Difference between revisions of "West Virginia state budget"

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::''See also: [[West Virginia public pensions]] and [[West Virginia public employee salaries]]''
 
::''See also: [[West Virginia public pensions]] and [[West Virginia public employee salaries]]''
  
A 2012 report from the Pew Center on the States noted that [[West Virginia public pensions|West Virginia's pension system]] was funded at 58 percent at the close of fiscal year 2010, well below the 80 precent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."<ref name=wvpew>[http://www.pewstates.org/research/state-fact-sheets/widening-gap-update-west-virginia-85899399358 ''Pew Center on the States'' "Widening Gap Update: West Virginia," June 18, 2012]</ref>
+
A 2012 report from the Pew Center on the States noted that [[West Virginia public pensions|West Virginia's pension system]] was funded at 58 percent at the close of fiscal year 2010, well below the 80 precent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."<ref name=wvpew>[http://www.pewstates.org/research/state-fact-sheets/widening-gap-update-west-virginia-85899399358 ''Pew Center on the States'', "Widening Gap Update: West Virginia," June 18, 2012]</ref>
  
 
The funding ratio for the state's pension system increased from 54.91 percent in fiscal year 2006 to 64.16 percent in fiscal year 2011, a 9.25 percent jump. Unfunded liabilities increased slightly in the same period, from $5.36 billion in fiscal year 2006 to $5.71 billion in fiscal year 2011.
 
The funding ratio for the state's pension system increased from 54.91 percent in fiscal year 2006 to 64.16 percent in fiscal year 2011, a 9.25 percent jump. Unfunded liabilities increased slightly in the same period, from $5.36 billion in fiscal year 2006 to $5.71 billion in fiscal year 2011.

Revision as of 06:07, 9 May 2014

West Virginia state budget

Flag of West Virginia.png
Budget calendar:  Annual
Current fiscal year:  2014
State credit rating:  AA (as of May 2012)
Current governor:  Earl Ray Tomblin
Financial figures
GF expenses[1]:  $4.2 billion
All funds expenses:  $23.4 billion (FY 2013 estimate)
Spending % change:  Green Arrow Up Darker.svg0.36%[2]
% from federal funding:  34.71%
State debt:  $24,972,461,000
Per capita state debt:  $13,459
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Policypedia Budget Policy-logo-no background.png
This page contains information about budget processes and policy issues in West Virginia, including:
  • A summary of the budget drafting process
  • Trends in expenditures and revenues
  • Current and past fiscal year budget developments
  • Financial transparency measures

Between fiscal year 2009 and fiscal year 2013, West Virginia's total expenditures increased by approximately $3 billion, from $20.4 billion in 2009 to $23.4 billion in 2013. This represents a 12.8 percent increase, outpacing the cumulative rate of inflation during the same period (9.06 percent, calculated using the Consumer Price Indices for January 2009 and January 2013).[3][4]

Budget process

The state operates on an annual budget cycle. The sequence of key events in the budget process is as follows:[5][6]

  1. Budget instruction guidelines are sent to state agencies in July.
  2. State agencies submit budget requests in September.
  3. Agency hearings are held in October and November.
  4. The governor submits his or her proposed budget to the West Virginia State Legislature on or before the second Wednesday in January.
  5. The legislature adopts a budget in March or April. A simple majority is required to pass a budget.

West Virginia is one of 44 states in which the governor has line item veto authority.[6]

The West Virginia State Legislature is constitutionally required to pass a balanced budget. The budget must be balanced before the governor can sign it into law.[6]

Expenditures

Definitions

Although each state executes its budget process differently, the National Association of State Budget Officers (NASBO) breaks down state expenditures into four general categories. This allows for comparisons among the 50 states. NASBO's categories are as follows:[7]

  • General fund: "The predominant fund for financing a state’s operations. Revenues are received from broad-based state taxes. However, there are differences in how specific functions are financed from state to state."[7]
  • Other funds: "Expenditures from revenue sources that are restricted by law for particular governmental functions or activities. For example, a gasoline tax dedicated to a highway trust fund would appear in the “Other funds” column. For Medicaid, other state funds include provider taxes, fees, donations, assessments, and local funds."[7]
  • Federal funds: "Funds received directly from the federal government."[7]
  • Bonds: "Expenditures from the sale of bonds, generally for capital projects."[7]

2013 expenditures

Breakdown of expenditures in FY 2013.
Source: National Association of State Budget Officers

The table below breaks down expenditures for fiscal year 2013 (comparable figures from surrounding states are provided to give additional context).[7] Figures for all columns except "Per capita expenditures" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the column labeled "Per capita expenditures" have not been abbreviated.

Total state expenditures, FY 2013 ($ in millions)[7]
State General fund Federal funds Other funds Bonds Total Per capita expenditures**
West Virginia $4,159 $4,394 $14,736 $74 $23,363 $12,599.34
Kentucky $9,426 $8,001 $8,246 $0 $25,673 $5,841.02
North Carolina $20,602 $17,459 $12,543 $785 $51,389 $5,218.19
Tennessee $12,622 $13,055 $5,394 $382 $31,453 $4,841.92
Virginia $17,691 $9,546 $16,191 $1,167 $44,595 $5,398.65
**Per capita figures are calculated by taking the state's total expenditures and dividing by the number of state residents according to United States Census estimates.[8][9]
Source: National Association of State Budget Officers

Expenditures by function

Breakdown of expenditures by function in FY 2012.
Source: National Association of State Budget Officers

State expenditures in West Virginia can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2012 data is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percents, indicating the share of the total budget spent per category.

Expenditures by function, FY 2012 (as percents)[7]
State Elementary and secondary ed. Higher ed. Public assistance Medicaid Corrections Transportation Other
West Virginia 10.8% 14.1% 0.7% 12.7% 1.0% 5.8% 54.9%
Kentucky 19.8% 25.7% 0.9% 22.5% 2.4% 8.9% 19.8%
North Carolina 23.2% 9.0% 0.5% 24.7% 4.2% 9.9% 28.4%
Tennessee 17.7% 12.8% 0.4% 30.7% 2.7% 6.4% 29.3%
Virginia 16.0% 13.1% 0.4% 16.2% 2.9% 11.3% 40.1%
Source: National Association of State Budget Officers

Expenditure trends

From 2008 to 2012, expenditures on elementary and secondary education, public assistance, Medicaid, corrections and transportation all decreased, with expenditures on elementary and secondary education falling the most at 12.3 percent less than 2008. During that same time period, expenditures on higher education increased by 0.4 percent. The table below details changes in expenditures from 2008 to 2012.[7][10][11][12][13] Figures are rendered as percents, indicating the share of the total budget spent per category.

Expenditures from 2008 to 2012 (as percents)
Year Elementary and secondary ed. Higher ed. Public assistance Medicaid Corrections Transportation Other
2012 10.8% 14.1% 0.7% 12.7% 1.0% 5.8% 54.9%
2011 23.3% 14.2% 1.4% 23.5% 2.9% 8.3% 26.3%
2010 24.4% 13.2% 1.4% 23.0% 3.2% 9.1% 25.8%
2009 24.6% 13.3% 1.2% 21.4% 3.4% 8.0% 28.0%
2008 23.1% 13.7% 1.3% 19.6% 3.7% 8.5% 30.2%
Change in % -12.30% 0.40% -0.60% -6.90% -2.70% -2.70% 24.70%
Source: National Association of State Budget Officers

Revenues

2013 revenues

Breakdown of general fund revenue sources in FY 2013.
Source: National Association of State Budget Officers

The table below breaks down general fund revenues by source in fiscal year 2013 (comparable figures from surrounding states are also provided to give additional context).[7] Figures for all columns except "Per capita revenue" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the column labeled "Per capita revenue" have not been abbreviated.

Revenue sources in the general fund, FY 2013 ($ in millions)[7]
State Sales tax Personal income tax Corporate income tax Gaming tax Other taxes and fees Total Per capita revenue**
West Virginia $1,197 $1,722 $249 $0 $982 $4,150 $2,238.04
Kentucky $3,022 $3,723 $401 $0 $2,202 $9,348 $2,126.82
North Carolina $5,309 $10,958 $1,192 $0 $3,100 $20,559 $2,087.62
Tennessee $6,643 $126 $1,083 $0 $3,551 $11,403 $1,755.39
Virginia $3,249 $11,093 $821 $0 $1,259 $16,421 $1,987.92
**Per capita figures are calculated by taking the state's total revenues and dividing by the number of state residents according to United States Census estimates for 2013.[8]
Source: National Association of State Budget Officers

Revenue trends

The table below details the change in revenue sources in the general fund from 2009 to 2013.[7][10] Figures for all columns except "Per capita revenue" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the column labeled "Per capita revenue" have not been abbreviated.

Revenue sources in the general fund, West Virginia ($ in millions)[7][10]
Year Sales tax Personal income tax Corporate income tax Gaming tax Other taxes and fees Total Per capita revenue**
2013 $1,197 $1,722 $249 $0 $982 $4,150 $2,238.04
2012 $1,178 $1,647 $174 $0 $1,017 $4,016 $2,163.00
2011 $1,148 $1,593 $303 $0 $1,020 $4,064 $2,190.62
2010 $1,095 $1,447 $233 $0 $983 $3,758 $2,026.81
2009 $1,110 $1,557 $270 $0 $964 $3,901 $2,143.67
Change in % 7.84% 10.60% -7.78% N/A 1.87% 6.38% 4.40%
**Per capita figures are calculated by taking the state's total revenues and dividing by the number of state residents according to United States Census estimates.[8][9]
Source: National Association of State Budget Officers

State budgets by year

DocumentIcon.jpg See budget bill: H.B. 2014

Fiscal year 2014

West Virginia state budget -- 2014
West Virginia State Legislature
Text:H.B. 2014
Legislative history
Introduced:February 13, 2013
House:April 12, 2013
Vote (lower house):85-13
Senate:April 13, 2013
Vote (upper house):33-1
Conference:April 17, 2013
Governor:Earl Ray Tomblin
Signed:April 22, 2013

The state's FY 2014 budget was signed into law by Governor Earl Ray Tomblin on April 22, 2013.[14] A copy of the full budget bill can be found here.

Fiscal year 2013

See also: West Virginia state budget (2012-2013)

Fiscal year 2012

See also: West Virginia state budget (2011-2012)

Fiscal year 2011

See also: West Virginia state budget (2010-2011)

Fiscal year 2010

See also: West Virginia state budget (2009-2010)

Historical spending

State budget historical spending below was compiled by the National Association of State Budget Officers. Figures reflect the reported "Total Expenditures" in Table 1. Figures for all columns are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000).[7][11]

Historical state budget spending in West Virginia ($ in millions)
Fiscal year General Fund Other funds Federal funds Bonds Budget totals
Total % of Budget Total % of Budget Total % of Budget Total % of Budget
2011-2012 $4,144 19% $13,540 62.1% $4,064 18.6% $73 0.3% $21,821
2010-2011 $3,770 17.8% $12,906 60.9% $4,460 21% $62 0.3% $21,198
2009-2010 $3,704 18.2% $12,122 59.5% $4,475 22% $77 0.4% $20,378
Averages: $3,872.67 18% $12,856 61% $4,333 21% $70.667 0% $21,132.33
General Fund: The predominant fund for financing a state’s operations. Revenues are received from broad-based state taxes. However, there are differences in how specific functions are financed from state to state.
Other funds: Expenditures from revenue sources that are restricted by law for particular governmental functions or activities. For example, a gasoline tax dedicated to a highway trust fund would appear in the “Other funds” column. For Medicaid, other state funds include provider taxes, fees, donations, assessments, and local funds.
Federal funds: Funds received directly from the federal government.
Bonds: Expenditures from the sale of bonds, generally for capital projects.

State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, West Virginia had a state debt of over $24 billion. Its state debt per capita was $13,459. The report revealed that state governments faced a combined $5.1 trillion in debt, 33 percent of annual gross state product. The obligation amounts to $16,178 per capita in the nation. A bulk of the state debt -- 79 percent -- was linked to unfunded public pensions.[15][16]

Total state debt in West Virginia[17]
Type Totals U.S. rank
Total state debt $24,972,461,000 39
Per capita debt $13,459 29
State and other fund expenditures $17,684,000,000 50

Public pensions

See also: West Virginia public pensions and West Virginia public employee salaries

A 2012 report from the Pew Center on the States noted that West Virginia's pension system was funded at 58 percent at the close of fiscal year 2010, well below the 80 precent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."[18]

The funding ratio for the state's pension system increased from 54.91 percent in fiscal year 2006 to 64.16 percent in fiscal year 2011, a 9.25 percent jump. Unfunded liabilities increased slightly in the same period, from $5.36 billion in fiscal year 2006 to $5.71 billion in fiscal year 2011.

Credit ratings

States sometimes sell general obligation bonds to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). Credit rating agencies, such as Standard and Poor's, assign grades to states, evaluating their ability to pay the principal and interest on such bonds. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest. Generally speaking, a higher credit ranking indicates lower risk for an investor, which in turn lowers costs for taxpayers.[19]

The table below lists the Standard and Poor's credit ranking for West Virginia from 2001 to 2012 (grades from surrounding states are provided for additional context).[19]

S&P credit ratings from 2001 to 2012
West Virginia Kentucky North Carolina Tennessee Virginia
2012 AA AA- AAA AA+ AAA
2011 AA AA- AAA AA+ AAA
2010 AA AA- AAA AA+ AAA
2009 AA AA- AAA AA+ AAA
2008 AA- AA- AAA AA+ AAA
2007 AA- AA- AAA AA+ AAA
2006 AA- AA- AAA AA+ AAA
2005 AA- AA- AAA AA AAA
2004 AA- AA- AAA AA AAA
2003 AA- AA- AAA AA AAA
2002 AA- AA- AAA AA AAA
2001 AA- AA AAA AA AAA

Federal aid to state budget

See also: Federal aid to budgets in the 50 states

The chart below notes how much of the state’s general revenues come from the federal government. Figures were calculated by dividing each state’s federal intergovernmental revenue into its general revenue. The number in the rightmost column indicates the state's ranking in relation to the rest of the nation (e.g., if "1," the state receives the highest percentage of federal funding in the nation). Figures from neighboring states are included to provide additional context.[20]

State governments receive aid from the federal government to fund a variety of joint programs, such as Medicaid. Federal aid varies considerably from state to state. For example, Mississippi received approximately $7.7 billion in federal aid in 2012, which accounted for more than 45 percent of the state's general revenues. By contrast, Alaska received roughly $2.9 billion in federal aid in 2012, just under 20 percent of the state's general revenues.[20]

Federal aid to state budgets in 2012
State Federal aid as % of general revenue Total federal aid National rank
West Virginia 34.71% $4,267,399,000 19
Kentucky 35.69% $8,056,691,000 14
North Carolina 33.24% $15,192,577,000 26
Tennessee 41.02% $11,198,575,000 3
Virginia 23.53% $9,278,113,000 48

Stimulus

West Virginia received $1.61 billion in federal stimulus spending between February 2009 and June 2013.[21]

Budget transparency

Transparency evaluation
Transparency West Virginia
Searchability Y
600px-Yes check.png
Grants Y
600px-Yes check.png
Contracts N
600px-Red x.png
Line item expenditures Y
600px-Yes check.png
Dept./agency budgets Y
600px-Yes check.png
Public employee salaries N
600px-Red x.png
Last evaluated in 2010.
See also: Evaluation of West Virginia state website and Constitutional provisions regarding reading of bills

As of 2010, West Virginia had limited transparency. The West Virginia State Legislature website posted information about state grant awards here but during the 2009 legislative session, they did not pass "The Budget & Spending Transparency Act," which would have created greater spending transparency.[22]

Government tools

The table to the right is helpful in evaluating the level of transparency provided by Transparency West Virginia.

Independent transparency sites

West Virginia University students compiled a report finding that the state was a "laggard" in the area of budget transparency and made recommendations for increased transparency, including:[23]

  • Budget requests and presentations from all state agencies, boards and commissions should be available online.
  • Common standards should be set for agency disclosures across the state government to make sure that information is available to the public in an easy-to-find manner.
  • Online public disclosure standards of other states with high marks for transparency and accountability should be copied and set for West Virginia.

Multi-measure budget transparency profile

The Institute of Government and Public Affairs at the University of West Virginia created a multi-measure transparency profile for West Virginia, which measured state transparency as of September 2011 using indicators from a range of organizations. These indicators measured both website transparency and other recognized facets of governmental transparency. In addition, IGPA presented four unique indicators of non-transparency based on the observation that transfers or reassignments between general and special funds can obscure the true fiscal condition of a state.[24][25]

IGPA devised a budget transparency index based on information available from the National Association of State Budget Officers. West Virginia tied for eighth in the nation with 11 other states, earning six out of eight possible points.[25]

West Virginia - IGPA score for budget process, contents and disclosure
Budget transparency indicator Yes or no?
Performance measures
{{{1}}}
"Generally Accepted Accounting Principles" budget N
600px-Red x.png
Multi-year forecasting
{{{1}}}
Annual cycle
{{{1}}}
Binding revenue forecast N
600px-Red x.png
Legislative revenue forecast
{{{1}}}
Non-partisan staff
{{{1}}}
Constitution or statutory tax/spend limitations
{{{1}}}
TOTAL 6

In addition to the individual state profile, IGPA offers a 50-state comparison and profiles for other states.[25]

U.S. PIRG "Following the Money" report

See also: Following the Money 2014 Report

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[26] According to the report, West Virginia received a grade of C and a numerical score of 72, indicating that West Virginia was "middling" in terms of transparency regarding state spending.[26]

Accounting principles

See also: West Virginia government accounting principles

The West Virginia State Auditor is responsible for examining state and local governments and school boards as well as paying all the state's bills.

Contact information

WV State Budget Office
Department of Revenue
Building 1, Room W-310
State Capitol Complex
Charleston, WV 25305-0171
Phone: 304-558-0040
Fax: 304-558-1588
http://www.budget.wv.gov/

See also

External links

Additional reading

References

  1. Refers to General Fund spending. Typically in state budgets the General Fund is spending that is most directly controlled by state legislators.
  2. This figure is derived by calculating the percent difference between the prior two years' spending levels according to the National Association of State Budget Officers.
  3. Bureau of Labor Statistics, "CPI Detailed Report Data for February 2014," accessed April 9, 2014
  4. InflationData.com, "Cumulative Inflation Calculator," February 28, 2014
  5. National Conference of State Legislatures, "State Experiences with Annual and Biennial Budgeting," updated April 2011
  6. 6.0 6.1 6.2 National Association of State Budget Officers, "Budget Processes in the States, Summer 2008," accessed February 21, 2014
  7. 7.00 7.01 7.02 7.03 7.04 7.05 7.06 7.07 7.08 7.09 7.10 7.11 7.12 7.13 National Association of State Budget Officers "State Expenditure Report, 2011-2013," accessed February 21, 2014
  8. 8.0 8.1 8.2 United States Census Bureau, "Annual Estimates of the Resident Population: April 1, 2010 to July 1, 2013," accessed February 26, 2014
  9. 9.0 9.1 United States Census Bureau, "Vintage 2009: Annual Population Estimates," accessed February 26, 2014
  10. 10.0 10.1 10.2 National Association of State Budget Officers, "State Expenditure Report, 2009-2011," accessed February 24, 2014
  11. 11.0 11.1 National Association of State Budget Officers, "State Expenditures Report, 2010-2012," accessed February 24, 2014
  12. National Association of State Budget Officers, "State Expenditure Report, 2009," accessed February 24, 2014
  13. National Association of State Budget Officers, "State Expenditure Report, 2008," accessed February 24, 2014
  14. West Virginia State Legislature, "House Bill 2014," accessed May 6, 2014
  15. State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  16. Washington Examiner, "EXography: Unfunded public employee pensions drive state debts skyward," January 21, 2014
  17. State Budget Solutions "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  18. Pew Center on the States, "Widening Gap Update: West Virginia," June 18, 2012
  19. 19.0 19.1 Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2012," July 13, 2012
  20. 20.0 20.1 United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014
  21. Recovery.gov, "Stimulus Spending by State," accessed February 21, 2014
  22. West Virginia Republican Party, "Delegate Sobonya's guest editorial submitted to herald dispatch/wayne co. news," June 17, 2009
  23. West Virginia Univeristy, "Accountability and Transparency in the West Virginia Budget Process: Moving West Virginia from Laggard to Pace Setter," September 2010
  24. Institute of Government and Public Affairs at University of West Virginia, "Home page," accessed February 21, 2014
  25. 25.0 25.1 25.2 Institute of Government and Public Affairs at University of West Virginia, "Budget Transparency Profiles - All 50 States," September 2011
  26. 26.0 26.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014