FISCAL NOTE

Date Requested: January 12, 2018
Time Requested: 10:26 AM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
1047 Introduced SB150
CBD Subject: Natural Resources


FUND(S):

General Revenue Fund, local governments

Sources of Revenue:

General Fund local property tax

Legislation creates:

Increases Revenue From Existing Sources, 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 repeal a section of the code related to wind power projects.
    
    According to our interpretation, passage of this bill would effectively eliminate any salvage valuation pollution control treatment for wine power plants. As a result, taxable property valuations for such facilities would increase along with property tax assessments. There would be an increase of roughly $8.5 million in revenue beginning in FY2020. The estimated revenue gain would be more than $3.8 million to the State General Revenue Fund, $1.6 million to local county school boards, and $3.1 million to county commissions. The distribution of estimated cost is based on information from taxes levied as reported in the Classified Assessed Valuations Taxes Levied for 2017 Tax Year publication of the State Tax Department and the incorporation of the calculation of local property tax share within the State Aid to Schools Formula.
    
    Additional administrative costs would be minimal.
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2018
Increase/Decrease
(use"-")
2019
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 0 0
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 0 8,500,000


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


    There would be an increase of roughly $8.5 million in revenue beginning in FY2020. The estimated revenue gain would be more than $3.8 million to the State General Revenue Fund, $1.6 million to local county school boards, and $3.1 million to county commissions. The distribution of estimated cost is based on information from taxes levied as reported in the Classified Assessed Valuations Taxes Levied for 2017 Tax Year publication of the State Tax Department and the incorporation of the calculation of local property tax share within the State Aid to Schools Formula.
    
    Additional administrative costs would be minimal.
    



Memorandum


    The stated purpose of this bill is repeal a section of the code related to wind power projects.
    
    The purpose of this bill is to repeal West Virginia Code §11-6A-5a, which specifically made wind power projects subject to the valuation of pollution control facilities under this Article. This permitted wind turbines and towers of wind power projects to be valued at salvage value for the purposes of ad valorem property taxes. Without Section 5a, it appears to be unlikely that wind power projects would fit under the definition of pollution control facilities found under West Virginia Code §11-6A-2 and, therefore, wind power projects would not be allowed this special property valuation.
    



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