Senate Bill No. 632
(By Senators Chafin, Browning, Oliverio, Green and Stollings)
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[Introduced February 22, 2010; referred to the Committee on
Finance.]
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A BILL to amend and reenact §11-13A-6 of the Code of West Virginia,
1931, as amended, relating to dedicating a portion of revenue
generated from severance taxes for the benefit of counties and
municipalities; creating fund; and providing permissible uses
for fund.
Be it enacted by the Legislature of West Virginia:
That §11-13A-6 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 13A. SEVERANCE AND BUSINESS PRIVILEGE TAX ACT.
§11-13A-6. Additional tax on the severance, extraction and
production of coal; dedication of additional tax
for benefit of counties and municipalities;
distribution of major portion of such additional
tax to coal-producing counties; distribution of
minor portion of such additional tax to all counties and municipalities; reports; rules;
special funds in office of State Treasurer; method
and formulas for distribution of such additional
tax; expenditure of funds by counties and
municipalities for public purposes; special funds
in counties and municipalities; and requiring
special county and municipal budgets and reports
thereon.
(a) Additional coal severance tax. -- Upon every person
exercising the privilege of engaging or continuing within this
state in the business of severing coal, or preparing coal (or both
severing and preparing coal), for sale, profit or commercial use,
there is hereby imposed an additional severance tax, the amount of
which shall be equal to the value of the coal severed or prepared
(or both severed and prepared), against which the tax imposed by
section three of this article is measured as shown by the gross
proceeds derived from the sale of the coal by the producer,
multiplied by thirty-five one hundredths of one percent. The tax
imposed by this subsection is in addition to the tax imposed by
section three of this article, and this additional tax is referred
to in this section as the "additional tax on coal".
(b) This additional tax on coal is imposed pursuant to the
provisions of section six-a, article ten of the West Virginia
Constitution. Effective July 1, 2010, one percent of every $1 million of the tax annually generated under this section for the
fiscal year 2010 shall be dedicated for the use and benefit of the
counties and municipalities from which those taxes were generated,
and any other counties upon application to the State Auditor, and
shall be distributed to each county and municipality as provided in
this section. The remaining funds attributable to those taxes
shall be distributed as provided in this section. The remaining
seventy-five percent of the net proceeds of this additional tax on
coal shall be distributed by the State Treasurer in the manner
specified in this section to the various counties of this state in
which the coal upon which this additional tax is imposed was
located at the time it was severed from the ground. Those
counties are referred to in this section as the "coal-
producing counties". The remaining twenty-five percent of the net
proceeds of this additional tax on coal shall be distributed among
all the counties and municipalities of this state in the manner
specified in this section.
(c) The additional tax on coal shall be due and payable,
reported and remitted as elsewhere provided in this article for the
tax imposed by section three of this article, and all of the
enforcement and other provisions of this article shall apply to the
additional tax. In addition to the reports and other information
required under the provisions of this article and the tonnage
reports required to be filed under the provisions of section
seventy-seven, article two, chapter twenty-two-a of this code, the Tax Commissioner is hereby granted plenary power and authority to
promulgate reasonable rules requiring the furnishing by producers
of such additional information as may be necessary to compute the
allocation required under the provisions of subsection (f) of this
section. The Tax Commissioner is also hereby granted plenary power
and authority to promulgate such other reasonable rules as may be
necessary to implement the provisions of this section: Provided,
That notwithstanding any language contained in this code to the
contrary, the gross amount of additional tax on coal collected
under this article shall be paid over and distributed without the
application of any credits against the tax imposed by this section.
(d) In order to provide a procedure for the distribution of
the one percent of every $1 million of the tax annually generated
from the tax imposed under this section for the fiscal year 2010,
as provided in subsection (a) of this section, a special fund known
as the County Severance Revenue Fund is hereby established in the
State Treasurer's Office. The moneys in the fund shall be
distributed to the respective counties and municipalities entitled
thereto at the direction of the State Auditor upon application for
reimbursement for the costs associated with transporting citizens
to the pro-coal rally held in Washington, D.C. on May 9, 2009.
Seventy-five percent of any moneys remaining in the fund at the end
of fiscal year 2010 shall be deposited in the "County Coal Revenue
Fund" as provided in this section, and twenty-five percent of any
such remaining moneys shall be deposited in the "All Counties and Municipalities Coal Revenue Fund" as provided in this section.
(d) (e) In order to provide a procedure for the distribution
of the remaining seventy-five percent of the net proceeds of the
additional tax on coal to the coal-producing counties, the special
fund known as the "County Coal Revenue Fund" established in the
State Treasurer's office by chapter one hundred sixty-two, acts of
the Legislature, 1985 regular session, as amended and reenacted in
subsequent Acts of the Legislature, is hereby continued. In order
to provide a procedure for the distribution of the remaining
twenty-five percent of the net proceeds of the additional tax on
coal to all counties and municipalities of the state, without
regard to coal having been produced therein, the special fund known
as the "All Counties and Municipalities Revenue Fund" established
in the State Treasurer's office by chapter one hundred sixty-two,
Acts of the Legislature, 1985 regular session, as amended and
reenacted in subsequent Acts of the Legislature, is hereby
redesignated as the "All Counties and Municipalities Coal Revenue
Fund" and is hereby continued.
Seventy-five percent of the net proceeds of such additional
tax on coal shall be deposited in the County Coal Revenue Fund and
twenty-five percent of the net proceeds shall be deposited in the
All Counties and Municipalities Coal Revenue Fund, from time to
time, as the proceeds are received by the Tax Commissioner. The
moneys in the funds shall be distributed to the respective counties
and municipalities entitled to the moneys in the manner set forth in subsection (e) (f) of this section.
(e) (f) The moneys in the County Coal Revenue Fund and the
moneys in the All Counties and Municipalities Coal Revenue Fund
shall be allocated among and distributed quarterly to the counties
and municipalities entitled to the moneys by the State Treasurer in
the manner specified in this section. On or before each
distribution date, the State Treasurer shall determine the total
amount of moneys in each fund which will be available for
distribution to the respective counties and municipalities entitled
to the moneys on that distribution date. The amount to which a
coal-producing county is entitled from the County Coal Revenue Fund
shall be determined in accordance with subsection (f) (g) of this
section, and the amount to which every county and municipality is
entitled from the All Counties and Municipalities Coal Revenue Fund
shall be determined in accordance with subsection (g) (h) of this
section. After determining as set forth in subsection (f) (g) and
subsection (g) (h) of this section the amount each county and
municipality is entitled to receive from the respective fund or
funds, a warrant of the State Auditor for the sum due to each
county or municipality shall issue and a check drawn thereon making
payment of such amount shall thereafter be distributed to each such
county or municipality.
(f) (g) The amount to which a coal-producing county is
entitled from the County Coal Revenue Fund shall be determined by:
(1) Dividing the total amount of moneys in the fund then available for distribution by the total number of tons of coal mined in this
state during the preceding quarter; and (2) multiplying the
quotient thus obtained by the number of tons of coal removed from
the ground in the county during the preceding quarter.
(g) (h) The amount to which each county and municipality is
entitled from the All Counties and Municipalities Coal Revenue Fund
shall be determined in accordance with the provisions of this
subsection. For purposes of this subsection "population" means the
population as determined by the most recent decennial census taken
under the authority of the United States:
(1) The treasurer shall first apportion the total amount of
moneys available in the All Counties and Municipalities Coal
Revenue Fund by multiplying the total amount in the fund by the
percentage which the population of each county bears to the total
population of the state. The amount thus apportioned for each
county is the county's "base share".
(2) Each county's base share shall then be subdivided into two
portions. One portion is determined by multiplying the base share
by that percentage which the total population of all unincorporated
areas within the county bears to the total population of the
county, and the other portion is determined by multiplying the base
share by that percentage which the total population of all
municipalities within the county bears to the total population of
the county. The former portion shall be paid to the county and the
latter portion is the "municipalities' portion" of the county's base share. The percentage of the latter portion to which each
municipality in the county is entitled shall be determined by
multiplying the total of the latter portion by the percentage which
the population of each municipality within the county bears to the
total population of all municipalities within the county.
(h) (i) All counties and municipalities shall create a "Coal
Severance Tax Revenue Fund" which shall be the depository for
moneys distributed to any county or municipality under the
provisions of this section, from either or both special funds.
Moneys in the Coal Severance Tax Revenue Fund, in compliance with
subsection (i) (j) of this section, may be expended by the county
commission or governing body of the municipality for such public
purposes as the county commission or governing body shall determine
to be in the best interest of the people of its respective county
or municipality: Provided, That in counties with population in
excess of two hundred thousand, at least seventy-five percent of
the funds received from the county coal revenue fund shall be
apportioned to, and expended within the coal-producing area or
areas of the county, said coal-producing areas of each county to be
determined generally by the State Tax Commissioner: Provided,
however, That the Coal Severance Tax Revenue Fund moneys shall not
be budgeted for personal services in an amount to exceed one fourth
of the total funds available in such fund.
(i) (j) On or before March 28, 1986, and each March 28
thereafter, each county commission or governing body of a municipality receiving such revenue shall submit to the Tax
Commissioner on forms provided by the Tax Commissioner a special
budget, detailing how such revenue is to be spent during the
subsequent fiscal year. Such budget shall be followed in expending
the revenue unless a subsequent budget is approved by the State Tax
Commissioner. All unexpended balances remaining in Coal Severance
Tax Revenue Fund at the close of a fiscal year shall be
reappropriated to the budget of the county commission or governing
body for the subsequent fiscal year. The reappropriation shall be
entered as an amendment to the new budget and submitted to the Tax
Commissioner on or before July 15, of the current budget year.
(j) (k) On or before December 15, 1986, and each December 15
thereafter, the Tax Commissioner shall deliver to the Clerk of the
Senate and the Clerk of the House of Delegates a consolidated
report of the special budgets, created by subsection (i) (j) of
this section, for all county commissions and municipalities as of
July 15 of the current year.
(k) (l) The State Tax Commissioner shall retain for the
benefit of the state from the additional taxes on coal collected
the amount of $35,000 annually as a fee for the administration of
such additional tax by the Tax Commissioner.
NOTE: The purpose of this bill is to defray the costs to
counties and municipalities for the expense of transporting
citizens to Washington, D.C. for a pro-coal rally held on May 9,
2009.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.