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 provide a tax credit for persons in counties affected by the chemical spill in the Elk River.
As written, this bill would provide a refundable tax credit of $1,000 to any person residing in Boone, Cabell, Clay, Jackson, Kanawha, Lincoln, Logan, Putnam, and Roane Counties for the tax year beginning on or after January 1, 2013 and ending on December 31, 2013. According to our interpretation and based on available county population estimates, passage of this bill would result in a reduction in the General Revenue Fund of roughly $480 million. Since the processing of the tax credit proposed by this bill will require new tax returns and computer programs, it is expected that most of the refunds paid out for the proposed tax credit would be made after June 30, 2014. Thus, the estimated $480 million reduction in the General Revenue Fund would occur in FY2015.
Additional administrative costs to the State Tax Department associated with passage of this bill would be $200,000. Also, many Taxpayers may incur additional costs since the claiming of the tax will likely require an amended return, since revised tax returns and processes will likely not be available by the April 15, 2014 due date for tax year 2013 Personal Income Tax returns.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2014
Increase/Decrease
(use"-") |
2015
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
200,000 |
0 |
| Personal Services |
0 |
180,000 |
0 |
| Current Expenses |
0 |
20,000 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
0 |
0 |
0 |
| Other |
0 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
-480,000,000 |
0 |
Explanation of above estimates (including long-range effect):
As written, this bill would provide a refundable tax credit of $1,000 to any person residing in Boone, Cabell, Clay, Jackson, Kanawha, Lincoln, Logan, Putnam, and Roane Counties for the tax year beginning on or after January 1, 2013 and ending on December 31, 2013. According to our interpretation and based on available county population estimates, passage of this bill would result in a reduction in the General Revenue Fund of roughly $480 million. Since the processing of the tax credit proposed by this bill will require new tax returns and computer programs, it is expected that most of the refunds paid out for the proposed tax credit would be made after June 30, 2014. Thus, the estimated $480 million reduction in the General Revenue Fund would occur in FY2015.
The latest available population estimates for the identified counties are as follows:
County Population
Boone 24,478
Cabell 96,974
Clay 9,297
Jackson 29,234
Kanawha 192,179
Lincoln 21,627
Logan 36,168
Putnam 56,435
Roane 14,684
Total 481,076
Additional administrative costs to the State Tax Department associated with passage of this bill would be $200,000 in FY2015. Also, many Taxpayers may incur additional costs since the claiming of the tax will likely require an amended return, since revised tax returns and processes will likely not be available by the April 15, 2014 due date for tax year 2013 Personal Income Tax returns.
Memorandum
The stated purpose of this bill is to provide a tax credit for persons in counties affected by the chemical spill in the Elk River.
While the Bill title and stated purpose refer to “counties affected by the chemical spill in the Elk River,” the proposed tax credit appears to be available to any person residing in the identified counties not just person actually affected by the chemical spill. The bill does not provide a definition for “person residing.” Absent a definition for the term “person residing,” the proposed tax credit maybe available to more persons than intended.
Person submitting Fiscal Note: Mark B. Muchow
Email Address: Roger.D.Cox@wv.gov