Date Requested:March 22, 2013
Time Requested:12:00 PM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2013R2924 Introduced HB3043
CBD Subject: METHANE MONITORS
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 define eligible safety property as including methane monitoring equipment.
    
     As indicated in the stated purpose above, the bill expands the definition of eligible safety property in Article 13BB of Chapter 11 of the West Virginia Code by including methane monitoring equipment as safety technology equipment. Article 13BB allows eligible taxpayers a credit against the taxes imposed by articles twenty-three (Business Franchise Tax) and twenty-four (Corporation Net Income Tax) of Chapter 11. The amount of allowable credit is equal to fifty percent of the cost for eligible safety property pursuant to a qualified purchase, which is placed in service or use in this state by the eligible taxpayer during the tax year. The State Tax Department does not have information on the number of methane monitors that would be purchased. Since monitors are required equipment in underground mines and the Taxpayer would be able to recoup up to fifty percent of the cost through the tax credit, the number purchased may be significant. Based upon information from the initial year of the West Virginia Innovative Mine Safety Technology Tax Credit, the proposal in this bill may result in additional annual tax credit allocations of up to $1.5 million per year (the annual allocations of the tax credit are currently capped at $2 million during any fiscal year). The additional tax credit allocations attributable to passage of this bill would result in a reduction in the General Revenue Fund of up the $1.5 million per year.
    
     Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal.

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 indicated in the stated purpose above, the bill expands the definition of eligible safety property in Article 13BB of Chapter 11 of the West Virginia Code by including methane monitoring equipment as safety technology equipment. Article 13BB allows eligible taxpayers a credit against the taxes imposed by articles twenty-three (Business Franchise Tax) and twenty-four (Corporation Net Income Tax) of Chapter 11. The amount of allowable credit is equal to fifty percent of the cost for eligible safety property pursuant to a qualified purchase, which is placed in service or use in this state by the eligible taxpayer during the tax year. The State Tax Department does not have information on the number of methane monitors that would be purchased. Since monitors are required equipment in underground mines and the Taxpayer would be able to recoup up to fifty percent of the cost through the tax credit, the number purchased may be significant. Based upon information from the initial year of the West Virginia Innovative Mine Safety Technology Tax Credit, the proposal in this bill may result in additional annual tax credit allocations of up to $1.5 million per year (the annual allocations of the tax credit are currently capped at $2 million during any fiscal year). The additional tax credit allocations attributable to passage of this bill would result in a reduction in the General Revenue Fund of up the $1.5 million per year.
    
     Additional administrative costs to the State Tax Department associated with passage of this bill would be minimal.


Memorandum
Person submitting Fiscal Note:
Mark B. Muchow
Email Address:
Roger.D.Cox@wv.gov
     The stated purpose of this bill is to define eligible safety property as including methane monitoring equipment.
    
     Section 75.342 of Title 30 of the Code of Federal Regulations (MSHA’s regulations) and W. Va. Code §22A-2-43 require machine mounted methane monitors on all face cutting machines, continuous miners, etc. It appears that since machine mounted methane monitors are already required safety equipment for use in mines, that only portable methane monitors would be eligible to be on the list of approved innovative mine safety technology. Thus, the machine mounted methane monitors don’t appear to be eligible for the tax credit.