Gas money fund studied
WHEELING – Despite three unsuccessful attempts, West Virginia Senate President Jeff Kessler isn’t giving up on creating a “West Virginia Futures Fund” to save tens of millions of dollars each year in natural gas-related revenue for a rainy day.
But as Kessler, D-Glen Dale, plans to lead a bipartisan group of lawmakers to North Dakota later this month to examine the effects of a similar fund there, House of Delegates Minority Leader Tim Armstead believes the future is now, as the state faces a projected $300 million budget gap for the 2015 budget year.
Armstead’s comments came during a panel discussion Friday at the West Virginia Press Association annual convention at Oglebay Park’s Wilson Lodge, in response to a question from J. Michael Myer, executive editor of The Intelligencer and Wheeling News-Register, on the likelihood of resurrecting Kessler’s proposal within the next year.
Kessler’s bill would have directed a portion of severance tax revenue from natural gas production in West Virginia to the Futures Fund, with the intention of holding that money in reserve for at least 20 years.
Armstead, R-Kanawha, said he doesn’t necessarily oppose the Futures Fund idea, but he believes West Virginia faces more pressing matters. With talk of Gov. Earl Ray Tomblin’s Blue Ribbon Commission on Highways proposing an increase in the state sales tax to 7 percent to pay for West Virginia’s current infrastructure needs, he believes the concept of raising taxes while socking away more money for the future would be a tough sell to the public.
He also said the best use of any boost in severance tax revenue may be to help reduce or eliminate the West Virginia inventory tax that he said keeps job creators from locating in the state.
“It’s a job-killer, and I think everyone admits it is, but how do you make that (revenue) up in the school systems?” Armstead said of the inventory tax.
Kessler, however, looks to the success of such funds in states like Alaska, after which he patterned the West Virginia Futures Fund bill, and North Dakota, where officials had banked $1 billion within 20 months of establishing its Legacy Fund in 2011.
“Our long-term financial future is in pretty good shape in terms of paying off our debts . … Had we done something similar to (the West Virginia Futures Fund) with coal, we might have billions of dollars in the bank” today to deal with roads, increase teachers’ pay and cut taxes to make West Virginia’s economic climate more competitive, Kessler said.
Other leaders in the Legislature indicated support Friday for the Futures Fund. Senate Minority Leader Mike Hall, R-Winfield, said he believes the Futures Fund is a realistic possibility. New House Speaker Tim Miley agreed, but was a bit more cautious, noting “the devil will be in the details.”
“If you’re not going to impose additional taxes, you’ve got to set benchmarks at a point where you’re not taking money away from needed services,” Miley, D-Harrison, said.
Kessler sponsored legislation to create the Futures Fund during the last three regular sessions, but each time failed to garner enough support to get the bill out of committee.