FISCAL NOTE

Date Requested: February 27, 2018
Time Requested: 01:24 PM
Agency: Natural Resources, WV Division of
CBD Number: Version: Bill Number: Resolution Number:
1025 Introduced SB112
CBD Subject: Natural Resources


FUND(S):

0265,3200,3204,3247,8707

Sources of Revenue:

General Fund General and Special Funds

Legislation creates:

Increases Existing Expenses



Fiscal Note Summary


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


This Agency supported bill re-establishes Natural Resources Police Officer subsistence as pensionable compensation. Currently NRP officers receive a monthly subsistence in addition to their annual salary per WV Code. This subsistence is received in one payment along with salary and is considered taxable earnings with deductions withdrawn as required by law. Employee and employer contributions were made to PERS from 1997 to 2015 until the Consolidated Public Retirement Board decided that subsistence was not pensionable. The Natural Resources Police subsistence is the only subsistence benefit set by code in the State.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2018
Increase/Decrease
(use"-")
2019
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 5,405 21,621 21,621
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 0 0


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


At the current rate the Division would pay 11 percent for the employer portion of the subsistence allowance for pension benefits to PERS per officer. This estimate is based on a full staff of 126 officers.



Memorandum


Based on a full staff of 126 officers the employees would contribute $9,430.20 to PERS. Historically officers received subsistence in a separate check up to the year 1996 and no deductions were withheld. In 1997, the IRS determined that subsistence was a non-accountable expense reimbursement and as such was subject to federal, Social Security, and Medicare taxes. The Division started deducting federal and state income taxes, Medicare and Social Security taxes and retirement from subsistence and the subsistence was rolled into one check with the salary, The Consolidated Public Retirement Board decided in 2015 that subsistence was not pensionable. The subsistence is still counted as earnings and the additional deductions are still being withheld. It is estimated that employee and employer contributions to PERS from 1997 to 2015 was around $447,876 dollars. This estimate is based on 110 officers at an average rate of 10 percent for employer and 4.5 percent for employee contributions. Approximately 61 retirees or their widows would be affected by error correcting from the retirement board if this issue is not resolved and retirement deductions cease.



    Person submitting Fiscal Note: Jennifer Snow
    Email Address: jennifer.l.snow@wv.gov