FISCAL NOTE

Date Requested: February 16, 2016
Time Requested: 04:08 PM
Agency: Natural Resources, Division of
CBD Number: Version: Bill Number: Resolution Number:
2216 Introduced HB4567
CBD Subject: Natural Resources, Taxation


FUND(S):

3265

Sources of Revenue:

Special Fund

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


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


Generally speaking, the Division of Natural Resources owns the minerals underlying the state’s rivers and streams unless otherwise sold or conveyed. This bill appears to redirect all revenues derived from leases executed after July 1, 2016, to develop minerals underlying the state’s rivers and streams to the state road fund and away from the division. It is not possible to forecast and assign a future value to these minerals with any accuracy. The value of these properties is subject to unpredictable market conditions and fluctuates constantly depending on the location and nature of the minerals, commodity prices, and the strength of the balance sheets of the companies that nominate and bid on these properties, among other factors. To our knowledge, there has been no production occur yet on any of these properties and no royalty income has been generated. For historical reference, the Division of Natural Resources has received approximately $5.7 Million in up-front, one-time bonus payments to lease minerals under the State’s waterways since December of 2014. This funding is being dedicated to finance much needed repairs of existing State Park system facilities. If future lease revenues prove substantial the funds could be utilized to finance a bond issue for renovation of the lodge and supporting recreational facilities at Cacapon Resort State Park.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2016
Increase/Decrease
(use"-")
2017
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 0


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






Memorandum


For additional information concerning this fiscal note, please contact: Emily J. Fleming Deputy Director WV Division of Natural Resources 324 4th Avenue South Charleston, WV 25303 304-558-2754 phone 304-558-2768 fax



    Person submitting Fiscal Note: Emily Fleming
    Email Address: Emily.J.Fleming@wv.gov