2014’s Bills Passed with a Fiscal Impact

The Legislature passed 201 bills during the 2014 Legislative Session. 51 of those bills came with fiscal notes attached, the price tags attached to legislation that inform legislators and the public of the estimated cost to the state in either expenditure increases or revenue losses. Fiscal notes are usually attached to a bill when taxes or fees are assessed or a new program, service, or fund is being created. While there are significant flaws with fiscal notes in West Virginia, they still contain important information.

Of the 61 fiscal notes attached to completed legislation in 2014 (some bills have more than one fiscal note, submitted by different agencies, which is why there are more fiscal notes than bills), 17 identified a measurable expenditure impact. Seven of these fiscal notes identified a negative expenditure effect, meaning that the passage of the bill would reduce government spending, while 10 identified a positive expenditure effect. In total, the 19 fiscal notes show that the passed legislation would increase state spending by $61.2 million. The largest of these was SB 391, providing salary increase for teachers and school service personnel, at a cost of $38 million.

In addition, another eight fiscal notes identified possible expenditure changes, but were unable to provide an estimate.

Four fiscal notes identified a measurable revenue impact. Three of these fiscal notes showed a positive revenue impact, meaning that the passage of the bill would increase government revenue, while one showed a negative impact, indicating a reduction in revenue. In total, the four fiscal notes show that the passed legislation would increase government revenue by $5.4 million. The largest of these was SB 328, terminating the Strategic Research and Development Tax Credit, which increased revenue by $4 million.

In addition, another six fiscal notes identified possible revenue changes, but were unable to provide an estimate. Notable among these bills are two tax incentive bills: HB 4184, otherwise known as the Greenbrier tax credit, and HB 4343, the Project Launchpad Act. 

Below is a list of the bills passed with a fiscal note.

Bill

Summary

Full Expenditure Impact

Full Revenue Impact

SB 90

Creating criminal offense for interfering or preventing call for assistance of emergency service personnel

$0

$0

SB 204

Relating to crime victims compensation awards

-$1,204,000

$0

SB 315

Clarifying use of certain funds under Military Authority Act

$0

$0

SB 328

Terminating Strategic Research and Development Tax Credit

$0

$4,000,000

SB 331

Requiring certain accelerated payment of consumers sales and service and use tax and employee withholding taxes

$0

$0

SB 356

Relating to purchasing reforms

$0

$0

SB 373 (DEP)

Relating to water resources protection

$755,715

$930,715

SB 373 (DHHR)

Relating to water resources protection

$454,191

$0

SB 375

Excluding certain personal property from TIF assessment

$0

$0

SB 391

Providing salary increase for teachers and school service personnel

$38,988,702

$0

SB 402

Permitting recovery of service charge and fees charged to Tax Commissioner by financial institutions

-$25,000

$0

SB 414

Redirecting nonprobate appraisement filings

$0

$0

SB 416

Relating to tentative appraisals of industrial and natural resources property

-$5,000

$0

SB 431

Relating to issuance and renewal of certain driver’s licenses and federal ID cards

-$560,228

$372,420

SB 443

Relating to SPRS

$0

$0

SB 444

Relating to PERS

$0

$0

SB 452

Relating to TRS annuity calculation of member with reciprocal service credit

$0

$0

SB 456

Extending expiration date for health care provider tax on eligible acute care hospitals

$19,932,495

$0

SB 457

Requiring programs for temporarily detained inmates in regional jails

$0

$0

SB 458

Dedicating certain circuit court fees to fund low-income persons’ civil legal services

$0

$0

SB 461

Creating Future Fund

$0

unknown

SB 469

Creating Veterans and Warriors to Agriculture Program

$0

$0

SB 486

Establishing salaries and providing raises for State Police forensic lab employees

$644,931

$0

SB 523

Providing for additional state veterans skilled nursing facility in Beckley

$0

$0

HB 2165 (DHHR)

Relating to death certificates of military veterans

$0

-$108,713

HB 2165 (Veteran’s Affairs)

Relating to death certificates of military veterans

$0

$0

HB 2954

Requiring that members of the Mine Safety Technology Task Force are paid the same compensation as members of the Legislature

$0

$0

HB 4005 (Corrections)

Relating to criminal offenses for child neglect

unknown

$0

HB 4005 (DHHR)

Relating to criminal offenses for child neglect

$0

$0

HB 4006 (Corrections)

Relating to the possession and distribution of child pornography

unknown

$0

HB 4006 (DHHR)

Relating to the possession and distribution of child pornography

$0

$0

HB 4006 (Supreme Court)

Relating to the possession and distribution of child pornography

$0

$0

HB 4184 (Development Office)

Relating to the West Virginia Tourism Development Act

$0

$0

HB 4184 (Tax Dept)

Relating to the West Virginia Tourism Development Act

unknown

unknown

HB 4210

Juvenile sentencing reform

$0

$0

HB 4228

Repealing or removing certain portions of education-related statutes that have expired

-$190,000

$0

HB 4236

Sexual assault nurse examination network

$156,446

$0

HB 4254

Providing that certain state employees may be granted a leave of absence with pay during a declared state of emergency

unknown

$0

HB 4256

Amending the annual salary schedule for members of the state police

$408,562

$0

HB 4270

Relating to salaries of service employees of the state camp and conference center known as Cedar Lakes Conference Center

$0

$0

HB 4283 (Div of Labor)

Raising the minimum wage

$650,000

unknown

HB 4283 (Div of Personnel)

Raising the minimum wage

unknown

unknown

HB 4284

Pregnant Workers’ Fairness Act

unknown

$0

HB 4290

Revising the regulatory structure of money transmitters and other entities

$0

$210,476

HB 4318

Continuing education of veterans mental health

$0

$0

HB 4332 (DHHR)

Extending the time that certain nonprofit community groups are exempt from the moratorium on creating new nursing home beds

$4,165,000

$0

HB 4332 (Health Care Authority)

Extending the time that certain nonprofit community groups are exempt from the moratorium on creating new nursing home beds

$0

$0

HB 4332 (PEIA)

Extending the time that certain nonprofit community groups are exempt from the moratorium on creating new nursing home beds

$0

$0

HB 4343

West Virginia Project Launchpad Act

$110,000

unknown

HB 4349

Clarifying retirement dependent child scholarship and burial benefits under a Qualified Domestic Relations Order

$0

$0

HB 4350

Providing for the awarding of a West Virginia Veterans Medal and ribbon, and a West Virginia Service Cross and ribbon to certain qualifying West Virginia Veterans

$0

$0

HB 4363

Creating an informal dispute resolution process available to behavioral health providers

$0

$0

HB 4365

Relating to employer remittance and reporting of Teachers Retirement System member contributions to the retirement board

$0

$0

HB 4373

Relating to driver education programs

-$3,064,842

$0

HB 4393

Creating the Dangerous Wild Animals Act

unknown

unknown

HB 4425

Giving the Superintendent of State Police authority to hire additional staff

-$16,568

$0

HB 4432

Adopting Principle Based Reserving as the method by which life insurance company reserves are calculated

$0

$0

HB 4449

Including proximity detection systems and cameras used on continuous mining machines and underground haulage equipment for tax credit purposes

$0

unknown

HB 4496

Providing for the allocation of matching funds from future moneys deposited into the West Virginia Research Trust Fund

$0

$0

HB 4588

Protecting unborn children who are capable of experiencing pain by prohibiting abortion after twenty weeks

unknown

$0

HB 4619

Authorizing innovation school districts

$0

$0

And The Healthiest County is…Pleasants?

The 2014 County Health Rankings were released this week and in a bit of a surprise, little Pleasants County took top honors, while for the 5th year in a row, McDowell County earned the dubious distinction of the least healthy county in the state.

These rankings, compiled annually by the Robert Wood Johnson Foundation and the University of Wisconsin’s Population Health Institute, compare every county in each state based on a number of health outcomes (e.g. premature death, low birth weight) and health factors (e.g. health insurance, smoking rates, obesity rates).

There was some shakeup in this year’s rankings as Pleasants County (pop. 7,595) jumped from 7th in 2013 to 1st this year, displacing two-year reigning champ Monongalia County, which dropped to 2nd.  By and large however, the healthiest counties last year were the healthiest this year while the least healthy last year remain the least healthy again.

www.countyhealthrankings.org

Pleasants County was ranked as the healthiest county in West Virginia this year as McDowell County continues its streak of least healthy.  More information at www.countyhealthrankings.org

While the county aspect is interesting, I don’t think many people would be surprised by the overall trend.  The unhealthiest counties in our state tend to be the southern coal counties (which also tend to have the highest rates of poverty) and the healthiest tend to be where levels of education are the highest, like Mon County and the Eastern Panhandle.

Before all those folks up in the EP climb on their high horse, however, you should know that not a single county in West Virginia ranks in the top 10 percent of counties nationally in most of these measures, including smoking, obesity, premature death, health insurance, preventable hospital stays, physical activity, unemployment, or children in poverty. 

Yikes.

Ohio County has the lowest obesity in West Virginia, however it's still higher than the national average.

Ohio County has the lowest obesity of any county in West Virginia, yet it’s still higher than the national average.

So what purpose do these rankings serve?  Primarily, it helps illustrate the specific aspects in which our state is struggling by putting a numerical value on them.  Just like taking a practice test will help you see what material you need to work harder on, the county health rankings should help us recognize where our biggest deficiencies are. 

While our deficiencies seem to be pretty much everywhere, these rankings should provide the starting point by which we can 1) decide where to focus our limited resources, and 2) provide the yardstick to measure our efforts.

To do this, though, will require action, effort on the part of our state leaders.  Here’s to hoping folks will be willing to step up, be bold, and start driving this state toward a healthier future.    

Even though Putnam County has the lowest childhood poverty in West Virginia, it's getting worse in recent years.  Meanwhile, the rate of children across the state is substantially higher than the national rate.

Even though Putnam County has the lowest childhood poverty in West Virginia, it’s getting worse in recent years. Meanwhile, the rate of children across the state is substantially higher than the national rate.

Final FY 2015 Budget Comparison Available

The FY 2015 budget process took some twists and turns this year, with some big changes between the governor’s proposal, the house and senate versions and their final compromise, and the governor’s vetoes. Now you can compare all three versions of the budget in one place. This excel file lists each of the $12 billion in appropriations for FY 2015, comparing the governor’s original proposal, the enrolled version passed by the house and senate, and the final version after the governor’s vetoes. 

What was cut, what was increased, and what was vetoed can be answered with a glance. Download the file here, and check this post for a file comparing the FY 2014 budget with the FY 2015 proposal.

Governor Should Ignore Bogus “Flaws” in Minimum Wage Bill

On Sunday the Martinsburg Journal reported that attorney Brian Peterson with the law firm of Bowles Rice sent a memo to its clients warning of technical flaws and “unintended consequences” contained in HB 4283, which raises the state minimum wage from $7.25 to $8.75 an hour by 2016. Fortunately, many of the so-called “flaws” in the legislation are, in fact, good for working families and they align West Virginia code with other states. The bad news is that lobbyists who opposed increasing in the state’s minimum wage may use this memo as ammo to get Governor Tomblin to veto the bill (he has until Monday, April 1 to veto any bill).

In response, the National Employment Law Project has released a memo  outlining the problems contained in the Bowles Rice memo.

NELP 3.27.14 memo

The Legislature Gave, and the Governor Hath Taken Away

Governor Tomblin exercised his line item veto power today, trimming over $64 million from the budget sent to him by the legislature earlier this week. While the legislature had restored many of the cuts to children and family support programs that were in the FY 2015 budget proposal, the governor vetoed that funding, keeping the cuts in place. The governor also cut funding increases for the state police and for the expansion of an in-home senior service Medicaid program. 

Governor Tomblin originally called for borrowing $83 million from the Rainy Day fund, and the legislature increased that amount to $147 million in order to fund Medicaid. The governor vetoed that increase, and the final FY 2015 budget will borrow $100 million from the Rainy Day Fund for Medicaid. According to the governor’s veto letter, there will be additional funds available to appropriate to Medicaid at a later date. If this happens, it means that the Governor is really only vetoing $17 million – not the $65 million that is being reported.

Here’s how that works. In the governor’s proposed budget, Governor Tomblin appropriated $376.3 million for Medicaid through the Medical Services line item (Fund 0403, Activity 189), while transferring $83.8 million from the Rainy Day Fund into the Medicaid Trust Fund. Together, these actions provided $460.1 million for Medicaid.

In the compromise budget reached between the House and the Senate, $147.6 million was transferred from the Rainy Day Fund into the Medicaid Trust Fund, an increase of $63.7 million over the governor’s proposal. But the compromise also reduced the General Revenue appropriation for Medicaid to $312.6 million, a decrease of $63.7 million. So, like in the governor’s proposal, the two actions together provided $460.1 million for Medicaid, but the legislature’s action freed up $63.7 million in General Revenue, which they used to restore some of the governor’s proposed cuts and increase various line items. 

But, the governor vetoed the $147.6 million transfer, reducing it to $100 million. But, the governor can not use the line item veto to increase an appropriation, so the General Revenue appropriation for Medicaid remains at $312.6 million, $63.7 million below the governor’s proposal. The governor could reduce the Rainy Day transfer, but he can’t reverse the Medicaid line item reduction that the Rainy Day transfer offset. 

Since the vetoed transfer from the Rainy Day fund didn’t actually reduce any base budget appropriations, the Governor’s vetoes only cut $16.9 million out of the base budget ($12.6 million in General Revenue and $4.3 million in Lottery). 

2

The $16.9 million vetoed by the governor will presumably be funneled back into Medicaid (to help make up for the general revenue line item reduction). And the governor is counting on $26 million from the “haircut bill” to appropriate to Medicaid. However, these actions will still leave Medicaid about $5 million short of the $460 million it received from General Revenue and the Rainy Day transfer in the legislature’s enrolled budget, necessitating further budget maneuvers.

1

The stated reason for the vetoes was to ensure that the Rainy Day Funds (Revenue Shortfall Reserve Fund A & B) did not drop below 15 percent of the budget over the next three fiscal years.  Currently, the Rainy Day Funds hold “$914 million in cash” or about 21 percent of the FY 2015 general revenue fund budget.

According to the Governor’s veto letter, the budget bill passed by the legislature would grow the base-budget thereby increasing future budget gaps that would require additional revenue from the Rainy Day Fund. The projected budget gap in FY 2016 is $126 million, $44 million in FY 2017, and $0 in FY 2018. Of course, the Governor’s assumption is that the legislature would dip into the Rainy Day Fund over the next three years to fill these gaps instead of raising revenue by increasing the tobacco tax or other taxes.

Below is a list of all of the governor’s vetoes for the FY 2015 budget. 

Agency/Department

Line Item

FY 2015 Enrolled

Final With Vetoes

Vetoed Amount

General Revenue

 

 

 

 

WV Development Office

Regional Contracting Assistance Center

$375,000

$208,215

$166,785

WV Development Office

Local Economic Development Assistance

$4,688,940

$1,850,000

$2,838,940

State Department of Education

Current Expenses

$2,797,390

$2,627,390

$170,000

State Department of Education

21st Century Innovation Zones

$466,144

$266,144

$200,000

State Department of Education

21st Century Learners

$2,187,598

$2,062,598

$125,000

Department of Education and the Arts

Educational Enhancements

$350,000

$200,000

$150,000

Division of Health – Central Office

Primary Care Centers – Mortgage Finance

$343,505

$229,003

$114,502

Division of Human Services

Family Resource Networks

$1,762,464

$1,612,000

$150,464

Division of Human Services

Domestic Violence Legal Services Fund

$400,000

$370,000

$30,000

Division of Human Services

In-Home Family Education

$1,000,000

$750,000

$250,000

Division of Human Services

Grants for Licensed Domestic Violence Programs and Statewide Prevention

$2,500,000

$2,142,100

$357,900

Division of Human Services

Children’s Trust Fund – Transfer

$300,000

$220,000

$80,000

Adjutant General – State Militia

Unclassified

$16,710,103

$15,524,044

$1,186,059

Division of Corrections – Correctional Units

Corrections Academy

$1,602,129

$1,502,129

$100,000

WV State Police

Personal Services

$59,075,965

$58,568,052

$507,913

WV State Police

Childrens Protection Act

$947,942

$935,819

$12,123

WV State Police

Current Expenses

$11,219,232

$10,397,784

$821,448

WV State Police

Vehicle Purchase

$2,403,790

$1,500,000

$903,790

WV State Police

Communications and Other Equipment

$1,338,968

$1,268,968

$70,000

WV State Police

Trooper Retirement Fund

$4,625,240

$4,586,341

$38,899

WV State Police

Handgun Administration Expense

$81,668

$80,420

$1,248

WV State Police

Capital Outlay and Maintenance

$314,425

$250,000

$64,425

WV State Police

Automated Fingerprint Identification system

$704,920

$671,994

$32,926

Division of Criminal Justice Services

Child Advocacy Centers

$1,702,466

$1,502,466

$200,000

Division of Criminal Justice Services

Sexual Assault Forensic Examination Commission

$150,000

$100,000

$50,000

Bureau of Senior Services

Transfer to DHS for Health Care and Title XIX Waiver for Senior Citizens

$19,457,690

$15,957,690

$3,500,000

Higher Education

West Virginia University – Parkersburg

$10,081,330

$9,858,752

$222,578

Higher Education

West Virginia Advance Workforce Development

$3,645,095

$3,445,095

$200,000

Higher Education

West Virginia University

$103,099,869

$102,999,869

$100,000

WV Development Office

Regional Contracting Assistance Center

$375,000

$208,215

$166,785

WV Development Office

Local Economic Development Assistance

$4,688,940

$1,850,000

$2,838,940

State Department of Education

Current Expenses

$2,797,390

$2,627,390

$170,000

State Department of Education

21st Century Innovation Zones

$466,144

$266,144

$200,000

State Department of Education

21st Century Learners

$2,187,598

$2,062,598

$125,000

Department of Education and the Arts

Educational Enhancements

$350,000

$200,000

$150,000

Division of Health – Central Office

Primary Care Centers – Mortgage Finance

$343,505

$229,003

$114,502

Division of Human Services

Family Resource Networks

$1,762,464

$1,612,000

$150,464

Division of Human Services

Domestic Violence Legal Services Fund

$400,000

$370,000

$30,000

Division of Human Services

In-Home Family Education

$1,000,000

$750,000

$250,000

Division of Human Services

Grants for Licensed Domestic Violence Programs and Statewide Prevention

$2,500,000

$2,142,100

$357,900

Division of Human Services

Children’s Trust Fund – Transfer

$300,000

$220,000

$80,000

Adjutant General – State Militia

Unclassified

$16,710,103

$15,524,044

$1,186,059

Division of Corrections – Correctional Units

Corrections Academy

$1,602,129

$1,502,129

$100,000

WV State Police

Personal Services

$59,075,965

$58,568,052

$507,913

WV State Police

Childrens Protection Act

$947,942

$935,819

$12,123

WV State Police

Current Expenses

$11,219,232

$10,397,784

$821,448

WV State Police

Vehicle Purchase

$2,403,790

$1,500,000

$903,790

WV State Police

Communications and Other Equipment

$1,338,968

$1,268,968

$70,000

WV State Police

Trooper Retirement Fund

$4,625,240

$4,586,341

$38,899

WV State Police

Handgun Administration Expense

$81,668

$80,420

$1,248

WV State Police

Capital Outlay and Maintenance

$314,425

$250,000

$64,425

WV State Police

Automated Fingerprint Identification system

$704,920

$671,994

$32,926

Division of Criminal Justice Services

Child Advocacy Centers

$1,702,466

$1,502,466

$200,000

Division of Criminal Justice Services

Sexual Assault Forensic Examination Commission

$150,000

$100,000

$50,000

Bureau of Senior Services

Transfer to DHS for Health Care and Title XIX Waiver for Senior Citizens

$19,457,690

$15,957,690

$3,500,000

Higher Education

West Virginia University – Parkersburg

$10,081,330

$9,858,752

$222,578

Higher Education

West Virginia Advance Workforce Development

$3,645,095

$3,445,095

$200,000

Higher Education

West Virginia University

$103,099,869

$102,999,869

$100,000

Other Revenue

 

 

 

 

Revenue Shortfall Reserve Fund

Medical Services Trust fund – transfer

$147,552,295

$100,000,000

$47,552,295

Lottery

 

 

 

 

State Department of Education

Current Expenses

$3,653,750

$1,269,375

$2,384,375

Library Commission -Lottery Education Fund

Libraries – Special Projects

$786,250

$0

$786,250

Bureau of Senior Services

Senior Citizen  Centers and Programs

$2,284,740

$1,284,750

$999,990

Bureau of Senior Services

In-Home Services and Nutrition for Senior Citizens

$4,420,941

$4,320,941

$100,000

Total

 

 

 

$64,467,910

 

 

WV Legislature Gives 127,000 Working West Virginians a Raise

On the last night of the 2014 Legislative Session, West Virginia’s legislature passed HB 4283, raising the state’s minimum wage. The bill now goes to Governor Tomblin for his signature, making it law.

While we wait for the governor’s signature, let’s take a look at what passage of the bill means to West Virginia’s low-wage workers. The bill raises the minimum wage from $7.25 per hour to $8.75 per hour. That means, for full-time minimum wage workers, their annual pay will increase by $3,120, which for a family of two, is the difference between living in or out of poverty.

The bill passed by the legislature gives low-wage workers in West Virginia a raise in two steps. On January 1, 2015, the minimum wage increases to $8.00 per hour and on January 1, 2016, it increases to $8.75. We’ve looked before at who all would be getting a raise, so let’s now break it down by year.

In the first year, raising the minimum wage to $8.00 per hour will have a direct impact (those who currently earn less than $8.00 per hour) on about 37,800 workers. The average hourly wage for these directly affected workers is $7.45 per hour, and they work an average of 30.4 hours per week. That means that these workers will see an average annual pay increase of about $868, for a total statewide wage increase of $32.8 million.

In the second year, raising the minimum wage to $8.75 per hour will give those workers an average annual pay increase of $1,184, assuming they still average 30.4 hours per week and still make the minimum wage of $8.00. So for those 37,800 workers, the total impact after the wage increase is fully enacted is an average annual increase of $2,052, for a statewide increase of $77.7 million.

In addition to those 37,800 workers, raising the minimum wage from $8.00 to $8.75 in the second year will affect an additional 45,900 workers. These are workers who were already earning more than $8.00 per hour, but less than $8.75. These workers earn an average of $8.20 per hour and work an average of 35.3 hours per week, meaning they will see an average annual pay increase of about $1,010, for a total statewide increase of $46.3 million.

So, all told, after two years, 83,700 workers will get a raise, averaging an annual pay increase of $1,480. But those 83,736 workers aren’t the only ones getting a raise under the bill which also makes changes to the state’s tipped minimum wage. To avoid the messy details, the bill would increase the tipped minimum wage from $2.13 per hour to $2.40 per hour in 2015 and $2.63 per hour in 2016. This would affect an estimated 8,745 tipped workers, who would see an average annual pay increase of $426 in 2015 and another increase of $363 in 2016, based on average weekly hours.  That would equal a total average annual increase of $789 once the bill is fully in effect, for a statewide total of $6.9 million.

Aside from those directly affected by the wage increase, there will likely be spillover effects, as those who earn above $8.75 see a raise as the wage floor rises. We estimate that the spillover effects would impact about 34,600 workers. Assuming these workers see an average of a $0.50 per hour increase, they would see an annual average increase of $748, based on average wages and weekly hours, for a total statewide increase of $25.9 million.

So, to sum it all up, raising West Virginia’s minimum wage to $8.75 will give a raise to about 127,000 West Virginia workers. About 83,700 regular hourly workers will see an average annual pay increase of $1,480, while about 8,745 tipped workers will get a average annual pay increase of $789. In additional, 34,600 more workers could see a raise due to the law’s spillover effects, with a conservative estimate of an average annual increase of $748. Altogether, raising West Virginia’s minimum wage from $7.25 to $8.75 will increase wages in the state by an estimated $156.8 million.

Budget Beat – March 14, 2014

Legislative Wrap-Up

The last 24 hours of the 2014 Legislative Session were busy with several pieces of legislation passing at the last minute, like the bills to raise the minimum wage and create a West Virginia Future Fund.

In the end, the legislature passed the House bill to raise the minimum wage. This was the better bill as it raised the wage by $1.50 an hour over two years instead of three, as the Senate had proposed, to $8.75 an hour. The bill awaits Governor Tomblin’s signature.

After being heavily amended by the House in the session’s last hours, the West Virginia Future Fund did pass, with the Senate conceding to the House’s amendments. While the changes broaden the plan to include coal severance taxes, along with taxes from many other nonrenewable sources of energy, they also essentially put off any money going into the Future Fund for several years due to hard-to-achieve triggers. Read more in Ted’s blog post and in this Wheeling Intelligencer article.

Time ran out for some bills. After passing the full House and then the Senate Judiciary Committee, the Valued Employee Retention Program (Work Sharing) died in the Senate Finance Committee after being read twice on the Senate floor.

Dozens of health-care related bills were introduced this session, from raising the tobacco tax to encouraging more physical activity for kids while at school. Here’s a complete run-down by Health Policy Analyst Brandon Merritt.

St Patricks Day

Legislature Considers Budget

All this week the Senate and House have met to work out differences between their budget bills and the one submitted by Governor Tomblin. Thanks to the Our Children Our Future Coalition, on Thursday the legislature restored cuts to many important programs like Family Resource Networks and Family Resource Centers, In-Home Family Education programs and Domestic Violence Prevention.

Regional Tax Rate Could Stop Race to the Bottom

This week the WVCBP joined Policy Matters Ohio and the Pennsylvania Budget and Policy Center to call on the governors from all three states to work toward a regional severance tax structure. The recommendation is that all three states have at least West Virginia’s five-percent rate, the idea being that coordination, instead of competition, will halt the race to the bottom created by tax incentives offered to the drilling industry. Read more in the Pittsburgh Business Times, the State Journal and the Beaver County Times.

March 31: Deadline for Individuals to Enroll in Obamacare

The deadline to sign up for health care under the Affordable Care Act is quickly approaching. In large part due to Medicaid expansion, thousands of West Virginians now have health care. Read more in the Charleston Gazette.

West Virginia’s Addition to Fossil Fuels

West Virginia’s neighbor to the west, Kentucky, is recognizing the need for economic diversification as its coal production declines. Read more about the challenges some West Virginia leaders face as they try to push the state to look at its addiction to fossil fuels.

Congratulations, Christopher!

The WVCBP staff congratulates Christopher Nyden, our 2013 summer research associate, for being elected Student Body President at West Virginia University! Way to go, Chris!

Christopher

Fate of Health-Related Bills in the 2014 Legislative Session

The 81st West Virginia Legislature wrapped up session last Saturday night with 30 health-related bills (by my count). These bills spanned the spectrum from the hot button issue of abortion that continues to generate media coverage to bills that passed multiple committees and both chambers unanimously with nary a peep of press. Here I will highlight a handful of the more significant bills and their potential impact with a complete list of the bills, linked to the full text, at the end.

A good portion of these 30 bills seem to be largely procedural, simply amending or adding language to existing state code that overall has little statewide impact. An example of this is Senate Bill 314 which changed language in section 7-18-14 of state code from “There is one and only one hospital within the county” to read “There is no more than one hospital within the county.” 

Senate Bill 373 Water resources protection

One of the bills generating the most noise all session was one that would not have even been on the docket if it weren’t for the January 9 chemical spill into the Elk River. The bill requires the Department of Environmental Protection to look at what sorts of pollutant sources exist upstream from water treatment plant intakes and creates an entirely new program to monitor above-ground storage tanks. Additionally, after much debate, the final version of the bill does require the state Bureau for Public Health to study the long-term health effects from the MCHM chemical exposure related to the Freedom Industries spill. (Check out Ken Ward’s Coal Tattoo blog for lots of information on this bill.)

Senate Bill 395 Operation and oversight of certain human services programs

This was one of those bills that really seemed to slip by completely unnoticed. It adds two sections to existing state code, one (9-5-8b) gives authority to the Investigations and Fraud Management Division of the Office of the Inspector General to subpoena witnesses and documents in the investigation of potential cases of benefits fraud. The second section (61-4-9) states that anyone found guilty of possessing public assistance benefits (e.g. SNAP or TANF) that do not legally belong to them may face misdemeanor or felony charges based on the value of the benefits and could face fines and imprisonment. The bill did not come with a fiscal note.

House Bill 3108 Criminal background checks on applicants for employment by nursing homes

Adding a new section to state code, 16-5C-21, HB 3108 states that nursing homes shall conduct criminal background checks on all applicants before permanently employing them in their facility. The bill states that any applicant who has been convicted of a felony within the past 10 years may not be employed by the nursing home, while any applicant who has ever been found guilty of a misdemeanor or felony involving abuse against an elderly person may not be employed.

The state’s population is aging and a growing proportion of its residents are being admitted to nursing homes or other long-term care facilities and it is therefore more important than ever to ensure that we are protecting our seniors. I do find it odd that the bill is worded in such a way that criminal background checks must be completed on all applicants, and not just those applicants who are being offered employment. Also, as there is no fiscal note attached to this bill, I presume that the nursing homes will be responsible for the cost of requesting the checks. 

House Bill 4237 Prohibiting sale and use of electronic cigarettes by minors

I believe it is pretty safe to say that this is a bill that most folks would consider a no-brainer. HB 4237 amends Article 9A in state code to include alternative nicotine products, vapor products, and electronic cigarettes in the definition of tobacco products, specifying that no person under the age of 18 is permitted to be sold or use such products. 

House Bill 4335 Child’s right to nurse

Possibly the most succinct bill passed this session, HB4335 adds a new section, 16-1-19, to state code that explicitly protects a mother’s right to breast-feed a child at “any location open to the public.”  It may come as a surprise to many people that versions of this bill in the past have faced significant resistance, dying in committee. The vote tally this year was an overwhelming 130 Yeas to two Nays (Del. Gearheart in the House and Sen. Barnes in the Senate) with two not voting.

House Bill 4588 Prohibiting abortion after 20 weeks

Unsurprisingly, one of the most controversial bills of the session that resulted in a number of impassioned speeches on the floors of both chambers was HB 4588 regarding abortion. Currently, West Virginia is one of 10 states that does not have a law that limits abortions based on gestational age of the fetus. This means that, in theory, a woman could seek an abortion at any point in her pregnancy.  In practice, however, late-term abortions simply don’t happen very often. According to the most recent data from the CDC, only seven abortions, less than one-half of one percent of the total abortions in West Virginia, occurred after 20 weeks of gestation. As health care providers are required to report all abortions for any reason, it’s possible that some or all of those abortions were due to medical reasons of the mother or fetus. It’s important to point out that HB 4588 does include certain, very narrowly defined exceptions to permit a woman to seek an abortion after 20 weeks gestation.  One exception is if termination is necessary to “avert her death or to avert serious risk of substantial and irreversible physical impairment of a major bodily function.” The other exception is if a physician determines that “there exists a non-medically viable fetus.”  Even with such language, a physician’s fear of being prosecuted may limit a woman’s medical options, as several physicians testified before the Legislature.  Dr. David Jude, an OB-GYN at Marshall University was quoted saying “Frankly, I don’t want to be on call wondering if I’m going to be prosecuted for terminating a pregnancy.”  In addition to these concerns, there is also belief among many that such a state law may be challenged as unconstitutional in federal court. Media reports indicate that Governor Tomblin is considering a veto of the bill due to such constitutionality questions.*

Some bills that didn’t pass are also worth noting. For example, House Bill 4191 and Senate Bill 534 both would have raised the tobacco tax substantially, generating up to $137 million more in state revenue, but both died in committee. Oddly, even though electronic cigarettes and vapor products were redefined as tobacco products by HB 4237,  restricting their usage by minors (discussed above), the failure of the tobacco tax bills means that for tax purposes, electronic cigarettes are still not considered tobacco products.  

Senate Bill 6 to make pseudoephedrine available by prescription only was a controversial bill that received a lot of attention but ultimately failed amid last-minute controversy. While the bill’s intent was to reduce the number of clandestine meth labs (and all the economic and health costs that go with them), pharmaceutical lobbyists won the public-relations battle, convincing many that the prescription-only requirement would not work even though the evidence from Oregon and Mississippi points the other way

Finally, Senate Bill 455, or the Move to Improve Act, would have established physical activity minimums for the state Department of Education to include in its mandatory statewide curriculum. The bill was an effort to address obesity rates among West Virginia children but ended up dying in committee.

Here is a full list of health-related bills that passed the 2014 WV Legislature:

SB12 Expedited partner therapy

SB155 Authorizing DHHR promulgate rules

SB314 Hotel occupancy tax in counties with no more than one hospital

SB341 Supplemental appropriations from excess lottery revenue fund to Division of Human Services (Medicaid)

SB373 Water resources protection

SB394 Health Sciences Service Program

SB395 Operation and oversight of certain human services benefit programs

SB425 Licensure, supervision, and regulation of physician assistants

SB456 Extending expiration date on health care provider tax

SB523 Creation of veterans skilled nursing facility in Beckley

SB602 Requiring health care providers wear ID badges

SB619 Exempting certain critical access hospitals from certificate of need

HB3108 Criminal background checks on applicants for employment by nursing homes

HB4005 Criminal offenses for child abuse and neglect

HB4188 Updating authority and responsibility of the Center for Nursing

HB4208 Banning synthetic hallucinogens

HB4217 Medicaid reports to the legislature

HB4237 Prohibiting sale and use of electronic cigarettes by minors

HB4245 Anticipated retirement dates of certain health care professionals

HB4278 Rewriting procedure by which corporations may obtain authorization from Board of Medicine to practice medicine

HB4284 Pregnant Workers’ Fairness Act

HB4287 Administration of health maintenance tasks

HB4312 Creating certification for emergency medical technician-industrial

HB4318 Continuing education relevant to mental health issues of veterans

HB4332 Extending time certain nonprofit groups are exempt from nursing home bed moratoriums

HB4335 Child’s right to nurse

HB4363 Informal dispute resolution process for behavioral health providers

HB4538 Relating to Board of Dentistry

HB4560 Relating to reimbursement for copies of medical records

HB4588 Prohibiting abortion after 20 weeks

*Note: a reader contacted me to point out that I had referred to an incorrect draft of HB 4588, the Engrossed Version rather than what ultimately passed.  I’ve updated the post to include reference to the language found in the final version of the bill–BM 3-17-14

Giant Step for Future Fund, but More Work Ahead

Late Saturday night, the Legislature passed SB 461 that created the West Virginia Future Fund. While this is an important step forward, the bill included the adopted house changes that I focused on last week. The most significant changes included a new funding mechanism and several conditions that have to be met in order to deposit money into the Future Fund. Unfortunately, these changes will very likely preclude any deposits made into the Future Fund for several years.

Instead of adopting the Senate version which deposited 25 percent of all natural gas and oil revenue above $175 million, the Future Fund will now receive three percent of general revenue severance tax collections on coal, oil, natural gas, limestone and sandstone. The three percent will not include local severance tax distributions or the $23 million that goes into the infrastructure fund in calculating the share that would be deposited into the Future Fund. In addition, the three percent does not include “natural gas liquids” which are expected to grow from $10 million to at least $35 million over the next few years. 

As discussed earlier, deposits into the Future Fund can only happen if Rainy Day Fund A (Revenue Shortfall Reserve Fund) is above 13 percent of the General Revenue Fund budget. As Senator McCabe said on Saturday night, this condition will not likely be met for many years because of the state’s revenue problems – which are mostly due to self-inflicted tax cuts. To give you an idea of why it will be so hard to meet this trigger, the chart below looks at a couple of scenarios.

RDF Projections

Currently, Rainy Day Fund A is 13.3 percent of the General Revenue Fund Budget for FY 2014. This will most likely drop significantly after the end of the week when the Legislature passes its final budget for FY 2015. The House plans to use at least $84 million from the Rainy Day Fund A for its FY 2015 budget (per the Governor’s request) to pay for Medicaid, while the Senate version of the budget would use $125 million from the Rainy Day Fund. This would put Rainy Day Fund A at 11.1 percent or 10.2 percent, respectively. So this means no deposits in the Future Fund in FY 2015.

What about in later years?  In order for Rainy Day Fund A to be at 13 percent in FY 2016 it will need an additional $140 to $181 million. Usually the only way money grows in the Rainy Day Fund is through deposits made from budget surpluses (80% of surpluses will now go into the RDF A) or interest accrued in the fund. The interest income from the fund would likely be no higher than eight percent, so it will take at least a surplus of $110 million next year (unless there are deep cuts to the budget) for a deposit to be made in the Future Fund. The same goes for the outer years. The only foreseeable way this could change is a boom in shale development beyond beyond what is baked into future budgets or some other type of economic miracle.

How can we fix this problem? Two actions: 1) the state desperately needs to increase its revenue base (e.g. increase tobacco products’ taxes) so it can fill in current and future budget gaps in order to stop depleting the Rainy Day Fund. Without this action, it doesn’t look likely anything will ever flow into the Future Fund; 2) combine both Rainy Day Funds (A & B) or alter the language in the code to include both funds in the trigger. That way, it meets the 13 percent threshold trigger. To strengthen the Future Fund, it also needs to include “natural gas liquids” or it could just say “all severance taxes” collected.

This all being said, the Legislature should be commended for taking a great step toward creating the Future Fund. Now we just need to be sure that it gets the funding it deserves and that it’s constitutionally protected.

Budget Beat – March 7, 2014

Legislation Session in Final Hours

Tomorrow night at midnight the 2014 Legislative Session will be over. As we go to press, pieces of legislation that we have followed for the last 59 days are changing quickly.

capitol dome

The Senate version of the bill to raise the minimum wage was passed today. It drags out the incremental increases over three years instead of the two years in the House version. The bill will now go back to the House and the differences will need to be ironed out if the bill is to pass this year. Here’s more on how low-income families would benefit from an increase to the minimum wage.

An argument that surfaced this week against raising the minimum wage was that low-income people would start making too much money to be eligible for Medicaid. While the premise is true, what’s also true is that this would not be a bad outcome for those folks. Read more in Brandon’s blog post.

Raising the minimum wage will also make low-income people less reliant on federal benefits like the Supplemental Nutritional Assistance Program (SNAP), otherwise known as food stamps. Increasing the federal minimum wage to the proposed $10.10 an hour would save about $4.6 billion in SNAP benefits. Read more here.

Another way to get more money into the hands of low-income workers is through an expanded Earned Income Tax Credit. President Obama’s proposed budget released this week would do just that by extending the credit to childless workers. This would create jobs while lifting more people out of poverty. Read more in Sean’s blog post.

The West Virginia Future Fund bill was heavily amended by House Finance on Wednesday. It is scheduled to be read on the House floor for the second time today so it still has time to pass in one form or another before the session’s close. To read about the changes the House Finance Committee made to the Future Fund bill, read Ted’s blog post. Here are Three Questions with Ted Boettner and another State Journal article.

Kessler FF meme

Voluntary Employment Retirement Accounts (VERA), despite passing the House of Delegates, will now be studied during the 2014 Legislative Interims.

The Valued Employee Retention Program (Work Sharing) is still awaiting action by the Senate Finance Committee but has been read twice on the Senate floor. For more on the benefits of a Work Sharing program, here’s an article from the Charleston Gazette.

Budget Week Starts Monday

As mentioned last week, legislators will start their work on the state budget next week. It is likely they will dip into the state’s Rainy Day Fund, along with other measures, to close the budget gap. The WVCBP has made numerous recommendations on other ways to deal with the state budget shortfalls and here’s more. Ted also appeared on the Legislature Today on Monday to talk about the budget and the WV Future Fund. Listen here.

Ending Currency Manipulation Would Create Millions of Jobs

Currency manipulation affects the price of the country’s imports and exports, increasing the trade deficit by billions. In fact, according to the Economic Policy Institute, ending currency manipulation could, in turn, improve trade and current accounts in the United States by between $200 billion and $500 billion over the next two to three years. Read more here.