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Budget woes may intensify

Within a few weeks, West Virginia officials should have an idea of whether the gap between state spending and budget revenue is going to persist – or even grow worse. By then, data on this year’s income tax collections ought to be available. And early in May, another round of unemployment figures will be released.

The outlook is not good.

Earlier this month, it was revealed that state tax collections during March totaled $306.2 million – $14.2 million below projections on which the current year’s budget were based.

With the fiscal year three-quarters completed at the end of March, the revenue total was $78.18 million less than had been expected. Still, Revenue Secretary Bob Kiss said state government should end the fiscal year on June 30 with a balanced budget.

That will happen only because of a hiring freeze, mid-year spending curbs and “budget supplements” approved by the Legislature. Those supplements for this year and next will come from the state’s emergency “Rainy Day” fund.

There was a bright spot in the report earlier this month. It was that, by the end of March, state income tax collections were up slightly (4.1 percent) over what had been expected. Again, final numbers on the income tax should be available within a few weeks.

But this week there was more bad news for state fiscal policymakers to ponder. It came in the form of the monthly report on how many West Virginians are working.

After improving through much of last year, unemployment is trending upward in the Mountain State. During March, the rate was 6.1 percent, up about 0.2 percent since January.

That may seem like a small uptick, but each one-tenth of a percent represents nearly 800 men and women without jobs – and without paychecks. If unemployment continues to increase, it will have a serious effect on state revenue collections both now and during the upcoming fiscal year.

Gov. Earl Ray Tomblin’s administration and legislators already are on the defensive regarding the state budget. Clearly, they should be preparing for the distinct possibility of worse to come.

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