FISCAL NOTE
Date Requested: January 14, 2026
Time Requested: 07:30 PM |
| Agency: |
Tax & Revenue Department, WV State |
|---|
| CBD Number: |
Version: |
Bill Number: |
Resolution Number: |
| 1071 |
Introduced |
SB110 |
|
|---|
| CBD Subject: |
Workers Compensation |
|---|
|
FUND(S):
State Black Lung Fund, General Revenue Fund
Sources of Revenue:
Special Fund
Legislation creates:
Decreases Existing Revenue, Creates New Fund: State Black Lung Fund
Fiscal Note Summary
Effect this measure will have on costs and revenues of state government.
The stated purpose of this bill is to create the West Virginia Black Lung Program and to grant entitlement for pain and suffering for occupational pneumoconiosis.
The provisions of this bill attempt to create a new State-funded Black Lung Benefit Program for miners and retirees who worked in coal mines for a period of at least 10 years. The program would be funded by new surtaxes on mining companies and certain electric power generation companies. This fiscal note only addresses the tax related provisions within this bill. Any costs associated with the new State-funded benefit program would come from the agency administering the new benefit program.
As written, some lack of clarity in the bill may create issues in implementation and administration. However, based on our interpretation of Legislative intent, the bill would create the West Virginia Black Lung Program to be funded from an additional tax imposed on severance of natural resources and generation of electricity by wind and solar devices. The provisions of the bill attempt to impose a 10 percent surtax on the severance of coal, natural gas, and oil.
Combined State and local severance taxes on coal, natural gas, and oil vary significantly from year to year due to various economic factors. Over the past four years, collections of tax on coal, natural gas, and oil varied from a low of roughly $341 million, in Fiscal Year 2024, to a high of nearly $900 million in Fiscal Year 2023. The yield from Business and Occupation Taxes on wind power generation is generally less than $2 million per year. Based on past history, an additional 10 percent surtax on those activities would potentially yield between $34.1 million and $90.0 million per year for the new State-funded Black Lung Benefit Program.
According to our interpretation, the provisions of this bill would also allow a non-refundable Personal Income Tax credit for taxpayers who received the benefits from the new State-funded Black Lung Benefit Fund equal to the amount of payments received each year. The minimum annual payment would be $2,400 per year for someone with 10 to 15 years of exposure with the payment rising above $5,000 for someone with 30 or more years of exposure. According to federal statistics, there are currently 4,136 federal Black Lung claims in West Virginia. Data provided by Workforce WV indicates that there have been approximately 20,600 miners employed in the state, on average, over the past 10 years. However, due to vagueness in the language of the bill, regarding the eligibility of the taxpayer claiming the credit, the estimated amount of revenue loss cannot reasonably be determined. The cost of the credit could easily exceed $48 million per year if most affected taxpayers have pre-credit State income tax liability of at least $2,400.
Additional administrative costs to the Tax Division would be $90,470 in FY2026 and $44,820 in subsequent fiscal years.
Fiscal Note Detail
| Effect of Proposal |
Fiscal Year |
2026
Increase/Decrease
(use"-") |
2027
Increase/Decrease
(use"-") |
Fiscal Year
(Upon Full
Implementation) |
| 1. Estmated Total Cost |
90,470 |
44,820 |
44,820 |
| Personal Services |
44,820 |
44,820 |
44,820 |
| Current Expenses |
0 |
0 |
0 |
| Repairs and Alterations |
0 |
0 |
0 |
| Assets |
1,650 |
0 |
0 |
| Other |
44,000 |
0 |
0 |
| 2. Estimated Total Revenues |
0 |
0 |
0 |
Explanation of above estimates (including long-range effect):
The provisions of this bill attempt to create a new State-funded Black Lung Benefit Program for miners and retirees who worked in coal mines for a period of at least 10 years. The program would be funded by new surtaxes on mining companies and certain electric power generation companies. This fiscal note only addresses the tax related provisions within this bill. Any costs associated with the new State-funded benefit program would come from the agency administering the new benefit program.
As written, some lack of clarity in the bill may create issues in implementation and administration. However, based on our interpretation of Legislative intent, the bill would create the West Virginia Black Lung Program to be funded from an additional tax imposed on severance of natural resources and generation of electricity by wind and solar devices. The provisions of the bill attempt to impose a 10 percent surtax on the severance of coal, natural gas, and oil.
Combined State and local severance taxes on coal, natural gas, and oil vary significantly from year to year due to various economic factors. Over the past four years, collections of tax on coal, natural gas, and oil varied from a low of roughly $341 million, in Fiscal Year 2024, to a high of nearly $900 million in Fiscal Year 2023. The yield from Business and Occupation Taxes on wind power generation is generally less than $2 million per year. Based on past history, an additional 10 percent surtax on those activities would potentially yield between $34.1 million and $90.0 million per year for the new State-funded Black Lung Benefit Program.
According to our interpretation, the provisions of this bill would also allow a non-refundable Personal Income Tax credit for taxpayers who received the benefits from the new State-funded Black Lung Benefit Fund equal to the amount of payments received each year. The minimum annual payment would be $2,400 per year for someone with 10 to 15 years of exposure with the payment rising above $5,000 for someone with 30 or more years of exposure. According to federal statistics, there are currently 4,136 federal Black Lung claims in West Virginia. Data provided by Workforce WV indicates that there have been approximately 20,600 miners employed in the state, on average, over the past 10 years. However, due to vagueness in the language of the bill, regarding the eligibility of the taxpayer claiming the credit, the estimated amount of revenue loss cannot reasonably be determined. The cost of the credit could easily exceed $48 million per year if most affected taxpayers have pre-credit State income tax liability of at least $2,400.
Additional administrative costs to the Tax Division would be $90,470 in FY2026 and $44,820 in subsequent fiscal years.
Memorandum
The stated purpose of this bill is to create the West Virginia Black Lung Program and to grant entitlement for pain and suffering for occupational pneumoconiosis.
This bill is too vague to be administered. It is unclear who would qualify for the program and how someone would apply for the program. The provisions for the personal income tax credit and the additional severance tax are vague. This bill does not attempt to coordinate the collection of the tax with the deposit of the revenue into the Fund or with the date that payouts may be due from the Fund.
Person submitting Fiscal Note: Mark Muchow
Email Address: RADfiscal@wv.gov