Gov. Tomblin Redirects $25.5M From Work Comp Debt Fund to General Fund

Wednesday, November 16, 2016 | 0

West Virginia Gov. Earl Ray Tomblin issued an executive order Tuesday redirecting $25.5 million from the Workers' Compensation Debt Reduction Fund to the state's general revenue fund for Fiscal Year 2017, the Martinsburg-based newspaper The Journal reported.

Gov. Earl Ray Tomblin

Tomblin announced the executive order at the same time as an across-the-board budget cut of 2% for most West Virginia government agencies.

The state's general revenue fund has fallen behind by more than $87 million since July, the governor's office said in a press release.

The Workers' Compensation Debt Reduction Fund was established in Fiscal Year 2006 to pay down the debt incurred when the workers' compensation system was privatized that year, according to state documents. Taxes on coal and racetrack purses, among other goods and services, went into the fund. 

The Office of the Insurance Commissioner predicted that the West Virginia's workers' compensation debt would be paid off by the end of calendar year 2016, according to a fiscal note published last year. In fact, Tomblin announced in February 2016 that the debt was paid off with the signing of Senate Bill 419, which terminated certain taxes that had been imposed under the Workers' Compensation Debt Reduction Act. 

Read The Journal's story on West Virginia's budgetary problems here.