PEIA Finance Board could revisit cuts after budget collapse

You are here

PEIA Finance Board could revisit cuts after budget collapse

By Hoppy Kercheval
WV MetroNews

CHARLESTON, W.Va. – The state Public Employees Insurance Agency finance board has called a special meeting for next week where the board may again impose a series of controversial benefit reductions for school teachers and state workers and premium increases for retirees.

The finance board approved $120 million in cuts last year, but rescinded them in January after Governor Tomblin submitted a proposed budget for next fiscal year raising the tobacco tax to cover most of the reductions.  However, lawmakers rejected Tomblin’s spending plan and budgets proposed by the House and Senate were negated when the administration announced last week that revenues next year will be $92 million lower than expected.

Republican leaders of the House and Senate have insisted that the PEIA cuts will be restored in next year’s budget, but so far there is no agreement on a plan to match anticipated revenues with expenses. However, Tomblin administration communications director Chris Stadelman said the PEIA finance board has to act now because plan participant guides must be mailed soon and open enrollment begins April 2nd.

“Governor Tomblin submitted a structurally sound, fiscally responsible budget that included revenue increases that would have allocated an additional $43 million for PEIA,” Stadelman said.  “The House of Delegates did not pass those revenue increases, and without a FY 2017 budget there is no guarantee of additional funds for the program.”

House Speaker Tim Armstead and Senate President Bill Cole said in a joint statement March 15th following the new revenue estimates that the PEIA fix was accounted for. “Before the Governor lowered the revenue estimates, we were prepared to complete the session today with a balanced budget that tightened our belt while funding essential state programs, such as our education system and Public Employees Insurance Agency.”

If the PEIA finance board re-institutes the previous cuts it will mean higher out-of-pocket costs for members and increased premiums for retirees. The meeting is scheduled for Wednesday at 1 p.m. at the DEP/PEIA building in Kanawha City.