Date Requested:February 14, 2013
Time Requested:01:19 PM
Agency: Tax Department, State
CBD Number: Version: Bill Number: Resolution Number:
2013R1425 Introduced SB18
CBD Subject: MULTIFAMILY RENTAL PROPERTY
FUND(S)
General Revenue Fund, local governments
Sources of Revenue
General Fund,Other Fund Local Property Tax Revenu
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 provide for the method of appraising certain affordable, multifamily rental property for property tax assessment purposes. The bill also grants rule-making authority.
    
     As written, the bill would require County Assessors to consider the following in determining the value of certain property: the actual rents received and the impact of rent restrictions applicable to the property; the expenses associated with the operation of the property; and, the impact of rent restrictions on the transfer of title of the property. The bill also indicates that federal or State income tax credits allowed with respect to the property may not be treated as part of the property or as income attributable to the property. According to our interpretation and based upon information from a survey of County Assessors, passage of this bill would result in an annual decrease of roughly $3 million in local property tax revenues and minimal loss in State revenue.
    
     Additional administrative costs associated with this bill would be significant. Additional costs would be related to training that would be required for Assessors to comply with this legislation.

Fiscal Note Detail
Over-all effect
Effect of Proposal Fiscal Year
2013
Increase/Decrease
(use"-")
2014
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 would require County Assessors to consider the following in determining the value of certain property: the actual rents received and the impact of rent restrictions applicable to the property; the expenses associated with the operation of the property; and, the impact of rent restrictions on the transfer of title of the property. The bill also indicates that federal or State income tax credits allowed with respect to the property may not be treated as part of the property or as income attributable to the property. According to our interpretation and based upon information from a survey of County Assessors, passage of this bill would result in an annual decrease of roughly $3 million in local property tax revenues and minimal loss in State revenue.
    
     Additional administrative costs associated with this bill would be significant. Additional costs would be related to training that would be required for Assessors to comply with this legislation.
    


Memorandum
Person submitting Fiscal Note:
Mark B. Muchow
Email Address:
Roger.D.Cox@wv.gov