Introduced Version
House Bill 2795 History
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Key: Green = existing Code. Red = new code to be enacted
H. B. 2795
(By Delegates Storch, Ferns, Ferro, Pethtel,
Swartzmiller, Jones, Diserio, Romine,
Miley, Pasdon and D. Evans)
[Introduced March 1, 2013; referred to the
Committee on Energy, Industry and Labor, Economic
Development and Small Business then Finance.]
A BILL to amend the Code of West Virginia, 1931, as amended, by
adding thereto a new section, designated §11-13A-5b, relating
to reallocating and dedicating three percent of oil and gas
severance tax revenues up to $20 million annually to the oil
and gas producing counties of origin and their respective
municipalities; establishing state and local oil and gas
county reallocated severance tax funds and providing for
distribution of the moneys to the county commissions and
governing bodies of the municipalities by the State Treasurer;
establishing amounts each oil and gas producing county and
their respective municipalities are to receive; requiring the
creation of local funds into which moneys are to be deposited;
requiring moneys be expended solely for economic development
projects and infrastructure projects; providing definitions;
providing restrictions on the expenditure of moneys; providing
duties of State Tax Commissioner; requiring report of expenditures to Joint Committee on Government and Finance;
providing audits of distributed funds when authorized by the
Joint Committee on Government and Finance; and authorizing
legislative and emergency rules.
Be it enacted by the Legislature of West Virginia:
That the Code of West Virginia, 1931, as amended, be amended
by adding thereto a new section, designated §11-13A-5b, to read as
follows:
ARTICLE 13A. SEVERANCE AND BUSINESS PRIVILEGE TAX ACT.
§11-13A-5b. Reallocation and dedication of percentage of
severance tax for benefit of oil and gas
producing counties and their municipalities;
permissible uses of distributed revenues; duties
of State Treasurer and State Tax Commissioner;
audits; rulemaking.
_____(a) The purpose of this section is to provide for the
reallocation and dedication of a portion of the tax attributable to
the severance of oil and gas imposed by section three-a of this
article for the use and benefit of the various counties and their
respective municipalities in which the oil and gas was located at
the time it was severed from the ground.
_____(b) (1) Effective July 1, 2014, two percent of the tax
attributable to the severance of oil and gas imposed by section three-a of this article shall be transferred to the county
commissions
of the oil and gas producing counties as provided in
this section.
_____(2) Effective July 1, 2014, one percent of the tax
attributable to the severance of oil and gas imposed by section
three-a of this article shall be transferred to the governing
bodies of municipalities within the oil and gas producing counties
as provided in this section on a population pro rata basis
.
_____(3) The proceeds dedicated in subdivisions (1) and (2) of this
subsection may not exceed the sum of $20 million per year.
_____(c) The amounts of the tax dedicated in subsection (b) of this
section shall be deposited, from time to time, into a special fund
known as the Oil and Gas County and Municipality Reallocated
Severance Tax Fund, which is hereby established in the State
Treasury, as the proceeds are received by the State Tax
Commissioner.__
_____(d) The net proceeds of the deposits made into the Oil and Gas
County and Municipality Reallocated Severance Tax Fund
shall be
allocated among and distributed quarterly to the oil and gas
producing counties and their respective municipalities by the State
Treasurer in the manner specified in this section. On or before
each distribution date, the State Treasurer shall determine the
total amount of moneys that will be available for distribution to
the respective counties and municipalities entitled to the moneys on that distribution date. The amount to which an oil and gas
producing county or municipality is entitled from the Oil and Gas
County and Municipality Reallocated Severance Tax Fund
shall be
determined in accordance with subsection (e) of this section. After
determining the amount each oil and gas producing county and
municipality are entitled to receive from the fund, a warrant of
the State Auditor for the sum due to each oil and gas producing
county and municipality shall be issued and a check drawn thereon
making payment of that amount to the oil and gas producing county
and municipality by hand, mail commercial delivery or electronic
transmission.
_____(e) The amount to which an oil and gas producing county or
municipality is entitled from the Oil and Gas County and
Municipality Reallocated Severance Tax Fund
shall be determined by:
_____(1) Dividing the total amount of moneys in the fund then
available for distribution by the total number of barrels of oil
and total number of cubic feet of gas produced in this state during
the preceding quarter; and
_____(2) Multiplying the quotient thus obtained of each by number
of barrels of oil and number of cubic feet of gas produced in
the
county or municipality during the preceding quarter.
_____(f) (1) No distribution made to a county or municipality under
this section may be deposited into the county's or municipality's
General Revenue Fund. The county commission of each county and the governing body of each municipality receiving a distribution under
this section shall establish a special account to be known as the
"(Name of County or Municipality) Oil and Gas County (or
Municipality) Reallocated Severance Tax Fund" into which all
distributions made to that county or municipality under this
section shall be deposited.
_____(2) Moneys in the county's and municipality's oil and gas
county reallocated severance tax fund shall be expended by the
county commission and governing body of the municipality solely for
economic development projects and infrastructure projects.
_____(3) For purposes of this section:
_____(A) "Economic development project" means a project in the
state which is likely to foster economic growth and development in
the area in which the project is developed for commercial,
industrial, community improvement or preservation or other proper
purposes.
_____(B) "Infrastructure project" means a project in the state
which is likely to foster infrastructure improvements including,
but not limited to, post-mining land use, water or wastewater
facilities or a part thereof, storm water systems, steam, gas,
telephone and telecommunications, broadband development, electric
lines and installations, roads, bridges, railroad spurs, drainage
and flood control facilities, industrial park development or
buildings that promote job creation and retention.
_____(4) A county commission or governing body of a municipality
may not expend any of the funds available in its oil and gas county
and municipality reallocated severance tax fund for personal
services, for the costs of issuing bonds or for the payment of bond
debt service. Total funds available shall be directed to project
development which may include the costs of architectural and
engineering plans, site assessments, site remediation,
specifications and surveys and other expenses necessary or
incidental to determining the feasibility or practicability of an
economic development project or infrastructure project.
_____(g) On or before December 31, 2015, and December 1 of each
year thereafter, the county commission of each county and governing
body of each municipality
receiving a distribution of funds under
this section shall deliver to the Joint Committee on Government and
Finance a written report setting forth the specific projects for
which those funds were expended during the preceding fiscal year,
a detailed account of those expenditures and a showing that the
expenditures were made for the purposes required by this section.
_____(h) An audit of funds distributed under this section may be
authorized at any time by the Joint Committee on Government and
Finance to be conducted by the Legislative Auditor at no cost to
the county commission audited.
_____(i) The State Tax Commissioner shall propose for legislative
approval legislative rules pursuant to article three, chapter twenty-nine-a of this code for the administration of the provisions
of this section, and is authorized to promulgate emergency rules
for those purposes pursuant to that article.
NOTE: The purpose of this bill is to reallocate and dedicate
three percent of oil and gas severance tax revenues up to $20
million annually to the oil and gas producing counties of origin
and their respective municipalities. The bill establishes state
and local oil and gas county reallocated severance tax funds and
provides for distribution of the moneys to the county commissions
and governing bodies of the municipalities
by the State Treasurer.
The bill establishes a procedure for determining the amounts each
oil and gas producing county and their respective municipalities
are to receive and requires the creation of local funds into which
moneys are to be deposited. The bill requires the funds to be used
solely for economic development projects and infrastructure
projects. The bill also provides restrictions on fund expenditures.
The bill sets forth duties of the State Tax Commissioner. The bill
requires a report of expenditures to Joint Committee on Government
and Finance. The bill also provides for audits of distributed funds
when authorized by the Joint Committee on Government and Finance.
The bill authorizes legislative and emergency rules.
This section is new; therefore, it has been completely
underscored.