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CHARLESTON -- State agencies will now have to jump through some hoops before getting access to a credit line for large purchases.
Gov. Jim Justice announced Monday that his administration is putting in place new policies and procedures for state agencies to follow before getting access to a $25 million credit line the state has had since 1992.
"We want to ensure that any use of our credit line is done in a careful and transparent fashion," Justice said. "We recently discovered that there hasn't been any review or approval procedures for agencies to use the credit line. All future requests will be reviewed and approved only when they are fiscally responsible."
The line of credit, financed by Bank of America at 1.68 percent interest rate, was first established by former Gov. Gaston Caperton during his second term. State agencies can access the line of credit for large purchases and pay the money back.
According to the governor's office, the balance for the credit line sits at $21 million, with $17.6 million being used for vehicle purchases by the state Fleet Management Office.
A memo was issued Oct. 24 to the governor's cabinet secretaries, executive branch agency heads and chancellors by Ann Urling, deputy chief of staff to Justice. In the memo, Urling said all loan approval must come from the governor's office.
"Pursuant to the West Virginia Expenditure of State Funds Policy, please be advised that effective Oct. 31, 2018, prior to any loan or extension of credit from a bank or other financial institution, all executive branch agencies must provide notice to, and receive approval from, the Governor's Office," Urling wrote.
"Agency heads and purchasing personnel should be cognizant that all loans, of any value, should be utilized only if it is in the best financial interest of the state." Urling, a former Summit Community Bank executive, said. "Agencies are directed to analyze every contract to ensure that the state taxpayers receive the best value for their money. Unnecessary or wasteful loan applications should not move forward, regardless of the amount of the loan."