Date Requested:February 02, 2012
Time Requested:02:40 PM
Agency: State Tax Department
CBD Number: Version: Bill Number: Resolution Number:
2012R1923 Introduced SB487
CBD Subject: COALBED METHANE GAS DISTRIBUTION FUND
FUND(S)
Coalbed Methane Gas Distribution Fund
Sources of Revenue
Special 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 amend §11-13A-20a to establish the Coalbed Methane Gas Distribution Fund in the State Treasurer’s Office, authorize the Tax Commissioner to deposit natural gas severance tax moneys into the fund, direct the State Treasurer to distribute moneys in the fund to county economic development authorities or corporations or county commissions and to authorize such distributions. The bill also corrects subdivision references and the omission of the term county economic development corporation. As well, the bill specifies the permissible uses of fund moneys, removes the requirement of Development Office approval of use of fund moneys and creates an accounting and reporting mechanism.
    
    As written, the bill directs the State Tax Commissioner to deposit the Severance Tax attributable to the production of coalbed methane, up to a maximum of $4 million, into a new fund in the State Treasurer’s Office known as the Coalbed Methane Gas Distribution Fund. The bill also provides that the State Treasurer is to distribute the money in the Coalbed Methane Gas Distribution Fund, as determined from the allocation methodology in the current Statute, to county commissions, county economic development authorities established pursuant to W. Va. Code §7-12 et seq., or other corporations designated by resolution of the county commission of the county as the lead entity for economic development activities. The bill also authorizes the State Treasurer to distribute accumulated but undistributed moneys from fiscal years 2009, 2010, 2011, and 2012 to the lead economic development authority or corporation for the county. Additionally, the bill makes changes to the activities on which the funds may be expended and to the necessary preapprovals and the bill requires entities receiving a distribution to file a written report with the Joint Committee on Government and Finance providing a detailed accounting of the expenditures of the money received.
    
    According to our interpretation, passage of this bill would have no impact on State or local revenue. The changes proposed in the bill do not affect the levying of the Severance Tax on coalbed methane or the computation of the amount to be distributed to counties or the lead economic development authorities in counties. The bill makes a technical correction in the identification of the lead economic development authorities in counties to whom allocated revenue is to be distributed.
    
    The State Tax Department will not incur any additional administrative costs associated with passage of this bill. However, the State Treasurer and the entities receiving a distribution of revenue may incur some additional administrative costs associated with passage of this bill.

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):
    As written, the bill directs the State Tax Commissioner to deposit the Severance Tax attributable to the production of coalbed methane, up to a maximum of $4 million, into a new fund in the State Treasurer’s Office known as the Coalbed Methane Gas Distribution Fund. The bill also provides that the State Treasurer is to distribute the money in the Coalbed Methane Gas Distribution Fund, as determined from the allocation methodology in the current Statute, to county commissions, county economic development authorities established pursuant to W. Va. Code §7-12 et seq., or other corporations designated by resolution of the county commission of the county as the lead entity for economic development activities. The bill also authorizes the State Treasurer to distribute accumulated but undistributed moneys from fiscal years 2009, 2010, 2011, and 2012 to the lead economic development authority or corporation for the county. Additionally, the bill makes changes to the activities on which the funds may be expended and to the necessary preapprovals and the bill requires entities receiving a distribution to file a written report with the Joint Committee on Government and Finance providing a detailed accounting of the expenditures of the money received.
    According to our interpretation, passage of this bill would have no impact on State or local revenue. The changes proposed in the bill do not affect the levying of the Severance Tax on coalbed methane or the computation of the amount to be distributed to counties or the lead economic development authorities in counties. The bill makes a technical correction in the identification of the lead economic development authorities in counties to whom allocated revenue is to be distributed.
    
    The State Tax Department will not incur any additional administrative costs associated with passage of this bill. However, the State Treasurer and the entities receiving a distribution of revenue may incur some additional administrative costs associated with passage of this bill.


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