FISCAL NOTE
Date Requested: January 25, 2016 Time Requested: 01:54 PM |
Agency: |
Tax Department, State |
CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
1486 |
Introduced |
HB4210 |
|
CBD Subject: |
Energy |
---|
|
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 reduce the severance rate for coal mined by underground methods based on the length of belt line or distance travelled in the mine. The bill also provides that underground methods with coal mining operations that have belt lines or travel distances of three miles or 15,840 feet within the mine are small mining operations. The bill is subject to a three-year sunset provision.
The State Tax Department was unable to gather statistical data regarding the number of qualifying underground mines or production potentially subject to the provisions of this bill. Permit regulators suggest that proper evaluation would take more than a month to complete. In addition, the provisions of this bill are ambiguous regarding whether the specified belt line or travel distances are maximum or minimum distances. Therefore, we are unable to accurately estimate the potential revenue decrease associated with this bill. The provisions would apply to some mines with average seam thickness greater than 45 inches. Thin-seam mines are already taxed at a lower rate.
Additional administrative costs will be $26,500 for the remainder of FY2016. No additional costs are expected.
Fiscal Note Detail
Effect of Proposal |
Fiscal Year |
2016 Increase/Decrease (use"-") |
2017 Increase/Decrease (use"-") |
Fiscal Year (Upon Full Implementation) |
1. Estmated Total Cost |
26,500 |
0 |
0 |
Personal Services |
0 |
0 |
0 |
Current Expenses |
0 |
0 |
0 |
Repairs and Alterations |
0 |
0 |
0 |
Assets |
0 |
0 |
0 |
Other |
26,500 |
0 |
0 |
2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The State Tax Department was unable to gather statistical data regarding the number of qualifying underground mines or production potentially subject to the provisions of this bill. Permit regulators suggest that proper evaluation would take more than a month to complete. In addition, the provisions of this bill are ambiguous regarding whether the specified belt line or travel distances are maximum or minimum distances. Therefore, we are unable to accurately estimate the potential revenue decrease associated with this bill. The provisions would apply to some mines with average seam thickness greater than 45 inches. Thin-seam mines are already taxed at a lower rate.
Additional administrative costs will be $26,500 for the remainder of FY2016. No additional costs are expected.
Memorandum
The stated purpose of this bill is to reduce the severance rate for coal mined by underground methods based on the length of belt line or distance travelled in the mine. The bill also provides that underground methods with coal mining operations that have belt lines or travel distances of three miles or 15,840 feet within the mine are small mining operations. The bill is subject to a three-year sunset provision.
The proposed bill does not specify whether the distance travelled within a mine (3 miles or 15,840 feet) is a maximum or minimum distance. The bill also does not state an effective date.
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov