Date Requested:March 12, 2013
Time Requested:01:33 PM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2013R1949 Introduced HB2903
CBD Subject: "ECONOMIC FAIRNESS ACT"
FUND(S)
State General Revenue Fund, General Revenue Fund of Counties
Sources of Revenue
General Fund,Other Fund General Revenue Fund of C
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 create the economic fairness act and encourage economic development in counties with high unemployment.
    
     Based upon our interpretation of this bill, passage of this bill would result in a reduction in the General Revenue Fund of up to $2.5 million per year beginning in Fiscal Year 2014. The bill provides for a partial refund of the Personal Income Tax collections from the five counties with the highest average unemployment during the previous three years. Each of the five designated counties would receive additional revenues equal to 20 percent of Personal Income Tax collections attributable to the county or $500,000, whichever is less. As written, the bill requires the designated counties to submit an economic development plan to the West Virginia Economic Development Authority. Upon approval of the economic development plan by the West Virginia Economic Development Authority, the funds would be released to the county for economic development purposes.
    
     There would be no additional administrative costs to the State Tax Department associated with this bill. However, the West Virginia Economic Development Authority may incur additional administrative costs due 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 -2,500,000 -2,500,000
3. Explanation of above estimates (including long-range effect):
     As written, the bill would result in a reduction in the General Revenue fund of up to $2.5 million annually. The five counties with the highest average unemployment during the previous three years would each receive the lesser of $500,000 or 20 percent of the Personal Income Tax collections attributable to the county.
    
     There would be no additional administrative costs to the State Tax Department associated with this bill. However, the West Virginia Economic Development Authority may incur additional administrative costs due to passage of this bill.


Memorandum
Person submitting Fiscal Note:
Mark B. Muchow
Email Address:
Roger.D.Cox@wv.gov
     The stated purpose of this bill is to create the economic fairness act and encourage economic development in counties with high unemployment.
    
     The referred to W. Va. Code § 31-15-4 defines project by referring to “industrial projects” and “commercial projects” as broadly defined under W. Va. Code §13-2C-3. No additional accountability provisions are offered.
     When certain taxes are dedicated to something other than the General Revenue Fund, the dedication is set out in the article of the particular tax. Since the proposed bill involves personal income tax it may be better placed in article 21 of the tax code. Article 1 of the Tax Code sets forth the general powers of the Tax Commissioner. There is a one section, which requires the Tax Commissioner to create a single dwelling residential housing index. The reason for the housing index differs from the use of unemployment statistics in the proposed bill.