Tomblin to propose borrowing $85 million from Rainy Day Fund

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By Hoppy Kercheval
WV MetroNews

NEW YORK, NY – Gov. Earl Ray Tomblin will propose using $85 million from the state’s Rainy Day reserve fund to balance the 2016 fiscal year budget, according to Fitch Ratings. If approved by the Legislature it will make the second year in a row the state has had to tap into savings to balance the budget.

Last year, the state needed $100 million from the emergency account to achieve a balanced budget. Even after the withdrawal, the state still has approximately $860 million in reserve, making West Virginia one of the most fiscally stable states.

Fitch detailed Tomblin’s plans in a report released Tuesday. “The Governor is expected to propose a further $85 million use of the RDF (Rainy Day Fund) in fiscal 2016, lowering reserves to a still solid 18 percent of general fund revenues,” Fitch reported.

Overall, Fitch said the state’s finances are stable and it maintains a AA+ rating, the second highest rating the financial services company issues. According to its website, Fitch is one of three rating agencies “first recognized by the Securities and Exchange Commission as a nationally recognized statistical rating organization in 1975.”

Tomblin’s proposed use of the Rainy Day fund may meet opposition when lawmakers gather starting next week for the 2015 legislative session. Leaders of the new Republican majorities in the Senate and House of Delegates have expressed more interest in cutting spending. They have asked state agencies to provide detailed breakdowns of their budgets for review.

“You have to ask the questions,” said Senate President Bill Cole (R-Mercer) on MetroNews Talkline Wednesday.  “You have to dig a little bit deeper than just accepting what you see on the surface.”

Cole said he would not rule out using Rainy Day monies, but it’s not his first choice.

“You have to be open to it, but it’s certainly not something we want to do,” he said.