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Analysis Economic Justice

Behind a Governor Named Justice, a Trail of Failed Promises and Debt

India Amos

Will the "face" of opposition to the West Virginia teachers' strike come through for state employees?

At a town hall with West Virginia Gov. Jim Justice (R) in Wheeling, West Virginia, on February 27, sixth-grader Gideon Titus-Glover pointed out that the governor’s plans to increase the state’s tourism budget was a conflict of interest. Justice has owned and operated a variety of businesses, including a well-known luxury resort, since before he ran for office. The governor’s budget plan rankled at a time when the state’s teachers were fighting for a raise. Due to meetings like one in Wheeling, and another town hall he held in Charleston, where he had harsh words for teachers, Justice became the symbolic “face” of opposition to the strike. But this is not the first time since becoming governor that Justice, who flipped political affiliations twice, has courted controversy, particularly when it comes to finances.

The West Virginia teacher and school personnel strike came to an end on March 6, with Justice  signing into effect a 5 percent pay raise for teachers and a hold on rising health care premium costs. But questions remain about whether the state’s teachers—and workers overall—should look to Justice for leadership and better working conditions.

A West Virginia native with a net worth of $1.73 billion, according to Forbes, Justice, who shares similar business tactics and a friendship with President Donald Trump, is a paradoxical business mogul in considerable debt. On one hand, he owns one of the largest farming operations east of the Mississippi River. But on the other, the coal mines he owns are struggling. His mines have a record of safety violations; in 2017, a mining operation owned by Justice was cited for six violations, including one that warrants a “special assessment” penalty, following the death of a mine worker.

NPR reported that in 2016, Justice owed $15 million in taxes and fines, while he was running for office. In July 2017, it was still unclear how Justice was going to pay his debt. As of March 1, 2018, Justice continues to owe $2.9 million in delinquent property taxes to five counties located near the West Virginia border in eastern Kentucky.

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This tax money, if paid, would be used at least in part to fund public schools across Harlan, Floyd, Pike, Magoffin, and Knott counties. The money could greatly improve classroom conditions in some of these underfunded schools—an ironic realization considering the fact that Justice, in an abrupt role reversal, is now being regarded as the individual responsible for improving conditions for West Virginia teachers.

Before the strike, conducted as a protest against low pay and rising insurance premiums, West Virginia teachers ranked 48th nationally when it came to salaries. According to state Sen. Craig Blair (R-Berkeley), the proposed 5 percent pay raise is the largest pay raise in West Virginia’s history.

Sean O’Leary, senior policy analyst at the West Virginia Center on Budget and Policy, believes the pay raise is a good development for West Virginia. “[It] should have a positive effect on the economy, putting more money in the hands of middle-class workers in the state,” he wrote in an email to Rewire.News. But how the raise will be funded remains unclear.

The salary increase won’t be funded by raising taxes. Senate leaders say the raise will be paid for by making cuts to the new budget, and Sen. Blair said in a CNN interview that the state will reduce spending on programs such as Medicaid, which covers over 564,000 people in West Virginia.

But Gov. Justice was vehement that Medicaid will not languish due to the pay raise. He did concede that the Medicaid budget might have to be reduced by $10 million. However, he maintains the stance that the funds for Medicaid could be restored, providing his increased revenue projections are accurate, according to the Gazette-Mail.

West Virginia began fiscal year 2018 with an $11 million budget gap, which O’Leary blamed for the state’s underfunding of education. To offset the gap, West Virginia residents were told to expect cuts in public service departments.

The proposed cuts to essential social services have been met with criticism when Justice’s budget proposal, submitted to the state legislature on January 10, included a $14 million increase in funding for the Division of Tourism—an increase that would boost his own business interests. This increase, according to Justice, was intended “to nearly triple the division’s annual budget, [and] to greatly expand state tourism advertising and marketing.” Justice also suggested a $35 million increase for the Department of Commerce, intended “to promote various economic development initiatives.”

West Virginia is a state rich in history with a mountainous interior that appeals to nature adventurers. For 2018, there is an estimated $8 return for every $1 of investment in tourism advertising across the state, and in 2016, West Virginia’s tourism industry had an impact of more $4 billion, which shows this could potentially be a profitable area for investment across the state.

But in addition to serving as a governor, Justice still owns the Greenbrier hotel, one of West Virginia’s most touted tourist attractions. This luxe resort is a known favorite among politicians, with The Greenbrier Classic, a popular golf tournament on the PGA tour, held here annually.

Justice, according to reporting from the Wheeling town hall, took student Titus-Glover’s speech into account when he proposed the subsequent pay raise for teachers and administrative personnel. But the governor has yet to take the sixth grader’s argument about potential conflicts of interest to heart. Much like when Trump announced his plans to run for the presidency, West Virginians have become weary of Justice’s inability to separate his personal interests from his political ones. The overlap of his businesses and his legislation is too great.

While teachers have since returned to their classrooms, and lawmakers and school personnel have reached a fiscal compromise, West Virginia—and Jim Justice—will need to overhaul its budgeting strategy if it hopes to avoid gaps in the future. Despite marginal increases in its gross domestic product in recent financial quarters, West Virginia does not appear to be on a sustainable path, and the majority of these issues relate directly to the state’s economy. It remains to be seen whether the governor will follow through on his promises to protect Medicaid and pay West Virginia teachers more, but for now, teachers and other locals are calling their recent strike a success.

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