May 15, 2016
Special session underway
Governor Earl Ray Tomblin issued a proclamation yesterday calling for lawmakers
to pass a budget for the coming year and resolve the current $111 million shortfall
in this year’s revenues.
The Governor’s 2017 budget calls for: (1) increasing tax on all tobacco products and
impose a tax on e-cigarettes; (2) increasing the consumers sales and use tax by
no more than one percent; and (3) eliminate the tax on sales of telecommunications.
It is important to dentists to know the Governor’s proposal does not call for any cuts
in the Medicaid program. (There was talk last month by some lawmakers to reduce
In addressing the shortfall in this year’s revenues, which in part prompted Medicaid
to alert dentists and other providers in April of a slow down in payments, the Governor
is asking lawmakers to transfer unexpired funds from several agencies over to the
general revenue. Some of these funds may be used to “shore up” Medicaid.
Finally, the Governor asked lawmakers to approve his furloughing state employees
in the event of fiscal emergency.
In an open, joint meeting of the House and Senate Finance Committees yesterday,
the Governor’s top officials presented the budget and reasons for taxes increases.
It was noted during the meeting that the Governor has cut spending by $434 million
during his service, leaving little room for cuts without eliminating more services.
In somewhat of a surprise move yesterday, the Senate dispensed with sending the
tobacco tax proposal to its Finance Committee and approved the measure for its
first reading. The amount of the increase in tobacco tax will be debated today by
the full Senate while the bill is on second reading (amendment stage). A 45-cent
increase in tobacco tax is estimated to generate $78 million. The House took no
action yesterday on a tobacco tax or any other proposed tax.
WVDA Executive Director Richard Stevens is attending the special session and
the Interim Committee meetings scheduled later this week.