Justice Touts Positive Revenue Numbers
CHARLESTON — When Gov. Jim Justice was giving his first State of the State address in 2017, he was looking down the nose of a nearly $500 million budget shortfall.
Now that the 2020 fiscal year started on Monday, the state ended the year with another surplus.
West Virginia ended fiscal 2019 — which started July 1, 2018, and ended Sunday, June 30 — with approximately $8.2 million above estimated tax collections for the fiscal year.
“Our revenue numbers this year have been so special, it’s unbelievable,” Justice said in a statement. “We set a record almost every single month, and to see it all pay off with an all-time state record for revenue growth is so exciting for our people and our future. I’m incredibly proud and so happy for every single West Virginian.”
The state’s estimated collections were $4.748 billion, with the state bringing in $4.756 billion, 12 percent more than last fiscal year.
The Governor’s Office raised the revenue estimates at least two times during the year based on improving revenue numbers, or $308 million.
According to an analysis by the Senate Finance Committee, the state would have brought in more than $305 million above the original revenue estimate submitted by the governor to the West Virginia Legislature in January.
Helping bring the state over the fiscal year finish line was personal income tax collections, which exceeded estimates by $4.8 million for the fiscal year. Officials with the state Department of Revenue estimated $2.092 billion in personal income tax collections, with the state bringing in $2.096 billion.
Last week, the U.S. Department of Commerce praised West Virginia for leading the nation in personal income growth rate of 5.6 percent for the first three months of 2019, a rate that eclipsed the national rate by 2.2 percent. According to the National Association of State Budget Officers, West Virginia was one of five states to get to double-digit revenue growth between 2018 and 2019.
The severance taxes on coal and natural gas also brought in abundant tax revenue over the last 12 months, coming in $11.5 million above estimates. Revenue officials estimated collections of $451 million, while the state brought in $462.6 million.
Earlier this month, Justice announced that the first 10 months of fiscal year 2019 saw 11.5 percent growth in the state general revenue tax collections.
June tax collection numbers appeared to be down but were really up according to Revenue Secretary Dave Hardy. Revenue for the month came in $8.95 below estimate, coming in at approximately $478 million or 2 percent below estimates. But that was after the state transferred $12 million into the income tax reserve fund. Before that money was transferred June had a $3.1 million surplus.
“This is a great day for West Virginia,” Hardy said. “Record-breaking revenue numbers such as these reflect an overall improvement in nearly all sectors of the state’s economy. This reflects robust and continued growth in virtually all of our revenue sources, including consumer sales, personal income, corporate net income and severance taxes.”
Personal income tax collections for June came in at more than $200 million, or $2.8 million below estimates. Severance tax collections for June came in at $51.9 million, or $9.8 million above estimates. Consumer sales and service tax revenue came in at $151 million, or $2.1 million above June estimates.
The State Road Fund saw $972.7 million by the end of the fiscal year in June, which was $33 million above estimate and 14.5 percent ahead of fiscal year 2018’s numbers.
The state’s revenue shortfall reserve funds, also known as rainy day funds, remain flush with cash. The total of the state’s two rainy day funds at the end of June is $753 million, a 6 percent increase from the same time last year.
Justice also cited other positive economic achievements since taking office in 2017, including leading the nation in 2017 with a 14.4 percent job growth rate and 4,300 construction jobs that year.
“I’ve said over and over, the people of West Virginia will not tolerate being dead last anymore,” Justice said. “We still have a lot of people to help and we will absolutely do that. But we’re getting there and today is a day to celebrate all of the good that we have going on in our growing economy.”