Date Requested:January 14, 2012
Time Requested:01:15 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2011R1787 Carry Over HB2235
CBD Subject: COUNTY ELECTION FOR HOMESTEAD EXEMPTION
FUND(S)
General Revenue Fund, local governments
Sources of Revenue
General Fund,Other Fund local property tax
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 permit county commissions to allow resident homeowners, who are sixty-five years or older, to defer the payment of property tax increases to their residential property during their lifetime.
    
    The use of this deferment would be a decision made on a county-by-county basis. Based on information from a deferment that was previously in effect, we estimate that the revenue loss from this bill would be minimal. When the previous deferment was in effect, no homeowners in any county elected to defer their taxes. If all counties permitted this type of deferment and all qualifying homeowners would elect to defer their taxes, there would be an annual decrease of roughly $1.8 million in local property tax revenues and minimal loss in State revenue. These taxes are to be recouped upon the death of the homeowner or the sale of the property.
    
    The State Tax Department would incur additional costs of $20,000 in programing costs to implement this legislation. There would be no other additional costs to the State or local governments.
    

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2012
Increase/Decrease
(use"-")
2013
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):
    The use of this deferment would be a decision made on a county-by-county basis. Based on information from a deferment that was previously in effect, we estimate that the revenue loss from this bill would be minimal. When the previous deferment was in effect, no homeowners in any county elected to defer their taxes. If all counties permitted this type of deferment and all qualifying homeowners would elect to defer their taxes, there would be an annual decrease of roughly $1.8 million in local property tax revenues and minimal loss in State revenue. These taxes are to be recouped upon the death of the homeowner or the sale of the property.
    
    The State Tax Department would incur additional costs of $20,000 in programing costs to implement this legislation. There would be no other additional costs to the State or local governments.
    


Memorandum
Person submitting Fiscal Note:
Mark Muchow
Email Address:
kerri.r.petry@wv.gov
    The stated purpose of this bill is to permit county commissions to allow resident homeowners, who are sixty-five years or older, to defer the payment of property tax increases to their residential property during their lifetime.
    
    The bill, as written, does not state that the proposal only applies to tax increases on the person’s residence. As a result, the deferment may also apply to property owned by the homeowner but used for commercial purposes. Also, a starting point after which the increases may be deferred is not stated in the bill.