Senate Bill No. 357
(By Senators Boley and Burdette, Mr. President)
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[Introduced February 16, 1994; referred to the Committee
on Finance.]
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A BILL to amend and reenact section nine, article three, chapter
eleven of the code of West Virginia, one thousand nine
hundred thirty-one, as amended; and to amend and reenact
section two-m, article thirteen of said chapter, all
relating to taxation of municipally-owned property; and
making it clear that the exemption from business and
occupation taxes for power generating facilities owned by
municipalities is applied to municipalities established
under the laws of this state.
Be it enacted by the Legislature of West Virginia:
That section nine, article three, chapter eleven of the code
of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted; and that section two-m,
article thirteen of said chapter be amended and reenacted, all to
read as follows:
ARTICLE 3. ASSESSMENTS GENERALLY.
§11-3-9. Property exempt from taxation.
All property, real and personal, described in this section,
and to the extent herein limited, shall be exempt from taxation,
that is to say: Property belonging to the United States, other
than property permitted by the United States to be taxed under
state law; property belonging exclusively to the state; property
belonging exclusively to any county, district, city, village or
town in this state, and used for public purposes; property
located in this state, belonging to any city, town, village,
county or any other political subdivision of another state, and
used for public purposes; property used exclusively for divine
worship; parsonages, and the household goods and furniture
pertaining thereto; mortgages, bonds and other evidence of
indebtedness in the hands of bona fide owners and holders
hereafter issued and sold by churches and religious societies for
the purposes of securing money to be used in the erection of
church buildings used exclusively for divine worship, or for the
purpose of paying indebtedness thereon; cemeteries; property
belonging to, or held in trust for, colleges, seminaries,
academies and free schools, if used for educational, literary or
scientific purposes, including books, apparatus, annuities and
furniture; property belonging to, or held in trust for, colleges
or universities located in West Virginia, or any public or
private nonprofit foundation or corporation which receives
contributions exclusively for such college or university, if the
property or dividends, interest, rents or royalties derived
therefrom are used or devoted to educational purposes of suchcollege or university; public and family libraries; property used
for charitable purposes, and not held or leased out for profit;
property used for the public purposes of distributing water or
natural gas, or providing sewer service by a duly chartered
nonprofit corporation when such property is not held, leased out
or used for profit; property used for area economic development
purposes by nonprofit corporations when such property is not
leased out for profit; all real estate not exceeding one-half
acre in extent, and the buildings thereon, and used exclusively
by any college or university society as a literary hall, or as a
dormitory or clubroom, if not leased or otherwise used with a
view to profit; all property belonging to benevolent
associations, not conducted for private profit; property
belonging to any public institution for the education of the
deaf, dumb or blind, or any hospital not held or leased out for
profit; house of refuge, lunatic or orphan asylum; homes for
children or for the aged, friendless or infirm, not conducted for
private profit; fire engines and implements for extinguishing
fires, and property used exclusively for the safekeeping thereof,
and for the meeting of fire companies; all property on hand to be
used in the subsistence of livestock on hand at the commencement
of the assessment year; household goods to the value of two
hundred dollars, whether or not held or used for profit; bank
deposits and money; household goods (which term is deemed for
purposes of this section to mean only personal property and
household goods commonly found within the house and items used tocare for the house and its surrounding property) when not held or
used for profit, and personal effects (which term is deemed for
purposes of this section to mean only articles and items of
personal property commonly worn on or about the human body, or
carried by a person and normally thought to be associated with
the person) when not held or used for profit; dead victuals laid
away for family use and any other property or security exempted
by any other provision of law; but no property shall be exempt
from taxation which shall have been purchased or procured for the
purpose of evading taxation, whether temporarily holding the same
over the first day of the assessment year or otherwise:
Provided,
That real property which is exempt from taxation by
this section shall be entered upon the assessor's books, together
with the true and actual value thereof, but no taxes shall be
levied upon the same or extended upon the assessor's books.
Notwithstanding any other provisions of this section,
however, no language herein shall be construed to exempt from
taxation any property owned by, or held in trust for,
educational, literary, scientific, religious or other charitable
corporations or organizations, including any public or private
nonprofit foundation or corporation existing for the support of
any college or university located in West Virginia, unless such
property, or the dividends, interest, rents or royalties derived
therefrom, is used primarily and immediately for the purposes of
such corporations or organizations.
The tax commissioner shall, by issuance of regulations,provide each assessor with guidelines to ensure uniform
assessment practices statewide to effect the intent of this
section.
Except for municipalities or entities of other states owning
property in this state on the effective date of this section, the
term "municipality" is a word of art and means and includes any
Class I, Class II and Class III city and any Class IV town or
village, heretofore or hereafter incorporated as a municipal
corporation under the laws of this state.
ARTICLE 13. BUSINESS AND OCCUPATION TAX.
§11-13-2m. Business of generating or producing electric power;
exception; rates.
(a) Upon every person engaging or continuing within this
state in the business of generating or producing electric power
for sale, profit or commercial use, either directly or through
the activity of others, in whole or in part, when the sale
thereof is not subject to tax under section two-d of this
article, the amount of the tax to be equal to the value of the
electric power, as shown by the gross proceeds derived from the
sale thereof by the generator or producer of the same multiplied
by a rate of four percent, except that the rate shall be two
percent on that portion of the gross proceeds derived from the
sale of electric power to a plant location of a customer engaged
in a manufacturing activity, if the contract demand at such plant
location exceeds two hundred thousand kilowatts per hour per
year, or if the usage at such plant location exceeds two hundredthousand kilowatts per hour in a year.
(b) The measure of this tax shall be the value of all
electric power generated or produced in this state for sale,
profit or commercial use, regardless of the place of sale or the
fact that transmission may be to points outside this state:
Provided, That the gross income received by municipally owned a
municipality from plants owned by the municipality generating or
producing electricity shall not be subject to tax under this
article. For the purpose of this subsection, the term
"municipality" is a word of art and means and includes any Class
I, Class II and Class III city and any Class IV town or village,
heretofore or hereafter incorporated as a municipal corporation
under the laws of this state.
(c) Beginning the first day of March, one thousand nine
hundred eighty-nine, every person taxable under this section
shall determine their liability for payment of tax under this
section and under paragraph (3), subsection (a), section two-d
of this article and section two-n of this article. If for
taxable months beginning on or after the first day of March, one
thousand nine hundred eighty-nine such person's liability for
payment of tax under this section and paragraph (3), subsection
(a), section two-d of this article is less than the amount of
such person's liability for payment of tax under section two-n of
this article, then such person shall pay the tax due under
section two-n and not the sum of the amount of tax due under this
section and under paragraph (3), subsection (a), section two-d ofthis article. If the tax due under section two-n of this article
is less, then the amount of tax due under this section and
paragraph (3), subsection (a), section two-d of this article
shall be paid. The provisions of this section shall expire and
become null and void for taxable years beginning on or after the
first day of January, one thousand nine hundred ninety-eight.
NOTE: The purpose of this bill is to clarify that the
exemption from business and occupation taxes for power generating
facilities owned by municipalities is applied to municipalities
established under the laws of this state.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.