HOUSE CONCURRENT RESOLUTION NO. 55

(By Delegates Fragale, Angotti, Cann and Warner)


[Introduced April 3, 2001; referred to the

Committee on Rules.]


Requesting the Joint Committee on Government and Finance to conduct a study of tax increment financing.

Whereas, Tax Increment Financing is a financing/development tool that allows for Payments In Lieu Of Taxes (PILOTS) to be used to pay for approved project-related costs, infrastructure and capital improvements; and
Whereas, Tax Increment Financing uses the increase in property taxes generated by development to support a level of debt service to finance a development project or portion thereof; and
Whereas, Tax Increment Financing (TIF) has been used to effectively assist in elimination of areas of economic blight; and
Whereas, Property tax rates within a TIF project area are frozen for the life of the project, and a plan may contain more than one project, with each project having a maximum life of several years, and projects may be phased in over a period which further extends the maximum plan life, during which increases in city and county taxes due to new construction and improvements associated with the TIF plan are abated for this period; and
Whereas, Property owners make PILOTS in an amount equal to the tax abatement granted; and those payments go into a special allocation fund along with a part of all local operations and activity taxes generated within the plan area; and
Whereas, Approved project costs are then paid or reimbursed to the developer from the special allocation fund, and PILOTS which exceed approved expenses are reallocated to the appropriate taxing districts; and
Whereas, Tax Incremental Financing benefits bond financing and provides funding for project-related costs, capital and infrastructure improvements to the plan area; therefore, be it
Resolved by the Legislature of West Virginia:
That the Joint Committee on Government and Finance is hereby requested to conduct a study of Tax Increment Financing as it is being employed in other states and its potential to generate economic development in West Virginia; and, be it
Further Resolved, That the Joint Committee on Government and Finance report to the regular session of the Legislature, 2002, on its findings, conclusions and recommendations, together with drafts of any legislation necessary to effect its recommendations; and, be it
Further Resolved, That the expenses necessary to conduct this study, to prepare a report and to draft necessary legislation be paid from legislative appropriations to the Joint Committee on Government and Finance.