Legislature in low-key mode
November and December tend to be a quiet time in West Virginia state politics. But we should soon start hearing about what a possible legislative agenda could look like in 2022.
The 2022 legislative session begins noon Wednesday Jan. 12 and it will wrap up at midnight on Saturday March 12. Gov. Jim Justice will give his fifth State of the State address the first night of the session and present his budget for fiscal year 2023.
With 2022 being an election year, I’d be surprised if major legislation makes it through. The party primaries take place Tuesday, May 10, more than 40 days after the end of the session. That’s plenty of time to hammer your primary opponent for a controversial vote on a bill.
Not to say that some bills won’t raise eyebrows. Inevitably, our TV news media will latch on to some bill that likely has no chance of being put on a committee agenda and create a controversy. I tend to focus on bills that make it to a committee because committee chairs have a wide degree of latitude on what bills they put up for a vote.
That doesn’t mean some bills shouldn’t be focused on regardless of its chances of being moved forward. Lawmakers should always be held accountable for the bill they introduce. But let’s be honest. Many bills are introduced simply to show a certain constituency that the bill was introduced, knowing full well the bill won’t go anywhere. More often than not, they don’t even support the bill they introduced.
Keep in mind, the vast majority of bills that show up the first day of the session are bills that have been previously introduced. If you subtracted all the repeat bills that get recycled, I bet the number of new bills introduced would be quite small. For example, of the 2,039 bills introduced in 2021 between the House of Delegates and the Senate, only 280 made it through the process to be signed by the governor. That’s only 13.7% of the total number of bills in 2022.
The state Constitution requires a 60-day session every year and our lawmakers are part-time, meaning they have regular jobs. That’s not a lot of time to pass bills, meaning legislative leadership and committee chairs have to do some triage – push the bills that have the best chance of making it through committees and a vote, and leave the rest floating in legislative purgatory.
So, what could we see in the next session? I’d say the biggest thing, unless the governor and lawmakers get cold feet and decide to wait, is another debate about how to phase out the state income tax.
As we saw last year, Justice and most of the Senate Republican Caucus had one plan to phase it out, and the House Republicans united behind a different plan. The governor/Senate plan was more of a shifting of taxes away from personal income taxes, while the House plan was a true phase-out with controls on new government spending to make up the difference.
Both plans anticipated economic growth, though that’s a hard thing to estimate into the future. That’s why you almost never see me write stories about the five-year budget forecasts showing deficits or PEIA needing new funds in the future. Budget forecasts are always going to show the state in the red five years out, and PEIA is always going to look like it needs premium increases because those same estimates have a hard time seeing into the future when it comes to economic conditions.
Sure, it’s likely a personal income tax phase-out could bring more businesses here and bring in more tax revenue from other sources to make up the difference when the personal income tax rates are cut. But how much? My 8 Ball is murky on that.
Instead of creating a big fight over the personal income tax, instead we might see a push for a tiered natural gas and coal severance tax. Increases in coal mining and natural gas prices helped the state’s severance tax on coal and natural gas come in above estimates for the third month in a row. The severance tax brought in $116.3 million year-to-date, resulting in a $44 million surplus. Justice has been pushing for a tiered severance tax since 2017 when he took office.
As I’ve reported recently, it’s likely we’ll see legislation creating a performance-based funding formula to determine how much taxpayer dollars go to the state’s four-year and two-year higher education institutions. Lawmakers have been wanting this ever since House Majority Whip Paul Espinosa, R-Jefferson, chaired the House Education Committee and pushed for the Higher Education Policy Commission to work up a performance-based funding model in 2017.
Taxpayer dollars make up varying percentages of higher education budgets. In the case of West Virginia University, it’s only about 10% of its total budget, but for smaller schools it’s a bigger percentage. Also, in the case of WVU, the college raised its tuition every year since fiscal year 2018 except for the first year of the pandemic. Sources tell me to expect at least a 2% tuition increase at WVU likely every year going forward.
Nearly all the public colleges and universities in the state, including WVU and Marshall University, are on board the HEPC’s draft performance-based funding plan modeled after Tennessee’s program. If I were a lawmaker, I would take that broad support with a grain of salt and really scrutinize the plan. When the foxes all support the new security system for the hen house, it should raise alarm bells.