Lawmakers discuss West Virginia’s economic future, drug epidemic
CHARLESTON — Lawmakers are working on four pillars they believe will move the state economically forward.
House of Delegates Speaker Tim Armstead, R-Kanawha, told members of the West Virginia Press Association Thursday that the four were the state’s tax structure, infrastructure, the legal regulatory climate and the education system.
However, over the last few years a fifth issue has emerged that has impacted the state economy, he said.
“We also have to deal with the drug epidemic in our state,” Armstead said. “We are trying to work in each of those areas during this session.”
The press association’s 2018 Legislative Breakfast Thursday was at the Embassy Suites hotel in Charleston.
Armstead talked about efforts to eliminate the personal property tax on equipment and inventory. Tax studies have described it as a “job killer” in the state, he said.
“They said there were three main taxes standing in the way of economic development in our state, the business franchise tax which has been eliminated and the corporate net income tax…we have lowered that so it is more in line with surrounding states.
“The third remaining impediment is this personal property tax on equipment and inventory.”
Armstead said he believes the Legislature has a reasonable way to do that now with work taking place in the next couple of weeks on this issue.
“This tax has become so bad that our state is always trying to find a work-around this tax in order to attract businesses to this state,” he said.
The state will buy the needed equipment and lease it back to the company so it will agree to locate in West Virginia, he said.
Armstead said they want to eliminate the tax so all businesses can have opportunities in West Virginia.
The cost of that, $20 million, can be absorbed by the state over time, Armstead said.
A constitutional amendment would have to be voted on by the people of the state. Such a thing would include assurances to the counties and school districts, which receive money from that tax, that they would be made whole, he said.
“I believe this would be a tremendous advantage to our state,” Armstead said. “It would put us in line with the states we compete with everyday for job creation. It is basically an unfair tax most states have eliminated.”
Work has been done on the state’s regulatory climate to make the state’s court systems more fair to all sides, Armstead said. Before changes were made, it impacted economic development and whether companies decided to locate in West Virginia, he said.
Regulations have been put on the books and have not been updated to see if they were working, Armstead said. Lawmakers believe those regulations should be reviewed every five years.
“No one wants to do away with necessary regulations that protect safety and our environment,” Armstead said. “We are one of the most over regulated states in the country. We can change that in a very responsible way.”
Education is the key to moving the state forward economically, the speaker said.
Legislators want young people to stay in the state, have jobs and be able to support their families, he said.
“We are looking for ways to be able to let our teachers teach,” Armstead said without the whole system being micromanaged from Charleston.
A proposed pay raise for teachers is being considered and discussions are happening with PEIA concerns, he said.
“We are moving forward in a positive way,” Armstead said.
With infrastructure, the Roads to Prosperity bond passed last fall which calls for the sale of $1.6 billion in bonds over four years for road improvement projects across the state.
“We need to make sure each one of those dollars is spent efficiently, ethically and have the type of oversight to ensure that,” Armstead said.
In dealing with the state’s drug epidemic, the state needs to identify how to prevent people from getting addicted, which now includes education programs in the schools, and make sure teachers are well trained to deal with these situations they face with students in homes where drug abuse is a regular occurrence, he said.
“We want to make sure we reach those children early and make sure they are aware of the risks and disadvantages of becoming addicted to drugs,” he said. “For those already addicted, what can we do to help free them from that addiction.”
Through treatment and other programs, the Legislature put an additional $22 million into drug treatment.
Finally, the state needs to make it clear to those who would bring drugs into the state, this is not the place to come, he said.
“We need to crack down on that,” Armstead said. “We are not talking about those addicted, but those who would use West Virginians to further the drug trade. We need to be very strong and decisive that this is a place they do not want to come.”
Democrats in the Legislature pointed out things they felt were important.
In addition to teachers, there is a need to pay corrections officers more as the state’s jail system is having a manpower shortage, said Minority Leader Tim Miley, D-Harrison.
Some facilities have had to consider hiring people with misdemeanor convictions on their records and having to determine how serious the charge was, Miley said.
“That is a sad state of affairs where we are hiring criminals to watch over criminals,” Miley said. “We can talk about eliminating one tax or another, but there is money we have to spend as a state, as a matter of public safety, we need to address sooner than later.”
No one in the Democratic Caucus believes the personal property tax on equipment and inventory is a good tax, he said.
“The reality is we are charged with balancing a budget,” Miley said. “We need to make sure we can do that.”
The state is making progress but there is a ways to go despite some optimistic outlooks as pay for teachers and other public employees continues to remain unchanged, Miley said.
Miley said every year, there is something that seems to prevent businesses from coming to West Virginia and every year it changes from taxes to labor issues to regulations.
“You lose credibility when you say ‘this’ is the silver bullet,” Miley said. “You address that and come back and now it is something else. No one is going to come to our state if they don’t have good educational opportunities.”
Senate Minority Leader Sen. Roman Prezioso, D-Marion, said many companies know the importance of an educated workforce and there is a need to bring qualified teachers to provide that at all levels, including vocational education.
“Do you want your children to go to school where there are 725 non-certified teachers?” he asked. “I don’t. Our kids have to compete globally in math and science and those teachers are hard to find.”
In the past, the state passed taxes, totaling $350 million, which helped to fund education at a time when little money was available, he said. That included a $5,000 raise for teachers.
“People agreed with us,” Prezioso said. “They said we had to do something. Where there is a will, there is a way.”