W.Va. Starts New Fiscal Year with a Deficit
The Governor’s Office says the state technically ended the previous fiscal year in the black last month, but there is already a deficit in fiscal year 2018.
The new budget year officially began July 1—less than two weeks ago—and the state is already $11 million short.
Gov. Jim Justice’s Chief of Staff Nick Casey said Wednesday that’s because lawmakers anticipated a larger surplus at the end of the previous fiscal year.
Casey explained West Virginia ended fiscal year 2017 with a $100 million deficit.
Revenue officials were able to plug that hole by sweeping agency accounts, or taking one-time money state agencies had saved, maintaining previous cuts, and by using money from the Rainy Day Fund. Casey said with all of that action, the state actually ended the fiscal year with a $63 million surplus.
The problem is lawmakers were counting on an $82 million surplus and had appropriated half of that revenue into the current budget.
“As we started July 1, the prediction of the Legislature that we would in fact have a surplus we could spend was over stated by $11 million," Casey said, "so we started $11 million in the hole.”
Casey said the governor is hoping for increased severance tax revenues and a boost from road construction in the upcoming fiscal year, but those increased revenues are already built into the budget and won't make up for the $11 million shortfall.