Date Requested:February 24, 2011
Time Requested:12:22 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
Comm. Sub. SB537
CBD Subject: BUSINESSES THAT COMPOST
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 businesses a tax credit for composting certain types of garbage, landscape waste and food.
    
    As written, this bill would create a new tax credit in an amount equal to 50 percent of the cost of contracting with a commercial composting facility, up to a maximum of $2,000 per year for businesses that collect their compostable garbage, landscape waste and unused food separate from traditional garbage for transportation to a commercial composting facility. The credit may be applied against the Business and Occupation Tax, Personal Income Tax, Business Franchise Tax, and Corporation Net Income Tax. The bill also provides that the State Tax Commissioner in consultation with the Department of Environmental Protection must propose Legislative rules to provide any necessary clarification of the provisions of the proposed legislation and to efficiently provide for the general administration of the credit.
    
    The State Tax Department does not possess sufficient information as to the number of businesses that may already meet or choose to meet the credit requirement to contract with a commercial composting facility. Thus, we are unable to provide an estimate of the potential reduction in the General Revenue Fund that would occur due to claims of the proposed credit.
    
    Assuming that all Business and Occupation Tax, Personal Income Tax, Business Franchise Tax, and Corporation Net Income Tax returns claiming the new credit would be accepted as filed, additional administrative costs for the State Tax Department would be minimal. However, if the State Tax Department is required to verify that a business complied with the credit requirements, additional administrative costs to the State Tax Department could be significant.
    

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 create a new tax credit in an amount equal to 50 percent of the cost of contracting with a commercial composting facility, up to a maximum of $2,000 per year for businesses that collect their compostable garbage, landscape waste and unused food separate from traditional garbage for transportation to a commercial composting facility. The credit may be applied against the Business and Occupation Tax, Personal Income Tax, Business Franchise Tax, and Corporation Net Income Tax. The bill also provides that the State Tax Commissioner in consultation with the Department of Environmental Protection must propose Legislative rules to provide any necessary clarification of the provisions of the proposed legislation and to efficiently provide for the general administration of the credit.
    
    The State Tax Department does not possess sufficient information as to the number of businesses that may already meet or choose to meet the credit requirement to contract with a commercial composting facility. Thus, we are unable to provide an estimate of the potential reduction in the General Revenue Fund that would occur due to claims of the proposed credit.
    
    Assuming that all Business and Occupation Tax, Personal Income Tax, Business Franchise Tax, and Corporation Net Income Tax returns claiming the new credit would be accepted as filed, additional administrative costs for the State Tax Department would be minimal. However, if the State Tax Department is required to verify that a business complied with the credit requirements, additional administrative costs to the State Tax Department could be significant.
    


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kerri.r.petry@wv.gov
    The stated purpose of this bill is to businesses a tax credit for composting certain types of garbage, landscape waste and food.
    
    The bill uses a number of terms without providing a definition.