FISCAL NOTE

Date Requested: February 04, 2020
Time Requested: 11:08 AM
Agency: Tax & Revenue Department, WV State
CBD Number: Version: Bill Number: Resolution Number:
2867 Introduced HB4686
CBD Subject: Taxation


FUND(S):

General Revenue Fund

Sources of Revenue:

General Fund

Legislation creates:

Decreases Existing Revenue, 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 provide that moneys in the West Virginia Emergency Medical Services Retirement Fund are exempt from any state or municipal tax, are not subject to execution, garnishment, attachment, or any other process whatsoever with the exception that the benefits or contributions under the system shall be subject to “qualified domestic relations orders” and are generally unassignable. The bill puts EMS members on equal retirement fund footing as firefighters, deputy sheriffs and other law enforcement personnel. This bill exempts from all state taxes both the funds and the proceeds of the emergency medical services retirement fund. Under the provisions of this bill, pension benefits from the West Virginia Emergency Medical Services Retirement Fund would be exempt from Personal Income Tax. The exemption of these pension benefits would result in a loss of $160,000 in State revenues beginning FY2022. Additional administrative costs would be $10,000 in FY2021 and subsequent years.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2020
Increase/Decrease
(use"-")
2021
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 10,000 10,000
Personal Services 0 10,000 10,000
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 -160,000


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


This bill exempts from all state taxes both the funds and the proceeds of the emergency medical services retirement fund. Under the provisions of this bill, pension benefits from the West Virginia Emergency Medical Services Retirement Fund would be exempt from Personal Income Tax. The exemption of these pension benefits would result in a loss of $160,000 in State revenues beginning FY2022. Additional administrative costs would be $10,000 in FY2021 and subsequent years.



Memorandum


The stated purpose of this bill is to provide that moneys in the West Virginia Emergency Medical Services Retirement Fund are exempt from any state or municipal tax, are not subject to execution, garnishment, attachment, or any other process whatsoever with the exception that the benefits or contributions under the system shall be subject to “qualified domestic relations orders” and are generally unassignable. The bill puts EMS members on equal retirement fund footing as firefighters, deputy sheriffs and other law enforcement personnel. Retirees from this Fund would also be eligible for the $8,000 modification for senior citizens or persons who are totally and personally disabled for non-pension income. Therefore, passage of this bill as written would effectively provide emergency medical services retirees over age 65 with a greater tax preference than retired firefighters, deputy sheriff and other law enforcement personal. Retired firefighters and police only receive a benefit from the $8,000 modification if their pension income is less than the $8,000. Preferential treatment for retirees from the West Virginia Emergency Medical Services Retirement Fund relative to federal civil service retirees would conflict with the U.S. Supreme Court ruling in Davis v. Michigan.



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