West Virginia Chamber - 2022 Position Papers

Issue

A comprehensive plan to attract young workers must be put in place in order for West Virginia to take maximum advantage of the state’s economic potential.

Background

West Virginia’s civilian labor force participation rate is 53.2%. This means that out of all working-age West Virginians who are eligible for employment, just slightly over half are in the workforce. While this rate is up from a thirty-year low in 2015, it remains the lowest in the nation. It should be noted that the civilian labor force counts both people who are employed and people who are unemployed and actively seeking employment.

West Virginia’s low labor force participation rate is now leading to another issue – a lack of qualified people in the workforce who can fill available jobs. In 2009, at the height of the Recession, West Virginia had 4.2 unemployed people for every job opening. In 2019, there was one unemployed person for every job opening. In the past four years before the COVID-19 pandemic, West Virginia added over 30,000 jobs, helping to put more people back to work and get more people to re-enter the labor force. While coronavirus caused a significant uptick in unemployment, it has created new opportunities for attracting young talent that is eager to escape large urban areas.

The Chamber's Position

West Virginia has taken some positive steps towards attracting and retaining young workers. The Legislature passed Senate Bill 1 in 2019, which provides last-dollar-in funding for students to attend career and technical college in the state. This program is still in its infancy, but all signs are pointing towards it being a success and helping to provide students with the necessary skills for good-paying jobs. This program should be monitored and consideration should be given to expansion if it continues to be successful.

West Virginia should consider providing tax relief to workers who are saddled with student loans. According to Business Insider, the average West Virginia student-loan borrower owes over $30,000. Given that these loans frequently carry interest rates of 6%-7% or higher, they can take several years or decades to pay off, and typically burden younger workers who are recent college-graduates. Providing tax relief to responsible student-loan debt holders would be a major incentive to remain and work in West Virginia.

Remote work has become more normalized due to the COVID-19 pandemic, and many employers across the country have found that their workforce is just as productive when working from home as they are in the office. Major employers tell us that they don’t care where their employees live as long as they are able to remote connect to their jobs. West Virginia should place a heavy focus on attracting young families by highlighting its great quality of life and outdoor activities. Reliable, high-speed broadband connectivity is also key to attracting these individuals.

Lastly, K-12 public education improvement must remain a top priority for policymakers, students, parents and teachers. Ensuring that our children are equipped to succeed in the global marketplace regardless of their economic situation or background is essential to a developing economy. The West Virginia Chamber supports a wide array of measures that will help West Virginia students compete with their national and international peers.

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Issue

In our ever-expanding digital world, broadband access has become a vital necessity for households and businesses alike. Broadband access has rapidly evolved into a critical infrastructure component. In recognition of this shift, many States have implemented broadband initiatives to remain competitive in attracting and retaining jobs. These broadband policy efforts have come to the forefront of State government efforts focused on economic development and job creation. It is abundantly clear that affordable, high speed broadband access is a dominant consideration for the business community, their employees, their customers, and their supply chains.

Background

Since the advent of the Broadband Internet era in 2000, telecommunications providers have collectively invested over $4 billion in building a fiber optic middle mile and last mile infrastructure for commercial and residential broadband services in West Virginia. This investment has resulted in a dramatic expansion of broadband availability in the state, however, there are many rural communities that still do not have access to broadband service at speeds that meet or exceed the new Federal Communications Commission (FCC) definition. The majority of these communities are sparsely populated and geographically removed from more populated areas of the State. Due to these factors, private sector investment in these markets is difficult because opportunities to receive a return on their investment are very limited, if they exist at all.

To help solve the dilemma of extending broadband service to sparsely populated areas of our country, the FCC recently completed an auction for its Rural Digital Opportunity Fund (RDOF). Nine companies successfully bid on a total of over $362 million to help subsidize the cost of expanding service in West Virginia. The largest winner in the auction, Frontier Communications, successfully bid on 68% of these funds, or $247,626,395. The RDOF funds will be distributed to these companies over the next ten years to subsidize the cost of expanding service into West Virginia’s most remote areas.

The Chamber's Position

Broadband services are clearly essential to economic development, healthcare, education, business and daily life in the 21st Century. While broadband providers have and are continuing to make substantial investments in improving and expanding the availability of services in the state, broadband investments in the most rural portions of our state will remain an economic challenge because of the high cost of deployment and low customer density. The Chamber supports any state policy that will incentivize the private sector to invest in unserved and underserved markets throughout the State. For example, the State should consider the use of tax credits for the provision of new broadband service in underserved and unserved markets, as well as the creation of a loan guarantee program, which will assist smaller companies by providing access to capital so that they can invest in these same geographic areas.

Broadband services are clearly essential to economic development, healthcare, education, business and daily life in the 21st Century. The COVID-19 pandemic has highlighted that broadband service is essential to the everyday life of citizens, especially as more and more employees must work remotely. The Chamber supports any state policy that will incentivize the private sector to invest in unserved and underserved markets throughout the State. For this reason, the West Virginia Chamber of Commerce strongly supports the efforts of the Federal Communications Commission through its Rural Digital Opportunity Fund. The West Virginia Chamber also strongly advocates for strict and thorough oversight of these funds to ensure that they are being properly used to connect West Virginians to high-speed internet. If winners of the RDOF bid are not using the funds as promised, the FCC should re-auction those dollars and allow other companies the opportunity to expand broadband service.

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Issue

Should the West Virginia Legislature implement an employer tax credit to incentivize businesses to create childcare facilities for their employees?

Background

Quality, affordable and available childcare is one of the most challenging issues facing families and employers. According to care.com’s childcare index, West Virginia ranks 50th in childcare and has the highest costs of childcare compared to median household income in the country. This, compounded with a childcare availability problem, puts tremendous strain on the state’s workforce.

West Virginia’s workforce participation rate is the lowest in the nation at 54.9%. The workforce participation rate for females, however, is even lower at 50.2%. Employer members of the West Virginia Chamber of Commerce are saying that they have jobs available but are unable to find employees to fill them. Understandably, this leads to lower economic output and economic activity in the state.

Over half of the states in the nation have taken proactive steps to help improve access and costs of childcare via tax credits. How these credits are implemented vary from state to state, but one such example is the State of Georgia. Businesses operating in Georgia can claim a 100% tax credit against their corporate net income tax over 10 years for starting and operating a childcare facility. The policy has certain requirements for eligibility and contains a “clawback” provision if the employer disestablishes the facility within a certain time frame. The goal, however, is to incentivize businesses to provide childcare for their employees and help with availability.

Incentivizing businesses to create childcare facilities can be a useful tool for helping make childcare more available across West Virginia and for helping people who desire to re-enter the workforce but may otherwise be inhibited by costs.

The Chamber's Position

The West Virginia Chamber is supportive of efforts to expand childcare opportunities in West Virginia, including those that utilize tax credits as an incentive. Careful thought must be given, however, to making a program available and effective for small businesses. Only 4.2% of businesses in West Virginia employ more than 50 people, and sizeable portion of those employ far less than that. For that reason, policymakers should be open to allowing businesses that are similarly located to partner and form childcare facilities. This would still assist with the goal of making childcare more affordable and available for our citizens, but would provide a way for our smallest businesses to participate. Policymakers should also give consideration to allowing a tax credit to pay for employees’ childcare at an existing facility in rural areas where starting their own facility would not be feasible.

The West Virginia Chamber of Commerce is focused on improving the workforce in West Virginia. Taking steps to make childcare more affordable and available is a key component on boosting workforce participation.

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Issue

West Virginia has made significant progress in the past few years in adopting meaningful civil justice reform legislation. Many of the laws that made West Virginia stand out in a negative light have been resolved by the recent decisive actions of the West Virginia Legislature.

Thanks to the reforms that have been undertaken, legal experts both inside West Virginia and throughout the nation recognize that steps are being taken to ensure West Virginia will become a place with fair and consistent laws.

2021 was a year in which significant additional reforms took place. The West Virginia Legislature passed the most comprehensive COVID-19 liability shield in the nation with bi-partisan support, and West Virginia finally passed legislation to create an Intermediate Court of Appeals – guaranteeing that important cases for individuals and businesses will receive a full and thorough appeal.

While much of the “heavy lifting” has been accomplished, some additional reforms must be passed to continue the goal of bringing West Virginia into step with the rest of the nation. Legislation that is still needed includes: medical monitoring, collateral source rule, phantom damages, fair mediation system, and addressing civil rules regarding discovery.

These reforms are needed in order to continue towards the goal of “Making West Virginia Irresistible to Business.”

The Chamber's Position

Provided are the components necessary to enact additional legal reforms that will eliminate risks and impediments on West Virginia employers and revitalize the state so it truly can grow its economy.

• Collateral source - Allow courts to consider amounts that plaintiffs have received as compensation from other, non-family sources to cover costs in determining damages, including but not limited to sources such as disability insurance, unemployment compensation, including enhanced unemployment payments, etc. When juries are trying to determine how much economic loss a plaintiff has suffered for compensation purposes, they should consider all sources which offset that economic loss in determining a just verdict and avoid unfair double-dipping by jury award winners.
• Phantom Damages - Allow plaintiffs to recover only the amounts actually incurred for medical services, rather than the full sticker price that is listed before discounts or negotiations reduced the actual out-of-pocket damages. Compensatory damages are designed to make an injured party “whole,” not provide a financial windfall, especially since punitive damages remain available in appropriate situations.
• Online Case Management System - Continue the implementation of a statewide and uniform online system for case management of all circuit and family courts in West Virginia.
• Fair Mediation - Mediations are very successful in resolving civil cases without the expense of a trial. Some circuit court judges who will preside over a trial, however, opt to mediate the case themselves rather than assign it to a different judge or mediator. As many jurisdictions have recognized, this can have a chilling effect on the ability of parties to speak candidly about issues. Legislation or rules should be passed/adopted to require a mediator to be different than the judge who will potentially preside over a trial. It is also worth noting that the American Arbitration Association forbids a mediator from also arbitrating the same case that he or she mediated.
• Medical monitoring - In 1999, the West Virginia Supreme Court established a new cause of action, which allows an individual who has been exposed to a proven hazardous substance to recover damages for future medical monitoring when the individual has no physical injuries. This new cause of action exposes many of West Virginia’s businesses to potential liability even though there is no actual injury associated with the exposure. The Legislature should enact legislation to correct the Court’s decision.

This list of recommended provisions is offered as a series of additional legal reforms which would further bring West Virginia into the mainstream of other states in terms of rules and laws governing court proceedings.

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Issue

The business case for employee diversity is real. Diversity in the workplace is beneficial. People with different backgrounds bring different perspectives and create a more robust, stimulating, and vibrant environment from which everyone can learn and grow. In turn, the expanded base of knowledge leads to more creativity and innovation in the workplace. A diversity of opinions naturally leads to higher quality decisions and improved performance.

Discussion

West Virginia Chamber of Commerce members employ more than one-half of the state’s workforce, giving the Chamber a large and influential voice to articulate workforce needs and preparedness. We are a solutions oriented, member supported organization that gives voice to the needs and concerns of our state’s employers. Our members understand the struggles of finding qualified applicants for well-paying jobs.

There are numerous types of diversity within our culture, including gender, race, age, religion, national origin, sexual orientation and gender identity. Numerous studies confirm the economic reality that diversity and non-discrimination policies are good for business. Companies embracing diversity know that inclusive working environments are good for business. Studies show that employers with non-discrimination policies enjoy greater productivity and lower turnover in their workforces.

Demographic research shows that West Virginia ranks exceptionally low in terms of the racial diversity of our population. According to the 2014 U.S. Census, West Virginia’s total population is 92.5% white, 3.6% black, 1.5% Latino / Hispanic, and 0.8% Asian. West Virginia’s population is, to a large extent, racially homogenous.

In addition to issues of racial diversity, employers also recognize the importance of other types of diversity among their employees, such as sexual orientation and gender identity. More than 90 percent of Fortune 500 companies now include sexual orientation in their workplace nondiscrimination policies, and 61 percent of such companies prohibit discrimination based on gender identity.

The Chamber's Position

We need full participation and inclusion of all groups in order to move West Virginia forward. Our ability to attract new jobs and the job creators, particularly Fortune 500 companies who require diversity within their workforce, is greatly impaired without a strong commitment to diversity.

West Virginia businesses should take full advantage of the opportunities that a diverse workforce represents, and our policy makers should embrace policies that support a diverse and robust workforce in West Virginia. As the U.S. population becomes increasingly more diverse, so too will our state’s workforce in West Virginia. West Virginia’s job creators should embrace diversity and capitalize on the resulting benefits.

West Virginia must be able to attract and retain investment and talent from all backgrounds. The Chamber has long supported diversity in our state and in our workplaces. Many of our Chamber members already have existing personnel policies in effect which promote diversity and inclusion in the workplace. The Chamber also respects the strongly-held faith based views of different religious groups in West Virginia. The Chamber will not support legislation which promotes or allows discrimination, nor which sends the wrong message regarding economic development and job growth in West Virginia. The Chamber will oppose legislation (including RFRA) that authorizes a form of discrimination or that creates new causes of action against employers. Such legal actions would place our state’s employers at a competitive disadvantage with other states.

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Issue

West Virginia’s public education system must continuously strive to ensure students can achieve the results necessary to compete in the global marketplace.

Background

The West Virginia Chamber of Commerce believes that the children of West Virginia deserve a public school system that is the envy of the nation. Our schools must produce educated, versatile, creative problem solvers and responsible, well informed citizens. Our children must be equipped to succeed in the global marketplace regardless of their economic station or background.

West Virginia Chamber of Commerce members employ more than one-half of the state’s workforce, giving the Chamber a large and influential voice to articulate workforce needs and preparedness. Our members understand the struggles of finding qualified applicants for well-paying jobs. Chamber members know that educated and skilled citizens make good workers and help to build robust communities.

When we fail to educate all children, the outcome is predictable: elementary school students with poor skills become middle school students with poor skills, and eventually become high school students without the ability to succeed in post-secondary education or to compete in today's economy. Through the 3rd Grade, children learn to read. After the 3rd grade, children read to learn. If they do not meet this critical benchmark, children continue falling further and further behind and will not be prepared for life after school.

The National Assessment of Educational Progress (NAEP) is the largest continuing and nationally representative educational assessment of American students in all 50 states. This assessment is administered every two years and measures student achievement in the critical subjects of math and reading in both the 4th and 8th grades. In the 2019 NAEP assessment, the percentage of West Virginia students who are considered “at-or-above proficient” rank the state 44th in fourth-grade reading, 45th in eighth-grade reading, 48th in fourth-grade math, and 47th in eighth-grade math. In measuring the important metric of being able to read in order to learn when a child is in the 4th grade, only 30.3%, less than one-third, of 4th graders in West Virginia are considered proficient in reading.

The 2019 WV Balanced Scorecard that was released by the West Virginia Department of Education, which tracks all public schools’ English Language Arts and Mathematics performance, shows that much work remains. According to the state’s own assessments, out of 116 public high schools, 10 meet the standard for English Language Arts and none meet the standard for Math.

Yet from a spending perspective, public education accounts for nearly 45 percent of the state’s General Revenue Budget (FY 2021). According to the National Education Association (NEA), West Virginia has the 23rd highest total spending per pupil in the nation (2021 Report). West Virginia spends $12,958 per pupil. The national average for per pupil spending is $13,597. Despite the state’s significant investment in education that keeps up with national norms, student achievement in West Virginia continues to lag behind the rest of the country.

The Chamber's Position

The Chamber supports efforts to improve the academic achievement of every student in West Virginia. These recommendations provide a framework for a system that allows for more authority and accountability at the local level. The West Virginia Legislature and the West Virginia Department of Education must work together to remove existing impediments that constitute the over-regulation of our education system while guaranteeing benchmarks that raise the bar for West Virginia students to compete successfully with their international peers.

• The Chamber supports an accountability system for schools that is easy to understand and allows for a measurement of year-to-year progress. Accountability systems that are based on academic growth will increase transparency, parental engagement and public pressure to improve. Accountability systems are contributing to improved school performance in other states.
• West Virginia must begin to implement a culture of constant improvement in our public school system. Such a move will help our state become and remain competitive in attracting investment and jobs to West Virginia. This mindset is also needed to combat what is frequently perceived by employers seeking to hire recent graduates as a culture of “mediocrity is OK” in our public school system. Nearby states such as Virginia have adopted rigorous performance standards for schools, principals and teachers. We should examine what practices work best in those states and implement them here.
• Transparency in our public education system is critical. A 2012 audit found that West Virginia is one of the most highly-centralized and the most insulated from voter control or input in the country. Requiring an easy-to-use, detailed online portal that allows the tracking of education funds down to the classroom level will enable parents, teachers and policy-makers the ability to explore how their tax dollars are being spent and offer creative solutions on maximizing the efficiency of the state’s investment in education. Additionally, the West Virginia Legislature and Governor should require a new independent audit of the state’s public education system to ascertain what improvements have been made since the 2012 audit.
• Highly qualified principals and teachers are of great importance to helping students improve academic achievement. Professional development and leadership training should be continuously modernized to ensure that those in the classroom have the necessary resources and support to help our children. Teachers must also be respected as professionals, and given the flexibility to customize teaching methods to better fit the needs of each student.
• The Chamber believes that innovation works in both business and in education. Public charter schools allow for truly innovative schools where non-traditional operators, such as a group of educators, parents or directors could lead a school or a cluster of feeder schools to recreate itself from the ground up with new ways to best educate its kids. The freedom to operate a low-performing school differently and to move away from the “one size fits all” paradigm will create the best opportunity for students to reach their potential. West Virginia recently joined forty-four states and the District of Columbia in allowing public charter schools. Every effort should be made to assist in the creation of public charter schools in our state to allow innovative teaching methods where best practices can be learned and applied to traditional schools.
• Additional control should be given to local boards of education to better meet the local realities they face. This control should extend to more flexibility in setting the school calendar, and locality pay to ensure that highly qualified teachers can be attracted and retained.
• Personnel policies within the public education system must be modernized, and principals should be given more responsibility and accountability to ensure they have an effective team in place to lead their schools.
• While public school teachers have received raises equating to 10% during 2018 and 2019, salaries for public educators in West Virginia continue to be lower than most states, ranking 47th in the country (NEA Report). Continuous attention must be given to improving this standing, though future raises should incorporate a system to ensure that highly qualified and excellent teachers are receiving additional compensation.
• Pre-K programs in West Virginia should be expanded. Many children in our state are living in difficult circumstances and do not receive the educational foundation that is necessary to their success in school. Pre-K programs play a vital role in preparing these students, helping them start K-12 school on a level playing field.
• Schools and local businesses should be encouraged to closely partner with each other. The employer community in West Virginia supports public education and can provide additional resources and support that are not traditionally available to schools. This is not limited to financial support and can extend to internship and mentorship programs to benefit students.
• A continued focus must remain on meeting students’ emotional needs, especially those dealing with family challenges such as drug abuse, homelessness or unemployment. West Virginia should also continue expansion of the U.S. Department of Agriculture’s Community Eligibility Provision to ensure every student receives breakfast and lunch – regardless of their family’s ability to pay.

These policy and legislative recommendations represent part of the Chamber’s long-term commitment to the multifaceted effort to transform our education system in West Virginia. We believe that all West Virginia students should be held to high expectations, with the belief that they can and will achieve success. The West Virginia school system should promote a culture of rigor that makes ‘getting an education’ a serious pursuit which leads to success in life.

The West Virginia Chamber of Commerce is comprised of our state’s leading businesses. We are a solutions-oriented, member supported organization that gives voice to the needs and concerns of our state’s employers. The Chamber is committed to working with state and local officials, teachers, principals and caring citizens to assure the best for our 21st Century students.

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Issue

West Virginia is an energy state. Our coal, oil, gas and renewable resources are some of the most valuable natural resource assets in the world, and these resources – and the industries they power – play a major role in economic development for our state and nation.

Power generation – regardless of type – is also one of the highest local tax payers and economic development engines for the communities in which they are located. The West Virginia Chamber also points out that market conditions and requirements from prospective businesses require fostering the growth of renewable energy sources such as wind and solar. To best utilize all of these energy sources and maximize economic development opportunities, West Virginia needs to ensure that we are putting the correct policies in place to encourage “downstream investment” that utilizes as many of these resources in-state as possible.

Background

In 2020, the most recent year for which data is available, West Virginia was the second largest producer of coal in The United States. West Virginia was also the fifth largest producer of natural gas that year in terms of marketed production. Those two factors alone place West Virginia in a unique situation to attract significant economic development.

Over the past few years West Virginia has been examined by major investors seeking to build natural gas power plants and other downstream projects. These projects would provide decades of economic benefit to the state and nearby communities. Unfortunately, some competitive interests have sought to tie these projects up in the courts. While their legal challenges were found to be without merit, these competitors successfully delayed the projects long enough that they were pulled by investors. By comparison, over 30 gigawatts of natural gas-fired electricity is going online in neighboring Pennsylvania and Ohio.

West Virginia is the site of significant investment and development of renewable energy sources such as wind and solar. Those who work in economic development will quickly point out that many major employers and investors have a requirement that some of the energy they use comes from renewable sources. This drove the successful passage of SB 583 during the 2020 Legislative Session, which allows commercial production of solar energy in the state. Recent estimates, however, show that West Virginia is only realizing about 1% of its wind energy potential. West Virginians are well aware that energy production is evolving, and policymakers should recognize the shifting attitudes of the citizens and help foster more renewable energy development.

West Virginia also has an abundance of water and rivers to help facilitate manufacturing and energy development. While water can also play a significant role in energy production, it is very attractive to many new and evolving industries. West Virginia should take advantage of this resource to help attract industries that require heavy water usage – such as server farms.

Energy developers highlight the importance of the environment and social impacts of their operations, as well as corporate governance issues. Such emphasis on Environment, Social, and Governance (ESG) helps ensure West Virginia communities, and the state as a whole, experience significant and lasting benefits.

The Chamber's Position

West Virginia economic development groups and officials – from the local level to the federal level – must send clear and unambiguous signals to potential investors that West Virginia is welcoming of all types of energy investment. The state must also help these investors efficiently work through the regulatory process so that they can quickly break ground and begin construction. Competition should not be between technologies or fuel types, but rather between West Virginia and other states. If West Virginia does not capitalize on these opportunities, we will continue to watch these projects be built across the state line.

West Virginia should avoid severance tax increases advocated by some groups to fund certain projects. While severance taxes are an important part of West Virginia’s collected revenues, increasing them in a careless fashion can make production less economically viable in our state. The West Virginia Chamber also opposes any efforts to increase taxation on wind energy by taxing wind turbines at real property values rather than salvage value. Changing the rules in the middle of the game would make operating wind energy facilities uneconomical, sending a troubling signal about the lack of a stable business environment in the state.

As technology and innovation foster advances in natural gas development, state laws must be modernized to allow for large tracts of minerals to be produced in a planned and efficient manner. This means that mineral owners must be treated fairly, but not enabled to hold up development for the rest of the owners in the unit. Unitization laws would make West Virginia competitive with surrounding states, foster greater energy extraction with smaller surface impact, enable more West Virginians to receive royalty payments, and encourage investment and job growth in the natural gas sector. Thirty-nine different states have pooling laws in effect. The laws are different and not all apply to all formations. Neighboring Ohio, Pennsylvania, Virginia, and Kentucky are all among those states which allow pooling

West Virginia has a decades-old ban on nuclear energy production within our borders. The technology for nuclear production is quickly advancing, and many experts believe that small micro reactors will become a realistic option in the near future. West Virginia should remove this ban so as to keep our state competitive for this technology when it becomes viable.

Affordable, abundant, and reliable energy resources are critical to the state’s future economy. These resources can be the catalyst that unlocks the full potential of that economy.

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Issue

West Virginia is ground zero for the opioid addiction crisis. Among the many health challenges facing America, none has hit our state harder than opioid addiction. The impact of the opioid crisis on West Virginians is staggering, with an estimated 952 overdose deaths reported in 2018. According to the U.S. Centers for Disease Control and Prevention, West Virginia has the highest overdose rate in the nation, and the overdose rate in 2018 was approximately 52.7 per 100,000 people. In addition to the human cost, of significance is the toll it has taken on the state’s economic growth and development.

Background

In West Virginia, the opioid crisis has contributed to a workforce participation challenge that undermines the competitiveness of existing businesses while creating barriers for new investments. For existing businesses, unfilled vacancies represent lost productivity that makes competing in the regional, national and global economies more difficult. Meanwhile, companies are hesitant to invest in areas where they may not be able to attract and retain the skilled and drug-free workforce they need to operate efficiently.

West Virginia has welcomed many new business investments this year, creating over 17,000 new jobs for the state. But many employers are growing concerned about the lack of qualified workers to fill new jobs. Many Chamber members say drug abuse is a key contributor to that problem. Many people actively looking for work cannot pass the drug tests required for employment, and those who do have jobs are exiting the workforce due to untreated, or undertreated, addictions.

When work is not an option, individuals turn to government programs, such as Medicaid, for support. This transition from gainful work to reliance on public assistance creates a cyclical problem with disastrous, long-term consequences for taxpayers and the economy. According to the White House Council of Economic Advisers, the total economic cost to the nation of the opioid epidemic is over $500 billion per year. Giving patient’s access to effective addiction treatments with a goal of truly ending their addiction is our best chance at getting people back to work and improving our economy.

Addiction continues to threaten opportunities for economic growth – a cyclical problem that will only become more difficult to break in the years to come.

The Chamber's Position

At a time when job openings and investments in West Virginia are growing, we must provide the healthy, productive workforce needed to grow the economy. To do that, treatment, with the goal of full recovery, must be a top priority for our state.

Because every person is different, health care providers and the public must be aware of all evidence-based, FDA approved treatment options. This includes counseling and medication assisted treatments proven to be effective at managing and, hopefully, ending addiction.

Providers must be prepared to develop treatment plans that consider each patient’s individual needs, which may require new education and training. At the same time, patients must have barrier-free access to the treatment they need to recover and return to healthy, productive lives.

Business leaders, health care providers and public officials must work together to address the opioid crisis by ensuring unfettered access to and education around all FDA approved opioid addiction treatments. Only by getting more individuals on the path to recovery will West Virginia truly thrive and reach its full potential.

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Issue

What steps can be taken to help strengthen and improve our economic recovery for small businesses in West Virginia?

Discussion

Small businesses make up the backbone of West Virginia’s economy. According to the latest information available (March 2021) through Workforce West Virginia, all but 115 employers in West Virginia meet the federal definition of a small business. 71% of West Virginia employees work for a business that employs less than 500 people, and nearly half of employees work for a company of less than 100 people.

The West Virginia Chamber of Commerce has members located in all fifty-five counties who employ over half of our state’s workforce. The vast majority of these members are our small business neighbors. The economic effects of the COVID-19 pandemic have been felt by individuals and employers of all size, but the impact has been especially pronounced for small businesses. Helping these businesses to continue recovering from this global health crisis will be crucial to the economic recovery of West Virginia as a whole.

The Chamber's Position

Policymakers at the state and local level should be mindful of policies they implement and how they affect small businesses. Additionally, steps can be taken to help assist these important members of our community. These include:

• Seeking to lower costs associated with unemployment insurance.
• Finding ways for small businesses to obtain and offer affordable health insurance.
• Streamlining regulatory processes to more easily permit small businesses to participate in state contracts and purchasing.
• Ensuring tax rates are competitive and allow small businesses to grow and thrive.
• Simplifying tax and regulatory filings.

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Issue

What can be done to enhance the role of West Virginia’s institutions of post-secondary education in improving the economy of West Virginia?

Discussion

West Virginia’s institutions of post-secondary education play an important role in preparing our students for the workforce of the 21st Century. They also are economic cornerstones for many communities throughout the state. Four-year institutions with undergraduate and graduate programs have the ability to attract some of the best and brightest minds from around the country and the world. When these schools thrive the local economy in the area sees a major boost, helping to create good-paying jobs for our citizens.

West Virginia’s system of community & technical colleges and junior colleges also plays a critical role in workforce development. Many individuals pursue careers that require post-secondary education, but not a four-year degree. Individuals attending these institutions are prepared for good-paying jobs without being saddled with large student loans that may take years to repay.

The Chamber's Position

The economic constriction resulting from the COVID-19 pandemic has caused nearly every sector of the economy to tighten budgets. Governments and education institutions have not been immune to these challenges. Public funding is an important component of the success for many of West Virginia’s post-secondary institutions, and great care should be taken to avoid making harmful cuts in the state budget that could negatively affect the great service provided.

West Virginia should also look at ways to make post-secondary education more affordable for our citizens. Allowing for a student loan tax credit would enable more students to consider the loans necessary for attending these institutions, providing a boost to both public and private institutions, and helping to keep their graduates within our state. 2019’s Senate Bill 1 has opened the door for many of our citizens to attend community and technical college, and that program should be preserved and expanded.

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Taxation of Tangible Personal Property

The Chamber has recommended in the past and continues to recommend that the West Virginia Constitution be amended to allow the Legislature to, by general law, exempt some or all tangible personal property from ad valorem property taxation and, should such legislation be enacted, for the Legislature to provide one or more means by which additional revenues or revenue sources are made available to the local levying bodies to cover the cost of the personal property tax exemption. In 2021 the West Virginia Legislature approved a constitutional amendment that will be on the 2022 General Election ballot for the citizens to finally give the Legislature this much-needed authority.

An obstacle to capital investment and reinvestment is the property tax on machinery and equipment and other tangible personal property. Business decision makers will ask why the capital investment should be made in West Virginia when the investment can be made across the border in Ohio or Pennsylvania, or in one of a host of other states, that do not tax tangible personal property for property tax purposes or only nominally tax such property. A recent study by KPMG concludes that our state’s manufacturers and labor-intensive industries are among the eighth and fourth highest inventory and tangible personal property taxpayers in the United States.

The Chamber's Position

The West Virginia Chamber of Commerce is advocating for the voters of West Virginia to approve Amendment 1 on the 2022 General Election Ballot. Approval of this amendment will not change any taxes in West Virginia, but it will give the Legislature the much-needed authority to begin working with all stakeholders to find a solution to this onerous tax.

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Issue

What steps can West Virginia take to improve its tax competitiveness to attract working families and more economic development?

Background

West Virginia’s General Revenue Budget is funded by a wide array of sources that allow state government to carry out essential functions. In FY 2019, which is a good benchmark year as it was completed before the COVID-19 pandemic, West Virginia collected $4.756 billion in General Revenues. The five largest sources by percentage of those funds were:

• Personal Income Tax (44.1%)
• Consumer Sales Tax (28.8%)
• Severance Tax (9.8%)
• Corporate Net Income Tax (4.2%)
• Tobacco Products Tax (3.6%)

West Virginia’s economic growth over the past few years has led to steadily increasing General Revenue collections. From FY 2016 through FY 2019, tax collections increased by $653 million. Approximately $70 million of that increase was derived from a tobacco tax increase that was passed by the Legislature right before the beginning of FY 2017. After a year of declining revenues caused by the COVID-19 pandemic, West Virginia collected just shy of $5 billion in revenue for FY 2021. This represented a $231 million increase over pre-pandemic revenue collections. The natural growth in the state’s General Revenue Budget demonstrates that spending freezes and a commitment to right-sizing state government could help fund significant tax reductions in our state.

The West Virginia Chamber has identified several options for legislators to make West Virginia’s Personal Income Tax rates more competitive with other states. Below are a few potential options:

Child Care Tax Credit

West Virginia is one of 18 states that does not allow any type of child-care tax credit for either parents or employers. There are two options that legislators could explore.

The first would be allowing a tax credit on the personal income taxes for parents (or other primary caregivers). This would provide much-needed financial help to many West Virginia families who are raising children in the state. It would also serve the purpose of making West Virginia a more attractive place to live, work and raise a family.

The second option would be to consider a child-care tax credit for employers who operate a day care center or pay for the child care costs of their employees. This would provide a financial incentive to employers to help cover the costs – which can be significant – of child care. Such a program would also have the benefit of helping to increase workforce participation, by making it financially viable for stay-at-home parents who may desire to re-enter the workforce.

Mortgage Interest Deduction

Thirty states and the District of Columbia allow taxpayers to take an itemized deduction for mortgage interest. West Virginia is one of eleven states that has a Personal Income Tax but does not offer this or any other itemized deductions.

Allowing homeowners to take a mortgage interest deduction would be another way to provide beneficial tax relief to hard-working West Virginians. This would also be another tool to encourage people to become homeowners

Student Loan Assistance

The average student-loan borrower in West Virginia owes over $30,000. These loans frequently carry interest rates in the range of 6% - 7% or higher. Student loans serve an important purpose of allowing individuals to further their education, but loans of these size with high interest rates can take many years to repay, and the debt most affects younger individuals who are starting families.

Interest paid on student loans is deductible on federal taxes, but very few states have taken steps to provide this form of assistance on state income taxes. West Virginia has an opportunity to take a lead in attracting young workers and families by offering student loan assistance on Personal Income Taxes. Assistance could be structured in multiple ways (credit or deduction; based on interest paid or total payments in a calendar year, etc.).

West Virginia could capitalize on this opportunity and become on of the first states to offer student loan assistance on income taxes. Such a step would also have the added benefit of encouraging personal responsibility through proper repayment of loans.

No Personal Income Tax for new College Graduates

In lieu of providing tax assistance with student loan payments, the State of West Virginia could implement a program whereby new college graduates do not have to pay the Personal Income Tax for a set number of years. An effort such as this could provide more revenue in the pockets of young workers and families when they are first beginning their careers and are not yet on solid financial ground.

Consideration of a program such as this should explore who would be eligible (4-year, junior college, community college, etc.) and for how long the program should be available for a new graduate.

Multi-Year Phaseout of Personal Income Tax

During the 2021 Session of the West Virginia Legislature, the House of Delegates passed HB 3300, which would have implemented a multi-year phaseout of the Personal Income Tax in West Virginia. This phaseout would have been accomplished through gradual reductions in state expenditures and natural revenue growth through a growing economy. This plan was also structured that it did not offset tax reductions with tax increases in other areas. The West Virginia Chamber of Commerce was supportive of this approach.

The Chamber's Position

West Virginia must be competitive in tax policy. Ensuring that taxes are low, fair and broad helps attract economic development to our borders and incentivizes job growth.

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Issue

The United States Congress is considering H.R. 1423, the “Forced Arbitration Injustice Repeal (FAIR) Act,” which would effectively ban the use and availability of pre-dispute arbitration agreements.

Background

Arbitration is a common dispute resolution method between businesses, employees and consumers that has been in use for nearly a century. Arbitration is a less-costly method of dispute resolution for all parties involved and is fair and effective. Arbitration is also a much speedier process than litigation where the parties must often wait months or years before a judge can schedule a trial. Finally, both parties get to choose a neutral arbitrator from a panel of available arbitrators and they can often select an arbitrator with expertise in the area of law at issue; unlike courts where judges are assigned with little input from the parties and sometimes with no expertise on the law at issue.

The United States Supreme Court has made it clear that where parties have agreed to arbitration to settle disputes, those agreements are binding and will be enforced. In addition, the courts have set forth various protections and obligations that must be followed to protect employees when it involves the arbitration of employment law disputes. Arbitration agreements tend to keep the courts from being flooded with disputes that can otherwise be settled in a fair and less-expensive manner, leaving the courts available to address more serious cases and criminal cases where the US Constitution guarantees the right to a speedy trial.

The FAIR Act that is under consideration by the U.S. Congress would effectively eliminate this form of dispute resolution.

The Chamber's Position

The West Virginia Chamber of Commerce opposes the FAIR Act and believes that arbitration should remain as an option for dispute resolution. Arbitration only occurs when all parties previously agree to use that as a method of dispute resolution – if a dispute were to arise in the future. Eliminating this as an option will simply mean that any disputes must be handled in the court system, which will typically take longer and be much more expensive for all parties involved.

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Issue

Should the West Virginia Chamber of Commerce oppose President Biden’s “Build Back Better” initiative?

Background

“Build Back Better” is the name given to the President’s massive social infrastructure spending package of 2021. The bill pending before the U.S. Senate is H.R. 5376, which passed the U.S. House of Representatives on November 19, 2021. The package, which is separate from the bi-partisan infrastructure bill that was supported by both the West Virginia Chamber and the U.S. Chamber, would cost $1.75 Trillion. However, the Congressional Budget Office has stated that if all programs remained in place for ten years, the bill would cost $4.9 Trillion and add $3 Trillion to the national debt. To put that in context, the entire cost to the United States for fighting World War II adjusted for inflation was $4 Trillion. Critics, who include all Republican members of the U.S. Senate and U.S. House of Representatives and some Democrats, claim the bill creates new and expanded social programs that will add to the nation’s debt.

Under the current rules of the U.S. Senate, legislation requires the support of sixty senators in order to overcome a filibuster and pass. This important rule is designed to protect the rights of the minority and achieve more bipartisan solutions to our problems. The one exception to this rule is through budget reconciliation, a once-a-year process that is designed to allow for the passage of the budget with a simple majority. Because Democrats only control the 50-50 U.S. Senate with the tie-breaking vote of Vice President Harris, Democratic leadership and the President are hoping to pass all of the Build Back Better plan through the reconciliation process.

Build Back Better is not limited to the budget process. Included within this mammoth bill are trade adjustment assistance, Medicare expansion, changes to labor laws, numerous tax increases on employers, and major “giveaways” to plaintiffs’ attorneys. Of note, the Senate parliamentarian has not ruled on all aspects of the bill.

Throughout the Summer and Fall of 2021, the West Virginia Chamber has heard from countless members about their concerns with provisions contained in this legislation. Below are some of the specific problems that have been identified by our members as having a negative impact on their ability to operate and create jobs:

• The $3 Trillion in new spending would likely add to the already-troubling inflation tax that is hitting every American.


• Would allow the immediate deduction of plaintiffs’ attorneys’ expenses incurred instead of waiting for the resolution of the litigation. Current law forbids attorneys working on a contingency-fee basis from deducting expenses until the lawsuit is settled. This change would encourage more frivolous lawsuits against employers.


• Would place a methane tax on producers of natural gas rather than emitters, thus disincentivizing companies from reducing their methane emissions. The methane tax also interferes with the collaboration between the natural gas industry and the U.S. EPA on furthering the goal of methane reduction.


• Temporarily expands Temporary Health Insurance Premium Tax Credits and allows some individuals to decline employer-sponsored health coverage and instead use the tax credit to purchase health insurance from the exchanges. This would cause more taxpayer expense for healthcare and could destabilize employer health insurance risk pools.


• Implements a Corporate Minimum Tax that is based on book income. This would disincentivize investments and upgrades in equipment by limiting the benefit of expensing and accelerated depreciation for many companies.


• Adds a 3.8% net investment tax to business income for taxpayers with income over $400,000. This would be a major tax increase on small business owners who, on paper, may appear to have high income but whose businesses are simply set up as pass-through entities.


• Increases the civil money penalties under the Fair Labor Standards Act from $2,074 to $20,740. This increase could put small businesses out of business and is far beyond what would be appropriate to correct any compensation errors and make the employee whole.


• Fundamentally changes the nature of the National Labor Relations Act by adding civil penalties ranging from $50,000 to $100,000 per charge of unfair labor practice. This exceeds the grant of authority issued by Congress, and the size of these penalties would be death sentences to West Virginia businesses. This change would encourage labor unions to file unfair labor practice charges, whether meritorious or not, simply to threaten employers to gain leverage during organizing campaigns or bargaining sessions.


• Gives an electric vehicle tax credit only to vehicles made with union labor. This picks winners and losers in the marketplace and would harm employees who may have decided against forming a union. This tax credit also directly negatively affects West Virginia’s automobile manufacturers.


• Establishes serious impediments that could prevent religious institutions from participating in the childcare entitlement, despite the fact that 53% of the nation’s childcare services are currently provided by a religious entity.

These are some of the many major issues that have been raised by members of the West Virginia Chamber of Commerce about what is contained in Build Back Better.

The Chamber's Position

The West Virginia Chamber has thoughtfully analyzed the 2,476-page Build Back Better bill. The Chamber recognizes that certain provisions contained within the bill could be helpful policies that would benefit our state and nation. Those policies should be thoroughly vetted on their own merits through regular order in the United States Congress. In the view of the West Virginia Chamber, a few good policies contained in this bill do not outweigh the $4.9 Trillion in spending and numerous problematic provisions that have been inserted and are found throughout the House-passed legislation. It is evident that this bill has become a vehicle for certain policymakers to insert their highly-unpopular pet projects and blatantly picks winners and losers through tax and regulatory schemes. The West Virginia Chamber of Commerce stands with Senator Joe Manchin, Senator Shelley Moore Capito, Congressman David B. McKinley, Congresswoman Carol Miller, and Congressman Alex Mooney in opposing Build Back Better as passed in the U.S. House of Representatives.

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Issue

Should the United States Congress enact legislation that compiles the failed legislative and regulatory efforts of Big Labor under the guise of “leveling the playing field” through the Protecting the Right to Organize, or “PRO”, Act (H.R. 2474)?

Discussion

Over the past ten years, the AFL-CIO and their member organizations have proposed a litany of legislative and regulatory initiatives which they claim are necessary to “level the playing field” between employers and unions seeking to organize American workers. Big Labor points to the fact that unions now represent a mere 10% of the American workforce when they have previously represented upwards of 33% of workers as evidence that employers coercively suppress union organizing and the will of workers.

The PRO Act is a collection of legislative and regulatory initiatives Big Labor has supported over the past ten years, and which have been rejected in Congress or the Courts, with one glaring exception.

Persuader Activity:

In 2016, the Obama Administration implemented a new regulation with enhanced reporting obligations for “persuader activity” by employers and their agents along with an expanded definition of what “persuader activity” involves. The Kennedy Administration defined persuader activity as communication between an employer’s agent – an attorney or a consultant – directly with employees designed to influence the employees’ perceptions of unions. That definition remained in place until 2016. The new definition erased the requirement for direct communication and included any legal advice or composition of messaging intended to be communicated to employees. A U.S. District Court in Texas prohibited enforcement of the regulation anywhere as it shattered the attorney-client privilege and was unconstitutional.

The PRO Act would codify these unconstitutional provisions into law.

Employee Free Choice Act:

EFCA, or “card check”, would permit unions to be certified by the National Labor Relations Board without an election. Rather, all unions would need to do would be to present signed authorization cards from a majority of a “unit” of an employer’s employees. Supporters introduced a bill to legislate the EFCA in the first Obama Administration.

The bill was never passed despite the significant majority of the supporting party in the House and Senate of Congress. The bill was seen as anti-democratic as it denied workers the right to a secret ballot election.

Ban Right to Work Laws:

Since the National Labor Relations Act was passed in 1935 states have enacted legislation prohibiting unions and employers from agreeing to language in collective bargaining agreements requiring employees to be members of unions as a condition of employment. The federal law expressly recognizes the right of a state to create these laws called “right-to-work” laws as they guarantee employees the right to work regardless of whether they join a union or not. A majority of the states have enacted right-to-work laws.

Big Labor demands that a state’s right to enact a right-to-work law be stripped and that federal law ties the hands of state legislatures from guaranteeing workers the protection from termination. The unions want to guarantee that the parties to a contract can force employees who choose not to pay dues be fired. Big Labor has never successfully revoked or prohibited right-to-work laws from being enforced in the courts.

Give Contractors the Right to Bargain along with Permanent Employees:

During the Obama Administration, the National Labor Relations Board gave contractors the right to join bargaining units with permanent employees for purposes of collective bargaining. For a small business that needs to replace a roof, this could result in the roofer’s employees securing collective bargaining rights with, for example, a bakery. During the Trump Administration, the National Labor Relations Board vacated this decision and implemented a regulation which reinstated the historic test for when the employees of an “independent” contractor have standing to join an existing collective bargaining unit. The primary aspect of the test is that the contractors are not truly “independent” from the contracting employer.

Big Labor desires to codify the earlier NLRB decision and bypass the current regulation.

Legalize Secondary Boycotts:

Currently, unions are only protected when they strike an employer that they are collectively bargaining with on behalf of employees. If the union strikes a customer of that employer – or a “secondary” employer – or boycotts that secondary employer to gain leverage against the primary employer, the union violates federal labor law and can be enjoined and be held liable for damages to the innocent secondary employer.

Now, for the first time, Big Labor wants the right to strike secondary employers. Under the PRO Act, a union could strike a small diner and put it out of business with a picket line if the diner purchases food from a delivery company which has a primary strike with a union, without any liability attaching to the union.

The Chamber's Position

The West Virginia Chamber of Commerce opposes passage of all provisions within the PRO Act:

• The Persuader Activity prohibitions are unconstitutional and un-American as they vaporize attorney-client privilege;
• The Employee Free Choice Act is anti-democratic as it will fully deprive workers of the right to a secret ballot election;
• The Prohibition of State laws to protect a worker’s choice to be represented by a union – or not – is an indefensible power grab by the federal government;
• Providing temporary contract workers with the right to bargain along with permanent employees is illogical and unworkable and will extinguish hundreds of small business; and
• Giving Big Labor the right to strike innocent secondary employers as collateral damage to a primary strike is heinous and disrespectful to the workers employed by the secondary employer.

All but one of these components of the labor omnibus bill have failed before the legislative or federal branches of our government.

Most fundamentally though, the reason unions have lost the support they enjoyed in the 1950s has nothing to do with coercion by employers creating an imbalanced playing field. Unions have recourse today through the NLRB for coercive conduct by an employer in an organizing campaign. Those unions who have lost membership since the 1950s where employees have not voted for them have lost those elections because the employees did not choose to be represented by them.

It is not the role or the function of federal government to choose a union for an employee accomplished through unconstitutional regulation, undemocratic and un-American elections, usurping states’ rights to legislation and exonerating the destruction of innocent businesses by expanding the right to strike.

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