Unable to pass tax increases or make major cuts in government spending, the West Virginia Legislature amended and passed a budget bill Thursday evening that uses $245 million in Rainy Day reserve funds and one-time money to close a $270 million gap in the 2016-17 state budget.
The bill (HB 101) passed the Senate on a party-line 18-16 vote. Later Thursday, the House of Delegates concurred and passed the bill 60-37, sending it to Gov. Earl Ray Tomblin.
Democrats warned that the bill faces a near-certain veto by Tomblin, who has said he will not allow the Legislature to take more than a "few million dollars" out of the Rainy Day funds to balance the budget.
"While it may be the easy way to get out of town, it does not solve the structural problems in West Virginia's budget," said Senate Minority Leader Jeff Kessler, D-Marshall, who called budget plan "fiscally irresponsible."
However, Senate Finance Chairman Mike Hall, R-Putnam, said he's hopeful Tomblin will treat the bill as the equivalent of a continuing resolution, to keep state government operating after July 1. West Virginia law does not provide for actual continuing budget resolutions, which other states have used to keep government operating during extended budget impasses.
"The public has asked us to pass a budget," Hall said. "I'm doing it with the only tools I have."
Hall stressed that he had pushed for two of the revenue measures proposed by Tomblin to balance the budget, but found little support in the Legislature for either option.
That included a tobacco tax hike that narrowly passed the Senate but was rejected 55-44 in the House, and a temporary increase in the consumer sales tax that was rejected Tuesday in Senate Finance Committee on a bipartisan 10-6 vote.
"I basically tried to get revenue, or we wouldn't have this budget before you," he said.
Hall agreed with Sen. Mike Romano, D-Harrison, who warned that use of one-time funds to balance the 2016-17 budget will create a larger, $380 million budget shortfall in fiscal 2018.
"It does not bode well going forward, I agree with you," Hall said.
Sen. Corey Palumbo, D-Kanawha, noted that, when the special session began on May 16, Senate Majority Leader Mitch Carmichael, R-Jackson, advocated balancing the budget by one-third with Rainy Day funds, one-third with budget cuts and one-third with tax increases.
"This is a 91-9-0 plan," Palumbo said, alluding to 91 percent of Rainy Day and one-time funds, 9 percent cuts and no new revenue.
"This budget, to me, just screams cowardly," he said.
Senate Judiciary Chairman Charles Trump, R-Morgan, conceded that all options facing the Legislature to balance the budget were unpalatable.
However, he said, "No combination of them is as horrible as the specter of not passing a budget and having this government shut down."
Sen. Ed Gaunch, R-Kanawha, was critical that the bill does not make systemic cuts to eliminate "duplication, inefficiency and waste" in government.
Gaunch said of the budget bill, "The truth is, we haven't done anything. It's smoke and mirrors. This is Kabuki theater, if you ask me."
In the House, an acrimonious debate, predominately over which party is to blame for the defeat of a tobacco tax bill last week, preceded the vote.
"This budget is a lie, because we say it is a balanced budget and it is not," said Delegate Tim Manchin, D-Marion. "We should not lie to the people of West Virginia. Certainly, we should not lie to them so they will send us back here in the fall [election]."
However, Delegate Bill Anderson, R-Wood, said passage of the budget would alleviate needless worry for citizens relying on state programs.
"We're not going to be able, we've shown, to pass revenue measures between the House and Senate, the Republicans and the Democrats," he said. "This is the vehicle we have in front of us right now. It may not be the vehicle we would prefer to ride in."
The budget plan authorizes $4.088 billion in general revenue spending, closing the $270 million budget shortfall with $182.6 million in Rainy Day funds and $62.4 million in one-time funds pulled from various accounts.
The bill imposes $122 million in spending cuts but makes no additional cuts to public education, higher education, Health and Human Resources, Division of Corrections, State Police and several other programs.
It also fully funds Promise scholarships and provides $43.5 million in new funding for employers' shares of PEIA health insurance premiums, which would avoid $120 million in benefit cuts through significantly higher co-pays, deductibles and out-of-pocket maximums. However, as part of the 80-20 premium match, employees will see premium increases averaging 12 percent.
Asked if he knew how many state employees will lose their jobs because of the budget cuts, Hall answered, "I do not. I do not have a jobs impact statement."
Instead of adjourning Thursday evening after 13 days in special session, the Legislature recessed the session until June 12.
Delegate Patrick Lane, R-Kanawha, said that would give the Legislature an opportunity to override what he said would be an "irresponsible" veto of the bill by Tomblin. However, an override of a veto requires a two-thirds majority vote, which would be difficult to achieve, particularly in the Senate.
Meanwhile, a number of bills were left in limbo with the Thursday evening recess, including a furlough bill that would have allowed the governor to continue essential state government operations through executive order if a budget is not enacted by July 1.
Reach Phil Kabler at philk@wvgazettemail.com, 304-348-1220 or follow @PhilKabler on Twitter.