Sen. Mike Hall

June 1, 2010

"The mantra of the Republican party has been 'lower taxes and less government,'" State Senator Mike Hall told Putnam Rotarians, today, "and everybody campaigns on that."

A veteran of the West Virginia Legislature since 1994, and Senator from District 4 (Jackson, Mason, Putnam, part of Roane) since 2006, Hall has recently been named minority leader -- "a new office up the hall."

"The salaries now being paid in the public sector are greater than in the private sector," he said. "I think we're going the wrong way there.

"Whenever I have to vote on things, I've been looking very carefully at the new bureaucracies or commissions being created: They came out with a bill in this last special session to create a commission of sixteen people to oversee the charter school movement.

"They put in the charter school bill that all those laws that presently pertain to personnel have to operate in the charter school. That's not a charter school.

"You have to go back to three or four things and then build from there.

"You've got to know what you want to teach. You've got to have a teacher who is able to engage the students in the material, and they have to be able to do it in a safe environment. That means the school has to be disciplined and ordered and controlled.

"And you've got to be able to find those people that God did not call to be teachers, but something else, and move them out of the school and move other people in."

A small number of teachers, says Hall, whose wife is a school principal, "can drag the whole building down. They lose control of their classrooms. They don't know how to teach. And they are difficult with you when you try to put them on a plan to improve.

"It takes two years at best to provide the calling for a person who shouldn't be a teacher to go somewhere else -- that's if you're batting three or four hundred. That's if you meet all the time lines and do all that you can do to get it done.

"And after a while you're not in a situation where you can move those folks out because you've got to live with them. And then you've got administrators who are weak and who won't do that.

"I thought it was very interesting," said Hall, "to see the Obama administration to try to force the types of reform that had not even been discussed seriously -- charter schools, merit pay."

Hall noted that the only required job for the Legislature is to provide a balanced budget, "based on the revenues that we project you're going to send us.

"But I do notice that every session about 3,000 bills get introduced. We haven't gotten it right yet. So we're continuing to try to fix it so it will be right one of these days."

How do you cut taxes and expenses and yet improve services and revenues?

"When I was first elected, the call for cutting tax rates appeared to be the thing that would stimulate economy if done right. But then I was acquainted with the West Virginia state budget."

Federal taxes on capital gains were cut in recent years "to 20 percent, to 15 percent, to ten percent. People sold things," he said. "You don't sell something, you don't pay a capital gain. But you cut the rates enough, people will go ahead and pay a little bit.

"I believe there are certain tax rates you can cut where you get more revenue. You get more activity. We want to bring people in here and not drive them away because the rates are higher than everybody else."

Hall was told one year that the pension fund was $80 million richer than expected. Where did it come from? "It looks like it came from the (federal) capital gains tax cut," he was told.

"Pension systems are driven by the economy, the stock market returns. We can grow ourselves out of this (pension) problem if we have a strong economy."

Half of the general fund budget goes for education, Hall told the group.

"In the entire general fund budget," he said, " eleven percent goes for one item; that is the teachers' retirement system. We are paying for sins of the past. (We have) $5 billion of unfunded liability -- depending on where the stock market is today. Several years ago, the Legislature began paying down that debt, and that's what that eleven percent is for.

"The problem we have in West Virginia is PEIA (Public Employees Insurance Agency). If nothing is done and everything is allowed to ride, it's $8 billion (under funded), and there's not a dime being paid on it. That means somewhere the Legislature is going to have to decide to start paying on it, or it will run out of money. We will have a time when the checks won't be written.

"When I was first elected," said Hall, "the Workers' Compensation system was going under. There was a big reform act, and then the courts took away all the reforms.

"Then toward the end of the decade -- when Bob Wise was in office, and he was a labor-oriented Democratic governor -- they woke up one day and realized that if they didn't do anything they were going to run out of money in about eight or nine months.

"And so Bob Wise's administration came back with all the same fixes that we had done the years before -- and a few more -- and set in motion the concept of privatization of Comp.

"It's been a rocky road. 'BrickStreet' is a four-letter word in some people's vocabulary, but it was a necessary and well-calculated process of moving from public to private.

"That's a huge sea-change to see an insurance program replaced by the private sector.

"That's where we are. We can talk about the fact that we have a balanced budget. Yes, we have enough money coming in to fund those numbers going out, but the cloud is there."