Avoiding Fiscal Cliff in W.Va.
West Virginia has reached a turning point. The road state government is on leads to a fiscal cliff of the same kind many other states have gone over during the past few years.
When legislators approved a budget for the coming year Friday, they agreed to spend $147.5 million the state does not have, in a very real sense. The budget will be balanced only if that amount is spent out of the Rainy Day emergency fund.
At first glance, the problem may not seem large. After all, the total budget for the coming year is about $22.2 billion. The $147.5 million being spent in excess of projected revenue is only about two-thirds of 1 percent of the total.
But $147.5 million is big money, no matter how you look at it. Had that amount been cut from state services or made up through tax increases, most West Virginians would have felt noticeable pain.
Unless revenue collections improve substantially during the coming year, legislators will have to take even more from the Rainy Day fund in March 2015. Within just a few more years, it will be empty.
Then what will we do?
Clearly, Gov. Earl Ray Tomblin and legislators need to find some way to get the state on a different, smoother road. Otherwise, we will continue driving toward that fiscal cliff.