Tomblin Budget Taps Reserves, Keeps Tax Rates

CHARLESTON (AP) – Amid a budget shortfall, Gov. Earl Ray Tomblin plans to avoid raising taxes and give public employees raises by tapping West Virginia’s rainy-day fund.

The governor is urging lawmakers to use $148 million in state reserves to balance next year’s budget, including $84 million from emergency-only savings. Dipping into the $918 million pot, which the state has never used to patch a budget, would clear the way for 2 percent raises for teachers and $504 pay bumps for state workers. The raises would cost the state about $42 million.

West Virginia officials face a variety of strains on their budget. For one thing, the state is paying for a larger share of Medicaid bills, though that is unrelated to the program’s expansion under federal health care reform.

Though tax revenues from natural gas producers have climbed, dimming prices of coal have hurt revenues from the state’s staple industry.

State agencies would endure a 7.5 percent drop in their funding, though certain areas such as public schools, higher education and corrections would not take a hit. Higher education would face a 3.75 percent cut.