West Virginia’s budget basics

According to the National Association of State Budget Officers (NASBO), West Virginia’s total expenditures in fiscal year (FY) 2021 were $19.1 billion, including general funds, other state funds, bonds, and federal funds. NASBO reported that total expenditures across all states in FY 2021 were $2.7 trillion, ranging from $4.7 billion in Wyoming to $512.8 billion in California.

Each state allocates spending and taxes differently among different levels of governments, and local governments often administer programs with state funds, so combined state and local government data show a more complete picture of individual benefits and contributions when comparing states.

Per the US Census Bureau, West Virginia’s combined state and local direct general expenditures were $16.7 billion in FY 2019 (the most recent year census data were available), or $9,298 per capita. (Census data exclude “business-like” activities such as utilities and transfers between state and local governments.) National per capita direct general expenditures were $10,161.

West Virginia’s largest spending areas per capita were public welfare ($2,692) and elementary and secondary education ($1,732). The Census Bureau includes most Medicaid spending in public welfare but also allocates some of it to public hospitals. Per capita spending is useful for state comparisons but is an incomplete metric because it doesn’t provide any information about a state’s demographics, policy decisions, administrative procedures, or residents’ choices.

West Virginia’s combined state and local general revenues were $17.4 billion in FY 2019, or $9,714 per capita. National per capita general revenues were $10,563. West Virginia uses all major state and local taxes. After federal transfers, West Virginia’s largest sources of per capita revenue were charges ($1,547), such as state university tuition and highway tolls, and individual income taxes ($1,168).

West Virginia’s politics

Governor Jim Justice, a Republican, was elected in 2020 with 65 percent of the vote. The next gubernatorial election is in 2024.

Republicans control both the House of Delegates (77 Republicans to 22 Democrats) and Senate (23 Republicans to 11 Democrats), with veto-proof majorities in both houses. Control of the governor’s mansion and each house of the legislature gives Republicans a trifecta in West Virginia. All West Virginia House seats are on the ballot in 2022 because delegates serve two-year terms. Senators serve four-year terms; roughly half the senatorial seats are on the ballot in 2022, and the other half will be up for election in 2024.

West Virginia’s budget institutions, rules, and constraints

West Virginia uses an annual budget. The legislature must pass a balanced budget, but it can carry a deficit over into the following year. West Virginia does not have any tax or expenditure limits. West Virginia does limit total authorized debt incurred by the state but not debt service.

(Note: Some states have informal budget institutions that constrain overall spending growth or a specific expenditure’s growth.)

West Virginia’s current budget

Governor Justice released his FY 2023 budget proposal and gave his state of the state address in January 2022. and gave his state of the state address in January 2022. The FY 2023 budget was enacted in March 2022.

West Virginia enacted its FY 2022 budget in April 2021. The enacted budget included $4.5 billion in general fund spending. in April 2021. The enacted budget included $4.5 billion in general fund spending.

Under the American Rescue Plan, West Virginia will receive $1.4 billion in direct state fiscal aid and $516 million in local government aid from the federal government. As of January 2022, West Virginia had not reported how it plans to spend its state ARP funds.

According to NASBO, West Virginia’s recent expenditure totals (general fund spending/total spending, including federal transfers) were:

• FY 2021: $3.7 billion/$19.1 billion

• FY 2020: $3.8 billion/$18.5 billion

• FY 2019: $3.9 billion/$17.9 billion

For more on West Virginia’s budget, see

• the West Virginia State Budget Office,
• the West Virginia State Treasurer, and
• the West Virginia Joint Committee on Government & Finance.

West Virginia’s economic trends

West Virginia’s per capita income (per the Bureau of Economic Analysis) was $47,817 in 2021, ranking 49th among the states. It was below both the national average of $63,444 and the Southeast regional average of $56,118. The state’s median household income (five-year estimate) was $48,037 in 2020, ranking 49th among the states and below the national average of $64,994. West Virginia’s poverty rate was 17.1 percent in 2020 (five-year estimate), above the national rate of 12.8 percent.

Although West Virginia’s averages tell a story about the entire state, West Virginia is composed of diverse localities. For example, the city of Huntington’s median household income was $33,012, and its poverty rate was 32.1 percent; the city of Bridgeport’s median household income was $84,295, and its poverty rate was 4.8 percent.

West Virginia’s unemployment rate has historically followed national trends. While the state’s rate trended below the US rate following the Great Recession, in recent years the state’s rate has been among the highest in the country. (See how COVID-19 is affecting state employment and earnings data.)

Unemployment rates (like other economic indicators) often vary significantly by race and ethnicity. However, West Virginia does not currently have enough information available for the Bureau of Labor Statistics to break down its unemployment rate by race. (This is preliminary data. See the 2020 data for a more detailed breakdown of state unemployment rates by race and ethnicity.)

The major industries that contributed the most to West Virginia’s gross domestic product (GDP) in 2020 were government, finance, social services (i.e. health and education), manufacturing, and professional services. Government and social services contributed more to West Virginia’s GDP than they did to the nation’s and region’s GDP, while finance, manufacturing, and professional services were less important to West Virginia than they were to the nation and region in 2020.

Looking at more specific industries, among those that accounted for at least one percent of West Virginia’s GDP in 2019, mining produced far more for the state than for the nation, contributing 5.4 percent to West Virginia’s GDP and 0.3 percent to the nation’s. Other industries that overperformed in West Virginia relative to national averages in 2019 were oil and gas extraction, state and local government, the federal government, and hospitals.

West Virginia’s demographics

As of July 2020, West Virginia’s population was 1,784,786. That was down 3.7 percent from 2010. For comparison, the nation’s population experienced 6.5 percent growth over the same period. The Urban Institute estimates the state’s population will increase 1.4 percent between 2010 and 2030, less than the nation’s estimated growth rate of 16 percent.

Additional resources

• The State and Local Finance Initiative’s Backgrounders explain the tax and spending issues highlighted in these briefs.
• The State Economic Monitor presents updated data and customized visualizations of state economic indicators.
• State and Local Finance Data: Exploring the Census of Governments allow users to sort, customize, and download the Census of Governments State and Local Finance series data featured in these summaries.
• The State Tax and Economic Review series provides quarterly reports on state tax collections and underlying economic trends in all 50 states.
• The Urban Institute’s State Tax Data Subscriptions provide access to up-to-date revenue data in all 50 states.