FISCAL NOTE



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


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


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