CHARLESTON, W.Va. -- Gov. Earl Ray Tomblin on Wednesday submitted a $4.726 billion 2014-15 budget plan that includes no new taxes or fee increases, and provides small pay raises for teachers, school service personnel and state government employees.
The budget proposes spending about $146 million more than the state is expected to collect in taxes and state Lottery revenue, and proposes making up the gap, in part, by tapping into the state's Rainy Day emergency reserve fund.
Revenue Secretary Bob Kiss said Wednesday it is "clearly an austere budget," but said the state is financially sound, unlike the crisis it faced in 1989, when he was House Finance Committee chairman.
"We are in far better position to deal with these challenges than a half-generation ago," Kiss said, adding, "This is not a long-term structural problem. This is a short-term problem."
Despite having to close a funding gap, the budget proposes no taxes or fee increases, and provides for 2-percent pay raises for teachers and school service personnel, and across-the-board $504 raises for state employees, at a total cost of $41.68 million.
Those raises were already built into the long-term state budget plan, which also calls for additional pay increases in 2016 and 2018.
However, the 2014-15 budget will require many state agencies to absorb another 7.5 percent spending cut, while Higher Education will have a 3.75 percent budget reduction.
Because public education, most Health and Human Resources' agencies, Corrections, Juvenile Services and certain other agencies are exempt from the spending cut, that amounts to an overall $69.9 million reduction in spending.
Kiss said the budget bill does not call for elimination of any programs or state offices, but said department heads may opt to make such cuts to comply with the spending reduction.
Meanwhile, a final round of reductions in business franchise and corporate net taxes will reduce state tax collections by about $39 million this budget year, Deputy Revenue Secretary Mark Muchow said.