12/28/2009
CHARLESTON, W.Va. – Due to current economic and fiscal trends, Gov. Joe Manchin has signed an executive order requiring all Executive Branch agencies and constitutional offices supported by General Revenue Fund appropriations to reduce their current fiscal year budget by 3.4 percent.
Although not required by the governor’s executive order, the West Virginia Legislature and the West Virginia Supreme Court of Appeals have agreed to assist and will reduce their spending for the current fiscal year, as well. The governor called it unparalleled cooperation among the Executive, Legislative and Judicial branches to come together and recognize the economic situation and hardships the state’s citizens and their families may face if we don’t continue planning for responsible spending.
The governor said the current delivery of essential services should continue and with this reduction he does not expect furloughs of any state employees. Agencies must provide their recommendations to reach that 3.4 percent reduction to the governor by Jan. 20. The governor has said he believes we can find efficiencies within our agencies to help make up for revenue shortfalls.
“Based upon state revenue for the first five months of fiscal year 2010, we are seeing a projected shortfall of about $120 million by June 30, which means we must ask our departments and agencies to come back to us with specific reductions of 3.4 percent to ensure we balance the budget at the end of the fiscal year,” Manchin said. “While revenue collections in some areas have exceeded estimates, the projected surplus in those areas is not enough to make up for the shortfall in other revenue.”
“Our cash flow is still in solid shape and we are not borrowing or delaying payments for invoices, so we are still running on schedule; however, we must take these pre-emptive actions to prevent more drastic measures later,” Manchin said.
Through November, the consumer sales and use tax, personal income tax and business and occupation tax have not met their fiscal-year-to-date estimates. State budget officials believe they will not rebound by June 30 for the budget to be balanced, which is required by the state constitution.
Certain budget line items are exempt from this order, including programs that fulfill a vital state interest and debt service, which are required to be paid.
Contact Information
Jama Jarrett or Melvin Smith
304-558-2000