FISCAL NOTE
FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
A New Program
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to: (1) Eliminate the authority of the West Virginia Economic Development Authority to grant tax credits to venture capital companies, economic development and technology advancement centers and business development corporations; (2) allow tax credits to be awarded to certified West Virginia small business investment companies and certified community development venture capital funds; (3) rename the act the "Community Redevelopment Act;" and (4) allow six million dollars of tax credits to be awarded during the fiscal year beginning July 1, 2007, with no more than three million dollars of credit being awarded to any single certified West Virginia small business investment company or certified community development venture capital fund that make investment in West Virginia.
As written, this bill creates a tax credit program available to taxpayers investing in West Virginia based small business investment companies or in local or regional community development venture capital funds. According to our interpretation, and assuming that the $6 million of credits that may be awarded in the Fiscal Year beginning July 1, 2007 would be allocated before taxpayers file their tax year 2007 tax return, passage of this bill will result in a $6 million reduction in the General Revenue Fund in Fiscal Year 2008.
Additional administrative costs to the State Tax Department associated with this bill would be minimal. In addition to the State Tax Department, the West Virginia Economic Development authority would likely incur additional administrative costs.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2007
Increase/Decrease
(use"-") |
2008
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 |
-6,000,000 |
0 |
Explanation of above estimates (including long-range effect):
As written, this bill essentially creates a tax credit program available to taxpayers investing in West Virginia based small business investment companies or in local or regional community development venture capital funds. According to our interpretation, and assuming that the $6 million of credits that may be awarded in the Fiscal Year beginning July 1, 2007 would be allocated before taxpayers file their tax year 2007 tax return, passage of this bill will result in a $6 million reduction in the General Revenue Fund in Fiscal Year 2008.
Additional administrative costs to the State Tax Department associated with this bill would be minimal. In addition to the State Tax Department, the West Virginia Economic Development authority would likely incur additional administrative costs.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kpetry@tax.state.wv.us