Penny Pinching Still Wise Course
West Virginia state government may be out of the fiscal woods, as Gov. Jim Justice has been saying for some time. The state did end the previous fiscal year on June 30 with a $36 million carryover. And general revenue fund receipts for July, the first month of the new fiscal year, exceeded estimates by $32.4 million.
So there is reason for Justice and legislators to breathe sighs of relief. The days of worrying about mid-year spending cuts and raids on the rainy day fund to keep the budget balanced may be over.
But a downturn in the economy or a major unforeseen expense could take us right back to the bad old days.
To cite just one potential pitfall: When Mountain State voters agreed to increase our taxes to pay for $1.6 billion in highway improvement bonds, we did so in part because of the persuasiveness of a list of proposed road and bridge projects throughout the state. But when bids for the biggest segment of the work, improvements to Interstate 70 in Ohio County, were opened, they provided a shocker. The project’s cost initially was estimated at $172.5 million. The lowest bid was $275 million.
At that rate, not all the proposals on the list state residents were shown will be affordable. Lots of voters will be angry.
So, just to keep state officials’ promises on highways, Justice and legislators may have to draw upon general revenue fund money. At the July rate of $32.4 million over estimates, making up the difference for the I-70 work alone would eat up a full quarter’s worth of excess revenue.
Yes, we are making progress. West Virginia workers and businesses deserve most of the credit for that.
And state legislators, by insisting last spring that spending plans be based on conservative revenue estimates, deserve pats on the back, too.
That penny-pinching attitude needs to carry forward through the rest of the current fiscal year.