CHARLESTON — With West Virginia having extra federal dollars and additional surplus tax collections to play with as the current fiscal year ends, Gov. Jim Justice said Monday it’s likely a special session of the Legislature will be called soon, and a gas tax holiday could be on that agenda.
Speaking during his first-of-the-week virtual briefing with reporters at the Capitol Monday morning, Justice said officials in the Governor’s Office and legislative leaders are still working out the details on a special session agenda and possible legislation.
But a short-term gas tax holiday or some other form of financial relief for state taxpayers could be an agenda item. Justice said he would release more details during a virtual briefing later this week.
“I’ve done a lot of thinking about maybe a gas tax holiday,” Justice said. “I do think that if we can help our folks, and I believe there is surely enough room to be able to help, I do think that is something that maybe, especially with families right now thinking about going on vacation and things like that, that if there is a way to help a little bit for maybe one month and take a one-month holiday, I don’t think it would be detrimental to us from the standpoint of our ability to do all the good stuff in regard to roads.”
Democratic members of the Senate and House of Delegates first called for a 30-day gas tax holiday in March one week after the end of the 60-day legislative session using surplus tax collections to replenish the state road fund to cover the lost tax revenue. The state collects 35.7 cents per gallon of gasoline. According to AAA, the average price for a gallon of gas then was around $4.10. Since then, prices have risen nearly 13 percent to $4.63 per gallon.
At the time, Justice accused Democratic lawmakers of grandstanding and creating a “publicity stunt,” though he said he would consider a gas tax holiday if brought to him by the Legislature.
In a joint release in March, Senate President Craig Blair, R-Berkeley, and House Speaker Roger Hanshaw, R-Clay, raised concerns about how a gas tax holiday could harm the state’s road bond ratings. No gas tax holiday was included in the two-day April special session.
Both Blair and Hanshaw declined to comment for this story, referring to their March joint statement.
Justice cautioned if there is a gas tax holiday, the relief could be minimal if gas prices continue to increase throughout summer.
“The dollars that will come back will be not really all that significant for people who are only filling up their car maybe twice a month or once a week,” Justice said. “It would be an unbelievable amount of dollars they will be saving, but it will help some. Maybe it is something we ought to do. I’m thinking real hard about that.”
Some Democratic lawmakers took to social media to encourage Justice and Republican legislative leaders to call a special session next week and put a gas tax holiday on the agenda.
“It’s about damn time,” said Delegate Kayla Young, D-Kanawha, in response to Justice leaning toward a gas tax holiday.
“Let’s stop the dog and pony show when it comes to the people of (West Virginia),” said Delegate Danielle Walker, D-Monongalia. “Now, it’s hurry-up-and-wait time. Can we progress as a state? Will the call happen in June or July? Let us do our job.”
“We will be in town next week. Get it done,” said House Minority Whip Shawn Fluharty, D-Ohio. “West Virginians need a break and overwhelmingly support our position.”
The special session could be scheduled as soon as next week coinciding with June legislative interim meetings already taking place June 12, through June 14, to save on costs. The next legislative interim meetings fall between July 24, and July 26. A typical special session can cost about $35,000 per day to cover lawmaker per diem costs and the cost of staff.
“We’re working on that from the standpoint of the possibility of calling a special session. I am considering that,” Justice said. “I will be coming to you with a list of things we may be going to a special session for with the dollars we have so far.”
Last month, the state received $677 million from the federal government, bringing the total number of American Rescue Plan Act funds to $1.35 billion. The $1.9 trillion American Rescue Plan Act, passed and signed into law by President Joe Biden in March 2021, provided $350 billion in direct funds for states. ARPA allows states to use their allotments for water, sewer, and broadband infrastructure projects. West Virginia received the first of its state ARPA allotment last year.
Lawmakers passed a bill during the 2021 regular session that requires the governor to receive legislative approval to spend any federal COVID funding that totals more than $150 million. During the second special session of the year in April, lawmakers appropriated $250 million in ARPA money for the Economic Enhancement Grant Fund through the West Virginia Water Development Authority. The fund will provide matching grants to municipalities for water and sewer infrastructure projects.
West Virginia also is sitting on more than $313 million in surplus tax collections as of the end of May. The state ended the last 11 months of the fiscal year with $5.2 billion in tax collections, 26.9 percent more than the $4.1 billion revenue estimate from the state Department of Revenue, resulting in a $1.1 billion surplus year-to-date.
More than $793 million of that $1.1 billion is already spoken for in the surplus section of the new fiscal year 2023 general revenue budget that kicks in on July 1, which includes items to be funded when surplus tax collections are available at the beginning of the new fiscal year. That leaves $313.6 million in surplus tax collections that Justice and lawmakers could go ahead and appropriate before the end of the fiscal year in June. With less than one month left in the fiscal year, Justice said surplus tax collections could easily surpass $400 million.
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