Date Requested:February 22, 2013
Time Requested:09:52 AM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2013R2070 Introduced HB2508
CBD Subject: TIF FINANCING
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 increase the minimum capital investment threshold from more than $25 million to more than $75 million for sales tax increment financing in county and municipal economic opportunity development districts.
    
     As written, this bill increases the capital investment threshold for proposed economic opportunity development district projects from $25 million to $75 million. Sales Tax Increment Financing projects (i.e., STIF program) involve the diversion of General Revenue Fund collections to retail development projects for an extended period of time, usually up to 30 years. The provisions of this bill seek to limit the STIF program to only special case projects. The proposed change helps to protect future General Revenue Fund revenues from raids associated with projects that normally occur within the State. Roughly 1.2 percent of total statewide sales tax collections are currently dedicated to STIF projects.
    
     There will be no increase in administrative costs to the State Tax Department attributable to passage of this bill.
    

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, this bill increases the capital investment threshold for proposed economic opportunity development district projects from $25 million to $75 million. Sales Tax Increment Financing projects (i.e., STIF program) involve the diversion of General Revenue Fund collections to retail development projects for an extended period of time, usually up to 30 years. The provisions of this bill seek to limit the STIF program to only special case projects. The proposed change helps to protect future General Revenue Fund revenues from raids associated with projects that normally occur within the State. Roughly 1.2 percent of total statewide sales tax collections are currently dedicated to STIF projects.
    
     There will be no increase in administrative costs to the State Tax Department attributable to passage of this bill.
    


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