FISCAL NOTE



FUND(S):

None

Sources of Revenue:

Other Fund

Legislation creates:

A New Program



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


The stated purpose of this bill is to prescribe uniform minimum reporting and content requirements for payment in lieu of tax agreements, to require that all local levying bodies approve a payment in lieu of tax agreement and to provide for allocation and distribution of payments in lieu of property tax. These rules would apply to payment in lieu of property tax agreements executed after June 30, 2008. The bill sets forth requirements for payment in lieu of property tax agreements. The requirements include the following: (1) the property to which the payment in lieu of property tax agreement relates must have been determined to be exempt from ad valorem property tax by the assessor of the county in which the property is situated or by the State Tax Commissioner; (2) the payment in lieu of property tax agreement must be approved by all local levying bodies having taxing jurisdiction that would have received tax revenues from the property subject to the agreement, and (3) the payment in lieu of property tax agreement must contain a summary statement in a form prescribed by the Chief Inspector. Additionally, the bill as written, requires the owner of the tax exempt property to file a copy of the payment in lieu of property tax agreement, the initial summary report and each annual updated summary report with the county clerk with copies of the initial summary report and each annual updated summary report to the State Auditor and to the Secretary of the Department of Revenue. Payments received from the agreements must be distributed among all local levying bodies in the same proportions as property taxes are distributed. The bill requires adjustments to be made to the State School Aid program in counties receiving payments from the agreements covered by this proposal. The provisions of the bill apply to all payment in lieu of property tax agreements executed after June 30, 2008. According to our interpretation, passage of this bill would have no impact on State and local revenue. Passage of this bill will result in a minimal increase in administrative expenses to the State and local governments.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2008
Increase/Decrease
(use"-")
2009
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):


This bill prescribes uniform minimum reporting and content requirements for payment in lieu of tax agreements, to require that all local levying bodies approve a payment in lieu of tax agreement, and to provide for allocation and distribution of payments in lieu of property tax. These rules would apply to payment in lieu of property tax agreements executed after June 30, 2008. According to our interpretation, passage of this bill would have no impact on State and local revenue. Passage of this bill will result in a minimal increase in administrative expenses to the State and local governments.



Memorandum


The stated purpose of this bill is to prescribe uniform minimum reporting and content requirements for payment in lieu of tax agreements, to require that all local levying bodies approve a payment in lieu of tax agreement and to provide for allocation and distribution of payments in lieu of property tax. These rules would apply to payment in lieu of property tax agreements executed after June 30, 2008. The bill, as written, has several references to the Department of Revenue and the Secretary of the Department of Revenue. However, the references should be to the State Tax Department, since the State Tax Commissioner has overall responsibility for administering the Property Tax at the State level. Proposed W. Va. Code ยง11-3-9a(c) provides that the legislation applies to payment in lieu of tax agreements entered into after June 30, 2007. As written, the bill would also apply to payment in lieu of tax agreements already in existence and amended after March 9, 2003. Also, the bill, as written, contains a number of provisions in which the intent may be subject to varying interpretations.



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kpetry@tax.state.wv.us