The new chairman of the House Finance Committee says the Justice administration will take the lead on proposing an annual state budget that could include tax cut proposals.
“I’m waiting on what the governor and the administration have. They’re working on a plan so that next Wednesday night he can promote it. And I’m waiting to hear from them. I’m hoping it hits the targets that we’ve asked for in the past,” House Finance Chairman Vernon Criss, R-Wood, said on MetroNews “Talkline.”
Criss has been the vice chairman of Finance and now moves into the chairman role as Delegate Eric Householder, R-Berkeley, becomes the chamber’s majority leader.
That comment by Criss specifically addressed the possibility of income tax cuts, which would be reflected in the budget.
On the budget itself, Criss also said he wants to start with what the Justice administration presents during the annual State of the State address next Wednesday evening.
“The governor has indicated he intends to promote next Wednesday night a flat budget. We’ll pretty well scour through that pretty quickly, along with the budget hearings we’ll have during January, and then we’ll come together — hopefully with the Senate — and produce a budget that will be relatively flat as far as expenses are concerned,” he said.
Senate Finance Chairman Eric Tarr previously said that chamber will put forth its own budget proposal and its own vision for tax cuts.
Tarr said on “580 Live” on WCHS Radio last week that the Legislature’s Republican supermajorities don’t need to rely on the governor for financial framework.
“What happens going forward really sits in the lap of the Legislature. It’s not on the governor. We don’t need the governor to do whatever we want to do to make West Virginia what it should be for your grandkids and great grandkids at this point because the things that we do now really can change the quality of life for the generations that follow us,” said Tarr, R-Putnam.
Republicans will hold 31 of 34 seats in the Senate the next two years and 88 of 100 House seats.
Relationships deteriorated between Republican leaders in the Senate and Gov. Jim Justice, also a Republican, during the statewide debate over amending the state Constitution to allow personal property tax exemptions for automobiles and what businesses pay on their inventory, equipment and machinery.
Senate Republicans supported the amendment, saying it would aid the state’s business climate. The governor opposed it, saying it would undercut the local governments that depend on property taxes to provide services.
Tarr, speaking last week on “Talkline,” described a proposal to provide rebates for personal property taxes.
“I anticipate that bill will look like rebates on all the six categories of property that were contemplated for the personal property elimination,” Tarr said. “And the remainder of that, since the rebate plan is a bit cheaper than what we were doing with the elimination by about $90 million, is we’ll take that $90 million and add that to the 10% income tax reduction.
“I think we’ll see a comprehensive tax reform plan coming out.”
In the House, Criss indicated there is limited support for such a plan that includes rebates on personal property taxes.
“We’re approaching tax cuts differently. We’re going to consider whatever the governor is planning to do as far as personal income tax is concerned,” Criss said.
“The public in November decided which way they wanted to go on that particular amendment. Right now I don’t see why we should go up against the public and change the course of what the public has said to do. They turned down that amendment. Therefore we need to move on and figure out a different way to do our income tax reduction.”
West Virginia’s budget picture has been solid in recent months.
The most recent monthly financial figures for the state show West Virginia is already $833 million above estimates for this fiscal year. Just for December, the most recent month, the state finished $145.5 million above estimates.
The most influential revenue sources were personal property taxes — a focus of potential cuts — which are $130 million above estimates for the year so far and notoriously fluid severance taxes, which are $433.4 million above estimates for the fiscal year so far.
With that financial cushion, Criss sees room both to provide tax cuts and to invest in West Virginia infrastructure.
“The House has introduced personal income tax reductions for the last several years, so we hope that now that the governor has decided to take a hard look at plans that have been out there plus adjust for his own, I assume we’re going to see some kind of tax cut from the administration, so we hope both the House and Senate will go along with that,” he said.
But Criss said infrastructure needs should be addressed as well.
“It’s sad to say you can go within 10 minutes of the Capitol to a house with no running water, and here we are into the 23rd year of the 21st Century, and we still have homes without running water. That’s sad,” he said, describing the need to continue to use federal infrastructure funds or state revenue to try to improve roads, water and sewer.
Criss said he supports pay raises for state employees as long as the governor expresses his support, too.
“If the governor puts it in his budget, and he talks about it on the State of the State, I’m 100% behind it,” Criss said.
