The shortest week of the 60-day regular session of the West Virginia Legislature ended last Friday with the Senate introducing 284 bills, while the House of Delegates introduced 332 bills.
GOVERNOR JUSTICE'S STATE OF THE STATE ADDRESS
The biggest news in this short week, however, was the Governor's State of the State Address. In a week fresh off the official announcement of his 2020 reelection campaign, Governor Jim Justice delivered his third State of the State address to a joint assembly of the State Legislature on January 9, 2019. For the first time since taking office, Governor Justice introduced a spending plan that takes into account a projected budget surplus of more than $200 million. The Governor struck an optimistic tone that touted a plan to shore up the Public Employees Insurance Agency and provide for new strategic investments in areas of economic development, tourism, higher education, opioid treatment, drug addiction, and job training. Governor Justice also formally recommended a 5 percent pay raise for all public employees, including teachers and school service personnel. The Governor embraced a proposal by Senate President Mitch Carmichael to provide PROMISE scholarship-type funding for tuition to students who wish to attend one of the state's community and technical colleges. He also used his speech to call for slight changes to the Roads to Prosperity highway plan that would invest additional money in the state's secondary road system.
Finally, the Governor used the last week's State of the State address to introduce proposals that would repeal the personal income tax cut on social security benefits, as well as a constitutional amendment to eliminate the personal property tax on machinery, equipment and inventory. Governor Justice formally endorsed a plan to create an intermediate court of appeals while also urging lawmakers to enact a fix to the state's medical cannabis law that is slated to take effect on July 1, 2019. In all, the Governor proposed approximately $80 million in new one-time spending including a program he called “Jim’s Dream,” meant to help with treatment for addiction and job training.
In healthcare, as expected, the Senate returned to the regulation of prior authorizations of certain healthcare procedures by insurance companies in SB 5. This bipartisan bill requires insurance companies to accept electronically transmitted prior authorizations and, in addition to other requirements, mandates insurance companies respond to such requests within 24 business hours of receipt.
In contrast, the House Health Committee originated HB 2351, its own bipartisan version of the prior authorization bill, wherein responses to such requests are mandated within seven days for non-urgent requests and two days where a delay could jeopardize the life or health of the patient. HB 2351 advanced out of Health Committee and could complete action in the House by or before Wednesday, January 16, as one of the first bills to complete action in one chamber this session.
SB 2 and SB 266
The creation of an Intermediate Court of Appeals has been an enduring interest of the business community, and this year there are two remarkably similar bills. SB 2, introduced by Senator Trump (R-Morgan), and SB 266, introduced by the Governor, highlight this keen interest. As foreseen in both bills, the Intermediate Court of Appeals will have a northern and southern district, with a panel of three judges for each district. The judges will be appointed with the advice and consent of the Senate and will serve initial, staggered terms. Thereafter, the judges will serve full 10-year terms. The ICA will not have any original jurisdiction, but after June 30, 2020 will hear all appeals from administrative agency decisions, Family Court orders, workers' compensation orders from the Office of Judges, and appeals of civil cases from Circuit Court. The ICA will not have appellate jurisdiction from orders entered in criminal, juvenile, child abuse or Public Service Commission cases.
Eliminating taxation on annuity considerations collected by a life insurer was introduced by Senator Blair (R-Berkeley) on the first day of session. West Virginia is one of seven states that still tax annuities. With the recent shift away from defined benefit pensions, annuities play an increasingly significant role in retirement security for people of all income levels. In fact, two-thirds of individual annuity owners have household incomes below $75,000; nearly half have household incomes below $50,000; and one-third have annual household incomes below $40,000. Similar legislation passed the Senate 34-0 in 2017 and 31-0 in 2018.
The government relations team at Spilman will be tracking and reporting further on these and other bills and major developments during the legislative session that may impact your business interests in West Virginia.