FISCAL NOTE

Date Requested: January 11, 2019
Time Requested: 03:33 PM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
1307 Introduced SB282
CBD Subject: Taxation


FUND(S):

General Revenue Fund

Sources of Revenue:

General Fund

Legislation creates:

Decreases Existing Revenue, Increases Existing Expenses



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


    The stated purpose of this bill is to change the qualifier for low income to 300 percent or less of the federal poverty guideline from one hundred and 50 percent or less of the federal poverty guideline for a senior citizens’ homestead tax credit.
    
    As written, this bill, would extend the Senior Citizens’ Tax Credit for Property Tax Paid on the first $20,000 of taxable assessed value of a homestead to taxpayers whose federal adjusted gross income is less than or equal to 300 percent of the federal poverty guideline based upon family size. Currently, the eligibility criterion is a Federal Adjusted Gross Income (FAGI) of less than or equal to 150 percent of the federal poverty guideline. According to our interpretation, passage of this bill would result in an initial annual reduction in the General Revenue Fund of roughly $8 million to $10 million beginning in FY2021. The number of senior citizens in West Virginia is expected to continue to grow. The annual reduction in General Revenue Fund collections would grow with the increase in number of senior citizens.
    
    Additional administrative costs to the State Tax Department attributable to passage of the bill would be roughly $196,200 in FY2020 and $125,000 for each year thereafter. 
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2019
Increase/Decrease
(use"-")
2020
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 196,200 125,000
Personal Services 0 80,000 80,000
Current Expenses 0 85,000 45,000
Repairs and Alterations 0 0 0
Assets 0 2,200 0
Other 0 25,000 0
2. Estimated Total Revenues 0 0 -10,000,000


Explanation of above estimates (including long-range effect):


    As written, this bill, would extend the Senior Citizens’ Tax Credit for Property Tax Paid on the first $20,000 of taxable assessed value of a homestead to taxpayers whose federal adjusted gross income is less than or equal to 300 percent of the federal poverty guideline based upon family size. Currently, the eligibility criterion is a Federal Adjusted Gross Income (FAGI) of less than or equal to 150 percent of the federal poverty guideline. According to our interpretation, passage of this bill would result in an initial annual reduction in the General Revenue Fund of roughly $8 million to $10 million beginning in FY2021. The number of senior citizens in West Virginia is expected to continue to grow. The annual reduction in General Revenue Fund collections would grow with the increase in number of senior citizens.
    
    Additional administrative costs to the State Tax Department attributable to passage of the bill would be roughly $196,200 in FY2020 and $125,000 for each year thereafter. 
    



Memorandum


    



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov