Date Requested:February 03, 2011
Time Requested:03:21 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2011R2404 Introduced SB410
CBD Subject: NATURAL GAS VEHICLES
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 extend the alternative-fuel motor vehicle tax credits. The bill makes additional legislative findings. The bill provides for new tax credits for qualified alternative fuel vehicles and refueling infrastructure. The bill establishes the amount of credit and the period of time the credit is available. The bill also eliminates the requirement the credit to be taken over a three year period;. The bill further eliminates some definitions of terms and defines other terms. The bill requires the Tax Commissioner to promulgate new rules. Additionally, the bill allows for the carryover and recapture of the tax credit.
    
    As written, this bill would amend an expired article of the West Virginia Code (i.e., W. Va. Code §11-6D et seq.). The proposed bill revises definitions for alternative fuel and adds definitions for “plug-in hybrid electric vehicle,” “qualified alternative fuel vehicle refueling infrastructure,” and “qualified alternative fuel vehicle home refueling infrastructure.” The bill sets the tax credit for alternative fuel motor vehicles at 35 percent of the purchase price with a maximum tax credit of $7,500 for vehicles that weigh less than 26,000 pounds and a maximum tax credit of or $25,000 for vehicles weighing more than 26,000 pounds. The bill also establishes the tax credit for qualified alternative fuel vehicle refueling infrastructure at 50 percent of the total costs directly associated with the construction or purchase or installation of the infrastructure with a maximum of $250,000 ($312,500 for public use facilities) for tax years 2011 through 2013, a maximum of $200,000 ($250,000 public use) for tax years 2014 through 2015, a maximum of $150,000 ($187,500 public use) for tax years 2016 through 2021. The tax credit for qualified alternative fuel vehicle home refueling infrastructure is 50 percent of the total costs directly associated with the construction or purchase or installation of the infrastructure up to a maximum of $10,000. The availability of all three credits expires December 31, 2021.
    
    The State Tax Department does not have sufficient data on the number of potentially qualifying vehicles or potentially qualifying vehicle refueling infrastructures to accurately estimate the potential annual revenue reduction attributable to passage of this bill.
    
    Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal in most years. However, the reactivation of the credit also reactivates a reporting requirement contained in West Virginia Code §11-6D-8(c). Additional costs associated with compiling information for the report would be approximately $30,000 in Fiscal Year 2021.

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2011
Increase/Decrease
(use"-")
2012
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 0 0
3. Explanation of above estimates (including long-range effect):
    As written, this bill would amend an expired article of the West Virginia Code (i.e., W. Va. Code §11-6D et seq.). The proposed bill revises definitions for alternative fuel and adds definitions for “plug-in hybrid electric vehicle,” “qualified alternative fuel vehicle refueling infrastructure,” and “qualified alternative fuel vehicle home refueling infrastructure.” The bill sets the tax credit for alternative fuel motor vehicles at 35 percent of the purchase price with a maximum tax credit of $7,500 for vehicles that weigh less than 26,000 pounds and a maximum tax credit of or $25,000 for vehicles weighing more than 26,000 pounds. The bill also establishes the tax credit for qualified alternative fuel vehicle refueling infrastructure at 50 percent of the total costs directly associated with the construction or purchase or installation of the infrastructure with a maximum of $250,000 ($312,500 for public use facilities) for tax years 2011 through 2013, a maximum of $200,000 ($250,000 public use) for tax years 2014 through 2015, a maximum of $150,000 ($187,500 public use) for tax years 2016 through 2021. The tax credit for qualified alternative fuel vehicle home refueling infrastructure is 50 percent of the total costs directly associated with the construction or purchase or installation of the infrastructure up to a maximum of $10,000. The availability of all three credits expires December 31, 2021.
    
    The State Tax Department does not have sufficient data on the number of potentially qualifying vehicles or potentially qualifying vehicle refueling infrastructures to accurately estimate the potential annual revenue reduction attributable to passage of this bill.
    
    Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal in most years. However, the reactivation of the credit also reactivates a reporting requirement contained in West Virginia Code §11-6D-8(c). Additional costs associated with compiling information for the report would be approximately $30,000 in Fiscal Year 2021.


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kerri.r.petry@wv.gov
    The stated purpose of this bill is to extend the alternative-fuel motor vehicle tax credits. The bill makes additional legislative findings. The bill provides for new tax credits for qualified alternative fuel vehicles and refueling infrastructure. The bill establishes the amount of credit and the period of time the credit is available. The bill also eliminates the requirement the credit to be taken over a three year period;. The bill further eliminates some definitions of terms and defines other terms. The bill requires the Tax Commissioner to promulgate new rules. Additionally, the bill allows for the carryover and recapture of the tax credit.
    
    The bill, as written, revises the definition of “alternate fuel’ by eliminating some fuels in the current (but expired) statute and by adding other fuels. The bill definition, as revised, will be different than the definition of “alternate fuel’ used by the U.S. Department of Energy. The bill also uses a number of terms without providing a definition for the terms.
    
    The body of revised WV Code §11-6D-2 indicates that the credit may be applied against the Personal Income Tax, Business Franchise Tax, and Corporation Net Income Tax, however, the title for the Section does not include the Business Franchise Tax.