FISCAL NOTE

Date Requested: February 12, 2019
Time Requested: 12:51 PM
Agency: Agriculture, WV Department of
CBD Number: Version: Bill Number: Resolution Number:
3125 Introduced HB2999
CBD Subject: Agriculture


FUND(S):

None.

Sources of Revenue:

Other Fund N/A

Legislation creates:

Decreases Existing Revenue, Increases Existing Expenses



Fiscal Note Summary


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


If passed, this bill will negatively impact the Department of Agriculture by decreasing the revenue from the registration of certain seeds and would increase agency expense for registration and compliance activities. Based on current data, this measure would decrease collections by $58,416 per year; however, agency workload would be increased. Additional staffing would be required, as both a full-time seed certification specialist as well as a full-time seed analyst in order to provide the appropriate level of regulatory and analytical support, which would increase ongoing agency expenses.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2019
Increase/Decrease
(use"-")
2020
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 113,600 113,600
Personal Services 0 113,600 113,600
Current Expenses 0 0 0
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 -58,416 -58,416


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


Total revenues would be decreased by $58,416 per year based on proposed reductions in licensing/registration fees. The breakdown is as follows: Current Law: Registration of Seedsman……. $125.00 Proposed Legislation: Registration of Seedsman……. $1.00 Registered Seedsman in 2018: 110 Revenue Under Proposed Legislation: $110.00 Net Loss: -$13,640.00 Current Law: Packet Display Stamps……. $10.00 Proposed Legislation: Packet Display Stamps……. $1.00 Seed Stamps Sold in 2018: 473 Revenue Under Proposed Legislation: $473.00 Net Loss: -$4,257.00 Current Law: Poundage Fee for Forest, Forage, & Agricultural Crop Seeds……. $0.50 per 100 weight Proposed Legislation: Poundage Fee for Forest, Tobacco, Alfalfa, Clover, Grass, Mixtures of any of these, & Vegetable Seeds……. $0.10 per 100 weight Poundage Fee for all other Agricultural Seeds…….$0.05 per 100 weight Revenue Under Proposed Legislation: $9,130.07 Net Loss: -$36,520.29 Current Law: Poundage Fee for Seed Potatoes……. $0.35 per 100 weight Proposed Legislation: Poundage Fee for Seed Potatoes……. $0.02 per 100 weight Revenue Under Proposed Legislation: $242.38 Net Loss: -$3,999.20 Total Net Loss Projected Under Proposed Legislation: -$58,416.49 per year In addition to lost revenue, a total of $113,600 would be needed each year to for a full-time (1.00) Seed Certification Specialist as well as a full-time (1.00 FTE) Seed Analyst. Currently, we do not have enough staff to conduct this analysis without hiring additional personnel. In total, with unforeseen expenses and lost revenue, the total annual negative impact to the Department of Agriculture would be $172,016.



Memorandum


Section 19-16-3: The changes in this bill related to the fees section will cost our seed program by approximately $58,000 per year based on registration data from 2018. This program is already struggling and a cut like this would essentially negate the program. There is also concern that this section affects the non-transferability of registrations and lacks language specifically allowing for a hearing prior to registration revocation to give registrants the right to defend themselves. Section 19-16-3b: This section will create a lot of additional paperwork, which is already an area of concern. This section also discusses seed certification is redundant since the section above discusses seed certification. Also, the agency already has written a seed certification rule to implement that section. Also, if the purpose of this section is to allow for equity incubators to support business growth in exchange for a share of the profits it does not make sense to limit businesses to just certified seed production. This entire section ideally should be in the hemp law and amended to allow for other business growth (not just certified seed production).



    Person submitting Fiscal Note: Alan Clemans, on behalf of Sandra Gillispie, CFO
    Email Address: sgillispie@wvda.us