FISCAL NOTE

Date Requested: February 13, 2018
Time Requested: 01:21 PM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
2611 Introduced HB4605
CBD Subject:


FUND(S):

Public Employees Insurance Agency

Sources of Revenue:

Other Fund PEIA

Legislation creates:

Creates New Revenue



Fiscal Note Summary


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


    The stated purpose of this bill is to assess nonoccupied property owned by out-of-state individuals or other legal entities with an additional $4 an acre with the revenue dedicated to the Public Employees Insurance Agency to reduce costs of insurance.
    
    According to our interpretation, passage of this bill would result in $7.6 million annually for the Public Employees Insurance Agency.
    
    The additional administrative costs to the State Tax Department would be minimal. The additional administrative costs to local governments cannot be determined.
    
    



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 7,600,000


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


    According to our interpretation, passage of this bill would result in $7.6 million annually for the Public Employees Insurance Agency.
    
    The additional administrative costs to the State Tax Department would be minimal. The additional administrative costs to local governments cannot be determined as the fifty-five county sheriffs might need to have computer programming done to collect the additional tax.
    



Memorandum


    The stated purpose of this bill is to assess nonoccupied property owned by out-of-state individuals or other legal entities with an additional $4 an acre with the revenue dedicated to the Public Employees Insurance Agency to reduce costs of insurance.
    
    Article X, Section 1 of the W. Va. Constitution requires taxation to be equal and uniform throughout the State, property to be taxed in proportion to its value, and no one species of property be taxed higher than any other species of property of equal value. The proposed bill may be in violation of this section because it imposes a flat rate tax which has no relation to the value of the property.
    
    The bill also fails to distinguish the different classes of property, and the different rates of tax thereon, established in Article X, Section 1 of the W. Va. Constitution. Under the proposed legislation, the same flat rate would be applied to residential, farm and commercial property.
    
    In addition, the bill would violate Article IV, Section 2 of the U.S. Constitution, which provides that “The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States,” which is to say, a citizen of one state has a fundamental right “to take, hold, and dispose of property [in another state]; and an exemption from higher taxes or impositions than are paid by the other citizens of the state.” Corfield v. Coryell, 6 Fed. Cas. 546, 551-52 (C.C.E.D.Pa.1823).
    
    



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