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 give a ten per cent franchise tax credit to those home builders who sell more than ten homes for less than two hundred, fifty thousand dollars that are greater than one thousand, two hundred square feet, provided those homes are sold to public school teachers who are in the state’s five counties that have the highest percentage of teachers who are less than “highly qualified.” As written, this bill would provide for a tax credit to Business Franchise Tax filers that build and sell a certain amount homes for specified price range and home size in a specified, and possibly changing area. Considering the wide array of qualifiers, the State Tax Department does not have the quantitative data available to estimate the potential loss to the General Revenue Fund associated with passage of this bill. Additional administrative costs to the State Tax Department attributable to notifying taxpayers of the change would be minimal.



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 5,000 0 0
Personal Services 0 0 0
Current Expenses 5,000 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):


The stated purpose of this bill is to give a ten per cent franchise tax credit to those home builders who sell more than ten homes for less than two hundred, fifty thousand dollars that are greater than one thousand, two hundred square feet, provided those homes are sold to public school teachers who are in the state’s five counties that have the highest percentage of teachers who are less than “highly qualified.” As written, this bill would provide for a tax credit to Business Franchise Tax filers that build and sell a certain amount homes for specified price range and home size in a specified, and possibly changing area. Considering the wide array of qualifiers, the State Tax Department does not have the quantitative data available to estimate the potential loss to the General Revenue Fund associated with passage of this bill. Additional administrative costs to the State Tax Department would be approximately $5,000 for printing and promotion associated with notifying taxpayers of the change.



Memorandum


The stated purpose of this bill is to give a ten per cent franchise tax credit to those home builders who sell more than ten homes for less than two hundred, fifty thousand dollars that are greater than one thousand, two hundred square feet, provided those homes are sold to public school teachers who are in the state’s five counties that have the highest percentage of teachers who are less than “highly qualified.” No requirements or mechanism is provided for the homebuilder to demonstrate that the home was in fact sold to a teacher in one of the five counties.



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