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Leaders predict workforce, transportation, budget issues will dominate legislative session

By Staff | Jan 15, 2016

CHARLESTON – Workforce, transportation and budget issues will likely dominate the legislative session that begins on Wednesday, according to panelists participating at the Associated Press’ annual West Virginia Legislative Lookahead held Friday at Marshall University’s South Charleston campus.

John Deskins, director of West Virginia University’s Bureau of Business and Economic Research, told journalists gathered for the annual press briefing that West Virginia has lost 8,000 to 9,000 jobs in the last few years.

Also, the state is expected to grow jobs at a rate that is 10 percent below the national rate in the foreseeable future, he said

Meanwhile, the state’s workforce participation rate is 53 percent – “dead last among the states,” Deskins noted. “We have some major long-term structural issues that keep our people out of the labor force,” including health problems and drug abuse.

“West Virginia is never going to be where it needs to be until we get more of our people in the workforce,” he said.

Deskins thinks the state is at a turning point because coal production has dropped by a third and “there’s a very strong likelihood that coal won’t be back to where it was in 2008. We need to diversify the economy.”

He said the Legislature, which makes public policy, has a lot to do. “We have so many challenges with human capital and infrastructure, one thing we have to get right is policy. West Virginia has as much regional variation as any state in the country. We should not think a one-size-fits-all economic strategy would be appropriate. There’s no one silver bullet for the state overall.

“I think we have a good start with home rule,” Deskins said, referring to the pilot program that gives municipalities some freedom to set policies and taxes.

State Sen. Bob Beach, D-Monongalia, said that while jobs are always important, transportation is a significant issue, especially in Morgantown. “We’re hamstrung,” he said. “Getting folks in and out of our area has become a critical problem.”

Beach said Morgantown has 31,000 residents, West Virginia University has 30,000 students, Monongalia County has 115,000 residents “and we’re still working on two-lane roads in most of the city.”

Last May Gov. Earl Ray Tomblin’s Blue Ribbon Commission on Highways issued a report that estimated it would take more than $1 billion to fix the roads network.

Beach said the fact Congress passed a six-year transportation bill in November is helpful “but it really doesn’t give us any extra money.”

Beech said he is open to ideas and noted there have been proposals that would allow communities to raise taxes for highway projects and to extend home rule powers to county commissions.

State Sen. Craig Blair, R-Berkeley, said the Eastern Panhandle is blessed with two interstate highways. “Interstate 81 is the manufacturing corridor of the East Coast and we’re sitting smack dab in the middle of that,” he said.

Blair said that when he was in high school General Motors, DuPont and Corning all had a presence in Berkeley County. “All of them have left,” he said. “When you can’t keep business in the Eastern Panhandle when you have Interstate 81 and Interstate 70, there’s clearly something wrong.”

He said, “things are starting to turn around” because of the reduction in workers’ compensation insurance rates over the past 10 years and other changes made by the state.

Blair cited the 2012 decision by Macy’s to build a 1.3 million-square-foot distribution center near Martinsburg, the 2015 decision by Proctor & Gamble to build a 1 million-square-foot manufacturing plant in the county, and last week’s announcement that Entsorga will build a $25 million trash-to-fuel facility in the panhandle.

Although those announcements were good news, Blair said the region has a big drug problem. “We have more overdoses per capita in the Eastern Panhandle than Baltimore,” he said. “We’re having a hard time getting a drug-free workforce. We’ve got to address that issue.”

State Sen. Chris Walters, R-Putnam, said jobs are the best cure to helping people. “We have to look at economic diversification,” he said. “In the past, the state didn’t have the foresight to do that.”

Beach agreed that diversification is key. “It’s easy to ask, ‘What’s the Legislature to do?,'” he said. “But this didn’t happen overnight.”

He recalled that Morgantown realized in the late 1980s that it needed to diversify so it took multiple actions, including the development of a marketing program and the redeveloped of its waterfront.

“I always joke that I’d like to take what we’ve done in Monongalia County and replicate it,” he said. “But maybe it’s not going to be possible to put a Mylan or a major health-care facility in southern West Virginia. We need to get together and decide where we want to go.”

Last week state Revenue Secretary Bob Kiss said that because of low energy prices and massive layoffs in the coal industry, the state anticipates a $353 million budget shortfall.

“West Virginia is facing a really bleak economic outlook,” Walters said. “We need to look at the businesses we have and do what we can to help them expand.”

He cited the rapid growth in the craft beer industry, which blossomed last year after the Legislature passed a law allowing licensed retailers to sell 32- and 62-ounce jugs of draft beer for consumption off premises.

“That was about getting the government out of the way,” he said.

Getting more and faster broadband in the state is another need that demands attention, Walters said. He introduced a bill in the last session of the Legislature that would promote the construction of a so-called middle-mile broadband network in the state. He said he would re-introduce it in the upcoming session.

Deskins said, “There’s definitely no silver bullet. We have to get everything right – the infrastructure, the human capital, the right policies. Our leaders need to make all policy decisions with an eye toward making the state attractive to potential businesses.

“Having bureaucrats deciding winners and losers is a terrible idea,” he said. “Entrepreneurship is how you achieve economic diversification.”

The Legislative Lookahead was sponsored by The Associated Press with assistance from Marshall University’s School of Journalism and the West Virginia Press Association.