H. B. 2314
(By Delegates Doyle, Fleischauer, Klempa and Marshall)
[Introduced January 13, 2010; referred to the
Committee on Energy, Industry and Labor, Economic
Development and Small Business then Finance.]
A BILL to amend and reenact §11-13A-3 of the Code of West Virginia,
1931, as amended, relating to a severance tax imposed on
surface mining activities; proceeds dedicated to surface mine
reclamation fund.
Be it enacted by the Legislature of West Virginia:
That §11-13A-3 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 13A. SEVERANCE TAXES.
§11-13A-3. Imposition of tax on privilege of severing coal,
limestone or sandstone, or furnishing certain
health care services, effective dates therefor;
reduction of severance rate for coal mined by
underground methods based on seam thickness.
(a) Imposition of tax. -- Upon every person exercising the
privilege of engaging or continuing within this state in the business of severing, extracting, reducing to possession and
producing for sale, profit or commercial use coal, limestone or
sandstone, or in the business of furnishing certain health care
services, there is hereby levied and shall be collected from every
person exercising such privilege an annual privilege tax.
(b) Rate and measure of tax. -- The tax imposed in subsection
(a) of this section shall be is five percent of the gross value of
the natural resource produced or the health care service provided,
as shown by the gross income derived from the sale or furnishing
thereof by the producer or the provider of the health care service,
except as otherwise provided in this article. In the case of coal,
this five percent rate of tax includes the thirty-five one
hundredths of one percent additional severance tax on coal imposed
by the state for the benefit of counties and municipalities as
provided in section six of this article.
(c) "Certain health care services" defined. -- For purposes of
this section, the term "certain health care services" means, and is
limited to, behavioral health services.
(d) Tax in addition to other taxes. -- The tax imposed by this
section shall apply applies to all persons severing or processing
(or both severing and processing) in this state natural resources
enumerated in subsection (a) of this section and to all persons
providing certain health care services in this state as enumerated
in subsection (c) of this section and shall be in addition to all other taxes imposed by law.
(e) Effective date. -- This section, as amended in the year
1993, shall apply to gross proceeds derived after May 31 of such
year. The language of this section, as in effect on January 1 of
such year, shall apply to gross proceeds derived prior to June 1 of
such year and, with respect to such gross proceeds, shall be fully
and completely preserved.
(f) Reduction of severance tax rate. -- For tax years
beginning after the effective date of this subsection, any person
exercising the privilege of engaging within this state in the
business of severing coal for the purposes provided in subsection
(a) of this section shall be allowed a reduced rate of tax on coal
mined by underground methods in accordance with the following:
(i) For coal mined by underground methods from seams with an
average thickness of thirty-seven inches to forty-five inches, the
tax imposed in subsection (a) of this section shall be two percent
of the gross value of the coal produced. For coal mined by
underground methods from seams with an average thickness of less
than thirty-seven inches, the tax imposed in subsection (a) of this
section shall be one percent of the gross value of the coal
produced. Gross value is determined from the sale of the mined
coal by the producer. This rate of tax includes the thirty-five
one hundredths of one percent additional severance tax imposed by
the state for the benefit of counties and municipalities as provided in section six of this article.
(ii) This reduced rate of tax applies to any new underground
mine producing coal after the effective date of this subsection,
from seams of less than forty-five inches in average thickness or
any existing mine that has not produced coal from seams forty-five
inches or less in thickness in the one hundred eighty days
immediately preceding the effective date of this subsection.
(iii) The seam thickness shall be based on the weighted
average isopach mapping of actual coal thickness by mine as
certified by a professional engineer.
(g) In addition to the amount of tax imposed by subsection (b)
of this section, section six of this article, and all other taxes
imposed by law, upon every person exercising the privilege of
engaging or continuing within this state in the business of
severing, extracting, reducing to possession and producing for
sale, profit or commercial use, coal by means other than
underground methods, shall be collected an additional severance tax
in the amount of five percent of the gross value of the coal
produced as shown by the gross income derived from the sale or
furnishing thereof by the producer, the proceeds of which shall be
dedicated to the Surface Mine Reclamation Fund pursuant to section
eleven, article three, chapter twenty-two of this code. This
subsection, as amended in the year 2009, shall apply to gross
proceeds derived after May 31 of such year.
NOTE: The purpose of this bill is to impose a severance tax on
surface mining activities with proceeds dedicated to the Surface
Mine Reclamation Fund.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.