FISCAL NOTE

Date Requested: January 10, 2018
Time Requested: 02:51 PM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
1363 Introduced SB108
CBD Subject:


FUND(S):

General Revenue Fund

Sources of Revenue:

General Fund State Road 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 create the Volunteer Firefighter Appreciation Act of 2018. The bill proposes to provide certain incentives for individuals to serve as volunteer firefighters.
    
    The bill proposes to provide certain incentives for individuals to serve as volunteer firefighters, including an increase in death benefit for survivors of firefighters, EMS, or law-enforcement killed in the line of duty, effective retroactively; allowing certain volunteer firefighters to hunt, trap or fish in season without a license; allowing a waiver of fees for certain volunteer firefighter registration plates; allowing a discount on lodging at state parks, and authorizing a refundable tax credit for certain expenses of volunteer firefighters..
    
    For tax years beginning after December 31, 2017, volunteer firefighters with valid credentials are entitled to a credit of up to $1,000 per year. The credit is equal to the amount of personal property tax paid on primary vehicles, the amount of sales tax paid on items used for firefighting duties, and 25 percent of costs of training courses. If all of the qualified tax payers took the maximum credit, the provisions of the bill would result in a loss in Personal Income Tax revenue of $8.4 million per year. There would be additional revenue losses associated with the waiver of fees for special license plates and the discount on lodging at state parks and the provisions allowing fishing, trapping and hunting by firefighters without a license.
    
    Additional administrative costs to the State Tax Department would be $46,000 in FY2019 and $35,000 in fiscal years thereafter.
    



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 46,000 35,000
Personal Services 0 35,000 35,000
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 1,000 0
Other 0 10,000 0
2. Estimated Total Revenues 0 0 -8,400,000


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


    For tax years beginning after December 31, 2017, volunteer firefighters with valid credentials are entitled to a credit of up to $1,000 per year. The credit is equal to the amount of personal property tax paid on primary vehicles, the amount of sales tax paid on items used for firefighting duties, and 25 percent of costs of training courses. If all of the qualified tax payers took the maximum credit, the provisions of the bill would result in a loss in Personal Income Tax revenue of $8.4 million per year. There would be additional revenue losses associated with the waiver of fees for special license plates and the discount on lodging at state parks and the provisions allowing fishing, trapping and hunting by firefighters without a license.
    
    Additional administrative costs to the State Tax Department would be $46,000 in FY2019 and $35,000 in fiscal years thereafter.
    



Memorandum


    The stated purpose of this bill is to create the Volunteer Firefighter Appreciation Act of 2018. The bill proposes to provide certain incentives for individuals to serve as volunteer firefighters.
    
    The credit is described in such a way as to make it appear to be a “refundable” tax credit. Not all the expenses used to calculate the credit are related to state general revenue. Only a small portion of property taxes (real property and personal property) collected inure to the state’s general revenue as it is a function of local collection. Thus, it would not appear to be a true credit against a tax paid such that the credit is given locally. Rather, the state (general revenue) is giving credit for taxes paid locally and not to the state.
    



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