Prepared text of Gov. Joe Manchin’s State of the State address to the Legislature Wednesday night:

Mr. President, Mr. Speaker, Members of the Board of Public Works, Justices of the Supreme Court of Appeals, Members of the Legislature, Distinguished Guests and my fellow West Virginians:

I am truly privileged that the people of West Virginia have given me the opportunity to stand once more before you and deliver my fifth State of the State Address. I am honored and humbled by the faith you have placed in me and my administration and, most importantly, I am eager to get back to work.

Tonight, as is tradition, I will report on the progress West Virginia has made and I will also talk about where we need to be headed. But it would be unrealistic for me to not first acknowledge the rough economic times our nation and state are facing - and the great challenges those times have created.

We are experiencing a global economic transformation - some even call it a financial meltdown. It is one of the most dramatic economic downturns since the Great Depression and all of us - directly or indirectly - are dealing with its effects.

However, while I am certainly concerned - I am not scared.

West Virginia has faced tough times before and we know better than most how to prepare for, and overcome, challenging times.

When I first took office four years ago, the outlook for our state was daunting. Some thought they would never see significant changes in their lifetimes. However, we came together and tackled our problems head on. We committed to running a fiscally disciplined and responsible government and together we turned many of those challenges into opportunities.

One of the biggest issues we faced was our state’s crippling debt. As I’ve said before, unmanaged debt will make a coward of us all when it’s time to make decisions and act responsibly. Our commitment to paying down pension debt and unfunded liabilities during the past four years has saved literally billions of dollars.

In addition, if we had not been proactive and put additional appropriations toward our teachers’ retirement debt in particular, with the financial market as it is today, we would have to put an additional $250 million in our 2011 budget and the next 23 years after that just to meet our teachers’ pension obligations. And they tell me that our nation’s financial conditions could get even worse. That is why our work to pay down our debt is so important.

We have also had record state revenue collections for three years in a row, which has led us to tremendously outperform our budget forecasts. This happened based on the confidence in our state that citizens and investors gained due not only to our commitment to pay down our debt, but also our efforts to tackle our outdated workers’ comp system, institute insurance reforms and reduce our state tax load on both individuals and businesses - something that we’re looking to do more of in the future.

Because of these responsible actions, we were able to provide more than $300 million in well-deserved pay increases four years in a row for our teachers and our state employees. This is the largest commitment to salary increases for state workers during a four-year term in the history of our state. In addition, as part of their standard incremental pay package, all West Virginia teachers with between one and 35 years of service will have their salaries automatically increased this year by a minimum of $587.

We’ve also improved our business climate. Since 2005, more than 200 companies have located or expanded here and, together, they have invested $8.6 billion in the Mountain State.

We’re also shipping more West Virginia-made products around the globe than ever. Last year, West Virginia exports grew 41 percent to $5.6 billion, outpacing the national rate of 12 percent. That’s $1.7 billion more than in 2007.

But let me make this clear: Tougher times are ahead. While we are in better financial shape than our neighbors, West Virginia is not immune to the national and global economy. Everyone is understandably concerned about their jobs and about their families. These may be the most challenging times we have faced.

We’ve witnessed layoffs and shutdowns at our plants and watched in sadness as some of our retailers have closed their doors. We must be more diligent now than ever before. The hard work is not over. It has just begun.

We did what needed to be done and it put us in a better situation than many other states. Our next move is up to all of us.

Do we remain focused and disciplined with a strong vision? Or do we throw caution to the wind and bet on this economy turning around quickly?

After four years, you know the latter is not my style.

As I said in my inaugural address, it’s time to do what West Virginians do best. Let’s roll up our sleeves and get to work.

When others have said “That can’t be done,” we’ve done it. And we will do it again.

The legislative agenda I present tonight is a responsible one that will continue to create confidence in our state and solidify our standing in the marketplace.

When I became your governor in 2005, for the first time, our budget team shared five-year forecasts with our legislators because I thought it was critical for all of us to look at the future to see what challenges we will face. That principle has served us well.

Today we are in a planning mode - not a panic mode.

And, while I know we will face more challenging times, I have no plans during this coming budget year to cut essential government services. I also have no plans to unnecessarily increase our state budget or expand the size of state government.

We’ve been very disciplined and, under my watch, we will not write checks that our children can’t cash.

Many other states are facing employee furloughs, cuts to essential government services, cuts in education budgets and tax increases. That is why I cannot include any base-building salary increases in this year’s budget. I will, however, ask for the ability to share any additional money that we may have with our teachers, service personnel and state employees, if financial conditions improve enough for us to afford to do so.

If we do not follow through on the continued responsible spending plan that I am submitting to you - we will not be able to manage our balanced budget without extreme cuts. We must follow this financial plan to continue to operate state government in the way our citizens expect and deserve. One of the world’s most-pressing issues is a growing demand for energy. Our nation needs West Virginia’s energy resources to climb out of this recession. The opportunity for us to take the world stage in new energy development is now. Companies from around the globe are prepared to invest in West Virginia to make this kind of development a reality.

If we want to be a leader in renewable resources, we must commit to investing in the energy sources of the future. Throughout our history, our state has powered this nation. West Virginians know energy better than anyone. We must build upon our past successes and uncover even more efficient and cleaner energy sources.

That means not just coal, but natural gas, and renewable resources, including wind, solar, hydro and biofuels.

Tonight, I am introducing a bill, called the Alternative and Renewable Energy Portfolio Act, which will put West Virginia at the forefront of new energy development. It sets a realistic timeframe for us to develop alternative and renewable energy resources.

Beginning in 2015, at least 10 percent of the electric energy sold to electric customers must be generated by alternative or renewable energy sources. And, by 2025, we will require that 25 percent of electricity sold in West Virginia must be generated from alternative or renewable energy facilities.

Our bill will provide incentives to locate new alternative energy facilities in West Virginia, which will encourage the development of renewable energy resources and create jobs in the Mountain State.

This is within reach. With the growth of wind technology, by recycling waste heat from our industrial facilities, by cultivating biofuels like switchgrass, by harnessing the power of our rivers and the sun, and by expanding our clean coal efforts, we can meet our energy needs, create new jobs and improve our environment at the same time.

Electricity doesn’t always come from the power plant. Today we have the technology to generate electricity at our own homes and businesses, but there has been little incentive to invest in this technology because there is no way to get credit for the power you return to the electric grid.

My alternative and renewable energy bill will also require electric utility companies to provide net metering to residential, small business and industrial customers who generate their own electricity. This bill also requires the Public Service Commission to expand the availability of net metering to West Virginia electric customers.

It will encourage private investment in renewable energy sources, including solar, wind, biomass, hydropower, waste heat recovery and even landfill gas. It is another step toward expanding our state’s energy portfolio.

We must also continue to keep in perspective the energy resources and technology we are using today. We can’t simply abandon the way we live and generate electricity, but we must find newer and cleaner ways to produce energy with the abundance of resources we already have.

It will take investment and research. We are on the verge of discovering cleaner, greener ways to use coal and we can continue to be a low-cost producer of energy if we believe in ourselves and embrace our energy expertise.

There’s been a lot of debate about clean coal technology. Whether you agree or disagree with the concept, one thing is certain: We can improve the way we use coal and reduce the carbon that is released into the atmosphere.

One new technology that has promise is carbon capturing. West Virginia can be at the forefront of this experimental method of capturing the carbon dioxide that comes from burning fossil fuels by finding ways to add value to this waste stream.

This week I will present a bill that will allow for permits for carbon sequestration projects. It will establish regulations for monitoring carbon sequestration sites and clarify ownership of the space in which the carbon is stored. Carbon sequestration is not the only solution to controlling power plant emissions, but we should explore its potential.

Energy independence must move from talk to action, and these proposals do that. By broadening our definition of energy beyond just fossil fuels, we position ourselves to continue producing the nation’s energy by any and all means.

These are all first steps that build on my vision for energy independence. They open the door to the future of new energy development in the Mountain State.

We must also continue our mine safety efforts. We now have more than 40,000 new self-contained self rescuers in our underground mines. About 225 emergency mine shelters are in place and more are on the way. We hope to have the rest in place by the second quarter of this year.

We are implementing advanced communication and tracking systems, so we never face the situation we did at Sago and Aracoma, not knowing where our trapped miners were located and putting our rescuers in danger. And, we continue to be vigilant in inspecting our mines to ensure they meet our more stringent safety standards. We have added more inspectors and safety instructors and we also increased our mine inspector salaries so we can retain qualified staff.

We’ve required foremen and fire bosses to undergo additional training and made it easier to shut down problem mines. We will continue to face challenges in this demanding industry, but let me assure you -- our mission is still to protect every miner so that he or she will return home safely to their families.

While our work to make our mines safer continues, we must also carry those lessons to the rest of our manufacturing industries, to help make all our industrial workplaces safer.

On a night last August, here in the Kanawha Valley, the sky glowed orange after an explosion and fire at one of our chemical plants. In the critical hours after the explosion, we had a lot of unanswered questions that left residents throughout the valley scared and wondering exactly what to do.

We lost two long-time plant workers because of that accident. Our thoughts and prayers remain with their families. On that night, though, we could have lost even more, had it not been for quick action by plant management and employees, and an emergency containment system that prevented potential catastrophe.

While plant emergency crews and company officials were working to control the situation, for too long our own emergency teams did not have access to the plant or the information they needed to respond or share with the public. That cannot happen again.

That’s why I am submitting a bill that will require all industrial plants within our state to follow the same reporting guidelines for major accidents as our mine operators. The bill will require industrial facilities to provide access to emergency response officials and will establish a system of communication so our responders have the important information they need to ensure public health and safety.

I said earlier that it’s time to roll up our sleeves and get back to work. However, none of that work can be done unless we have an educated workforce. The jobs of the future will go not to the places with the richest land or the most abundant resources, but the places with the richest minds.

We’re in a different world than we were even 10 years ago. We are competing for jobs and companies not just with other states, but with countries around the world. As a nation, we are in danger of falling far behind the countries that just a few years ago looked to our education systems as their model.

We must do a better job of educating our children, starting from the ground up. From pre-school through college. We’ve got to change.

One change we can make immediately is to allow more flexibility in our school calendar. We currently require our children to attend school 180 days a year, yet we also mandate specific dates for the school year to start and end.

Because of those very specific start and end dates, due to weather and other issues, many of our counties do not meet the 180-day requirement. So tonight, I’m presenting a simple fix that will help ensure that students receive 180 days of instruction by extending the school calendar on both ends.

This bill will require county school systems to begin the instructional term five days earlier and will give schools the flexibility to extend the calendar if necessary to meet the 180-day requirement.

We are blessed to have great professional educators who teach not just because it is their job but because it is their passion. I firmly believe that to be an effective educator, you must have a passion for what you’re teaching, so that the children you influence are inspired and share that passion.

West Virginia is fortunate to have great educators like MaryLu Hutchins, our 2009 West Virginia Teacher of the Year. MaryLu is a first grade teacher at Ohio County’s Steenrod Elementary School and also is co-chairwoman of a task force within our 21st Century Jobs Cabinet. The group, called PARTNERS, has worked diligently on our Bill of Rights and Responsibilities for Learning initiative, which outlines the shared responsibilities for safe and productive classrooms.

Teachers like MaryLu energize their classrooms and challenge their students to discover the joy of learning. MaryLu, will you please stand and be recognized.

I also want to acknowledge Toyota Motor Manufacturing and Mountain State Blue Cross Blue Shield for supporting our state’s Teacher of the Year program.

Good teachers are the heart of a quality education. But we must give our teachers and school systems the resources, the curriculum and the freedom to try innovative approaches to 21st century learning.

Every school community has unique needs and the people who know how best to meet those needs are not always in Charleston. That’s why I’ve joined the State Department of Education in formulating a bill that will give our schools the flexibility they need to meet the needs of diverse learners.

The School Innovation Zones Bill will give teachers, principals and school communities greater control over critical education factors that affect student achievement.

This bill will allow school staff to implement improvement strategies that currently are restrained by State Board of Education policies or antiquated state law.

In addition to being innovative and creative, we also need to refocus on some basic principles of learning. For dozens of years we have evaluated our children’s educational competency at critical grade levels through statewide testing. The data is helpful, but we should use that information to keep our children from being prematurely promoted to the next grade level.

Unfortunately, many students don’t meet the proficiency requirements in subject areas such as reading and math, and our school systems sometimes lack the necessary resources and capacity to address these deficiencies within the current school calendar.

Therefore, in cooperation again with the Department of Education, I am proposing tonight that if our children do not meet the educational standards we set at their third grade and eighth grade levels -- two of the most critical periods in their educational development -- then they cannot move on until they meet those required educational standards, either through after-school programs, attending summer school or being retained for another year.

This bill also engages the most critical factor in the learning process - the parents.

A structured statewide program will provide the extra help and time many students need to master the rigorous content and 21st century skills needed for future success in the global economy. This program is so important that we have directed additional resources to ensure its success. These carefully developed support programs will help our children learn the math and language skills they need to succeed at the next grade level.

We can no longer allow children who do not have the critical skill sets they require to advance to the next level. It is unfair to their parents, it is unfair to their classmates and, most of all, it is unfair to them.

We also have a tremendous workforce resource in our veterans. Those who have served our country have more than earned the right to further their education once they return to civilian life. It’s not just the responsible thing to do - it’s the right thing to do to move West Virginia ahead. In addition to the skills and knowledge they gain in the armed forces, our service men and service women can build the quality of our workforce by attaining college degrees.

Time and again, we have discussed ways to add strength and depth to the teaching ranks in West Virginia. With the Troops to Teachers program, West Virginia has seized an excellent opportunity to provide our brave veterans the chance to add value to our classrooms.

Veterans bring leadership and experience to our classrooms and their students. They are excellent role models, and I am confident they will help us educate our young people and prepare them with the skills they need to compete in today’s global economy.

I’d like to recognize one of our Troops to Teachers participants who is with us tonight, Stefan Smolski. Stefan is a retired naval flight officer who teaches physics and biology at Oak Glen High School in Hancock County. He also serves as the state mentor for others who want to join the Troops to Teachers program.

Stefan, will you please stand so we can say thank you.

Thank you Stefan, and all of our veterans-turned-teachers, who are bringing a new dimension of learning to our classrooms.

I also want to make sure our nation’s veterans know they are welcome at West Virginia’s colleges and universities. West Virginia has a long history of valuing and encouraging its citizens who have served in our Armed Forces, whether in our National Guard units, in Reserve components, or in our nation’s regular military services. Now we have an opportunity to extend our appreciation to all of our country’s veterans and, at the same time, to attract them to come to West Virginia to learn, to work, and to live.

Last year, Congress enacted what’s known as the “New GI Bill.” It pays for veterans’ tuition, up to the highest in-state undergraduate rate at our public colleges. However, veterans’ actual tuition and fees often exceed that amount if they are out-of-state residents.

I am proposing legislation that will require each of our public colleges and universities to participate in the New GI Bill’s “Yellow Ribbon Program” that will allow veterans from out of state to attend our public colleges and universities at the in-state rates. Schools would be free to participate for graduate and professional students, as well, if they choose.

This is another way we can say “thank you” to our veterans, and attract more of them to West Virginia.

And, finally, we are working to fix the veterans’ pension system so that every state worker who has put on a uniform to defend our country will be treated fairly.

They say that one of the ways you can judge the true progress of a society is by the way it treats its children - who also happen to be our future workers. While there is a lot more work to do, I’m proud to say we are taking care of our children’s health needs.

Beginning on January 1st of this year, the West Virginia Children’s Health Insurance Program expanded its coverage to more children by increasing the upper income limit from 220 percent to 250 percent of the Federal Poverty Level.

The bottom line is that we will continue to move forward to insure and protect every child in our state.

We’ve recognized the growing problem of childhood obesity and now require our kids to take physical education classes at school and the schools must also provide healthier food choices in their vending machines. According to data gathered through the CARDIAC project, last year, for the first time, West Virginia saw a decline in childhood obesity. In fact, it was the greatest decline in youth obesity in the nation.

Our efforts to increase awareness of the dangers of obesity and encourage healthy lifestyles for our children are paying off. We have a long way to go, but we are seeing positive results.

Two years ago, the Healthy Lifestyles Coalition joined with the Robert Wood Johnson Foundation and the Benedum Foundation to evaluate the impact of our 2005 Healthy Lifestyles Act, which was passed to address our state’s obesity problem. Just yesterday, we received a report made possible through grants from these foundations. The results show that our efforts to improve the health of our children are on the right track.

I would like to recognize Laura Leviton from the Robert Wood Johnson Foundation and Beverly Robinson from the Claude Worthington Benedum Foundation, who have made this ongoing study possible. Thank you.

And today, I am presenting a proposal to improve access to dental care for our families who cannot afford visits to the dentist. This one-time expenditure will help to buy dentistry equipment for our primary care clinics. I am also asking for our state’s dentists to support this effort by volunteering one day a month at our primary care clinics.

This investment will improve oral health for our most vulnerable citizens and strengthen the existing community health center network. We’ll place a priority on geographical areas designated as dental health professions shortage areas, and ones with an existing community health center.

Our workforce may be the best in the nation, but we cannot compete if we are not well. We have to have a healthy workforce if we expect to build a healthy economy. So we must today pledge to continue our efforts to make all West Virginians healthier.

We need to start by embracing advances in healthcare technology, including electronic health records and telehealth applications. West Virginia will continue to be a national leader in using information technology to transform our health care system.

We are also going to increase our efforts to detect and prosecute medical fraud, beyond just insurance, to all other forms of health care coverage.

In addition, I also strongly believe that we have a responsibility to provide more access to affordable health care for all working West Virginians.

Tens of thousands of West Virginians go to work each day to provide for themselves and their families, yet they cannot afford to go to the doctor for regular checkups because they have no health insurance. This must change. We must provide more options to our citizens - especially in this time of economic hardship for so many workers and their families.

I have asked our insurance commissioner to work with insurance carriers to establish new, affordable benefit packages that will increase coverage options for those unable to afford the insurance products currently available.

The insurance commissioner will design new coverage plans that promote healthy lifestyles and reward personal responsibility. These affordable plans will emphasize preventive care and catastrophic coverage. Insurance carriers will be able to offer competitive pricing on these plans so that consumers have as much choice as possible.

The insurance commissioner also will develop a Web site where individuals and businesses can obtain information on existing insurance options, so they can become informed consumers.

In addition, I want to take a truly meaningful step toward insuring West Virginia’s working poor -- those who are trying hard every day to make a better life for themselves but who just haven’t been able to make enough money to even think about paying for health care. They often wait until they’re critically ill before seeking medical treatment, so they end up in emergency rooms and hospitals. That adds to the unmanaged care bills that increase everyone’s health care expenses.

Currently, West Virginia covers a smaller percentage of our eligible working people under our Medicaid system than all but two other states. While federal Medicaid eligibility is set at 100 percent of the Federal Poverty Level, West Virginia only covers Medicaid-eligible parents who make less than 35 percent of the Federal Poverty Level, which is less than $6,160 per year - and we don’t even cover single members of the working poor at all. We need to change that if we are to help low-income working West Virginians move toward better-paying jobs with healthcare.

To that end, I have asked our Medicaid office to apply for a federal waiver to design a program of basic medical and preventive care coverage using the medical home concept that has worked well for the agency in the past. We will first use this program to expand health care coverage for working West Virginians, both individuals and parents, whose salaries are at or below 50 percent of the Federal Poverty Level but with the goal of achieving coverage for those with salaries up to 100 percent of the Federal Poverty Level.

This is such an important step toward addressing our state’s growing healthcare concerns and unmanaged healthcare costs that, if necessary in the future, I will propose an increase in our state’s cigarette tax to pay for its continuation.

However, as I’ve said before, the first bill I will present to the Legislature tomorrow will close the pension loophole that allows any kind of public pensions - judicial or otherwise - to be double-dipped. It will ensure that no retiring public official can be re-elected or reappointed to the same position within a year of his or her retirement. This does not preclude someone from running for the same public office again, but it does require ample notification of retirement to give someone else a fair chance to run.

There is one other significant area that involves judges which must also be addressed if we are to truly show that we’re willing to tackle West Virginia’s perceived challenges: Legal reform.

We must not let partisan politics prevent us from openly and honestly evaluating our judicial system, which, justified or unjustified, has been under attack.

Instead, we should objectively examine the structural aspects of our court system.

Our Supreme Court of Appeals is the busiest appellate court of its kind in the entire country, yet West Virginia is one of only 10 states that lack an intermediate appellate court of some kind. We are one of only seven states that use partisan elections to select every member of its judiciary.

And, year after year, the growing responsibilities of the judicial branch have led to a corresponding increase in the court’s budget. That is why I am going to sign an executive order that creates a commission to immediately begin studying how we can modernize our state court system.

This commission will be directed to look at all options, including creating an intermediate court, improving the judicial budget process, achieving more transparency in our judicial election campaigns, as well as the best method for selecting judges. We will work with a broad group of people, including judges, legislators and the private sector, to determine our next step in modernizing our judicial system.

Four years ago, we set out on a mission to change the mindset about West Virginia. We first had to start from within and tackle our own naysayers. I think we’ve made a lot of believers out of those who were skeptical.

We’ve also faced incredible challenges and have worked together to turn them into opportunities. That is the true Mountaineer Spirit.

In recognition of that spirit and the lasting impression this state has on those who come here, during last year’s State of the State Address, I said that we were starting a new campaign to encourage native West Virginians living elsewhere to take another look at their home state, to see what has changed in the last few years.

The Come Home to West Virginia program has generated a lot of excitement about what makes the Mountain State a great place to live, to work and to raise a family. People from across the country are visiting our “Come Home” web site to find jobs here, and to read the stories about West Virginians who have recently come home.

We want to bring former residents back home to work in our growing industries and encourage them to expand into West Virginia the businesses they have started elsewhere. In addition, we want to make people feel confident about West Virginia and optimistic about the future of their home state by reminding them of all the good things happening here.

Our program is succeeding. We’ve reached regional and national audiences with our promotions and positive media coverage, including a great article in the US Airways in-flight magazine and an upcoming article in Newsweek magazine.

On top of that, earlier today I received a phone call from Bob Mazzuca, chief scout executive for the Boy Scouts of America, who shared some good news with me. After an exhaustive nationwide search, the Boy Scouts today took an important step toward selecting a southern West Virginia site as the location for a national high adventure base for the Scouts.

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