House panel OKs Future Fund bill
WHEELING – West Virginia Senate President Jeff Kessler’s Future Fund proposal continues to blaze a smooth path through the Legislature, with just one stop to go before a final vote in the House of Delegates.
Legislation creating the fund, which would set aside a portion of natural gas severance tax revenue in a permanent investment fund to address the state’s future needs, cleared the House Judiciary Committee on Monday and now moves to that chamber’s Finance Committee. It already has passed the state Senate.
Judiciary committee members made one minor amendment – adding “cultural or historical improvement or preservation” as types of economic development projects for which interest income from the fund could be used – before voting unanimously to advance the bill.
To ensure time for passage prior to the close of the regular session at midnight Saturday, it would need to have its first reading on the House floor by Thursday.
Delegate Michael Ferro, D-Marshall, a member of the Judiciary Committee, said debate on the Future Fund bill was generally positive. Some lawmakers pointed out that future Legislatures could raid the fund for any purpose simply by amending the law, unless voters solidify spending limitations through a constitutional amendment – but such reservations weren’t serious enough to generate opposition to the bill.
“There were a few questions asked, but nothing contentious. … I think it’s a good thing. I really do,” Ferro said of the proposed Future Fund. “As Senator Kessler has said a number of times, if we had done this with coal severance (taxes), we would have billions of dollars.”
Each year, any natural gas severance tax revenue above the $175 million benchmark prescribed in the bill would be deposited into the fund. The account’s principal balance would be untouchable, and beginning in 2020, interest income only could be spent for economic development projects, infrastructure improvement and education enhancement.
The Future Fund conversation came on the heels of a marathon Judiciary Committee session on proposed chemical storage tank regulations that began Sunday afternoon and lasted into early Monday morning. One committee member, Delegate Stephen Skinner, said that debate highlighted one way the Future Fund could be of enormous benefit to West Virginia.
“It’s apparent that our folks throughout the state have water infrastructure issues, and I think this is part of the solution to those infrastructure issues,” Skinner, D-Jefferson, said. “This money can be reinvested back into those communities to deal with water problems. It’s the kind of forward thinking that we need to have in West Virginia.”
With the state Department of Revenue predicting natural gas severance tax proceeds to increase steadily through Fiscal Year 2017 before tapering off, the West Virginia Center on Budget & Policy projects the Future Fund could bank $127 million by the end of FY 2019, the year before the Legislature could begin spending interest income.
The Senate has approved a measure to place a constitutional amendment before voters related to Future Fund spending limits in November, but it faces two committee assignments before the full House will consider it.
The Future Fund bill is Senate Bill 461. The proposed constitutional amendment is Senate Joint Resolution 14.