West Virginia State of the State Address 2003
01/09/2003
Mr. President, Mr. Speaker, Members of the Board of Public Works, Justices of the Supreme Court of Appeals, Members of the Legislature, Distinguished Guests, and My Fellow West Virginians:
Mr. Speaker--Before I begin, I want to take a moment to recognize a man who sat where you are sitting tonight. Former House Speaker Lew McManus committed his life and dedicated his energies to promote all things that advanced West Virginia. His character as a public servant was unfaltering--and his love for life and our state was immeasurable. Lew passed away last month. I ask all of you tonight for a moment of silence as we remember this great speaker and citizen of West Virginia.
Last year, as we gathered in this chamber, the shock and horror of Sept. 11 were fresh in our minds. Smoke was still rising from the ruins of the World Trade Center.
Our skies are clearer today. We have shown that our spirit cannot be crushed. And we have shown that whatever divides us -- we will unite and fight when our nation is at risk.
On the podium tonight are the colors of many West Virginia military units. Last year at this time, I told you that these would remain posted in this Capitol for as long as men and women of these units remain on duty in defense of our nation.
West Virginia National Guard and Reserve units have served around the world and around the country this year. Even this week, more West Virginians have been activated for duty.
Their commander, Adjutant General Alan Tackett, cannot be here tonight because he is recovering from surgery. But I know he is watching and I send him the thanks of all West Virginians for what he and his soldiers are doing.
We owe a special debt of thanks to our own Brigadier General Wayne "Speedy" Lloyd who served as commander of a international air base in Kyrgyzstan - with troops from eight allied nations -- for a large part of this year. This the first time in U.S. Air Force history that a guardsman has commanded an air expeditionary wing deployed overseas. General Lloyd, please stand and accept our state's gratitude.
Ladies and gentlemen, many West Virginians serve the cause of freedom. Last year, two proud West Virginians lost their lives in combat in Afghanistan to protect us and the values we hold dear.
Allow me the honor of speaking their names, and join me in a moment of silence to reflect upon what they have done for us:
Staff Sergeant Gene Arden Vance of the West Virginia National Guard and Staff Sergeant Anissa Ann Shuttleworth Shero (SHEER-O) of the United States Air Force.
There are two other brave West Virginians I want to recognize tonight.
Trooper First Class Robert J. Elswick of the West Virginia State Police was shot in the head in the line of duty. He spent more than a month in a hospital. Doctors gave him little chance to live. But he's a tough West Virginia trooper, and he fought back. I am happy to report that he is alive and improving tonight at a rehabilitation center and our prayers are with him every day.
Let's also remember Sgt. Scott Paugh (PAUL) who was critically injured when a driver crossed the center line and hit his cruiser head on. Scott is recovering at home and we wish him well.
When West Virginians make such sacrifices on our behalf, it places a burden upon all of our shoulders. We owe it to them to create a state and a nation deserving of the loyalty and fidelity that they have shown.
We have taken West Virginia far in the past two years. And we face many challenges as we look forward. But we cannot falter. We cannot turn back. And we cannot lose sight of what the people of West Virginia elected us to do - strengthen the minds and characters of our children, create jobs, to give people the tools to create economic success, and provide for the health and safety of us all.
The economic challenges that have been with us from the very start of this administration have forced us to cut state spending again and again. Across the United States, Governors and Legislators are wresting with billion-dollar deficits, dwindling revenues, and increasing demands for service.
We will face this challenge - this year, in this legislative session - and we will emerge with a leaner, more effective state government.
The budget I am presenting tonight will be balanced. It cuts spending. It contains no general tax increase.
This budget includes spending cuts that total more than 200 million dollars. Just like the families in West Virginia, we've had to tighten our belts in these difficult economic times. We're concentrating on our priorities jobs, education and healthcare and moving ahead in an effective way toward realistic goals.
Working together, my Administration and this Legislature have accomplished much for our people.
We fought hard for jobs and working families: We are investing more than 200 million dollars in new Economic Development Grants that will generate more than 1 billion in new and expanded projects creating thousands of jobs. Last year we completely rewrote our business tax incentives--making it easier to invest in job creation in West Virginia. Our new Research and Development tax credit program is already attracting cutting edge industries. Our new Venture Capital initiative can translate into hundreds of million of dollars in new investments. Private enterprise, working with us, with the leadership of Senator Robert C. Byrd and the rest of our congressional delegation, and with our colleges and universities, has made West Virginia the Silicon Valley of biometric technology -- technology that will improve the safety and security of every American and bring good-paying jobs to West Virginia. We are investing in the future at the Blanchette (BLAWN-CHET) Rockefeller Neurosciences Institute -- established by our own United States Senator Jay Rockefeller -- a West Virginia based enterprise that is breaking new scientific ground in tracing the root causes of Alzheimer's disease and exploring new treatments. Last year at this time, our steel industry was teetering on the brink of extinction because of unfair foreign dumping. My Economic Development SWAT Team helped arrange an emergency loan to Wheeling Pittsburgh Steel to save some of our state's best manufacturing jobs. Today, thousands of workers are making steel 24 hours a day at Wheeling Pitt -- orders are up and pensions are being paid on schedule. The SWAT Team has been busy elsewhere. They have been actively involved in many job retention efforts, all over the state. And as a result thousands of West Virginians are still working today. We have created 4500 other new jobs in communities across West Virginia in a time of economic downturn. But that's not enough. I'm fighting every day to attract investment to create jobs. My administration's top priority is to ensure that every West Virginian will have the opportunity to work at a good-paying, secure job. I'll never stop fighting for this.
We made education a priority: We provided 3,500 PROMISE Scholars an opportunity to go to college. This year's freshman class is larger than ever. This year, with the PROMISE Scholarship, twenty-five percent more of our best-qualified students are staying at home -- in West Virginia. Our public school teachers received one of the largest pay raises in the history of West Virginia last year the second-highest percentage increase in the nation. Our teachers and school service personnel are fantastic people. They care about the children, they work hard, and they make our schools special places. As we started this tradition two years ago, we recognize one teacher who does it so well -- one teacher who stands for thousands of others -- our State Teacher of the year. Our teacher this year is from West Milford Elementary School in Harrison County. She's well loved there. In addition to our thanks, two West Virginia companies -- their representatives are seated in the chamber tonight -- have recognized her work. She will receive a $5,000 award from Mountain State Blue Cross-Blue Shield -- and the use of a 2003 Toyota from Toyota of West Virginia.
Let me present to you our State Teacher of the Year, Mary Kay DeVono
I also want to acknowledge all the parents and teachers who work with our youngest children on building the reading skills that form the foundation of education. I'd like to recognize one of those parents specifically -- I know who pretty well. First Lady Sandy Wise has been traveling the state talking to parents and caregivers about the importance of reading and talking to children early and often with her Love to Learn message.
Sandy--thank you--and all the parents in West Virginia for what you are doing for education. We now require character education in every school in the state -- because we believe it's just as important to teach our children right from wrong as it is to teach reading and writing. We provided $2.3 million to Marshall and WVU for research to improve lives and lay the foundation for the knowledge-based economy our children deserve. And we put more than $10 million toward research parks in university cities to capture the jobs that research creates. We provided the largest number and amount of needs-based college scholarships in West Virginia history.
We worked to keep our state healthy: In the past, West Virginia has had to turn back available Federal funds because we didn't reach enough children with the Children's Health Insurance Program. We made covering each child a priority -- and provided health care to a record 36,000 West Virginia children. I'm proud to announce that, for the first time, not one dime of unused Federal money is going back to Washington this year. We provided state-sponsored medical liability insurance to West Virginia physicians and hospitals when their insurance companies abandoned them. By the end of this month we will cover 1,000 doctors -- doctors who would have been forced to leave our state if we had not acted. We also provide needed coverage to 28 hospitals and health facilities. We established a prescription purchasing pool with 3 other states -- that will lower the prices on brand name prescription drugs and save $25 million over the next 3 years. We added a new drug discount plan to the Golden Mountaineer card -- and West Virginia Seniors have already saved $4 million on their prescriptions. We are ready to break ground this spring -- as soon as the Federal part of the funding is assured -- for the $24 million dollar Clarksburg Veterans Nursing Home. In 2002, I asked you for added financial support to improve safety in our coal mines. You provided it, and the results are encouraging: last year, we had the safest year in our mines in recent history.
West Virginians pulled together to recover from natural disaster, and: We vowed to rebuild flooded communities and we're doing it. And, this time, we're building flood proof housing nearly six hundred families have relocated to safe, dry housing, out of the flood plain. Many of these homes are on reclaimed surface mines. There will soon be another 100 housing lots opened in Premier, in McDowell County. I have directed the construction of a community center so that those strong West Virginia families will have a place to gather for the betterment of the entire area. We're putting flooded businesses back in operation. We've issued nearly 1,000 forgivable loans and micro loans and helped hundreds of businesses rebuild, restock and re-establish the vital services every community must have. We're working with local governments to plan a better future for communities hit by floods. Last year I announced in this chamber West Virginia RISE, a comprehensive program to improve life in Southern West Virginia for decades to come. Already we have coordinated economic development tools such as land use planning in several counties, making land outside the flood plan suitable for development.
I'm proud of what you and I have accomplished in the first half of this Administration. Out of adversity, we have created opportunity; in times of crisis, we, working together, have provided leadership.
The challenges we face for the next two years will be every bit as hard. We face a real budget crisis in the state government. We have unfinished work in developing our economy, educating our people and ensuring our healthcare.
Last year, because of our management, West Virginia was one of only 7 states to show a surplus. But we are not immune from the national economy that has resulted in growing budget shortfalls for almost every state.
But make no mistake. We can't look to Washington to bail us out. We're going to have to change the way we do business in West Virginia.
Tonight, I have placed before you a budget that begins a bold restructuring of state government in West Virginia.
Ladies and gentlemen, I told you many months ago that the funds available for the 2003 2004 budget year would not be enough to cover the predicted cost in the growth of government. We began unprecedented discussions with your legislative finance staff two months ago -- earlier than any governor has done before -- to prepare for this challenge.
I asked every branch of state government without exception to review all their programs and plans, and to develop the upcoming budget based on a ten percent reduction below this year's spending level.
We're going to start the cutting at the top. The Governor's Office will not be exempt. We also will cut our budget by at least 10-percent. This budget proposes a smaller Governor's Cabinet -- eliminating the post of Commerce Commissioner and combining the posts of Secretary of Tax and Revenue and Secretary of Administration. But this is not just a matter of eliminating administrative salaries -- we're combining many of the overlapping functions and duties of the agencies and subagencies under these posts to create real savings. I have also requested that we merge the Governor's Office of Technology with the Office of Information Services and Communications. We spend millions on technology--and it's simply not coordinated as well as it should be. We're going to serve our children better by coordinating the maze of overlapping children's programs in state government. We're now operating 257 separately funded programs for kids and families - many under funded and unable to fully meet the needs of the families they serve. We must combine the Governor's Cabinet on Children and Families and the West Virginia Bureau of Children and Families into a single agency that gives families one-stop access to assistance in meeting children's needs. I asked a year ago that state agencies cut their fleets. Let me be frank. I have not been satisfied with the results. There are still far too many state cars on the road. So, West Virginia, get ready for the largest surplus car sale ever. Effective today, I have signed an executive order reducing the vehicle fleet by 15 percent by March 31. We have placed a freeze on new purchases--and we will cut the fleet by an additional 10 percent next year.
Let me take a moment to thank the state's public employees for their response. I asked for their help. They have responded overwhelmingly. Our special public employee website has already received more than 700 suggestions for how to run state government better.
The single most common suggestion from state employees was to cut vehicle waste. We have a state employee with us tonight who gave us one of those suggestions. She is an engineer in the Division of Highways.
We're going to take her suggestion and make it our policy.
Kristi Cole, of Raleigh County, please stand as we thank you and all the public employees who are helping to restructure state government.
Yes, we will do steep budget cuts this year. But this crisis forces us to do what all of us know must be done -- to restructure state government to make it operate more effectively and efficiently. Because if all we do is merely cut the budget--we have failed. Every business must review its operations at least every 5 years. It's time state government does the same.
When I met in a satellite town meeting with 2500 of our public employees recently, they understood. It's not a question of if we change. The only issue is how and when.
I say now.
The people of West Virginia have demanded loud and clear that we not allow the budget crisis to distract us from solving some longstanding challenges.
For many years, it has been a mark of pride to "have a doctor in the family." We're proud of, and appreciative of the doctors in our extended family of West Virginians. We're proud of the men and women who mend our wounds, bring our children into the world, and ease the pain and suffering of our loved ones.
The hard work and commitment of our physicians makes our state a better place to live.
My number one commitment is to the health and safety of the citizens of West Virginia.
We must guarantee that every West Virginian has access to the doctors he or she needs and every West Virginia doctor has access to reasonably priced medical malpractice insurance.
The proposal I put before you tonight addresses both the tort system and the terrible economic pressures created when the national insurance companies jacked up prices -- and when they abandoned doctors who had paid premiums for decades.
This proposal levels the playing field so our doctors have the same protections as doctors in other states -- but still retains fairness for patients who are truly injured by medical mistakes. We must set reasonable caps, varying with the severity of injury, on awards for pain and suffering. I will propose a base cap of $250,000, with a sliding scale similar to that recently adopted in Ohio. We must hold people responsible only for their share of injuries they cause. We must protect our trauma care system by setting a $500,000 cap on liability for medical providers -- including doctors and emergency workers. We must take into account all payments made to an injured party so that no one is unduly enriched or paid twice for one injury.
It's time to set partisan politics aside. The bill I place before you today addresses each of these issues.
Tort reform is one part of the solution. It is not the only part. Affordable insurance is the other. Last year, we brought nearly 1,000 doctors into the state run insurance program. But that's not enough.
We can't leave the fate of our health system in the hands of insurance companies who know little -- and care even less -- for the health of West Virginians.
I am placing before you a proposal to create a $20 million fund -- supported by the tobacco settlement -- to offset for three years the costs of continuing medical liability protection for doctors who are forced to switch from private insurance carriers to the state provided Board of Risk and Insurance Management. Our experienced doctors are being punished for an insurance crisis they did not create. This fund will assist those who want to remain in practice.
We're also opening our coverage to other doctors who need more affordable and dependable coverage, and who want to take advantage of this assistance. There will be added help for doctors who remain with private insurers.
Let me take this moment to speak directly to every doctor in the state. Right now, the state of West Virginia guarantees that every qualified doctor will be covered by malpractice insurance. Pass my legislation and that insurance just became much more affordable.
When combined with the tort reforms we passed last year --reforms that have already caused a sharp reduction in suits being filed and that kept 1,000 doctors practicing in West Virginia -- my proposals will make West Virginia a state that has economic incentives for doctors to stay, to start new practices, and to build careers and families.
The health of tens of thousands of West Virginians is at stake. I urge this Legislature to put this bill at the very top of its agenda. We have other health issues to address.
Tobacco remains the single biggest threat to the health of West Virginia. We are making strides in tobacco prevention. But for decades we have ignored the best weapon in this fight the tobacco tax.
The cigarette tax has remained unchanged since 1978. It's just 17 cents a pack, one of the lowest in the nation. That 17 cents doesn't even begin to cover the health costs to West Virginia taxpayers that are generated by each pack of tobacco sold let alone the misery caused by heart and lung diseases, and cancer, all related to smoking.
This budget has no increases in income tax, sales tax or business taxes. But increasing the tobacco tax will have the dual effect of discouraging smoking -- especially among our children -- and helping balance some of the costs imposed on all of us by the effects of smoking.
I propose an increase in the West Virginia cigarette tax to 55 cents per pack, which is about the average paid by smokers in other states. Every single penny of this tax will be directed toward healthcare and by applying it toward federally matched programs, this money will help us avoid a $300 million dollar shortfall this year in healthcare.
There will be powerful forces at work against this proposal. There is no alternative. If you don't pass this--you will have to cut $300 million from the health budget this year alone. Ladies and gentlemen--that's nursing home care, that's senior citizen care, that's prescription drugs, that's children's health care -- and that's hundreds of health care jobs.
Pass this bill.
West Virginia senior citizens also have a health issue that cannot wait. We must do even more to restrain the runaway costs of prescription drugs. No West Virginian should have to choose between food and medicine, or should be forced to skip pills to make a prescription last until the next Social Security check arrives.
We are taking on the big brand name drug companies and we're fighting for discounts on prescriptions. This year, I will continue negotiating with the brand name prescription drug manufacturers, and to maintain -- and, hopefully expand -- the savings available with the Golden Mountaineer card.
We will continue and expand the program that helps doctors choose less costly generic medicines instead of heavily advertised brand name drugs.
There are several steps we can take this year that won't cost us money -- but will help West Virginia families. I have asked this Legislature twice before to toughen our drunk driving law. We must adopt the point-oh-eight alcohol level as proof of impairment. We have waited too long and too many lives already have been lost. If we don't act this year, we'll also lose more than two and a half million dollars in Federal funds that go into our highway program. That's money that can be used for essential road projects. And we must enact an ATV safety bill in this session. I am the first governor to call for this legislation. Too many young people have been killed or crippled, and the time to act is now. We must also change our adoption laws to allow parents who adopt children in other countries to bring them to West Virginia without facing an extra set of bureaucratic barriers.
Our State Police are our main line of defense against those who break the law, and against threats to our public safety in times of crisis and disaster. We have trooper shortages across the state -- only one county has 24-hour state police protection. This year, we invited 1200 recruits to test for appointment to the State Police. We will start --not one--but two classes -- nearly 80 new officers in the next month. I have directed another class to start later this year. And I have also included $1 million in this budget to address a long-standing fairness issue for our younger troopers by upgrading the Plan B trooper retirement plan.
We must not let the budget crisis derail the progress we have made in public and higher education in West Virginia. Education is still the centerpiece of our economic development plan and still the key to our future.
We insist on teaching our children values. We insist on emphasizing character. And in return, we promise quality education and opportunies for every child and every young person and every adult with the desire to learn.
I have exempted both the PROMISE Scholarship and the West Virginia Higher Education Grant Program from budget cuts. We will keep the Promise we made to the next generation.
In the audience with us tonight are 4 members of the first class of PROMISE Scholars. These four young people represent the brightest hope we have for the future of our state. I will ask each of them to stand as I call their name. Katie Molinari is a graduate of Parkersburg South High School in Wood County and is a freshman at West Virginia University. Justin Gore is a graduate of St. Albans High School in Kanawha County and is a freshman at Marshall University. Lindsey Wimer is a graduate of Pendleton County High School and is a freshman at West Virginia University. Bridget Fuller is a graduate of Yeager High School in McDowell County and is a freshman at Marshall University.
They represent 3,500 PROMISE Scholars who are about to begin the second semester of their college education. Next year there will be more.
Please recognize West Virginia's future.
West Virginia, in the past decade, has moved from the rear to the front among the nation's leaders in education in grades K-12 both in terms of resources and in terms of results. Since 1993, we've had the third largest increase among all the states in per-capita spending for education a 36% increase in 10 years. We've spent this money well better schools, better-paid educators, better programs and we are reaping the rewards.
As we face a tighter budget, we cannot retreat from this progress because it is the one best hope we have of creating a brighter future for West Virginia.
It is such a priority for me that education will not be reduced, even as we must make cuts elsewhere. We are not taking one dollar away from teachers and students in grades K-12. In fact, our K-12 public education budget is higher than ever before.
We're also helping parents with school costs.
Last year, this Legislature endorsed -- for just one year -- my back-to-school sales tax holiday. It gives parents a break on clothing and educational supplies for kids in the fall. It was a rousing success, and even brought shoppers from other states to spend their money in West Virginia stores. I ask you to continue that sales tax holiday this year. Let's talk about growth. Other states have cut back on schools, cut back on roads, cut back on investments in infrastructure. Don't count West Virginia in that pack.
We will put hundreds of million of dollars this year into schools, roads, housing, water and sewers. And we'll do it with the help of our own economic development grants and programs. We'll do it with the federal funds secured by Senator Byrd and Senator Rockefeller and Representatives Nick Joe Rahall, Alan Mollohan and Shelley Moore Capito, and the private sector.
This year, we will invest nearly TWO BILLION DOLLARS into infrastructure for our future. Some may say step back -- we say move forward.
Investment and job creation are the real answers to the problems we are facing today. We have to create jobs, create economic opportunity, to make West Virginia the state people look to when they invest, when they decide where to live and when they decide where to raise their children.
I will fight every day, as I have fought every day throughout my career, to create good-paying jobs for West Virginians. That's my number one job.
This year we will add even more tools to our job creation toolbox. The West Virginia Housing Development Fund which has helped thousands of West Virginia families own their own homes has developed at my request a $28 million economic development program; Additionally, the Economic Development Authority loans money to businesses. The current limit on EDA loans for all projects is $150 million, a limit that's been reached. That's good news -- we're helping lots of new businesses -- but we can't stop. If we want to be in the running for the next generation of manufacturing plants and new-economy enterprises, we need to raise the limit to $175 million. I ask you to do so without delay. We've got projects right now that we can move if we can finance them. And, thanks to an unprecedented partnership between business and labor, that, if you will recall, I created last year and announced in this chamber, we now can offer tax increment financing to new and expanded businesses. The All for One Committee united labor leaders like Jim Bowen, Kenny Perdue, and Steve White with business leaders like Paul Arbogast, Dana Waldo and Mike Basile. I ask them to stand and accept our thanks for what they have done to bring us together.
The business-labor partnership is also alive and active in our pursuit of the "Vision Shared" initiative.
We know this works, and we will ask these partners to work together on another crucial initiative this year -- eliminating the Workers' Compensation problems that affect our competitiveness. I consider this challenge as critical as the others I have discussed.
Business and labor leaders have agreed to help solve this problem once and for all. They recognize that Workers' Compensation issues make West Virginia less likely to attract investment. And I welcome members of the Legislature joining us in solving this problem.
We have already identified and will implement administrative changes that will save West Virginia businesses $135 million each and every year.
We must eliminate the Second Injury Fund that is the cause of most of our two-billion-dollar-plus unfunded liability.
We must create a deficit reduction account -- safe from raids by future legislatures and future Governors -- to guarantee that premiums paid to reduce the debt are used only for that purpose.
Two years ago, I ended this speech by handing two large bound books of legislation and budget documents to the Speaker and the President. This was the first time in my memory that the Governor ever presented all of the legislative agenda on the opening day.
I do this because I know that you need time to work on legislation -- and because I believe in the urgency of working hard and fast -- on the real issues that face us -- from day one of the legislative session.
Last year, we condensed the budget and the bills to two tiny compact discs and gave them to each member on the first day.
We've made it a tradition. This year, we're going a step further:
The executive budget, and my legislative proposals are being transferred as I speak to your email accounts.
They also being delivered electronically to the press, to state agencies and many citizens -- and we're saving a ton of papeMr. President, Mr. Speaker, Members of the Board of Public Works, Justices of the Supreme Court of Appeals, Members of the Legislature, Distinguished Guests, and My Fellow West Virginians:
Mr. Speaker--Before I begin, I want to take a moment to recognize a man who sat where you are sitting tonight. Former House Speaker Lew McManus committed his life and dedicated his energies to promote all things that advanced West Virginia. His character as a public servant was unfaltering--and his love for life and our state was immeasurable. Lew passed away last month. I ask all of you tonight for a moment of silence as we remember this great speaker and citizen of West Virginia.
Last year, as we gathered in this chamber, the shock and horror of Sept. 11 were fresh in our minds. Smoke was still rising from the ruins of the World Trade Center.
Our skies are clearer today. We have shown that our spirit cannot be crushed. And we have shown that whatever divides us -- we will unite and fight when our nation is at risk.
On the podium tonight are the colors of many West Virginia military units. Last year at this time, I told you that these would remain posted in this Capitol for as long as men and women of these units remain on duty in defense of our nation.
West Virginia National Guard and Reserve units have served around the world and around the country this year. Even this week, more West Virginians have been activated for duty.
Their commander, Adjutant General Alan Tackett, cannot be here tonight because he is recovering from surgery. But I know he is watching and I send him the thanks of all West Virginians for what he and his soldiers are doing.
We owe a special debt of thanks to our own Brigadier General Wayne "Speedy" Lloyd who served as commander of a international air base in Kyrgyzstan - with troops from eight allied nations -- for a large part of this year. This the first time in U.S. Air Force history that a guardsman has commanded an air expeditionary wing deployed overseas. General Lloyd, please stand and accept our state's gratitude.
Ladies and gentlemen, many West Virginians serve the cause of freedom. Last year, two proud West Virginians lost their lives in combat in Afghanistan to protect us and the values we hold dear.
Allow me the honor of speaking their names, and join me in a moment of silence to reflect upon what they have done for us:
Staff Sergeant Gene Arden Vance of the West Virginia National Guard and Staff Sergeant Anissa Ann Shuttleworth Shero (SHEER-O) of the United States Air Force.
There are two other brave West Virginians I want to recognize tonight.
Trooper First Class Robert J. Elswick of the West Virginia State Police was shot in the head in the line of duty. He spent more than a month in a hospital. Doctors gave him little chance to live. But he's a tough West Virginia trooper, and he fought back. I am happy to report that he is alive and improving tonight at a rehabilitation center and our prayers are with him every day.
Let's also remember Sgt. Scott Paugh (PAUL) who was critically injured when a driver crossed the center line and hit his cruiser head on. Scott is recovering at home and we wish him well.
When West Virginians make such sacrifices on our behalf, it places a burden upon all of our shoulders. We owe it to them to create a state and a nation deserving of the loyalty and fidelity that they have shown.
We have taken West Virginia far in the past two years. And we face many challenges as we look forward. But we cannot falter. We cannot turn back. And we cannot lose sight of what the people of West Virginia elected us to do - strengthen the minds and characters of our children, create jobs, to give people the tools to create economic success, and provide for the health and safety of us all.
The economic challenges that have been with us from the very start of this administration have forced us to cut state spending again and again. Across the United States, Governors and Legislators are wresting with billion-dollar deficits, dwindling revenues, and increasing demands for service.
We will face this challenge - this year, in this legislative session - and we will emerge with a leaner, more effective state government.
The budget I am presenting tonight will be balanced. It cuts spending. It contains no general tax increase.
This budget includes spending cuts that total more than 200 million dollars. Just like the families in West Virginia, we've had to tighten our belts in these difficult economic times. We're concentrating on our priorities jobs, education and healthcare and moving ahead in an effective way toward realistic goals.
Working together, my Administration and this Legislature have accomplished much for our people.
We fought hard for jobs and working families: We are investing more than 200 million dollars in new Economic Development Grants that will generate more than 1 billion in new and expanded projects creating thousands of jobs. Last year we completely rewrote our business tax incentives--making it easier to invest in job creation in West Virginia. Our new Research and Development tax credit program is already attracting cutting edge industries. Our new Venture Capital initiative can translate into hundreds of million of dollars in new investments. Private enterprise, working with us, with the leadership of Senator Robert C. Byrd and the rest of our congressional delegation, and with our colleges and universities, has made West Virginia the Silicon Valley of biometric technology -- technology that will improve the safety and security of every American and bring good-paying jobs to West Virginia. We are investing in the future at the Blanchette (BLAWN-CHET) Rockefeller Neurosciences Institute -- established by our own United States Senator Jay Rockefeller -- a West Virginia based enterprise that is breaking new scientific ground in tracing the root causes of Alzheimer's disease and exploring new treatments. Last year at this time, our steel industry was teetering on the brink of extinction because of unfair foreign dumping. My Economic Development SWAT Team helped arrange an emergency loan to Wheeling Pittsburgh Steel to save some of our state's best manufacturing jobs. Today, thousands of workers are making steel 24 hours a day at Wheeling Pitt -- orders are up and pensions are being paid on schedule. The SWAT Team has been busy elsewhere. They have been actively involved in many job retention efforts, all over the state. And as a result thousands of West Virginians are still working today. We have created 4500 other new jobs in communities across West Virginia in a time of economic downturn. But that's not enough. I'm fighting every day to attract investment to create jobs. My administration's top priority is to ensure that every West Virginian will have the opportunity to work at a good-paying, secure job. I'll never stop fighting for this.
We made education a priority: We provided 3,500 PROMISE Scholars an opportunity to go to college. This year's freshman class is larger than ever. This year, with the PROMISE Scholarship, twenty-five percent more of our best-qualified students are staying at home -- in West Virginia. Our public school teachers received one of the largest pay raises in the history of West Virginia last year the second-highest percentage increase in the nation. Our teachers and school service personnel are fantastic people. They care about the children, they work hard, and they make our schools special places. As we started this tradition two years ago, we recognize one teacher who does it so well -- one teacher who stands for thousands of others -- our State Teacher of the year. Our teacher this year is from West Milford Elementary School in Harrison County. She's well loved there. In addition to our thanks, two West Virginia companies -- their representatives are seated in the chamber tonight -- have recognized her work. She will receive a $5,000 award from Mountain State Blue Cross-Blue Shield -- and the use of a 2003 Toyota from Toyota of West Virginia.
Let me present to you our State Teacher of the Year, Mary Kay DeVono
I also want to acknowledge all the parents and teachers who work with our youngest children on building the reading skills that form the foundation of education. I'd like to recognize one of those parents specifically -- I know who pretty well. First Lady Sandy Wise has been traveling the state talking to parents and caregivers about the importance of reading and talking to children early and often with her Love to Learn message.
Sandy--thank you--and all the parents in West Virginia for what you are doing for education. We now require character education in every school in the state -- because we believe it's just as important to teach our children right from wrong as it is to teach reading and writing. We provided $2.3 million to Marshall and WVU for research to improve lives and lay the foundation for the knowledge-based economy our children deserve. And we put more than $10 million toward research parks in university cities to capture the jobs that research creates. We provided the largest number and amount of needs-based college scholarships in West Virginia history.
We worked to keep our state healthy: In the past, West Virginia has had to turn back available Federal funds because we didn't reach enough children with the Children's Health Insurance Program. We made covering each child a priority -- and provided health care to a record 36,000 West Virginia children. I'm proud to announce that, for the first time, not one dime of unused Federal money is going back to Washington this year. We provided state-sponsored medical liability insurance to West Virginia physicians and hospitals when their insurance companies abandoned them. By the end of this month we will cover 1,000 doctors -- doctors who would have been forced to leave our state if we had not acted. We also provide needed coverage to 28 hospitals and health facilities. We established a prescription purchasing pool with 3 other states -- that will lower the prices on brand name prescription drugs and save $25 million over the next 3 years. We added a new drug discount plan to the Golden Mountaineer card -- and West Virginia Seniors have already saved $4 million on their prescriptions. We are ready to break ground this spring -- as soon as the Federal part of the funding is assured -- for the $24 million dollar Clarksburg Veterans Nursing Home. In 2002, I asked you for added financial support to improve safety in our coal mines. You provided it, and the results are encouraging: last year, we had the safest year in our mines in recent history.
West Virginians pulled together to recover from natural disaster, and: We vowed to rebuild flooded communities and we're doing it. And, this time, we're building flood proof housing nearly six hundred families have relocated to safe, dry housing, out of the flood plain. Many of these homes are on reclaimed surface mines. There will soon be another 100 housing lots opened in Premier, in McDowell County. I have directed the construction of a community center so that those strong West Virginia families will have a place to gather for the betterment of the entire area. We're putting flooded businesses back in operation. We've issued nearly 1,000 forgivable loans and micro loans and helped hundreds of businesses rebuild, restock and re-establish the vital services every community must have. We're working with local governments to plan a better future for communities hit by floods. Last year I announced in this chamber West Virginia RISE, a comprehensive program to improve life in Southern West Virginia for decades to come. Already we have coordinated economic development tools such as land use planning in several counties, making land outside the flood plan suitable for development.
I'm proud of what you and I have accomplished in the first half of this Administration. Out of adversity, we have created opportunity; in times of crisis, we, working together, have provided leadership.
The challenges we face for the next two years will be every bit as hard. We face a real budget crisis in the state government. We have unfinished work in developing our economy, educating our people and ensuring our healthcare.
Last year, because of our management, West Virginia was one of only 7 states to show a surplus. But we are not immune from the national economy that has resulted in growing budget shortfalls for almost every state.
But make no mistake. We can't look to Washington to bail us out. We're going to have to change the way we do business in West Virginia.
Tonight, I have placed before you a budget that begins a bold restructuring of state government in West Virginia.
Ladies and gentlemen, I told you many months ago that the funds available for the 2003 2004 budget year would not be enough to cover the predicted cost in the growth of government. We began unprecedented discussions with your legislative finance staff two months ago -- earlier than any governor has done before -- to prepare for this challenge.
I asked every branch of state government without exception to review all their programs and plans, and to develop the upcoming budget based on a ten percent reduction below this year's spending level.
We're going to start the cutting at the top. The Governor's Office will not be exempt. We also will cut our budget by at least 10-percent. This budget proposes a smaller Governor's Cabinet -- eliminating the post of Commerce Commissioner and combining the posts of Secretary of Tax and Revenue and Secretary of Administration. But this is not just a matter of eliminating administrative salaries -- we're combining many of the overlapping functions and duties of the agencies and subagencies under these posts to create real savings. I have also requested that we merge the Governor's Office of Technology with the Office of Information Services and Communications. We spend millions on technology--and it's simply not coordinated as well as it should be. We're going to serve our children better by coordinating the maze of overlapping children's programs in state government. We're now operating 257 separately funded programs for kids and families - many under funded and unable to fully meet the needs of the families they serve. We must combine the Governor's Cabinet on Children and Families and the West Virginia Bureau of Children and Families into a single agency that gives families one-stop access to assistance in meeting children's needs. I asked a year ago that state agencies cut their fleets. Let me be frank. I have not been satisfied with the results. There are still far too many state cars on the road. So, West Virginia, get ready for the largest surplus car sale ever. Effective today, I have signed an executive order reducing the vehicle fleet by 15 percent by March 31. We have placed a freeze on new purchases--and we will cut the fleet by an additional 10 percent next year.
Let me take a moment to thank the state's public employees for their response. I asked for their help. They have responded overwhelmingly. Our special public employee website has already received more than 700 suggestions for how to run state government better.
The single most common suggestion from state employees was to cut vehicle waste. We have a state employee with us tonight who gave us one of those suggestions. She is an engineer in the Division of Highways.
We're going to take her suggestion and make it our policy.
Kristi Cole, of Raleigh County, please stand as we thank you and all the public employees who are helping to restructure state government.
Yes, we will do steep budget cuts this year. But this crisis forces us to do what all of us know must be done -- to restructure state government to make it operate more effectively and efficiently. Because if all we do is merely cut the budget--we have failed. Every business must review its operations at least every 5 years. It's time state government does the same.
When I met in a satellite town meeting with 2500 of our public employees recently, they understood. It's not a question of if we change. The only issue is how and when.
I say now.
The people of West Virginia have demanded loud and clear that we not allow the budget crisis to distract us from solving some longstanding challenges.
For many years, it has been a mark of pride to "have a doctor in the family." We're proud of, and appreciative of the doctors in our extended family of West Virginians. We're proud of the men and women who mend our wounds, bring our children into the world, and ease the pain and suffering of our loved ones.
The hard work and commitment of our physicians makes our state a better place to live.
My number one commitment is to the health and safety of the citizens of West Virginia.
We must guarantee that every West Virginian has access to the doctors he or she needs and every West Virginia doctor has access to reasonably priced medical malpractice insurance.
The proposal I put before you tonight addresses both the tort system and the terrible economic pressures created when the national insurance companies jacked up prices -- and when they abandoned doctors who had paid premiums for decades.
This proposal levels the playing field so our doctors have the same protections as doctors in other states -- but still retains fairness for patients who are truly injured by medical mistakes. We must set reasonable caps, varying with the severity of injury, on awards for pain and suffering. I will propose a base cap of $250,000, with a sliding scale similar to that recently adopted in Ohio. We must hold people responsible only for their share of injuries they cause. We must protect our trauma care system by setting a $500,000 cap on liability for medical providers -- including doctors and emergency workers. We must take into account all payments made to an injured party so that no one is unduly enriched or paid twice for one injury.
It's time to set partisan politics aside. The bill I place before you today addresses each of these issues.
Tort reform is one part of the solution. It is not the only part. Affordable insurance is the other. Last year, we brought nearly 1,000 doctors into the state run insurance program. But that's not enough.
We can't leave the fate of our health system in the hands of insurance companies who know little -- and care even less -- for the health of West Virginians.
I am placing before you a proposal to create a $20 million fund -- supported by the tobacco settlement -- to offset for three years the costs of continuing medical liability protection for doctors who are forced to switch from private insurance carriers to the state provided Board of Risk and Insurance Management. Our experienced doctors are being punished for an insurance crisis they did not create. This fund will assist those who want to remain in practice.
We're also opening our coverage to other doctors who need more affordable and dependable coverage, and who want to take advantage of this assistance. There will be added help for doctors who remain with private insurers.
Let me take this moment to speak directly to every doctor in the state. Right now, the state of West Virginia guarantees that every qualified doctor will be covered by malpractice insurance. Pass my legislation and that insurance just became much more affordable.
When combined with the tort reforms we passed last year --reforms that have already caused a sharp reduction in suits being filed and that kept 1,000 doctors practicing in West Virginia -- my proposals will make West Virginia a state that has economic incentives for doctors to stay, to start new practices, and to build careers and families.
The health of tens of thousands of West Virginians is at stake. I urge this Legislature to put this bill at the very top of its agenda. We have other health issues to address.
Tobacco remains the single biggest threat to the health of West Virginia. We are making strides in tobacco prevention. But for decades we have ignored the best weapon in this fight the tobacco tax.
The cigarette tax has remained unchanged since 1978. It's just 17 cents a pack, one of the lowest in the nation. That 17 cents doesn't even begin to cover the health costs to West Virginia taxpayers that are generated by each pack of tobacco sold let alone the misery caused by heart and lung diseases, and cancer, all related to smoking.
This budget has no increases in income tax, sales tax or business taxes. But increasing the tobacco tax will have the dual effect of discouraging smoking -- especially among our children -- and helping balance some of the costs imposed on all of us by the effects of smoking.
I propose an increase in the West Virginia cigarette tax to 55 cents per pack, which is about the average paid by smokers in other states. Every single penny of this tax will be directed toward healthcare and by applying it toward federally matched programs, this money will help us avoid a $300 million dollar shortfall this year in healthcare.
There will be powerful forces at work against this proposal. There is no alternative. If you don't pass this--you will have to cut $300 million from the health budget this year alone. Ladies and gentlemen--that's nursing home care, that's senior citizen care, that's prescription drugs, that's children's health care -- and that's hundreds of health care jobs.
Pass this bill.
West Virginia senior citizens also have a health issue that cannot wait. We must do even more to restrain the runaway costs of prescription drugs. No West Virginian should have to choose between food and medicine, or should be forced to skip pills to make a prescription last until the next Social Security check arrives.
We are taking on the big brand name drug companies and we're fighting for discounts on prescriptions. This year, I will continue negotiating with the brand name prescription drug manufacturers, and to maintain -- and, hopefully expand -- the savings available with the Golden Mountaineer card.
We will continue and expand the program that helps doctors choose less costly generic medicines instead of heavily advertised brand name drugs.
There are several steps we can take this year that won't cost us money -- but will help West Virginia families. I have asked this Legislature twice before to toughen our drunk driving law. We must adopt the point-oh-eight alcohol level as proof of impairment. We have waited too long and too many lives already have been lost. If we don't act this year, we'll also lose more than two and a half million dollars in Federal funds that go into our highway program. That's money that can be used for essential road projects. And we must enact an ATV safety bill in this session. I am the first governor to call for this legislation. Too many young people have been killed or crippled, and the time to act is now. We must also change our adoption laws to allow parents who adopt children in other countries to bring them to West Virginia without facing an extra set of bureaucratic barriers.
Our State Police are our main line of defense against those who break the law, and against threats to our public safety in times of crisis and disaster. We have trooper shortages across the state -- only one county has 24-hour state police protection. This year, we invited 1200 recruits to test for appointment to the State Police. We will start --not one--but two classes -- nearly 80 new officers in the next month. I have directed another class to start later this year. And I have also included $1 million in this budget to address a long-standing fairness issue for our younger troopers by upgrading the Plan B trooper retirement plan.
We must not let the budget crisis derail the progress we have made in public and higher education in West Virginia. Education is still the centerpiece of our economic development plan and still the key to our future.
We insist on teaching our children values. We insist on emphasizing character. And in return, we promise quality education and opportunies for every child and every young person and every adult with the desire to learn.
I have exempted both the PROMISE Scholarship and the West Virginia Higher Education Grant Program from budget cuts. We will keep the Promise we made to the next generation.
In the audience with us tonight are 4 members of the first class of PROMISE Scholars. These four young people represent the brightest hope we have for the future of our state. I will ask each of them to stand as I call their name. Katie Molinari is a graduate of Parkersburg South High School in Wood County and is a freshman at West Virginia University. Justin Gore is a graduate of St. Albans High School in Kanawha County and is a freshman at Marshall University. Lindsey Wimer is a graduate of Pendleton County High School and is a freshman at West Virginia University. Bridget Fuller is a graduate of Yeager High School in McDowell County and is a freshman at Marshall University.
They represent 3,500 PROMISE Scholars who are about to begin the second semester of their college education. Next year there will be more.
Please recognize West Virginia's future.
West Virginia, in the past decade, has moved from the rear to the front among the nation's leaders in education in grades K-12 both in terms of resources and in terms of results. Since 1993, we've had the third largest increase among all the states in per-capita spending for education a 36% increase in 10 years. We've spent this money well better schools, better-paid educators, better programs and we are reaping the rewards.
As we face a tighter budget, we cannot retreat from this progress because it is the one best hope we have of creating a brighter future for West Virginia.
It is such a priority for me that education will not be reduced, even as we must make cuts elsewhere. We are not taking one dollar away from teachers and students in grades K-12. In fact, our K-12 public education budget is higher than ever before.
We're also helping parents with school costs.
Last year, this Legislature endorsed -- for just one year -- my back-to-school sales tax holiday. It gives parents a break on clothing and educational supplies for kids in the fall. It was a rousing success, and even brought shoppers from other states to spend their money in West Virginia stores. I ask you to continue that sales tax holiday this year. Let's talk about growth. Other states have cut back on schools, cut back on roads, cut back on investments in infrastructure. Don't count West Virginia in that pack.
We will put hundreds of million of dollars this year into schools, roads, housing, water and sewers. And we'll do it with the help of our own economic development grants and programs. We'll do it with the federal funds secured by Senator Byrd and Senator Rockefeller and Representatives Nick Joe Rahall, Alan Mollohan and Shelley Moore Capito, and the private sector.
This year, we will invest nearly TWO BILLION DOLLARS into infrastructure for our future. Some may say step back -- we say move forward.
Investment and job creation are the real answers to the problems we are facing today. We have to create jobs, create economic opportunity, to make West Virginia the state people look to when they invest, when they decide where to live and when they decide where to raise their children.
I will fight every day, as I have fought every day throughout my career, to create good-paying jobs for West Virginians. That's my number one job.
This year we will add even more tools to our job creation toolbox. The West Virginia Housing Development Fund which has helped thousands of West Virginia families own their own homes has developed at my request a $28 million economic development program; Additionally, the Economic Development Authority loans money to businesses. The current limit on EDA loans for all projects is $150 million, a limit that's been reached. That's good news -- we're helping lots of new businesses -- but we can't stop. If we want to be in the running for the next generation of manufacturing plants and new-economy enterprises, we need to raise the limit to $175 million. I ask you to do so without delay. We've got projects right now that we can move if we can finance them. And, thanks to an unprecedented partnership between business and labor, that, if you will recall, I created last year and announced in this chamber, we now can offer tax increment financing to new and expanded businesses. The All for One Committee united labor leaders like Jim Bowen, Kenny Perdue, and Steve White with business leaders like Paul Arbogast, Dana Waldo and Mike Basile. I ask them to stand and accept our thanks for what they have done to bring us together.
The business-labor partnership is also alive and active in our pursuit of the "Vision Shared" initiative.
We know this works, and we will ask these partners to work together on another crucial initiative this year -- eliminating the Workers' Compensation problems that affect our competitiveness. I consider this challenge as critical as the others I have discussed.
Business and labor leaders have agreed to help solve this problem once and for all. They recognize that Workers' Compensation issues make West Virginia less likely to attract investment. And I welcome members of the Legislature joining us in solving this problem.
We have already identified and will implement administrative changes that will save West Virginia businesses $135 million each and every year.
We must eliminate the Second Injury Fund that is the cause of most of our two-billion-dollar-plus unfunded liability.
We must create a deficit reduction account -- safe from raids by future legislatures and future Governors -- to guarantee that premiums paid to reduce the debt are used only for that purpose.
Two years ago, I ended this speech by handing two large bound books of legislation and budget documents to the Speaker and the President. This was the first time in my memory that the Governor ever presented all of the legislative agenda on the opening day.
I do this because I know that you need time to work on legislation -- and because I believe in the urgency of working hard and fast -- on the real issues that face us -- from day one of the legislative session.
Last year, we condensed the budget and the bills to two tiny compact discs and gave them to each member on the first day.
We've made it a tradition. This year, we're going a step further:
The executive budget, and my legislative proposals are being transferred as I speak to your email accounts.
They also being delivered electronically to the press, to state agencies and many citizens -- and we're saving a ton of pape
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