Governor’s Budget Presented in House Finance with 2 days of Presentation and questions.

Charleston, WV- The House Finance Committee received the Governor’s budget proposal Thursday morning in a presentation from State Budget Director Mike McKown. The executive budget focuses on the general revenue fund, which makes up just under 28 percent of the state’s total spending plan.
McKown reported that the Public Employees Retirement System remains one of the strongest in the nation at 101.8 percent funded. The Teachers Retirement System is funded at 85 percent and would require an additional $2 billion to reach full funding. The state’s Rainy-Day funds total $1.2 billion and are performing well, though they would cover only about 90 days of emergency needs. The Personal Income Tax Reserve Fund holds roughly $460 million.
For fiscal year 2026, state revenues remain strong, and officials expect a healthy surplus. Public education, Medicaid, social services, and corrections are fully funded in the proposal. McKown said the major cost drivers for fiscal year 2027 are the HOPE Scholarship, statewide pay raises, and increased PEIA employer contributions. HOPE alone is projected to rise by $124.3 million, while pay raises total $78.4 million and PEIA costs increase by $35.1 million. The average pay raise is 3 percent, though individual increases will vary.
To fully fund the HOPE Scholarship, the state will need a supplemental appropriation of more than $230 million to cover the second half of FY27 and the first half of FY28. McKown also noted that the sale of long‑term care facilities will not reduce the appropriations needed to operate the state’s three hospitals, as the purchasing company must build new facilities.
The state’s share of SNAP funding has increased due to federal changes, shifting the cost split from 50/50 to 75 percent state-funded. McKown also reviewed the state’s six‑year financial plan, which helps identify and correct future budget gaps.

At the State Capitol on Monday, lawmakers continued digging into the Governor’s proposed budget as State Budget Director Mike McKown returned to the House Finance Committee for a second day of questions. McKown told delegates that revenues remain strong heading into fiscal year 2026, with public education, Medicaid, social services, and corrections all fully funded. He also highlighted the stability of the state’s pension systems, noting PERS is more than 100 percent funded and TRS sits at 85 percent. Rainy‑Day funds total $1.2 billion, and the state expects a healthy surplus.
Major cost pressures for next year include the HOPE Scholarship, statewide pay raises averaging 3 percent, and increased PEIA employer contributions. HOPE alone will require a more than $230 million supplemental to stay fully funded.