FISCAL NOTE



FUND(S):

General Revenue Fund

Sources of Revenue:

General Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


The stated purpose of this bill is to add a small scale tourism development component and an ancillary tourism facilities development component to the West Virginia Tourism Development Act. As written, this bill adds provisions to allow for a “small scale tourism development component” and an “ancillary tourism facilities development component.” In addition, the bill raises the approved cost expenditure to qualify for the “regular” tourism development project from $1.0 million to $2.5 million. The bill establishes that a “small scale tourism development component” must have approved costs greater than $250,000 but less than or equal to $2.5 million and an “ancillary tourism facilities development component” must have approved costs greater than $100,000 but less than or equal to $1.0 million. Also, the bill sets forth the amount of application fees to be paid to the Development Office, provides other parameters for qualification for the new tourism development components, limits the total amount of small scale tourism development tax credit to $1.5 million per year, and limits the total amount of ancillary tourism facilities development tax credit to $500,000 per year. According to our interpretation, passage of this bill may result in an annual reduction in the General Revenue Fund of up to $2 million per year (i.e., $1.5 million attributable to small scale tourism development tax credits and $0.5 million for ancillary tourism facilities development tax credits. Approved credits would be allowed as a credit against the Consumers Sales and Service Tax collected by the approved company. Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal. The Development Office may incur additional administrative costs due to passage of this bill.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2010
Increase/Decrease
(use"-")
2011
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 -2,000,000 -2,000,000


Explanation of above estimates (including long-range effect):


As written, this bill adds provisions to allow for a “small scale tourism development component” and an “ancillary tourism facilities development component.” In addition, the bill raises the approved cost expenditure to qualify for the “regular” tourism development project from $1.0 million to $2.5 million. The bill establishes that a “small scale tourism development component” must have approved costs greater than $250,000 but less than or equal to $2.5 million and an “ancillary tourism facilities development component” must have approved costs greater than $100,000 but less than or equal to $1.0 million. Also, the bill sets forth the amount of application fees to be paid to the Development Office, provides other parameters for qualification for the new tourism development components, limits the total amount of small scale tourism development tax credit to $1.5 million per year, and limits the total amount of ancillary tourism facilities development tax credit to $500,000 per year. According to our interpretation, passage of this bill may result in an annual reduction in the General Revenue Fund of up to $2 million per year (i.e., $1.5 million attributable to small scale tourism development tax credits and $0.5 million for ancillary tourism facilities development tax credits. Approved credits would be allowed as a credit against the Consumers Sales and Service Tax collected by the approved company. Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal. The Development Office may incur additional administrative costs due to passage of this bill.



Memorandum


The stated purpose of this bill is to add a small scale tourism development component and an ancillary tourism facilities development component to the West Virginia Tourism Development Act. As written, the bill uses a number of terms and phrases without providing definitions of the intended usage.



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov