State Budget Practice Report Cards and Budget Resource Guide
The Volcker Alliance’s budgetary grades for West Virginia were relatively consistent across the five categories studied from fiscal 2015 through 2017. The state received three-year averages of B in budget maneuvers, reserve funds, and transparency, and of C in legacy costs and budget forecasting.
In the budget maneuvers category, the state’s annual mark fell to C in 2017 from B the year before after West Virginia funded recurring expenditures with debt (as it did in 2015). It also used so-called scoop and toss measures in 2015.
“Scoop and toss” refers to the practice of repaying maturing bonds by selling new long-term debt, which generally extends the time for paying off the obligation. In 2015, West Virginia issued $134 million in refunding bonds to help repay debt maturing that year and to reduce future debt service. Thanks to lower interest rates, the state picked up $26 million in cash—just as individuals do in refinancing homes at lower rates. West Virginia veered from best practice in choosing to use that extra money over a few years rather than over the life of the new bonds.
West Virginia’s B for transparency reflects a lack of disclosure of deferred infrastructure replacement costs. Only California and Alaska provide meaningful information in that area.
To emphasize the need for clear and comprehensible budgets to inform citizens, promote responsible policymaking, and improve fiscal stability, the Volcker Alliance in 2016 began a study of budgetary and financial reporting practices of all fifty states. The Volcker Alliance’s mission is to improve the effectiveness of the administration of government at all levels. Making state budgeting more transparent and accountable is an important part of that goal.
The report cards found here contain grades of the state's budgetary practices during the fiscal years of 2015 through 2017. Each state received marks in five critical categories, based on their adherence to best practices in several key budgeting indicators. The five categories covered methods used to achieve budgetary balance as well as how budgets and other financial information are disclosed to the public.
States received grades of A to D-minus (there are no “failed states”) for their procedures in estimating revenues and expenditures; their use of one-time actions to balance budgets; how they oversee and use rainy day funds and other fiscal reserves; the adequacy of their funding of public worker retirement and other postemployment benefits; and the quality of transparency of budget and related financial information. The grades are based on research conducted by public finance and budgeting professors and students at eleven US schools of public administration or policy. The universities’ research efforts were augmented by Volcker Alliance staff, data consultants at Municipal Market Analytics, and special project consultants Katherine Barrett and Richard Greene.
State Budget Sources
State Budget Sources: An Annotated Guide to State Budgets, Financial Reports, and Fiscal Analyses is a resource published by the Volcker Alliance designed to help public officials, policy advocates, journalists, academics, and concerned citizens fully understand the critical fiscal decisions that governors and legislators must make. The guide includes the links below to budgets for this state as well as legislative analyses of budget bills and treasurers’ or comptrollers’ monthly state cash-flow statements; capital spending plans; reports on public-worker pension funding and returns; and reports by local and national fiscal research organizations, bond rating firms, and associations of state fiscal and finance officials.