CHARLESTON -– Gov. Joe Manchin and State Auditor Glen Gainer recently joined the West Virginia Department of Revenue in releasing final collection data for completed Fiscal Year 2007, which shows another year of steady growth -- a 4 percent increase in revenues.
"We have ended yet another positive fiscal year for West Virginia and its citizens," Manchin said. "The financial results experienced by West Virginia over the last three years have been extraordinary. Continued efforts by our state to place its financial house in order and to bring a more efficient and effective government to the citizens of West Virginia have paid dividends by maximizing this recent wave of economic growth.
"We must continue to take advantage of these opportunities and move our state forward. By the same token, in taking advantage of our recent successes, we must remain aware that the numbers are not always going to remain as strong as they have been recently."
State budget officials noted that personal income tax collections accounted for almost 70 percent of the total increase in General Revenue Fund receipts for the year, as personal income tax growth slightly exceeded 5 percent. After experiencing significant growth over the past two years, Corporation Net Income / Business Franchise Tax Collections grew by only 6 percent, as collections declined by nearly 20 percent during the last six months of the fiscal year.
"I commend the Governor and the Legislature for their continued fiscal restraint over state spending during these strong economic times," State Auditor Glen Gainer said.
In fact, fiscal year 2007 was really a tale of two halves. The significant growth associated with Fiscal Year 2006 continued into the first half of Fiscal Year 2007, as growth during that time exceeded 9 percent. As expected, growth slowed during the second half of Fiscal Year 2007.
The state's commitment to long-term debt management will serve to soften the potential for upcoming slowdowns in state revenues. With the recent securitization of our tobacco master settlement proceeds, the state has now leveled off the yearly unfunded liability payment
commitment to the Teachers' Retirement System at about $285 million. The total savings that the state will experience because of the extra commitments to the state's unfunded liabilities in retirement is more than $2.5 billion.
"We continue to press the need for everyone to be mindful of the five-year forecast in our budget planning, so our state does not overspend and over commit its resources and burden future administrations and generations of West Virginians," the governor noted. "We'll continue to revise this forecast as we analyze future trends that could impact both our immediate and long-term financial picture."