Date Requested: February 02, 2015
Time Requested: 02:11 PM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
1586 INTRODUCED HB2532
CBD Subject: Tax


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 allow members of volunteer fire departments and rescue squads who have successfully completed required training and are covered by workers’ compensation a credit of $500 from their state personal income tax.
    
    The revenue loss associated with this bill cannot be determined because data is not available on the number of volunteer firefighters who would meet this criteria. If all volunteer firefighters met the criteria, passage of this bill would result in a loss to the General Revenue Fund of roughly $3.3 million per year beginning in FY 2017.
    
    Additional administrative costs to the State Tax Department would be roughly $15,000 in FY2016 and $10,000 per year in subsequent years.
    



Fiscal Note Detail


Effect of Proposal Fiscal Year
2015
Increase/Decrease
(use"-")
2016
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 15,000 10,000
Personal Services 0 10,000 10,000
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 5,000 0
2. Estimated Total Revenues 0 0 -3,300,000


Explanation of above estimates (including long-range effect):


    The revenue loss associated with this bill cannot be determined because data is not available on the number of volunteer firefighters who would meet this criteria. If all volunteer firefighters met the criteria, passage of this bill would result in a loss to the General Revenue Fund of roughly $3.3 million per year beginning in FY 2017.
    
    Additional administrative costs to the State Tax Department would be roughly $15,000 in FY2016 and $10,000 per year in subsequent years.
    



Memorandum


    The stated purpose of this bill is to allow members of volunteer fire departments and rescue squads who have successfully completed required training and are covered by workers’ compensation a credit of $500 from their state personal income tax.
    
    The bill entitles an “active member” and “auxiliary member” of a volunteer fire department and rescue squad to a $500 credit against personal income tax. A member is eligible if he or she received appropriate training the fire department provides worker’s compensation coverage, and the member is on active statues.
    
    W. Va. Code does not define “active member” nor “Auxiliary member.” While “Active member” and “ancillary support member” are defined in Series 8, “auxiliary member” is not. A quick online search revealed several volunteer fire departments in WV offer active, junior, and associate memberships. These various levels of memberships and the use of differing terms create confusion.
    
    The proposed language requires the fire department provide worker’s compensation coverage for the member during the year. It is unclear who is responsible for providing proof and to whom the verification is to be provided.
    
    Active status is not defined in code or rule. This may lead to different applications across the state. Active status may not require the performance of duties.
    
    The bill does not state when the credit begins. It is unclear if the credit is allowed to carry forward. It is unclear if the credit is refundable.
    
    
    
    



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov