FISCAL NOTE
Date Requested: January 27, 2015 Time Requested: 01:53 PM |
Agency: |
Tax Department, State |
CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
2492 |
Introduced |
SB339 |
|
CBD Subject: |
Tax |
---|
|
FUND(S):
Workers Compensation Debt Reduction Fund
Sources of Revenue:
General Fund,Special Fund
Legislation creates:
Neither Program nor Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The stated purpose of this bill is to reduce the additional tax on coal effective July 1, 2015.
The bill would reduce the tax rate for the additional tax on coal from 56 cents to 28 cents. Passage of the bill would result in a revenue loss to the Workers’ Compensation Debt Reduction Fund by approximately $26.3 million in FY2016 and $28.7 million in subsequent years.
According to W.Va. Code §11-13V-4, an independent certified actuary has to determine that the unfunded liability of the Workers’ Compensation Debt Reduction Fund has been paid or provided for in its entirety. The Governor also has to certify that the payment of the debt service has been provided. According to the Office of the Insurance Commissioner, the Workers’ Compensation Debt should be paid off by the end of calendar year 2016. This bill could delay that payoff date, thereby extending other temporary revenue dedications and temporary taxes on employers and others for a longer period of time.
Additional administrative costs to the State Tax Department would be $60,000 in FY2015. There would be no additional administrative costs in subsequent years.
Fiscal Note Detail
Effect of Proposal |
Fiscal Year |
2015 Increase/Decrease (use"-") |
2016 Increase/Decrease (use"-") |
Fiscal Year (Upon Full Implementation) |
1. Estmated Total Cost |
60,000 |
0 |
0 |
Personal Services |
60,000 |
0 |
0 |
Current Expenses |
0 |
0 |
0 |
Repairs and Alterations |
0 |
0 |
0 |
Assets |
0 |
0 |
0 |
Other |
0 |
0 |
0 |
2. Estimated Total Revenues |
0 |
-26,300,000 |
-28,700,000 |
Explanation of above estimates (including long-range effect):
The bill would reduce the tax rate for the additional tax on coal from 56 cents to 28 cents. Passage of the bill would result in a revenue loss to the Workers’ Compensation Debt Reduction Fund by approximately $26.3 million in FY2016 and $28.7 million in subsequent years.
According to W.Va. Code §11-13V-4, an independent certified actuary has to determine that the unfunded liability of the Workers’ Compensation Debt Reduction Fund has been paid or provided for in its entirety. The Governor also has to certify that the payment of the debt service has been provided. According to the Office of the Insurance Commissioner, the Workers’ Compensation Debt should be paid off by the end of calendar year 2016. This bill could delay that payoff date, thereby extending other temporary revenue dedications and temporary taxes on employers and others for a longer period of time.
Additional administrative costs to the State Tax Department would be $60,000 in FY2015. There would be no additional administrative costs in subsequent years.
Memorandum
Person submitting Fiscal Note: Mark Muchow
Email Address: kerri.r.petry@wv.gov