Stop Draining Rainy Day Fund
Many West Virginia legislators seem to have little use for former Gov. Earl Ray Tomblin’s budget proposal. They are right to reject his recommendation for $270 million a year in tax increases.
But one cautionary note struck by Tomblin should be kept firmly in mind. It involves the only life preserver available to the ship of state in West Virginia.
During his farewell speech to lawmakers, Tomblin outlined his proposals for the fiscal 2018 budget. As he is well aware, new Gov. Jim Justice also has a plan. Justice has said quite rightly that Mountain State residents simply cannot afford higher taxes.
One way of avoiding them, used by legislators for the current budget, is to dip into the state’s emergency “Rainy Day” Fund. Every dollar taken from avoids a dollar in tax increases or a dollar in state spending cuts.
But the Rainy Day Fund never was intended as a supplement to regular budgets. It was established to give the state a cushion in case of a severe crisis.
In November 2013, the fund held $920 million. At last report, it was down to $632 million.
Drawing more money out of the fund could force the state’s bond ratings downward. That would make it more costly for the government to borrow money for projects such as highways.
In addition, of course, money drawn out of the account to balance budgets now will not be available in case of a major calamity, perhaps a natural disaster such as a flood.
As Tomblin advised in his speech, “part of being fiscally responsible means making sure that we can pay our bills without taking the Rainy Day Fund to dangerously low levels …”
He is absolutely right. Justice and legislators should stop draining the fund. We may need it badly in the future.