FISCAL NOTE
FUND(S):
Sources of Revenue:
Other Fund N/A
Legislation creates:
Neither Program nor Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of this bill is to reduce the amount of the allowance for uncollectibles (delinquencies, exonerations, and discounts) in the calculation of local share for the years 2014-15, and thereafter, from 5% to 4%.
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 |
-3,619,206 |
-3,619,206 |
Personal Services |
0 |
0 |
0 |
Current Expenses |
0 |
0 |
0 |
Repairs and Alterations |
0 |
0 |
0 |
Assets |
0 |
0 |
0 |
Other |
0 |
-3,619,206 |
-3,619,206 |
2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
Reducing the allowance rate for uncollectibles from 5% to 4% will increase the preliminary local share calculations by an estimated amount of $5,170, 295; however, since 30% of the increase is dedicated for Step 7, the estimated decrease in the amount required for state aid to schools will be approximately $3,619,206. However, based on the Interpretive Rule issued by the State Tax Department, the preliminary local share calculations will need to be updated when the county assessors issue their certified assessed valuations for the year, on or about March 3, 2014, so the estimated amount for FY15 will most likely change.
In addition, comparing actual regular levy tax collections to the projected gross tax collections for the 2012-13 year, actual collections were approximately 9% less than projections, statewide. To more accurately reflect actual tax collections, based on the 2012-13 data, the allowance for uncollectibles would need to be increased, rather than decreased.
Memorandum
Person submitting Fiscal Note: Brenda Freed
Email Address: bfreed@access.k12.wv.us