FISCAL NOTE
Date Requested: January 14, 2023
Time Requested: 02:47 PM |
| Agency: |
Auditor, State of WV |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1645 |
Introduced |
HB2073 |
|
|---|
| CBD Subject: |
|
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FUND(S):
State Funds
Sources of Revenue:
General Fund
Legislation creates:
Creates New Expense, Creates New Program
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The purpose of proposed House Bill 2073 is to create a state Bank of West Virginia.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2023
Increase/Decrease
(use"-") |
2024
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
0 |
0 |
0 |
| Personal Services |
0 |
0 |
0 |
| Current Expenses |
0 |
50,000 |
375,000 |
| 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):
Our review of the proposed legislation indicates the State Auditor will be responsible for contracting with an independent certified public accounting firm for an annual audit of the Bank of West Virginia. Such annual audit would be required to be conducted in accordance with Generally Accepted Government Auditing Standards (GAGAS). In addition, the financial statements of the Bank of West Virginia would be required to be presented in conformity with the provisions of the Audit and Accounting Guide for Banks and Savings Institutions as promulgated by the American Institute of Certified Public Accountants. Also, such audited financial statements would be prepared in a manner facilitating their inclusion in the Comprehensive Annual Financial Report of the State of West Virginia.
In addition, the State Auditor would be authorized to conduct additional performance and financial audits of the Bank of West Virginia, up to and including any of the separate programs and funds administered by the Bank of West Virginia. The results of any such performance or financial audits would be required to be reported to the Board of Banking and Financial Institutions, the Governor of West Virginia and the Joint Committee on Government and Finance within 30 days of the completion of any such audits.
We believe the potential costs of the required annual audit of the Bank of West Virginia would range between $250,000 and $375,000 per fiscal year beginning in Fiscal Year 2025. For purposes of this submission, we are estimating those annual costs at $325,000. In addition, we believe the additional audit costs for examination of Programs of the Bank of West Virginia by the State Auditor’s Office would approximate not more than $50,000 per fiscal year and such costs would potentially commence in Fiscal Year 2024. We do not have the ability to reliably estimate any other costs potentially associated with the Bank of West Virginia.
Memorandum
Our additional observations concerning the proposed Bill are as follows: 1. We believe the State Treasurer’s Office and the West Virginia Division of Banking Institutions should be requested to submit a Fiscal Note with respect to this proposed legislation, if such action has not yet been taken and 2. We believe the current proposed provisions of Section 3, Article 1 of Chapter 12 as reflected in the proposed Bill need to be examined for potential amendment. The Section would newly authorize State or Federal Credit Unions to be designated as an Eligible Depository for interest bearing deposits of State funds. However, it does not appear such State and Federal Credit Unions would be restricted to only a deposit amount not in excess of the amount insured by any agency of the federal government.
Person submitting Fiscal Note: Michael E. Sizemore, CPA
Email Address: Mike.Sizemore@wvsao.gov