Date Requested: February 06, 2015
Time Requested: 09:19 AM
Agency: State Tax & Revenue Department
CBD Number: Version: Bill Number: Resolution Number:
2809 Introduced HB2614
CBD Subject: Tax


FUND(S):

Eligible Acute Care Provider Enhancement Account

Sources of Revenue:

Special 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 remove the expiration date for the tax rate on eligible acute care hospitals.
    
    Although the stated purpose indicates the intent of the bill is “to remove the expiration date for the tax rate on eligible acute care hospitals,” it is our interpretation that the proposed amendment to W. Va. Code §11-27-38 would merely extend the expiration date from June 30, 2015 to June 30, 2016. Additionally, proposed changes in the bill include increasing the tax rate from 0.62 percent to 0.72 percent and extending by one year the previously enacted provisions for disposition of any funds remaining in the Eligible Acute Care Provider Enhancement Account.
    
    According to our interpretation and assuming that the change in the tax rate would be effective for gross receipts received on or after July 1, 2015, passage of this bill would provide additional revenue for the Eligible Acute Care Provider Enhancement Account of roughly $20.7 million in FY2016 and roughly $6.7 million in FY2017.
    
    Additional administrative costs to the State Tax Department associated with passage of this bill would be $5,000 in FY2016. The Department of Health and Human Resources Bureau of Medical Services may incur additional administrative costs associated with passage of this bill.
    



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 5,000 0
Personal Services 0 0 0
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 20,700,000 6,700,000


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


    Although the stated purpose indicates the intent of the bill is “to remove the expiration date for the tax rate on eligible acute care hospitals,” it is our interpretation that the proposed amendment to W. Va. Code §11-27-38 would merely extend the expiration date from June 30, 2015 to June 30, 2016. Additionally, proposed changes in the bill include increasing the tax rate from 0.62 percent to 0.72 percent and extending by one year the previously enacted provisions for disposition of any funds remaining in the Eligible Acute Care Provider Enhancement Account.
    
    According to our interpretation and assuming that the change in the tax rate would be effective for gross receipts received on or after July 1, 2015, passage of this bill would provide additional revenue for the Eligible Acute Care Provider Enhancement Account of roughly $20.7 million in FY2016 and roughly $6.7 million in FY2017.
    
    Additional administrative costs to the State Tax Department associated with passage of this bill would be $5,000 in FY2016. The Department of Health and Human Resources Bureau of Medical Services may incur additional administrative costs associated with passage of this bill.
    



Memorandum


    The stated purpose of this bill is to remove the expiration date for the tax rate on eligible acute care hospitals.
    
    Although the stated purpose indicates the intent of the bill is “to remove the expiration date for the tax rate on eligible acute care hospitals,” it is our interpretation that the proposed amendment to W. Va. Code §11-27-38 would merely extend the expiration date from June 30, 2015 to June 30, 2016.
    



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