H. B. 4846
(By Delegates Michael, Leach, Kominar, Stalnaker, Varner,
H. K. White, Williams, Hall, Evans, G. White and Cann)
(Originating in the Committee on Finance)
[February 23, 2006]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §5-10-22i; to amend
and reenact §5E-1-8 of said code; to amend said code by adding
thereto a new section, designated §11-24-43; and to amend said
code by adding thereto a new section, designated §18-7A-26t,
all relating to providing one-time supplements to certain
annuitants; dedication of corporate net income tax proceeds to
pay for supplement; and supplying fiscal support for such
supplements by increasing available general revenue through
the expiration of certain tax credits.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §5-10-22i; that §5E-1-8
of said code be amended and reenacted; that said code be amended by
adding thereto a new section, designated §11-24-43; and that said
code be amended by adding thereto a new section, designated §18-7A-
26t, all to read as follows:
CHAPTER 5. GENERAL POWERS AND AUTHORITY OF THE GOVERNOR, SECRETARY OF STATE AND ATTORNEY GENERAL; BOARD OF PUBLIC WORKS;
MISCELLANEOUS AGENCIES, COMMISSIONS, OFFICES, PROGRAMS, ETC.
ARTICLE 10. WEST VIRGINIA PUBLIC EMPLOYEES RETIREMENT ACT.
§5-10-22i. One-time supplement for certain annuitants effective
July 1, 2006.
(a) A one-time supplement to retirement benefits of three
percent shall be provided to all retirees that are age seventy or
older and have been annuitants for at least five consecutive years
as of the effective date of this section and beneficiaries of
deceased members who would have been at least seventy years of age
or older and have been annuitants for at least five consecutive
years as of the effective date of this section.
(b) The one-time supplement provided for in this section
applies only to members who have retired at least five years prior
to the effective date of this section or, if applicable, to
beneficiaries of deceased members who have been receiving benefits
under the retirement system at least five years prior to the
effective date of this section: Provided, That the supplement
provided herein is subject to any applicable limitations thereon
under Section 415 of the Internal Revenue Code of 1986, as amended.
CHAPTER 5E. VENTURE CAPITAL COMPANY.
ARTICLE 1. WEST VIRGINIA CAPITAL COMPANY ACT.
§5E-1-8. Tax credits.
(a) The total amount of tax credits authorized for a single
qualified company may not exceed two million dollars. The total amount of tax credits authorized for a single economic development
and technology advancement center may not exceed one million
dollars. Capitalization of the company or center may be increased
pursuant to rule of the authority.
(b) (1) The total credits authorized by the authority for all
companies and centers may not exceed a total of ten million dollars
each fiscal year: Provided, That for the fiscal year beginning on
the first day of July, one thousand nine hundred ninety-nine, the
total credits authorized for all companies may not exceed a total
of six million dollars: Provided, however, That for the fiscal
year beginning on the first day of July, two thousand, the total
credits authorized for all companies may not exceed a total of four
million dollars: Provided further, That for the fiscal year
beginning on the first day of July, two thousand one, the total
credits authorized for all companies may not exceed a total of four
million dollars: And provided further, That for the fiscal year
beginning on the first day of July, two thousand two, the total
credits authorized for all companies may not exceed a total of
three million dollars: And provided further, That for the fiscal
year beginning on the first day of July, two thousand three, the
total credits authorized for all companies may not exceed a total
of three million dollars: And provided further, That for the
fiscal year beginning on the first day of July, two thousand four,
the total credits authorized for all companies may not exceed a
total of one million dollars: And provided further, That for the fiscal year beginning on the first day of July, two thousand five,
there shall be no credits authorized: And provided further, That
for the fiscal years beginning on the first day of July, two
thousand six, two thousand seven, and two thousand eight, there
shall be no credits authorized: And provided further, That the
capital base of any qualified company other than an economic
development and technology advancement center qualified under the
provisions of article twelve-a, chapter eighteen-b of this code
shall be invested in accordance with the provisions of this
article. The authority shall allocate these credits to qualified
companies and centers in the order that the companies are
qualified.
(2) Not more than two million dollars of the credits allowed
under subdivision (1) of this subsection may be allocated by the
authority during each fiscal year to one or more small business
investment companies described in this subdivision: Provided, That
for the fiscal year beginning on the first day of July, two
thousand four, and for the fiscal year beginning on the first day
of July, two thousand five, and for the fiscal years beginning on
the first day of July, two thousand six, two thousand seven and two
thousand eight, no credits authorized by this section may be
allocated by the authority to one or more small business investment
companies. After a portion of the credits are allocated to small
business investment companies as provided in this section, not more
than one million dollars of the credits allowed under subdivision
(1) of this subsection may be allocated by the authority during each fiscal year to one or more economic development and technology
advancement centers qualified by the authority under article
twelve-a, chapter eighteen-b of this code: Provided, however, That
for the fiscal year beginning on the first day of July, two
thousand four, all of the credits allowed under subdivision (1) of
this subsection shall be allocated only to one or more qualified
economic development and technology advancement centers: Provided
further, That for the fiscal year beginning on the first day of
July, two thousand five, no credits allowed under subdivision (1)
of this subsection shall be allocated to any qualified economic
development and technology advancement center; And provided
further, That for the fiscal years beginning on the first day of
July, two thousand six, two thousand seven and two thousand eight,
no credits allowed under subdivision (1) of this subsection shall
be allocated to any qualified economic development and technology
advancement center. The remainder of the tax credits allowed during
the fiscal year shall be allocated by the authority under the
provisions of section four, article two of this chapter: And
provided further Provided, That for the fiscal year beginning on
the first day of July, two thousand four, and for the fiscal year
beginning on the first day of July, two thousand five, no credits
authorized by this section may be allocated by the authority to a
taxpayer pursuant to the provisions of section four, article two of
this chapter: Provided, however, That for the fiscal year beginning
on the first day of July, two thousand six, two thousand seven and two thousand eight, no credits authorized by this section may be
allocated by the authority to a taxpayer pursuant to the provisions
of section four, article two of this chapter. The portion of the
tax credits allowed for small business investment companies
described in this subdivision shall be allowed only if allocated by
the authority during the first ninety days of the fiscal year and
may only be allocated to companies that: (A) Were organized on or
after the first day of January, one thousand nine hundred
ninety-nine; (B) are licensed by the small business administration
as a small business investment company under the small business
investment act; and (C) have certified in writing to the authority
on the application for credits under this act that the company will
diligently seek to obtain and thereafter diligently seek to invest
leverage available to the small business investment companies under
the small business investment act. These credits shall be allocated
by the authority in the order that the companies are qualified. The
portion of the tax credits allowed for economic development and
technology advancement centers described in article twelve-a,
chapter eighteen-b of this code shall be similarly allowed only if
allocated by the authority during the first ninety days of the
fiscal year: And provided further, That solely for the fiscal year
beginning on the first day of July, two thousand four, the
authority may allocate the tax credits allowed for economic
development and technology advancement centers at any time during
the fiscal year. Any credits which have not been allocated to
qualified companies meeting the requirements of this subdivision relating to small business investment companies or to qualified
economic development and technology advancement centers during the
first ninety days of the fiscal year shall be made available and
allocated by the authority under the provisions of section four,
article two of this chapter: And provided further Provided, That
for the fiscal year beginning on the first day of July, two
thousand four, and for the fiscal year beginning on the first day
of July, two thousand five, and for the fiscal years beginning on
the first day of July, two thousand six, two thousand seven, and
two thousand eight, no credits authorized by this section may be
allocated by the authority to a taxpayer pursuant to the provisions
of section four, article two of this chapter.
(3) Notwithstanding any provision of this code or legislative
rule promulgated thereunder to the contrary, for the fiscal year
beginning on the first day of July, two thousand four, and for the
fiscal year beginning on the first day of July, two thousand five,
the authority has the sole discretion to allocate or refuse to
allocate tax credits authorized under this section to any qualified
economic development and technology advancement center upon its
determination of the extent to which the center will fulfill the
purposes of this article. The determination shall be based upon the
application of the center, the extent to which the company or
center fulfilled those purposes in prior years after receiving tax
credits authorized under this section, the extent to which the
center is expected to stimulate economic development and high
technology research in the chemical industry and such other similarly related criteria as the authority may establish by vote
of the majority of authority.
(c) Any investor, including an individual, partnership,
limited liability company, corporation or other entity who makes a
capital investment in a qualified West Virginia capital company, is
entitled to a tax credit equal to fifty percent of the investment,
except as otherwise provided in this section or in this article:
Provided, That the tax credit available to investors who make a
capital investment in an economic development and technology
advancement center shall be one hundred percent of the investment.
The credit allowed by this article shall be taken after all other
credits allowed by chapter eleven of this code. It shall be taken
against the same taxes and in the same order as set forth in
subsections (c) through (i), inclusive, section five, article
thirteen-c, chapter eleven of this code. The credit for investments
by a partnership, limited liability company, a corporation electing
to be treated as a subchapter S corporation or any other entity
which is treated as a pass through entity under federal and state
income tax laws may be divided pursuant to election of the entity's
partners, members, shareholders or owners.
(d) The tax credit allowed under this section is to be
credited against the taxpayer's tax liability for the taxable year
in which the investment in a qualified West Virginia capital
company or economic development and technology advancement center
is made. If the amount of the tax credit exceeds the taxpayer's tax
liability for the taxable year, the amount of the credit which exceeds the tax liability for the taxable year may be carried to
succeeding taxable years until used in full or until forfeited:
Provided, That: (i) Tax credits may not be carried forward beyond
fifteen years; and (ii) tax credits may not be carried back to
prior taxable years. Any tax credit remaining after the fifteenth
taxable year is forfeited.
(e) The tax credit provided in this section is available only
to those taxpayers whose investment in a qualified West Virginia
capital company or economic development and technology advancement
center occurs after the first day of July, one thousand nine
hundred eighty-six.
(f) The tax credit allowed under this section may not be used
against any liability the taxpayer may have for interest, penalties
or additions to tax.
(g) Notwithstanding any provision in this code to the
contrary, the tax commissioner shall publish in the state register
the name and address of every taxpayer and the amount, by category,
of any credit asserted under this article. The categories by dollar
amount of credit received are as follows:
(1) More than $1.00, but not more than $50,000;
(2) More than $50,000, but not more than $100,000;
(3) More than $100,000, but not more than $250,000;
(4) More than $250,000, but not more than $500,000;
(5) More than $500,000, but not more than $1,000,000; and
(6) More than $1,000,000.
CHAPTER 11. TAXATION.
ARTICLE 24. CORPORATION NET INCOME TAX.
§11-24-43. Dedication of corporation net income tax proceeds.
(a) There is hereby dedicated for the fiscal years beginning
on the first day of July, two thousand six, two thousand seven and
two thousand eight, an annual amount of ten million dollars from
annual collections of the tax imposed by this article for payment
of the unfunded liability created by the one-time supplement of
certain annuitants as provided in section twenty-two-i, article
ten, chapter five and section twenty-six-t, article seven-a,
chapter eighteen of this code.
(b) Notwithstanding any other provision of this code to the
contrary, on the first day of October of two thousand six, two
thousand seven and two thousand eight, ten million dollars from
collections of the tax imposed by this article shall be deposited
with the reserves of the public employees retirement and state
teachers retirement systems in such allocations as the consolidated
public retirement board finds to be necessary and advantageous in
funding the one-time supplements of certain annuitants as provided
in section twenty-two-i, article ten, chapter five and section
twenty-six-t, article seven-A, chapter eighteen of this code.
CHAPTER 18. EDUCATION.
ARTICLE 7A. STATE TEACHERS RETIREMENT SYSTEM.
§18-7A-26t. One-time supplement for certain annuitants effective
July 1, 2006.
(a) A one-time supplement to retirement benefits of three percent shall be provided to all retirees that are age seventy or
older and have been annuitants for at least five consecutive years
as of the effective date of this section and beneficiaries of
deceased members who would have been at least seventy years of age
or older and have been annuitants for at least five consecutive
years as of the effective date of this section.
(b)The one-time supplement provided for in this section
applies only to members who have retired at least five years prior
to the effective date of this section or, if applicable, to
beneficiaries of deceased members who have been receiving benefits
under the retirement system at least five years prior to the
effective date of this section: Provided, That the supplement
provided herein is subject to any applicable limitations thereon
under Section 415 of the Internal Revenue Code of 1986, as amended.
NOTE: The purpose of this bill is to provide for a one-time
supplement of three percent to be paid to all annuitants of the
Public Employees' Retirement and Teachers' Retirement Systems that
are age seventy or older and retired for five years or more on July
1, 2006. The bill dedicates $10 million of corporate net income
tax revenue in each fiscal years 2007, 2008 and 2009 to fund the
supplement. The bill would eliminate $10 million in Capital
Company Tax Credits for each fiscal year 2007, 2008 and 2009 to
offset the General Revenue Fund from the dedication corporate net
income tax revenues.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.