CHARLESTON — A House bill introduced last week proposes to divert the $15 million “pop tax” devoted annually to WVU Health Sciences for medical education from WVU to the Public Employees Insurance Agency.
Before we explain the bill and the local concerns about it, it’s important to note several things.
First, of the nearly 2,000 bills introduced each year, only about 10 percent pass. And many of those are rules bills.
Second, bills have to pass, generally, through two committees before reaching their chamber floor, then travel to the other end of the Capitol to undergo the same process in the other body. At the end, both sides must agree on any amendments. Most bills don’t get committee consideration and not all those that do will survive to the end.
And third, even the bill sponsor doesn’t think this will fly. But he put it out there for people to think about; so this offers a look at how diverse views are around the state.
The bill is HB 2455. It ends the practice of sending the pop tax revenue to WVU and devotes it to PEIA.
The code originated in 1951, to send money to WVU for the medical, nursing, dental (and now pharmacy and public health) schools.
Its puts a 1 cent tax on each 16.9 ounces of soft drink, 80 cents on a gallon or 84 cents on 4 liters of soft-drink syrup, and 1 cent per ounce of powdered drink.
For this fiscal year, 2019, the state authorized $15.9 million, though WVU said it generally collects less than that and budgeted $13.7 million. The money goes to various services and salaries to support areas of facilities, environmental health and services, information technology, research and utilities for the entire Health Sciences Center.
Delegate Tony Paynter, R-Wyoming, is lead sponsor, joined by eight Republicans and two Democrats.
Paynter said the tax benefits Ruby Memorial Hospital, which opened in 1988, and the whole state is helping pay for it. After 31 years of that tax money flowing to WVU, “it’s time to move it to help the rest of the state. The entire state is paying for it.”
While Paynter’s memory of why the tax was created is not entirely accurate, at least 10 other delegates share his view the money should be spread around to all state employees for their healthcare.
Paynter said PEIA needs stable funding and this is a good source. He also noted this idea was floated during PEIA task force discussions.
The bill goes first to House Banking and Insurance. Committee chair Eric Nelson, R-Kanawha, said he hadn’t seen the bill and the committee has other priorities, so he didn’t want to comment on whether it would ever appear on the agenda. Some unfinished comments left the listener to infer it’s not something he’d support.
The state budget allots the pop tax money to six areas: personal services (salaries), expenses, repairs and alteration, equipment, buildings, and other assets. WVU budgeted the FY 2019 money in three areas: salaries, $7.7 million; fringe benefits, $2 million; utilities, $4 million.
If the bill ever would appear on an agenda, local delegates said they wouldn’t support it. Neither would WVU leaders.
Delegate Barbara Evans Fleischauer, D-Monongalia, said, “This is a really big piece of the puzzle of how we fund medical education. … Of course we want to fix PEIA, and of course we need an additional revenue source to stabilize PEIA. But it seems kind of wrong-footed.”
PEIA needs healthcare providers, she said, and those providers need training, so we shouldn’t jeopardize funding used for that training.
Delegate Evan Hansen, D-Monongalia, agreed.
“I can’t support that bill,” he said. “We need the pop tax to continue supporting WVU Hospitals and this bill … diverts it somewhere else. I fully support finding ways to find a permanent solution to PEIA, but we can’t do that by taking it away from another program that’s important.”
WVU President Gordon Gee and Clay Marsh, vice president and executive dean for WVU Health Sciences, supplied statements via email.
Gee said, “West Virginia University cannot afford to lose the soft drinks tax. More importantly, the state of West Virginia cannot afford to take the soft drinks tax revenues away from West Virginia University. The state should be considering an increase in the soft drinks tax so that revenues could be provided to all of the academic medical centers in the state and to higher education in general.”
Marsh said, “While the soda tax is used for support services, those remain essential and necessary services that would have to be funded from other sources, putting the School of Medicine under further pressure at the same time it is making strides and combating some of the most serious health problems facing the state, especially opioid addiction, Alzheimer’s disease and similar maladies.
“If WVU loses the soft drinks tax,” he continued, “it will be forced to reduce these types of initiatives and redeploy monies to keep our medical, dental and nursing schools accredited and operational.”
