FISCAL NOTE

Date Requested: February 26, 2021
Time Requested: 11:59 AM
Agency: Natural Resources, WV Division of
CBD Number: Version: Bill Number: Resolution Number:
2381 Introduced HB2775
CBD Subject:


FUND(S):

3200, 8707

Sources of Revenue:

Special Fund

Legislation creates:

Decreases Existing Revenue



Fiscal Note Summary


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


The stated purpose of this bill is to require that all licenses and permits be valid for one year starting the month in which the licensee was born as opposed to starting with the date of purchase and lasting through the end of the calendar year. This would have a permanent negative effect on licensing revenues in the amount of $650,000 and as high as $1.9 million over the first three years of implementation. In addition, it will require an additional investment in the first year in the amount of $100,000 to change the current electronic licensing system and to retrain license agents which sell licenses in stores across the State.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2021
Increase/Decrease
(use"-")
2022
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 100,000 0
Personal Services 0 25,000 0
Current Expenses 0 0 0
Repairs and Alterations 0 75,000 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 -650,000 -650,000


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


The loss in annual revenue over the first three years of implementation is based on a 2015 study by the State of California that surveyed states that had switched to 365-day license (valid from date of sale) and found a 10 to 30% loss in sales in the 3-years following conversion. Based on the Division of Natural Resource’s 2018 license sales, this would result in an estimated decrease of $1.4 million to $4.2 million over the first three years. In addition, there will be a further decrease in resulting matching federal funds over the same three-year period ranging from $183,000 to $550,000 for a total estimated three-year loss of an additional $650,000 to $1.9 million. Once the costs of modifying the electronic license system, $75,000, and retraining license agents, $25,000 is included, the first year estimated costs would be $750,000 to $2,050,000. For the sake of this fiscal note we have selected the 10% reduction, so this is a best-case scenario. The result would be significant decrease in the level of service within the Division of Natural Resources, including Law Enforcement, Wildlife Resources Section and Administration. We would anticipate need to leave three Natural Resources Police Officer positions vacant at the 10% reduction and 9 Natural Resources Police Officer positions at the 30% reduction in license funds.



Memorandum


This bill has defects in its language as to the length of time the license would be valid. As written, the license does not become valid until the last day of the month the person was born. As written, this bill would require a person who was born in December to buy their hunting license for the following year before the end of December of the current year. Otherwise their license would not be valid until the end of December of the following year. The West Virginia Division of Natural Resources staff has made the assumption that the intent of this bill is to have a license be valid from the date of purchase if the birth month has already past in the current year and only be valid for the remainder of the year until the birth month is once again encountered. If this assumption is incorrect estimated losses in revenue could increase depending on the correct interpretation of the statute. Having expiration dates at the end of birth months could cause confusion for license holders and potentially result in greater hunting and fishing violations. A recent Southwick Associates study on WV Division of Natural Resources License Structure and Pricing (2020) reported residents overwhelmingly prefer the current calendar year licenses. For additional information concerning this fiscal note, please contact: Zack Brown zack.j.brown@wv.gov 304-558-2771



    Person submitting Fiscal Note: Amanda Morris
    Email Address: amanda.l.morris@wv.gov