FISCAL NOTE
Date Requested: January 27, 2015
Time Requested: 01:27 PM |
| Agency: |
Alcohol Beverage Control Administration |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 2385 |
Introduced |
SB273 |
|
|---|
| CBD Subject: |
Tax |
|---|
|
FUND(S):
General
Sources of Revenue:
General Fund
Legislation creates:
Neither Program nor Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The bill provides various mechanisms aimed at supporting the growing West Virginia brewing industry in order to spur more investment by existing brewers and resident brewers located in this state but to also grow their numbers.
The bill permits brewers or resident brewers to conduct tours and provide complimentary samples on its brewer premises.
The bill provides the new ability for resident brewers to sell growlers for off premises consumption to customers (this was previously only permitted at a brewpub).
The bill provides a sliding scale of license fees for a resident brewer or brewers with its principal place of business in West Virginia. The scale is: (1) 0-12,500 barrels the fee is $500; (2) 12,501-25,000 barrels the fee is $1000; and (3) 25,001 and more barrels the fee is $1,500. The sliding scale fee does require an initial estimation of production followed by a final report with the actual production and perhaps adjustment to the license fee based on actual production during a fiscal year. Brewers not located in the state are exempted from all the reporting requirements and pay $1,500.
Lastly, the bill removes the bonding requirement of a brewpub as the licensed suspension and/or revocation is security for payment of any taxes previously secured by the bond. This relieves the brewpub of paying the fees associated with bonding the brewpub.
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 |
-14,500 |
-14,500 |
-14,500 |
| 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):
The bill provides various mechanisms aimed at supporting the growing West Virginia brewing industry in order to spur more investment by existing brewers and resident brewers located in this state but to also grow their numbers.
Currently, West Virginia has 11 licensed brewers and resident brewers who are physically located in West Virginia. This number has doubled in the last 5 years with only minor changes in the law with respect to growlers and other aspects of the Nonintoxicating Beer Act. This bill aims to significantly increase the number of brewers and resident brewers physically located in West Virginia.
No single brewer or resident brewer is producing more than 12,500 barrels of nonintoxicating beer. Therefore these 11 would receive the reduced license fee of $500 from the previous fee of $1,500. This would result in a decrease of $11,000 in licensing revenue for the General Fund.
Further, 7 of these brewers and resident brewers have brewpubs where the license fee has been reduced from $1000 to $500, resulting in a $3,500 decrease in licensing revenue.
Assuming no new brewers or resident brewers obtain a license, then the total decrease in licensing revenue would be $14,500.
While the exact numbers are too speculative to provide, the aim of the bill is to spur growth in the existing 11 brewers which could lead to additional tax revenues and fees paid by them. Further, the bill aims to spur more growth in brewers and resident brewers which has been the trend in the West Virginia beer brewing industry. This growth would also add revenue.
Memorandum
The bill provides various mechanisms aimed at supporting the growing West Virginia brewing industry in order to spur more investment by existing brewers and resident brewers located in this state but to also foster growth in the West Virginia beer brewing industry and offset the initial revenue impact.
Person submitting Fiscal Note: Anoop Bhasin, General Counsel on behalf of WVABCA
Email Address: Anoop.K.Bhasin@wv.gov