By Phil Kabler
As Senate Finance Committee chairman, Senate president and governor, Earl Ray Tomblin has overseen the drafting of West Virginia state budgets for 30 years.
But a projected $353 million deficit could make putting together the 2016-17 state budget in the upcoming legislative session one of his biggest challenges.
"It's going to be a lean year, but I think we will still provide the services and do what we need to do," said Tomblin, who said state agency spending cuts of 7.5 percent, 7.5 percent and 4 percent over the past three years will remain in effect.
Tomblin said giving his sixth and final State of the State address on Wednesday will be a bittersweet experience, as he begins his 41st and presumably final year in state politics.
"It's going to be an active year. It's going to be a challenging year," he said in an interview with the Gazette-Mail last week.
"This was the year we thought we'd be back on the plus side," the governor said of six-year revenue forecasts that did not project severe drops in prices for natural gas, oil and coal.
Revenue Secretary Bob Kiss has said Tomblin will propose a "courageous and responsible plan" to address the deficit. Tomblin would not say if that plan includes tax increases.
"There's been discussions for several years, and the one in particular would be the tobacco tax. I think there will be a lot of discussion on that this year," he said.
Currently, West Virginia's 55-cent-a-pack cigarette tax is 46th-lowest in the U.S. Advocates point out that a $1 a pack increase would raise more than $100 million a year for the state, while giving people another reason not to smoke.
"If it happens, it has to be a balanced increase," Tomblin said, saying the tax can't be so high that it hurts retailers in border counties.
"It's one of those things where we want to do everything we can to discourage young people from smoking, but at the same time, we don't want prices so high, it puts small businesses out of business," he said.
While the energy market has contributed to the state's revenue downturn, the state also cut business taxes and eliminated the sales tax on food during Tomblin's tenure as Senate president and governor, reducing state revenue collections by more than $400 million a year.
However, Tomblin said the business tax cuts were instrumental in helping the state land some major investments, including the Macy's distribution center in Martinsburg, and the $500 million Proctor and Gamble manufacturing plant now under construction near that city.
"That will be huge, I think, when that's up and running," Tomblin said, saying he believes the plant will attract other suppliers and spin-off businesses to the Eastern Panhandle.
Tomblin mused that when he first came to the Senate in 1981, the Eastern Panhandle was relatively poor and under-populated, resulting in a 16th Senatorial District that encompassed seven counties. Today, with a population and economic boom, the 16th District is made up of just Jefferson County and the portion of Berkeley County that includes Martinsburg.
"Today, there's lots of people living there, and lots of employment, and we're spending lots of money over there building schools," he said. "It's because of some of the things we've done with the lowering of business taxes, and our workforce training efforts." The area has also become home to many people who commute to the Washington, D.C., area.
Likewise, Tomblin said the Northern Panhandle suffered a downturn when the steel industry left the region, but has rebounded in recent years with the Marcellus Shale natural gas boom.
"If the energy market worldwide ever gets straightened out, I feel very confident we still should have a very good chance of getting the (multibillion-dollar ethane) cracker plant, and all the downstream investment," he said.
In 2013, Brazilian company Odebrecht said it hoped to build a "cracker" plant, which removes components of raw natural gas and uses them in other applications, in Wood County. But in February 2015, an Odebrecht official said the company was reconsidering those plans in light of the downturn in the natural gas market.
Tomblin hopes a myriad of job training opportunities directed at southern West Virginia, particularly for laid-off miners and their families, will eventually lead to a revitalization of that hard-hit region.
"The mining jobs may not be returning, and you can always go back to that if they do, but it's good to have a little college training under your belt," he said. "Coal in southern West Virginia has had highs and lows for years, and it seems to be hit particularly hard this time."
The decline in West Virginia coal production is forecast to continue, because of competition from inexpensive natural gas, fewer quality reserves in Southern West Virginia, competition from other areas and from renewable power, and more rigid environmental standards.
For the second year, Tomblin will be dealing with a Republican-led Legislature. He hopes lawmakers will focus on resolving the state's budget deficit and diversifying the economy.
"I would certainly hope that we could deal with issues that improve the state and its opportunities and budgets, and don't let them get tangled up in some of the more social-type issues we usually have," Tomblin said.
Last session, Tomblin vetoed bills that would have barred abortions after 20 weeks, allowed people to carry concealed handguns without a license and permitted the sale of raw milk, among others. Legislators overrode his veto of the abortion bill.
Tomblin said there's still no consensus with the Legislature on the key issue of state highways funding.
Tomblin's Blue Ribbon Commission on Highways last year concluded that the state needs to raise an additional $750 million a year to adequately maintain state roadways, and an additional $350 million a year to complete proposed highways construction projects.
Legislators balked at the commission's main proposal, a $1 billion road bond issue, to be funded by keeping tolls on the West Virginia Turnpike through 2049.
"Trying to get consensus is a little bit hard to come by for additional money," the governor said, saying there is some consolation in passage of the federal highways bill in December that will provide $2.3 billion of road funding to the state over five years.
Going into what is likely the final year of a long career in state politics, Tomblin hopes his legacy will be education, workforce development, and fighting substance abuse problems in the state.
"I think we've made some major progress in the substance abuse problem," said Tomblin, who cited expansion of community-based drug treatment programs, establishment of a statewide, 24-hour drug abuse help line, and more emphasis on treating drug abuse as an illness rather than a crime.
"We can't lock them all up," he said.
"Education, workforce development, substance abuse, those are three things that I've spent a lot of time and effort on," Tomblin said. "There's still quite a bit of work to be done, but we've brought them to the forefront, and I think, made some strides."
Reach Phil Kabler at philk@wvgazettemail.com, 304 348-1220, or follow @PhilKabler on Twitter.