FISCAL NOTE
Date Requested: February 21, 2022
Time Requested: 10:40 AM |
| Agency: |
Division of Regulatory and Fiscal Affairs, WV |
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| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2912 |
Introduced - Originating in Committee |
HB4020 |
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| CBD Subject: |
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FUND(S):
General Revenue Fund
Sources of Revenue:
General Fund
Legislation creates:
Increases Existing Expenses
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
House Bill 4020 divides the responsibilities and staff of the West Virginia Department of Health and Human Resources (DHHR) between two new departments, the Department of Health, and the Department of Human Resources effective July 1, 2022. The various bureaus and offices of DHHR are assigned to the two new departments either within the text of H.B. 4020 or via direction to the two secretaries to reach a mutual agreement before reporting their decisions to the Legislative Commission on Health and Human Resources Accountability by August 1, 2022.
As H.B. 4020 does not affect the staffing or appropriations to any of the various bureaus or offices, the fiscal impact is generated via the creation of a new secretary position. Assuming an executive assistant position is also necessary, the Division of Regulatory and Fiscal Affairs projects a per-year fiscal impact to the state of $308,250. This figure could be higher or lower based on the salaries they receive. The current Secretary of DHHR salary is specified in §6-7-2a to be at least $95,000 per year and no more than $175,000. RAFA suggests the Legislature consider similar language for the new positions so as to provide more clarity regarding the fiscal impacts of H.B. 4020.
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 |
308,250 |
308,250 |
| Personal Services |
0 |
308,250 |
308,250 |
| 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):
The following primary assumptions are used to complete this analysis:
One additional Secretary position will be created at the same salary as the current Secretary of DHHR, $150,000 per year.
One additional executive assistant position will be necessary. Based on current salaries for such positions within DHHR, this is estimated at $75,000 per year.
A factor of 1.37 is used for full personnel costs, inclusive of pension and other benefits.
The Division of Regulatory and Fiscal Affairs has estimated the total cost of H.B. 4020 to be $308,250 per fiscal year, beginning in FY 2023.
This fiscal impact per year is based on each the Secretary of Health and the Secretary of Human Resources receiving salaries of $150,000 per year, the same as the current salary of the Secretary of Health and Human Resources. The DHHR Secretary salary is defined in §6-7-2a, “Secretaries of the departments shall be paid an annual salary as follows: Health and Human Resources, $95,000: Provided, That effective July 1, 2013, the Secretary of the Department of Health and Human Resources shall be paid an annual salary not to exceed $175,000”. RAFA is unsure how this provision would affect the salaries applicable to the Secretary of Health and the Secretary of Human Resources. For this Fiscal Note, RAFA assumes the salary of each position will be $150,000 per year, generating an additional to the cost of the state equal to ($150,000*1.37)=$205,500. In the event that the two salaries are lower, perhaps at the minimum $95,000 figure for the current DHHR Secretary position, the additional cost to the state would be less ($95,000*2-150,000)*1.37=$54,800.
The other cost to the state comes via the addition of an executive assistant to go along with the additional secretary position. Using similar positions within DHHR as a baseline, it appears an annual salary of $75,000 would be comparable. Again, factoring in pension and benefits yields a total personnel cost of ($75,000*1.37)=$102,750. Adding this to the cost of the additional secretary position yields the total fiscal impact of H.B. 4020, ($205,500+$102,750)=$308,250.
Memorandum
This Fiscal Note is based on assumptions regarding the division of staff between the two newly created departments from the current Department of Health and Human Resources. If additional staff are required, or promotions are necessary under the restructuring, resulting in pay increases for some staff, this Fiscal Note will underestimate the costs of House Bill 4020. However, none of these provisions are laid out in the text of the bill and would be subject to additional spending authority appropriated by the Legislature through additional legislation. As a result, this Fiscal Note does not speculate what such legislation may look like or what such costs may be.
Person submitting Fiscal Note: Peter Shirley
Email Address: peter.shirley@wvlegislature.gov