FISCAL NOTE

Date Requested: January 12, 2022
Time Requested: 04:03 PM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
1163 Introduced SB63
CBD Subject:


FUND(S):

General Revenue Fund, local governments

Sources of Revenue:

General Fund local property tax

Legislation creates:

Increases Revenue From Existing Sources, Increases Existing Expenses



Fiscal Note Summary


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


The stated purpose of this bill is to clarify that a wind power project is not a pollution control facility for purposes of §11-6A-1 et seq. of this code and is taxed as real property. According to our interpretation, passage of this bill would remove the current salvage valuation tax policy for wind power plants. As a result, taxable property valuations for such facilities would increase along with property tax assessments. There would be an increase of roughly $6.3 million in revenue beginning in FY2024. The estimated revenue gain would be more than $2.4 million to the State General Revenue Fund, $1.8 million to local county school boards, and $2.1 million to county commissions. The distribution of estimated cost is based on information from taxes levied as reported in the Classified Assessed Valuations Taxes Levied for 2021 Tax Year publication of the State Tax Department and the incorporation of the calculation of local property tax share within the State Aid to Schools Formula. Additional administrative costs would be minimal.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2022
Increase/Decrease
(use"-")
2023
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 0 0
Personal Services 0 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 0 6,300,000


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


According to our interpretation, passage of this bill would remove the current salvage valuation tax policy for wind power plants. As a result, taxable property valuations for such facilities would increase along with property tax assessments. There would be an increase of roughly $6.3 million in revenue beginning in FY2024. The estimated revenue gain would be more than $2.4 million to the State General Revenue Fund, $1.8 million to local county school boards, and $2.1 million to county commissions. The distribution of estimated cost is based on information from taxes levied as reported in the Classified Assessed Valuations Taxes Levied for 2021 Tax Year publication of the State Tax Department and the incorporation of the calculation of local property tax share within the State Aid to Schools Formula. Additional administrative costs would be minimal.



Memorandum


The stated purpose of this bill is to clarify that a wind power project is not a pollution control facility for purposes of §11-6A-1 et seq. of this code and is taxed as real property. The bill title and the bill note both state that this bill clarifies that a wind power project is not a pollution control facility. This is not a clarification of the law, but rather a change in the law. Therefore, this would be a title defect.



    Person submitting Fiscal Note: Mark Muchow
    Email Address: kerri.r.petry@wv.gov