Eric Householder Story Archives - West Virginia Public Broadcasting

Future Of MARC Commuter Train In Eastern Panhandle Still Uncertain

Local municipalities in the Eastern Panhandle have come together to provide some funding for the Maryland Area Regional Commuter, or MARC train, but it remains unclear if it will be enough to keep the service in West Virginia.

On Tuesday, the Shepherdstown Town Council approved $2,800 toward funding the MARC train service.

Shepherdstown’s contribution joins seven others made by local municipalities in the area. Those eight entities — Shepherdstown, Ranson, Charles Town, Harpers Ferry, Bolivar, Martinsburg, the Berkeley County Council, and the Jefferson County Commission — collectively agreed in October to pull together a one-time amount of $300,000 to put toward keeping MARC in the area through this fiscal year.

During the 2019 West Virginia Legislative session, Maryland requested $3.4 million to keep the MARC service in West Virginia’s Eastern Panhandle. The Legislature agreed to fund $1.1 million.

Maryland accepted that at the time, but then in August, announced there would be a reduction in MARC service in West Virginia if the entire amount was not paid by Nov. 4. Recently, that deadline was extended to the end of the month.

Shepherdstown, W.Va. Mayor Jim Auxer addresses attendees at the Shepherdstown Town Council’s Nov. 12, 2019 meeting. The council voted to approve $2,800 toward keeping the MARC train service.

At least 250 West Virginians ride the MARC train, daily throughout the work week, according to the Maryland Transit Authority. Eastern Panhandle state lawmakers argue, however, that number is between 300 and 400.

Finding A Funding Fix For MARC In W.Va.

The $300,000 contribution from local communities in the Eastern Panhandle is part of a larger funding fix.

According to Chief of Staff Mike Hall, the Justice administration agreed to fund the remaining $2 million Maryland is requesting if local entities came up with $300,000.

The plan is a short-term fix that will hopefully lead to a permanent funding solution, said Del. John Doyle, a Democrat from Jefferson County, who attended the Shepherdstown Town Council meeting this week

“If we’re gonna have a long-term plan, we have to save it in the short run,” he said. “And the only way to save it in the short run was to come up with enough money so that the governor said, yes we’ll do it.”

While the eight municipalities have raised most of the required $300,000, the Jefferson County Commission only provided $40,000, or half of its share, according to Doyle.

In an emailed statement from the Jefferson County Commission, Commission President Patricia Noland said the MARC train funding was an “unbudgeted expense.” She said funding came from a contingency fund, and their contribution was all the commission felt it could afford.

In a phone conversation with Del. Eric Householder, chairman of the House Finance Committee, he said he’s hopeful the governor will support the MARC service despite not having a total amount of $300,000 from local entities, and he said, going forward, a solution for MARC has to be found.

“I think it’s imperative that we increase the ridership,” Householder said. “That’s the number one goal, I believe, for the MARC train to be sustainable for us here in the Eastern Panhandle.”

Moving forward, Householder said having local municipalities take on some of the costs each year should be part of the overall budget for MARC in West Virginia. He argues, this will make it easier to secure funding from the Legislature if other lawmakers see Eastern Panhandle entities paying part of the bill.

Del. Doyle, however, disagrees and feels the cost should fall on the state. He argues many other major public transportation systems in other states are paid for completely by their state legislatures and not local municipalities.

West Virginia Public Broadcasting reached out to the governor’s office to ask if Gov. Justice would still be willing to fund the MARC train, despite the current shortfall. A spokesperson said they do not have a statement at this time.

West Virginia has until Nov. 30 to provide the remaining funding request to Maryland, otherwise, the service to West Virginia will be reduced from six trains per day to two.

Legislation to Reinstate the W.Va. Film Tax Credit Could Return in 2020

West Virginia’s film tax credit was eliminated by the West Virginia Legislature in 2018 after a legislative audit report deemed the credit as providing only “minimal economic impact.” But people who work in the film industry don’t agree. An attempt to resurrect the credit failed this past session, but supporters are hopeful it will make it through the next legislative session.

Robert Tinnell is a West Virginia filmmaker who was born and raised in Marion County. He’s been making movies professionally since 1980, and since 2005, he and his brother Jeffrey have been running a production company called Allegheny Image Factory out of the Morgantown area.

They’ve produced award-winning films, documentaries, music videos and commercials. One of their recent feature films was, Feast of the Seven Fishes based on Robert Tinnell’s graphic novel of the same name. The film featured actors Skyler Gisondo and Madison Iseman and was filmed entirely in West Virginia.

https://www.youtube.com/watch?v=ZeIWozecO50

Feast of the Seven Fishes will be available later this year but possibly under a new name. Tinnell said the film will likely be released under the title, 7 Fishes & Christmas ’83.

Tinnell said production of the film benefited greatly from West Virginia’s now-defunct film tax credit. He said the movie was able to be filmed and produced in-state, attracting actors and crew from the larger-film industry outside West Virginia thanks to incentive from the tax credit.

Now, since the credit was eliminated, Tinnell said it’s been harder to attract big productions to film in West Virginia.

“Stripping us of the tax credit, effectively disabled our ability to bring feature films or TV projects to West Virginia,” Tinnell said. “I mean, it’s that simple. Whether you agree with the tax incentive business model or not, the reality is, the industry and states, and even national governments, embrace the policy. And it simply is the cost of doing business.”

After losing the credit, Tinnell said it cost his production company two films and the potential of bringing about $4 million into the state.

“We say we want to diversify the state’s economy. We don’t want to just lean on extractive industries, it’s just too, up and down, and it’s putting all your eggs in one basket,” he said. “Here’s a really smart way to do it – and in a way that boosts not only the entertainment industry, but it’s just a great way to promote tourism.”

Del. Dianna Graves, R-Kanawha, discusses HB 2941 (reinstating the film investment tax credit) on the House floor on Feb. 27, 2019.

During the 2019 state Legislative session, Del. Dianna Graves, R-Kanawha, introduced a bill that would have reinstated the film tax credit – but with tweaks and adjustments based on the legislative audit report that made 12 recommendations if the credit were to be kept.

Graves has worked in the state’s film industry as both an accountant and producer, and she argues the tax credit was working but admits it did have problems, but problems she sought to fix with her bill.

“Even the audit admitted that it brought economic benefit to the state, it just didn’t think there was enough benefit to justify keeping it, well, then fine, let’s not get rid of it completely. It’s working. Let’s make it better. That was my goal,” she said.

Graves’ bill increased the cap of the film tax credit from $5 million to $10 million, and it would have required a film production company to spend at least $50,000 in-state before they would be eligible for the credit. After that, for every $100 spent, that production company could take home $27, but the remaining $73 would stay in-state.

Her bill managed to pass out of the House of Delegates but not without pushback. House Finance Chairman Del. Eric Householder, R-Berkeley, was one of 26 who voted against the bill.

Householder admits he’s not a fan of tax credits. He said they allow the government to pick economic winners and losers. He also argues the original film tax credit just wasn’t justifiable.

“In 10 years, only $8.6 million in tax credits were used,” Householder explained. “And if it’s such an attractive, competitive force, we would see more companies coming here, wanting to come here and take advantage of the tax credits, and it just wasn’t happening.”

He also felt Del. Graves’ bill didn’t make enough of the changes that were recommended by the audit.

“If she tightens all those up or takes those recommendations, I think it will pass the scrutiny,” he said. “Right now, I don’t foresee it happening since, remember, it was repealed in 2018. So, maybe in a year or so, maybe next legislative session, [it] might stand a better chance.”

Graves’ bill may have made it out of the House chamber last year, but it was never taken up by the Senate Finance Committee. In an emailed statement to West Virginia Public Broadcasting, Senate Finance Chairman Craig Blair, R-Berkeley, said he also felt Graves didn’t make enough changes recommended in the audit report.

Like Blair and Householder, Graves identifies as a fiscal conservative, and she said she doesn’t often vote for tax credits but says the film tax credit is different.

“The West Virginia film tax credit; it functions much more like advertising expense than a traditional tax credit,” she explained. “We are trying to entice film companies and movie studios to come here and film. But instead of giving this money up front, like you do with advertising expense, we only give it if you come here. So, that means that our advertising expense has a 100 percent success rate.”

Graves said the film tax credit helps to diversify the state’s economy. She plans to reintroduce her bill during the 2020 state Legislative session.

She said she hopes she can communicate to the Senate in particular of the credit’s benefits, increase the cap, and get it signed by the governor.

**Editor’s Note: This article was edited on Jun. 28, 2019 to add the correct spelling of Robert Tinnell’s last name.

House Moving Forward with Sales Tax Changes

Both the House and Senate will be presented with their respective 2018 budget plans on the floor Wednesday, and in the House, that budget will rely on nearly $140 million in new revenue.

The revenue comes from getting rid of certain exemptions to the state’s sales tax in an effort to lower the overall rate down the road.

As it came out of the Senate, Senate Bill 484 would have captured some $12 million a year in taxes paid on some road construction materials and kept them in the general revenue fund for legislative appropriation.

Del. Michael Folk speaking during a floor debate.

While the bill still contains that provision, the House Finance Committee made significant changes to the bill over the weekend, which were narrowly accepted by the body during a Tuesday evening floor session.

“One of the things that we learned in tax reform that we’ve been studying for the last two years is that you want to reduce your rates to the point that you have a competitive advantage,”House Finance Committee Vice Chair Eric Householder said, “and if you want to broaden out your sales tax base, broaden it out slowly, and that’s what we’re doing here tonight.”

The House Finance Committee amendment broadens the base of taxable goods and services and lowers the overall rate.

It gets rid of the exemptions on a number of services in two phases, July and October this year.

In July 2018, the amendment calls for a reduction of the state’s 6 percent sales tax to 5.5 percent, then to 5.25 percent in July 2019. After that date, the the tax rate would drop by a quarter of a percent each year if the sales tax revenues for the previous fiscal year exceed the 2017 incomes. The rate could not be reduced, though, below 4.75 percent.

“West Virginia’s tax structure is pushing jobs and people away from this state. We cannot expect our economy to grow if we do not provide a system that will allow for growth,” he said. “Broadening the sales tax base and lowering the rate is a good idea and it’s a move in a direction of sound tax policy.”

Several members of the House leadership team joined Householder in speaking in support of what they’re calling a tax reform measure, but Republican Del. Michael Folk called the bill a tax increase.

“People in this body and on this side of the aisle want to get out of here so bad, they’re willing to stick it to the taxpayers,” Folk said.

A number of Democrats expressed concerns about the provision, including House Minority Leader Tim Miley.

He said the amendment only increases taxes on West Virginia consumers and does not include a sacrifice from the business community.

Democratic Gov. Jim Justice is pushing for a small business tax increase—which the West Virginia Chamber of Commerce supports.

House Minority Leader Tim Miley during a 2017 floor session.

“Nothing in here reflects to me a sacrifice being made by the business community in this state, the same community that has indicated very publicly that they are willing to help pull the rope,” Miley said, “and so unless and until we have a comprehensive plan in which the business community has buy in and makes part of the sacrifices with the citizens in this state, I think we should reject this approach.”

The amendment was accepted on a 53 to 46 vote in the chamber.

The amended version of Senate Bill 484 will be up for a final vote Wednesday.

House Finance Looks at 2 Tax Reform Measures

Members of the House Finance Committee are expected to get their first look at the chamber’s budget for the 2018 fiscal year in a meeting this Saturday. In order to balance it, lawmakers will have to close an estimated $497 million hole.

To close the gap, Republican legislative leaders are largely looking to cut state spending, specifically in public education, higher education, and Medicaid, but on Friday, House Finance Committee members considered some new revenue increasing measures, or tax increases.

The House Finance Committee considered a committee substitute for House Bill 2816.

The bill would eliminate the West Virginia film tax credit – an annual $5 million cap awarded by the West Virginia Film Office to attract movie producers to the state. That elimination is one Democrat Jason Barrett, of Berkeley County, opposes.

Barrett says Berkeley and Jefferson Counties have hosted several Discovery Channel and National Geographic film shoots in recent years.

“This film tax credit brings people to the state of West Virginia; people who have never been here before, and probably wouldn’t come,” Barrett explained, “This brings them into our state; it allows them to see the beauty of West Virginia, not only in the Eastern Panhandle but the entire state.”

But the bill does a lot more more than just eliminate the tax credit. It also ends a transfer of some $12 million from the general revenue fund to the state’s road fund. That money comes from purchases of automobile parts and other items. Capturing the transfer and keeping it in general revenue will help balance the state’s budget.

The committee bill also includes provisions to increase the beer barrel tax, which is estimated to create an additional $3 million for the state.

The revenue aspect of the bill has changed quite a bit, though, since it was first introduced to the chamber on behalf of Gov. Jim Justice. It originally included an increase to the state’s sales tax and a new tax on businesses resulting in $400 million in new revenue. In total, the committee’s changes create only $15 million in increased revenue.

Minority House Finance Chair Delegate Brent Boggs spoke in opposition to the bill.

Del. Brent Boggs, D-Braxton, Minority House Finance Chair.

“I appreciate what little revenue it raises, but that’s the problem, it raises little revenue at a time that we need substantially more,” Boggs said, “and while no bill is perfect, and I’m sure no bill ever will be; this one falls way short of what I believe many of our needs are going to be, and it’s only a fraction of what was included in the governor’s original bill.”

Vice-Chair Delegate Eric Householder of Berkeley County spoke in favor of the bill.

“Under the original concept, if we were voting on the original concept, keep in mind, we would have a higher state sales tax, we would have $400 million in new taxes; more strain on an already existing economy that we’re seeing with our businesses that are having financial problems,” Householder said, “and I think for the most part, ladies and gentleman, this is a great compromise; it’s a better bill, and for those reasons, I support it.”

The bill passed on a roll call vote of 15 to 9, and will now be considered by the full House.

Del. Eric Householder, R-Berkeley, House Finance Vice-Chair.

There was another tax-related bill that moved in the House Friday. That bill is 2933, which expands the base of the current sales tax and lowers the overall rate to generate additional tax revenues.

Republican Delegate Riley Moore, of Jefferson County, is the lead sponsor. His bill would reduce the sales tax to 5.5 percent from the current 6 percent by January 1, 2018. It also ends current exemptions in the state sales tax on things like cell phones, personal and professional services, contracting services, mobile homes, and daycare services.

According to the bill’s fiscal note, the bill would bring in $105.6 million during fiscal year 2018, largely from the telecommunications and service taxes.

Moore says his bill would require businesses and residents who aren’t currently paying taxes to start paying, which he says will make the state’s tax system fairer and more competitive, especially in border counties.

“I think this is the best way to try to be able to do that, to be able to grow our economy,” Moore noted, “and also, especially for me, I’m from Jefferson County, our sales tax is quite a bit higher than our neighboring counties in Virginia, in particular. We have a lot of our folks go shopping over there, and we’re trying to keep some of that tax money here in the state.”

Moore says he think his bill will set a good foundation for West Virginia’s economy moving forward.

House Considers 3 Education Flexibility Bills

At the start of this legislative session, Republican leaders warned that public education could be on the chopping block, seeing reductions that the system has historically been protected from. During a recent press conference, both House Speaker Tim Armstead and Senate President Mitch Carmichael said they’ll work to mitigate the harm to classrooms and teachers, but funding will be reduced. The House’s Education Chairman says with those funding reductions, lawmakers are working to give county school systems more flexibility in how they spend their limited dollars.

House Bill 2569:

The House Education Committee is specifically looking for ways to give county school systems more flexibility when it comes to personnel. One way is through House Bill 2569.

When county Boards of Education need to reduce the number of teachers they have on the payroll, they are currently required to use a lottery system to determine which teachers of equal seniority will be let go. The bill removes the requirement and instead requires county boards to look at a variety of factors – qualifications, critical need, or the National Board of Certified Teachers.

“A school district that may have finally filled an AP calculus class or an advanced chemistry class with an educator may be forced to terminate that employee through a reduction in force with no consideration given to the fact that some of those positions are very, very hard to fill and in some cases it may not be the most senior person,” said House Education Chairman Paul Espinosa of Jefferson County.

Espinosa pulled the bill from the committee’s afternoon meeting Wednesday and says they will take it up on a later date.

House Bill 2738:

House Bill 2738 would also give more flexibility to public schools. The bill deals with teacher transfers.

“We believe it’s prudent to allow that school district to have the flexibility within that calendar year to move that individual, if necessary,” Espinosa said, “if it really makes sense for that school district, to move them to another role where perhaps their services are more needed.”

Sponsors of the bill say it will save schools’ money as enrollment changes, and it gives a school the ability to make quicker decisions when a particular role needs to be filled.

The bill passed out of committee Wednesday and heads to the full chamber.

House Bill 2637:

Another bill looking at public education flexibility is House Bill 2637. It’s already passed out of the House Education Committee and was taken up by the chamber’s Finance Committee Wednesday. It allows retired teachers to return to the classroom when there’s critical need or shortages.

“It’s not one of our efficiency issues that we’re looking at,” said House Finance Vice-Chair Eric Householder of Berkeley County, “but keep in mind; these retired teachers will be able to come back without any effect on their current retirement, so we’re not paying extra retirement benefits or anything like that, so I think it’s a win for the taxpayers.”

What now?

Legislative leaders announced earlier this week that the state’s public schools will see funding cuts—potentially as large as 5 percent—next year. House Finance Chair Eric Nelson says he and his colleagues will be looking closely at where those cuts fall.

“As far as the details of exactly what is coming from where; that’s the process that we’re going through right now; reviewing all three areas,” Nelson said, “You know, K-12 takes up 50 percent of our 4 billion dollars budget, and we’re very concerned about the various counties and their needs.”

Lawmakers have a little over 20 more days left of this regular session to pass a balanced budget. State Revenue Officials have projected a budget deficit for the upcoming fiscal year to be as large as $497 million.

W.Va. Dept. of Commerce Requests More State Dollars

The West Virginia Department of Commerce gave the House and Senate Finance committees a presentation Monday morning to explore the state’s competitiveness in attracting businesses.

The Commerce department also asked for a significant increase in its funding. However, that request collided with the reality of the state’s dire budget situation.

The Joint Standing Committee on Finance met in the House Chamber for the Department of Commerce’s informational meeting. The presentation was part of Governor Jim Justice’s Save Our State plan to bring more business and jobs to West Virginia.

The presentation explored ways the state could improve its competitive standing by enhancing infrastructure, building up a stronger workforce, and identifying good site building locations. Presenters also said that so-called Right-to-Work legislation has been a positive factor in attracting some businesses to the state.

But the state’s Right-to-Work legislation has not been fully implemented in West Virginia yet. It’s been challenged in a court case, and deemed unconstitutional by a Kanawha County Judge. The case will likely be decided by the West Virginia Supreme Court.

The Department of Commerce Cabinet Secretary Woody Thrasher says that even though the state is facing a budget shortfall this year, it’s not the time to cut the Commerce Department.

“West Virginia is dead last, and the reason we’re dead last, is a variety of reasons, but relative to the Department of Commerce, it’s because we do not have the tools in our toolbox to attract business specifically, really good sites,” Thrasher said, “I think we’re doing a really good job on workforce training. I think we’ve got a great quality of life, but we are way behind everybody else when it comes to having sites ready.”

Thrasher told lawmakers the Department of Commerce would need at least $35 million in increased funding for improving the state’s business climate, attracting more industry, and for site readiness.

House Finance Vice-Chair Eric Householder, of Berkeley County, says he felt inspired by the presentation, but he says increasing the Department’s budget could be tough.

“Right now, it’s going to be extremely difficult,” Householder said, “Currently we fund Commerce roughly around $10 million a year. It’s a tough budget year, as we all know, and it’s going to be extremely difficult, but we’re gonna do what we can. You gotta keep in mind, we’re trying to get the best return on investment for taxpayers.”

Democratic Delegate Larry Rowe, of Kanawha County, is a member of the House Finance Committee. He says he feels the request from the Commerce Department is a reasonable goal to achieve.

“We’re spending $10 million, and little of that is going to programming, most is going to personnel and expenses, so what I’d like to see us do is define very clearly what that extra money would be for and where it’s going to be spent,” Rowe said.

During the presentation, Cabinet Secretary Thrasher mentioned that by the end of the summer, he and his team hope to rebrand the state by having the Department of Tourism join the Department of Commerce. He also noted how getting the state’s Community Colleges involved more heavily in training the workforce will also be key in getting more industry in the state.