From the moment the proposed repeal of the state’s personal income tax collection was mentioned, the delegates representing most of Ohio County knew it was a bad deal for each of West Virginia’s 27 counties that border one of five neighboring states.
“If you live the middle of the state like Braxton County, you might not cross the border for months at a time,” said Del. Erikka Storch (R-3rd). “But when you live in the Northern Panhandle, you might go into East Ohio and western Pennsylvania on the same day. That’s just our reality here.”
“It only takes a couple of minutes to drive from downtown Wheeling to East Ohio, even with the (Interstate 70) construction right now,” said Del. Shawn Fluharty (D-3rd). “That’s probably where a lot of Wheeling businesses would have ended up if the governor’s proposal would have passed. It was another one of Gov. Jim Justice’s ideas that allows us in the Northern Panhandle to believe the man doesn’t know we exist.”
During his State of the State Address in mid-February, Justice proposed a full repeal with few offered details of how he would make up hundreds of millions of dollars. Once those specifics started surfacing, including an 8 percent state sales tax, a 3 percent tax on professional services, an additional dollar per pack of cigarettes, and new taxes on businesses involving fitness, data processing, digital advertising, and digital goods, Storch was a “No” vote.
“The damage it would have caused in Ohio County would have resulted in lost business,” she said. “I didn’t hear from a single person in the district who wanted me to vote in favor of the governor’s proposal. Not one.”
A Grizzly Bear Bully?
After much debate in the state Senate, a staged-in version of the repeal of the state’s personal income tax was approved by an 18-16 vote. The next step for HB 3300 was to return it to the House for review, consideration, and perhaps a vote.
“I don’t think anyone in the House thought it was worth a vote let alone consideration,” Fluharty recalled. “A ‘No’ vote was a no-brainer for any delegate who lived in a border county, and I don’t remember anyone really wanting to take it up for discussion.”
“But that’s when we started hearing what Gov. Justice was saying about the House,” Storch said. “We were in session when we started hearing about his comments, and I don’t think anyone was really happy about what the governor was saying about us.”
Justice goaded House members when he insinuated the lawmakers were afraid to take a vote, so, as explained by Speaker Roger Hanshaw, a clear collective opinion was delivered.
“Zero to 100,” Fluharty said with a chuckle. “He wanted a vote; he got a vote.
“What we sent to the Senate was not as extreme as what came back from that chamber,” the Democrat explained. “When the bill came back, I don’t think anyone really wanted to consider it because of all of the changes that were made by the senators, but then we heard from the governor, and that’s all that was needed.”
What Makes Sense?
For Del. Storch, who also serves as the president of the Wheeling Chamber of Commerce, NOT chasing business across the state line to Belmont County, Ohio, makes sense, but that does not mean she is opposed to tax code reform.
Del. Fluharty? The House Minority Whip favors tax breaks for residents as long as make-up revenue is part of the deal, and he just so happens to own an idea.
“I don’t know a single person in the state of West Virginia who enjoys paying the personal property taxes on our cars and things like boats and jet skis,” he said. “I would vote in favor of repealing that tax if it meant we approved adult-use cannabis in an effort to make up the lost revenue from the tax repeal.
“We’ve already lost ground with some of the bordering states moving forward with legalizing adult use, so if we’re going to do it, we should do it soon,” Fluharty insisted. “That personal property tax is like a 13th car payment a year, and it’s horrible, and I’ve never thought it was fair.”
“I will say this,” Storch said. “It’s the first time I heard Gov. Justice suggest he would support cannabis. He’s been pretty staunchly against it since he was elected in 2016, but it could just be for his PIT proposal and nothing else. Who knows?”
The governor said he would tour the state to lobby his income tax idea to residents in hopes of gaining enough support to sway the representatives. Justice has insisted that a personal income tax repeal would attract more remote workers to the Mountain State.
“I do hope someone in his office tells him he shouldn’t bother coming up here,” Storch added. “It would save taxpayer money.”
