West Virginia residents, famous for their resistance to new taxes, will get a chance to enhance that reputation in this coming Saturday's special statewide election. But this time it's going to be a little bit more complicated - to beat a tax hike, citizens will have to vote in favor of a new investment plan for state funds.
At present, West Virginia's constitution bars the state from investing state funds in the stock market. Only South Carolina retains a similar prohibition, and other states which invest in the state market get a return of 10.9 to 13 percent. West Virgina, which is restricted to the bond market, gets a return of 3 to 4.6 percent.
As we said in our August 15 editorial, this isn't just an obscure technical amendment to the constitution. Because the state hasn't shared in the stock market boom, its pension plans remain seriously unfunded. Instead of making enough money to fund their own operations, the funds needed a state subsidy of $315 million this year, Without a change, says Gov. Cecil Underwood, a change is "certainly probable."