Legislative leaders expect to adjust the built-in escalator in the gasoline tax in West Virginia so it is stabilized when they return next week for a special session originally focused on troubled municipal police and fire pensions.
For two years, the tax was frozen, once by executive order, then by the Legislature, and as a result, the state sacrificed some $140 million in funds directed to the cash-strapped highway account, Senate Finance Chairman Walt Helmick, D-Pocahontas, pointed out Tuesday in a transportation conference in Beckley.
That escalator is computed on the basis of the average retail sale of gas from July through October each year.
“We’re looking at everything we basically can so we can plan,” Gov. Joe Manchin said during a break at the gathering hosted by West Virginians for Better Transportation.
“Highways is having a hard time planning. We’re not going to raise it, basically.”
If oil prices go up as predicted, the governor said, he wants the tax structured so motorists aren’t hit too much, but at the same time, he wants to work with the Department of Transportation so the tax is done “in a prudent and sensible way.”
Manchin hasn’t issued a formal call, but both Helmick and House Finance Chairman Harry Keith White, D-Mingo, expect him to put nine items on the call, following his tradition of letting a special session dovetail with interims meetings as a cost-saving move.
White said he anticipates legislation that would impose both a floor and ceiling on the tax escalator so that it goes 1.5 cents in either direction.
At the same time, the House leader pointed out the Division of Highways still has some $29 million in unused general revenue money as part of a $40 million transfer made a few years ago. The unspent money was left in limbo since it faced a number of federal formula obligations to draw down cash from Washington, he explained.
It marked the first time since the 1960s that the Legislature dipped into the general revenue account to put money into the strapped DOH, White noted.
“They were only able to draw down $11 million of that money,” he said.
“Probably what we’ll do is make it easier for them to get it rather than jump through all the hoops they had to in the past.”
The one stipulation is that the unspent money must be dedicated exclusively to secondary roads, White said.
For some months now, attention has been riveted on bailing out police and fire pensions in a number of cities with a plan devised that would freeze those accounts and amortize them while creating fresh funds for new municipal employees.
White hasn’t seen details of the proposal but said the House likely would come on board, provided no new money is taken from any other program to pay for it.
“If it doesn’t have any new money, not taking money from anybody else, there’s a good chance our members will support it,” he added.