H. B. 2303

(By Delegate Johnson)
[Introduced March 3, 1997; referred to the
Committee on the Judiciary then Finance.]

A BILL to amend chapter four of the code of West Virginia, one thousand nine hundred thirty-one, as amended, by adding thereto a new article, designated article thirteen, relating to the state mandates relief act; legislative findings; definitions; requirement for funding state mandates; establishing division of local mandates; mandate review requirements; notification of local impact statement; appropriations requirement; establishing government mandates task force; and organization.

Be it enacted by the Legislature of West Virginia:
That chapter four of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended by adding thereto a new article, designated article thirteen, to read as follows:
ARTICLE 13. STATE MANDATES RELIEF ACT.
§4-13-1. Legislative findings.
The Legislature finds and declares that:
(a) Actions of the state government that directly or indirectly prescribe the manner, standards, level and conditions of public service to be provided by the state's counties, municipalities or county boards of education are often taken with little regard for the fiscal consequences of the actions upon the affected local jurisdictions.
(b) Many of the state's counties, municipalities and county boards of education are experiencing varying degrees of fiscal stress resulting from the need to provide adequate public services to their citizens but without the local tax resources to do so.
(c) The state government, prior to imposing new or expanded service requirements upon its counties, municipalities or county boards of education, should be aware of and confront the issue of where the burden of paying for those requirements will fall.
(d) It is appropriate, therefore, that the state government provide counties, municipalities and county boards of education protection against applicable unestimated or unfunded mandates contained in proposed legislation or rules.
§4-13-2. Definitions.
As used in this article:
(a) "Task force" means the local government mandates task force established pursuant to section eight of this article.
(b) "County" means the governing body and the officers and employees of a county.
(c) "Expanded program or service" means a program or service the scope of level of which would be increased, extended or enhanced by a county's, municipality's or county's board of education compliance with the provisions of a state law or rule.
(d) "Municipality" means the governing body and the officers and employees of a municipality.
(e) "Net additional cost" means the cost or costs incurred or anticipated to be incurred within a one-year period by a county, municipality or county board of education in performing or administering a new or expanded program or service required by a state law or rule after subtracting therefrom any revenues received or receivable by the county, municipality or county board of education from the program or service, including, but not limited to:
(1) Fee charged to the recipients of the program or service;
(2) State or federal aid paid specifically or categorically in connection with the program or service; and
(3) Any offsetting savings resulting from the reduction or elimination of any other program or service directly attributable to the performance or administration of the required program or service.
(f) "New program or service" means a program or service different in kind or purpose from those in existence at the time of the enactment of a law or promulgation of a rule requiring the performance or administration of the program by one or more counties, municipalities or county boards of education.
(g) "Division" means the division of local mandates established pursuant to section four of this article.
(h) "Program or service" means a specific and identifiable activity of a county, municipality or county board of education which is available to the general public or which is conducted, administered or provided for or on behalf of the citizens of a county, municipality or county board of education.
(i) "State mandate" is any state initiated rule, law or budget provision that requires a county, municipality or county board of education to expand, restrict or modify its activities in any way that bears upon its ability to raise revenues, make expenditures or conduct the administrative business of local government. State initiated requirements are intended to exclude any that originate at the federal level. Federal regulatory policy affecting local governments does not require a fiscal note so long as the state does not augment the federal standards by imposing higher standards of its own. Enabling legislation or conditions of aid are not considered mandates and do not require the preparation of a fiscal note.
§4-13-3. Requirement for funding state mandates.
(a) Notwithstanding any law or rule to the contrary, and except as provided in subsections (c) and (d) of this section, any provision of a state law or rule which becomes effective on or after the effective date of this article and which has the effect of requiring a county, municipality or county board of education to perform or administer a new or expanded program or service having a net additional cost in excess of ten thousand dollars for any county, municipality or county board of education, or one million dollars in any regular and special legislative session called in one fiscal year, for all affected counties, municipalities and county boards of education, is not enforceable in the county, municipality or county board of education, unless or until the state provides sufficient new funding or a means of new funding provided to each affected county, municipality or county board of education as are necessary to pay in full any net additional cost of compliance with the requirement.
(b) Any law subject to the provisions of subsection (a) of this section shall request any initial appropriation therein in an amount sufficient to pay in full any net additional cost of compliance by any affected county, municipality or county board of education, or both as the case may be.
(c) The provisions of subsection (a) of this section do not apply to any new or expanded program or service that:
(1) Is required or arises from a court order or judgment;
(2) Is provided at the option of the county, municipality or county board of education under a law or rule that is permissive rather than mandatory;
(3) Is requested by the county, municipality or county board of education;
(4) Is required by private, special or local laws;
(5) Is required by or arises from an executive order of the governor exercising his or her emergency powers;
(6) Is required by federal law as defined in section two-h, article thirteen, chapter four of this code;
(7) Authorizes the county, municipality or county board of education to levy charges, fees or assessments sufficient to cover the net cost of the mandate;
(8) Provides for offsetting savings that result in no net increased cost;
(9) Imposes duties that were approved by the voters in a statewide election; or
(10) Eliminates or changes a crime or infraction.
(d) The provisions of subsection (a) of this section do not apply when a law requiring a county, municipality or county board of education to perform or administer a new or expanded program or service is enacted without requesting an appropriation pursuant to subsection (b) of this section if the bill resulting in the enactment of the law passes the Legislature by a two-thirds vote of all the members of each house.
§4-13-4. Division of local mandates.
(a) There is established within the chief inspector's division of the state tax department a division of local mandates, which has as its primary function the review of proposed and adopted laws and rules for the purpose of completing a local impact statement. A local impact statement shall contain a fiscal analysis of the net additional costs to a county, municipality or county board of education that will result from any new or expanded program or service that the county, municipality or county board of education would be required to perform or administer as a result of the proposed or adopted law or rule.
(b) The tax department shall appoint and employ all persons for this division, including accountants, attorneys, auditors, financial analysts, management, purchasing and personnel analysts and any other individuals with experience in local government operations, and such clerical and technical assistants as the office may require within the limits of available appropriations.
§4-13-5. Mandate review requirements.
(a) Whenever any bill, which could possibly incur an increase in costs, is introduced into either house of the Legislature, and that bill receives first reading pursuant to the rules of the house into which it is introduced, the bill shall be immediately reviewed by the division of local mandates. If upon review the division determines that the bill will not result in net additional costs if the bill is enacted, the division shall certify that determination, on a signed statement and file the statement in the division office. If the division determines that the bill may result in net additional costs if enacted, the division shall immediately forward notice to all sponsors of the bill and to the chairman of the committee, if any, to which the bill has been referred or to the presiding officer of the house in which the bill originated if no such reference was made, that, in his or her judgment, a local impact statement is required.
(b) Upon determination that a bill has been introduced in the Legislature that may result in net additional costs to a county, municipality or county board of education, the division shall complete as soon as possible, but within five days of determination, a local impact statement containing the most accurate estimate possible, in actual dollars, of the net additional costs, if any, that will be required of a county, municipality or county board of education to perform or administer a new or expanded program or service. Local impact statements completed pursuant to this subsection shall be forthwith delivered to the presiding officer of each house of the Legislature.
(c) Whenever any legislative rule or an order is proposed or adopted, the state department head or state officer proposing the rule or issuing the order, and the secretary of state, as custodian of the rule or order, shall forthwith forward a copy of the proposed rule or order to the division of local mandates with a notice to complete a local impact statement within thirty days of the proposal or adoption.
(d) Upon receipt of a notice from the secretary of state, a state department head, a state officer or the governor of the proposal of a legislative rule or adoption of an executive order by that official, the division shall complete as soon as possible, but within thirty days of notification, a local impact statement containing the most accurate estimate possible, in actual dollars, of the net additional costs, if any, that will be required of a county, municipality or county board of education to perform or administer a new or expanded program or service. Local impact statements completed pursuant to this subsection shall be forthwith delivered to the governor and the presiding officer of each house of the Legislature, together with a copy of the rule or order.
(e) The division shall conduct an annual review of all pending legislative bills and rules proposed or adopted after the effective date of this article, for which the office has previously completed a local impact statement. Any annual change in the dollar estimate of the net additional costs from that provided in the original local impact statement shall be updated as a result of the review to disclose that change, and the updated local impact statement shall be delivered to the recipients of the original local impact statement.
§4-13-6. Notification of local impact statement.
A bill for which a local impact statement may be required may not proceed from the committee of the house inwhichin which it is introduced until the completed local impact statement is received by the chairman of that committee. No legislation or agency rule originating from the state, constituting an unfunded mandate to local government, is binding to the local government in the absence of the preparation of a fiscal note to inform the Legislature of the impact of the mandate to the local government prior to its enactment except as provided in subsections (c) and (d) section three of this article.
§4-13-7. Appropriations request.
Except as otherwise provided in subsection (d) of section three of this article, a bill for which a local impact statement has been received pursuant to section six of this article may not receive passage in either house until it contains therein an appropriation request at least equal to the amount estimated in the local impact statement as necessary to pay in full any net additional costs of compliance therewith.
§4-13-8. Local government mandates task force.
There is established the local government mandates task force. The membership of the task force shall consist of the chairpersons of the Senate government organizations and education committees, the chairperson of the house political subdivisions and education committees, to be appointed by the presiding officer of each house; one elected county official to be appointed by the governor; one elected municipal official to be appointed by the governor; one elected member of a county board of education, the director of the state association of municipalities, the state director of the association of counties, the director of the association of the county boards of education, a representative of the state tax department and any other person having expertise in the mandates issue at the discretion of the task force chairperson and upon approval of the majority of its members. Within each category of appointed members, the appointees shall be from different political parties. The legislative members shall serve during the two-year legislative session during which the appointment is made. The elected county and municipal officials shall serve as members during the terms of their elected office during which their appointments are made. Other members shall serve during the duration of the term of the governor who appointed them. The governor and the presiding officer of each house of the Legislature shall, in making their appointments, consult together to the extent necessary to ensure that among the appointed membership, there is not more than one member appointed as a local elected official or legislator representing the same local units of government within their election districts. A vacancy occurring in the membership of the board for any cause, other than the expiration of a term of office, shall be filled in the same manner as the original appointment.
The task force shall: (a) Identify and catalog existing state mandates to local government consistent with the definition of a mandate contained within this article; (b) retain copies of fiscal notes prepared for mandates that both were and were not enacted so as to create an informational resource for the preparation group and to track mandate legislation and costs over time; (c) periodically conduct follow-up studies of mandate costs post implementation to determine the accuracy of the fiscal note and make recommendations about how sampling and methodology might be improved; (d) evaluate the fiscal, programmatic and other consequences of state mandates on local governments; and (e) identify mandates: (1) Which should be eliminated; (2) for which reimbursement is no longer adequate; (3) which should be amended based on changing state and local circumstances; and (4) which are currently servicing the purpose for which they were enacted and should remain in force. The department of tax and revenue shall provide technical and support services for the task force. All expenditures deemed necessary to implement and effectuate the duties of the task force under this article shall be made within the limits of appropriations according to law.

NOTE: The purpose of this bill is to create the State Mandates Relief Act. Any state law or rule requiring additional expenditures, beyond the threshold established, by a county, municipality or county board of education can only become effective if: (1) The local government voluntarily complies; (2) the state provides adequate funding or reimbursement; (3) the state permits local governments to raise new revenues to fund the mandate; or (4) the Legislature enacts the mandate by a super majority of two-thirds of each house. Establishes the division of local mandates.

This article is new; therefore, strike-throughs and underscoring have been omitted.