West Virginia slipped five places to 35th overall in the 2019 edition of the annual “Rich States, Poor States” economic competitiveness survey by the conservative American Legislative Exchange Council (ALEC).
The report ranked West Virginia 35th, down from 30th in 2018 and 31st in 2017.
While West Virginia ranked fairly low in sales tax burden (15th), and income tax burden (16th), it ranked 46th for “remaining tax burden,” a calculation of tax burden for all taxes excluding personal income, corporate net, property, sales and severance taxes.
ALEC also ranked West Virginia 40th in a category that downgraded the state because its income tax rates increase progressively based on total income.
It ranked the state 43rd for “recently legislated tax changes” from 2017 and 2018, reflecting gas tax and DMV fee increases enacted in 2017 to fund the Roads to Prosperity road bond sales.
West Virginia ranked 45th for state legal system tort liability, and 29th for state minimum wage. (The study downgraded states that have minimum wage rates above the $7.25/hour national minimum wage. West Virginia’s minimum wage is $8.75.)
It also ranked 39th for number of public employees per 10,000 population (at 561.5).
West Virginia also ranked tied for 34th in having no tax expenditure limits in state law. States that require voter referendums or legislative super-majority votes to raise taxes rated higher in the study.
The state ranked fourth for Workers’ Compensation costs and tied for first in two categories: Having no state inheritance tax, and for being a right-to-work state.
The study ranked West Virginia 28th overall in absolute domestic migration, citing state population loss of more than 17,000 residents from 2008-2017.
“This isn’t just an academic report — it tracks the significant interstate migration that occurs every year,” ALEC Chief Economist and Vice President Jonathan Williams said in a statement. “Americans continue to vote with their feet across states, and they are voting strongly in favor of the states that have created a free market environment conducive to economic growth and opportunity.”
For 2019, the top states for economic competitiveness in the survey are Utah, Idaho, North Dakota, Nevada and Indiana.
Bottom states in the survey are: New Jersey, California, Illinois, Vermont and New York.
ALEC, meanwhile, was a frequent topic of discussion during the 2019 legislative session in West Virginia.
Democrats in both houses accused legislative leadership of copying and pasting large portions of ALEC model legislation into bills, most notably with the Senate’s ill-fated omnibus education bill, that adopted ALEC education proposals, including creation of charter schools and education savings accounts.
During floor debate in the House of Delegates, Delegate Shawn Fluharty, D-Ohio, argued that the education bill was the result of Senate leaders going to the ALEC website and hitting “print.”
During that debate, proponents of the education package cited an ALEC study ranking the state’s education system 47th overall, although three of the seven categories used in the ranking involved Charter Schools, for which West Virginia received a 0 score, Home School Regulation Burden and Private School Choice Programs.
ALEC, founded by the Koch brothers and underwritten with corporate funding, is best known for producing model state legislation aimed at cutting taxes and regulations, privatizing schools and prisons, and adopting strict voter identification laws, among other proposals, in keeping with it’s motto of, “Limited Government, Free Markets, Federalism.”