Lawmakers have stripped a key accountability provision from a bill that was meant to provide oversight over the hundreds of millions of dollars set to be spent for West Virginia broadband and economic development projects.
On Friday, House Finance Committee members passed House Bill 4001, with some changes. The new bill doesn’t include an original provision that would have created a legislative oversight commission over the Department of Economic Development, which is already managing hundreds of millions of dollars in federal and state broadband and economic development funds, with more still to come. It does still include the language that gives the state the ability to hold broadband companies accountable by denying their certification for FCC funding when they don’t follow through on their word.
Bill lead sponsor Delegate Daniel Linville, R-Cabell, said the majority of House Finance Committee members weren’t sold on the legislative oversight commission, though he still believes such a body is necessary.
“I think that there are significant amounts of dollars available here that rise to this level of having a dedicated oversight commission of the Legislature,” Linville said. “[I] believe that having a legislative oversight commission would be the best possible option, just to make sure that the dollars and programs that we have here are put… to the best possible use and that we catch any problems early.”
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An oversight commission typically has greater power than regular legislative committees. It’s required to meet regularly, and its sole purpose is scrutinizing a particular department — not just its finances, but also the department’s practices, policies and procedures.
Legislative oversight commissions already exist for state agencies that get a lot of federal money, including the Health and Human Resources, Education and Transportation departments. But a bipartisan group of lawmakers said establishing such a commission over the Department of Economic Development seemed unnecessary.
“While the Department of Economic Development has significant funds coming to it right now, a lot of those funds are one-time monies,” Delegate Clay Riley, R-Harrison, said in an email. Riley is a member of both committees that have so far considered Linville’s bill: the House Finance Committee and the House Infrastructure and Technology Committee.
Delegate Brent Boggs, D-Braxton, the minority chair of the House Finance Committee, said he was comfortable waiting to see how the Department of Economic Development handles the money over the next year.
“If we need to come back and do some additional oversight, we can do that,” he said.
Economic Development Secretary Mitch Carmichael, whose office would have been subject to increased oversight under the bill’s provision, said in late January that his team would be happy to comply with any commission set up to oversee his agency but he thinks the Legislature already has oversight, pointing to other committees that already exist, though he didn’t specify which ones.
“So if they want to create another committee, it seems like oversight of the oversight of the oversight, but we’re happy to comply,” Carmichael said.
But Linville points out that these committees weren’t enough to prevent the past state squandering of broadband and economic development investments.
The state has a spotty past when it comes to spending this money appropriately. There was the stimulus money the Obama administration gave to West Virginia for broadband expansion more than a decade ago; a West Virginia Legislative Auditor’s report found that millions of dollars that could have gone to expand high-speed internet was wasted. More recently there was the $25 million the state loaned to venture capitalists, who were supposed to repay with interest; $20 million hasn’t been returned.
Gary Zuckett, executive director of the West Virginia Citizen Action Group said the state’s past waste, in broadband and other spending, justifies a level of oversight.
“The rollout in the past of large amounts of resources given over directly to these big carriers has not resulted in I think wisely-spent public dollars,” Zuckett said. “So oversight, in that regard, is critical.”