Another top candidate in the 2024 GOP primary for U.S. Senate is Rep. Alex Mooney, R-W.Va., who announced his candidacy in November 2022. Only one Democratic candidate - veteran and self-described "socialist" Zachary Shrewsbury - has filed with the FEC to run next year, though Wheeling Mayor Glenn Elliott is considering entering the race.
WEST VIRGINIA ENDS FISCAL YEAR WITH ALL-TIME RECORD SURPLUS
While West Virginia has ended the last several fiscal years with large tax revenue surpluses, the state finished fiscal year 2023 - ending in June - with a $1.8 billion surplus, shattering all previous records.
"You deserve so much credit, West Virginia. It's your money, and you are the ones who made it happen," Gov. Jim Justice said in a pre-recorded video message at the end of June. "You are the engines that made this great state move right straight to the forefront where now everyone recognizes us as the place to come to."
The state ended fiscal year 2023 with more than $6.5 billion, which was 39.9% more than the official estimate set by the Department of Revenue and more than 10% more than the previous fiscal year, which saw more than $5.8 billion in collections and a $1.3 billion surplus.
Of the $1.8 billion collected in fiscal year 2023, $1.165 billion was appropriated in one-time funding placed in the surplus section in the back of the fiscal year 2024 budget. Another $231 million was deposited in the state's Rainy Day Fund, putting it at more than $1.1 billion.
Using remaining surplus tax dollars and making adjustments to the fiscal year 2024 revenue estimate, the state was able to spend $552 million in supplemental appropriations during an August special session. Combined with rollovers of remaining funds in various department line items, the estimated unappropriated balance available to the state is more than $157.6 million.
But fiscal year 2023 may have been the peak for tax collections. Year-to-date tax collections for fiscal year 2024 - beginning July 1 and covering the first five months of the fiscal year - were $2.2 billion, which was 14.9% more than the $1.9 billion revenue estimate. That leaves the state with a $286.2 million surplus fiscal year-to-date.
JUSTICE, LAWMAKERS PASS LARGEST TAX BREAK IN STATE HISTORY
When the 2023 legislative session began last January, Gov. Jim Justice and Republican members of the West Virginia Legislature were on bad terms after the governor helped tank a constitutional amendment on the ballot in 2022 to give lawmakers the authority to make changes to the state's tangible personal property tax system.
Instead, Justice introduced a bill to cut personal income tax rates by as much as 50%. While members of the House of Delegates Republican leadership were on board, Republican leadership in the Senate did not trust Justice's proposal, instead introducing their own bill.
After negotiations between the House, Senate and governor's office, a compromise was reached on House Bill 2526, which combined several proposals into one.
The final bill included a 21.25% cut across all six personal income tax brackets retroactive to Jan. 1, returning approximately $590 million to taxpayers. The bill also includes a trigger formula for further reducing personal income tax rates after Aug. 1, 2024, allowing for possible future reductions of up to 10% annually.
HB 2526 includes a 100% rebate on vehicle tangible personal property taxes for state residents in the form of a refund on annual personal income tax filings, returning an estimated $130 million to taxpayers annually.
The bill provides a 50% tax rebate in the form of personal income and corporate net income tax refunds for the payment by small businesses on tangible personal property taxes on machinery/equipment, inventory, leasehold investments, computer equipment and furniture and fixtures, returning approximately $35 million to taxpayers annually.
Lastly, HB 2526 includes a 100% refundable homestead tax credit for veterans who are 90% to 100% service-disabled. With all the provisions combined, the compromise bill would return approximately $750 million to taxpayers annually.
"Today, we put our stakes in the sand to invite any and everyone to this great state, to bring their business opportunities to us, to bring their jobs to us, to bring their folks to us," Justice said at bill signing event for HB 2526 in March. "It is an absolute monumental day; a day that I have incredible pride in."
"We know that we can do it, so we're moving forward with being able to have job creation, having educational opportunities and have the things our people deserve," said Senate President Craig Blair, R-Berkeley. "They're finally getting them now, and now we're able to give back and put some money in their pockets on top of it."
"This is a validation of the last eight years of work," said House Speaker Roger Hanshaw, R-Clay. "What we've seen signed in House Bill 2526 here is only possible because of eight years of work and creating a new economy here. That's why most of us are here and certainly why I'm here. We want to keep doing it."