Date Requested: February 24, 2015
Time Requested: 01:20 PM
Agency: Health and Human Resources, Department of
CBD Number: Version: Bill Number: Resolution Number:
1377 Introduced HB3004
CBD Subject: Health


FUND(S):

New Fund

Sources of Revenue:

Special Fund

Legislation creates:

A New Program,A New Fund



Fiscal Note Summary


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


    The purpose of this bill is to create the West Virginia Addictions Treatment and Recovery Fund by collecting and transferring $.05 per ounce of the uniform price of alcoholic liquors sold in this state to the fund.
    As $.05 per ounce of the uniform price for each variety, class and brand of alcoholic liquors offered for sale in state stores shall be deposited into the West Virginia Addictions Treatment and Recovery Fund.
    The Secretary for the Department of Health and Human Resources shall propose rules for legislative approval, to govern the disbursement of moneys from the fund for development costs, operating costs, infrastructure and program support, establish criteria for eligibility to receive grants or loans from the fund and in cases where loans are issued, establish the terms and conditions of the loans, including interest rates and repayment of terms.
    The total current expense to the Department of Health and Human Resources assumes all revenues generated from the West Virginia Addiction and Treatment Fund will be utilized for the development and support of programs including, but not limited to, community-based support programs or community-based correction programs, or both. The funds shall be used only for programs relating to the prevention, intervention, treatment, and recovery from addictions relating to drugs and/or alcohol; no more than 3% of total revenue generated will be used for administrative costs.
    



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 10,303,663 10,303,663
Personal Services 0 0 0
Current Expenses 0 10,303,663 10,303,663
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 10,303,663 10,303,663


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


    The total revenues were determined by utilizing the Fiscal Note Submitted by the West Virginia Alcohol Beverage Commission Authority (WVABCA):
    "The total ounces sold by the WVABCA (as provided by the WVABCA IT Department) in calendar year 2014 was 228,970,290 oz. So based on the numbers the fee/tax theoretically could have generated $11,448,514.50.
    
    However the fee/tax could have a negative impact on sales as it will be passed on to consumers. This negative impact could result in a rough estimate of 5% - 10% reduction in sales volume. Thus, in 2014 instead of a typical 3% increase in revenue transfers the WVABCA has seen historically, the WVABCA revenue transfer could be reduced by 5% to 10% as well as the amount deposited to the West Virginia Addictions Treatment Recovery Fund.
    
    If the bill is implemented in July 2015, 1/2 of the $11,448,514.50 or $5,724,257.25 with a "rough estimate" of a 10% drop in sales volume for 2014 = (228,970,290 oz * .10) - 228,970,290 oz = 206,073,261 * .05 cents = $10,303,663.05"
    



Memorandum


    



    Person submitting Fiscal Note: Karen L. Bowling
    Email Address: karen.l.bowling@wv.gov