By Hoppy Kercheval

www.wvmetronews.com

We're used to bad news in West Virginia. It seems to descend on us like freezing rain on a January day. I think we get so used to it that any good news is ignored or dismissed as political puffery.

For that reason, it's worth taking stock of the state's financial condition which is, well, downright healthy. Who would have thought that while industrial giants like California and Illinois are wallowing in unsustainable amounts of red ink and raising taxes to pay the bills, little ol' West Virginia would be in such an enviable financial position.

Consider the following:

West Virginia weathered the Great Recession without laying off any school teachers or state employees. The state has also kept up its payments to state employee retirement funds which, in turn, made all payments to retirees. Nobody missed a check.

The state finished last fiscal year with a general revenue surplus of over $102 million. Through the first six months of this year, the state is $160 million ahead of projected tax collections. That's a sign that the state's economy is regaining strength.

As a result, state government has a strong cash flow and is paying its bills on time. No state tax refunds will be delayed because the state can't cover the checks.

Moody's has upgraded the state's bond rating to Aa1; that's just one notch below the highest possible rating of AAA. Moody's awarded the upgrade because of what it said was the state's "ongoing trend to fiscal conservatism and favorable General Fund financial performance." The strong bond rating means lower interest costs when state or local governments issue bonds for roads, schools or other infrastructure projects.

West Virginia has one of the strongest Rainy Day funds of any state, with $632 million in the account. Many states exhausted their Rainy Day funds during the recession just to pay the bills.

The Governor's budget office projects general revenues will grow at better than seven percent in fiscal year 2012 over the current year. Still, Acting Governor Tomblin has proposed a budget that essentially holds the line on any new spending that would add to the base budget.

For example, he is proposing a one-time salary enhancement for teachers and state workers, rather than an across the board pay raise. The enhancement will mean a one-time cost of $47 million to state taxpayers, as opposed to an increase in the base which would grow the budget every year.

Meanwhile, Tomblin has no new tax or fee increase plans, but he is pushing to have the food tax lowered from the current three percent down to two percent.

West Virginia's political leadership in recent years has had its share of faults, and the state still struggles to provide a business climate that is conducive to broad based economic growth. But state leaders, most notably former Governor Manchin, deserve credit for keeping state spending in line and paying down debt.

This should be a source of pride for our state, especially at a time when we see so many other states staggering under the weight of debt resulting from bad decisions.