ENGROSSED
Senate Bill No. 78
(By Senator Craigo)
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[Originating in the Committee on Finance;
reported January 16, 1996.]
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A BILL to amend and reenact section five-a, article thirteen-a,
chapter eleven of the code of West Virginia, one thousand nine
hundred thirty-one, as amended, relating to dedication of oil
and gas severance tax for benefit of counties and
municipalities; distribution of dedicated tax; promulgation of
rules; creation of special funds; methods and formulae for
distribution of the dedicated tax; expenditure of funds by
counties and municipalities; and requirements for special
budgets and reports.
Be it enacted by the Legislature of West Virginia:
That section five-a, article thirteen-a, chapter eleven of the
code of West Virginia, one thousand nine hundred thirty-one, as
amended, be amended and reenacted to read as follows:
ARTICLE 13A. SEVERANCE TAXES.
§11-13A-5a. Dedication of ten percent of oil and gas severance tax
for benefit of counties and municipalities;
distribution of major portion of such dedicated tax
to oil and gas producing counties; distribution of
minor portion of such dedicated tax to all counties
and municipalities; reports; rules; creation of special
funds in the office of state treasurer; methods and
formulae for distribution of such dedicated tax; expenditure
of funds by counties and municipalities for public
purposes; and requiring special county and municipal budgets
and reports thereon.
(a) Effective the first day of July, one thousand nine hundred
ninety-six, five percent of the tax attributable to the severance
of oil and gas imposed by section three-a of this article is hereby
dedicated for the use and benefit of counties and municipalities
within this state and shall be distributed to
such the counties
and municipalities as
hereinafter provided
in this section.
Effective the first day of July, one thousand nine hundred ninety-
seven, and thereafter, ten percent of the tax attributable to the
severance of oil and gas imposed by section three-a of this article
is hereby dedicated for the use and benefit of counties and
municipalities within this state and shall be distributed to
such
the counties and municipalities as
hereinafter provided
in this section. Effective the first day of July, one thousand nine
hundred ninety-eight, and thereafter, ten percent of the tax
attributable to the severance of oil and gas imposed by section
three-a of this article is hereby dedicated for the use and benefit
of counties and municipalities within this state and shall be
distributed to
such the counties and municipalities as
hereinafter
provided
in this section.
(b) Seventy-five percent of this dedicated tax shall, after
appropriation
thereof of the tax by the Legislature, be distributed
by the state treasurer in the manner
hereinafter specified
in this
section, to the various counties of this state in which the oil and
gas upon which this additional tax is imposed was located at the
time it was removed from the ground. Those counties are
hereinafter referred to in this section
referred to as the "oil and
gas producing counties". The remaining twenty-five percent of the
net proceeds of this additional tax on
coal oil and gas shall be
distributed, after appropriation, among all the counties and
municipalities of this state in the manner
hereinafter specified
in
this section.
(c) The tax commissioner is hereby granted plenary power and
authority to promulgate reasonable rules requiring the furnishing
by oil and gas producers of such additional information as may be necessary to compute the allocation required under the provisions
of subsection (f) of this section. The tax commissioner is also
hereby granted plenary power and authority to promulgate such other
reasonable rules as may be necessary to implement the provisions of
this section.
(d) In order to provide a procedure for the distribution of
seventy-five percent of
such the dedicated tax on oil and gas to
such the oil and gas producing counties, there is hereby created in
the state treasurer's office the special fund known as the "oil and
gas county revenue fund"; and in order to provide a procedure for
the distribution of the remaining twenty-five percent of
such the
dedicated tax on oil and gas to all counties and municipalities of
the state, without regard to oil and gas having been produced
therein in those counties or municipalities, there is also hereby
created in the state treasurer's office the special fund known as
the "all counties and municipalities revenue fund".
Seventy-five percent of
such the dedicated tax on oil and gas
shall be deposited in the "oil and gas county revenue fund" and
twenty-five percent of
such the dedicated tax on oil and gas shall
be deposited in the "all counties and municipalities revenue fund",
from time to time, as
such the proceeds are received by the tax
commissioner. The moneys in
such the funds shall, after appropriation
thereof of the moneys by the Legislature, be
distributed to the respective counties and municipalities entitled
thereto to the moneys in the manner set forth in subsection (e) of
this section.
(e) The moneys in the "oil and gas county revenue fund" and
the moneys in the "all counties and municipalities revenue fund"
shall be allocated among and distributed annually to the counties
and municipalities entitled
thereto of the moneys by the state
treasurer in the manner
hereinafter specified
in this section. On
or before each distribution date, the state treasurer shall
determine the total amount of moneys in each fund which will be
available for distribution to the respective counties and
municipalities entitled
thereto to the moneys on that distribution
date. The amount to which an oil and gas producing county is
entitled from the "oil and gas county revenue fund" shall be
determined in accordance with subsection (f) of this section, and
the amount to which every county and municipality shall be entitled
from the "all counties and municipalities revenue fund" shall be
determined in accordance with subsection (g) of this section.
After determining, as set forth in subsections (f) and (g) of this
section, the amount each county and municipality is entitled to
receive from the respective fund or funds, a warrant of the state auditor for the sum due to
such the county or municipality shall
issue and a check drawn thereon making payment of
such the sum
shall thereafter be distributed to
such the county or municipality.
(f) The amount to which an oil and gas producing county is
entitled from the "oil and gas county revenue fund" shall be
determined by:
(1) In the case of moneys derived from tax on the severance of
gas:
(A) Dividing the total amount of moneys in
such the fund
derived from tax on the severance of gas then available for
distribution by the total volume of cubic feet of gas extracted in
this state during the preceding year; and
(B) Multiplying the quotient thus obtained by the number of
cubic feet of gas taken from the ground in
such the county during
the preceding year; and
(2) In the case of moneys derived from tax on the severance of
oil:
(A) Dividing the total amount of moneys in
such the fund
derived from tax on the severance of oil then available for
distribution by the total number of barrels of oil extracted in
this state during the preceding year; and
(B) Multiplying the quotient thus obtained by the number of barrels of oil taken from the ground in
such the county during the
preceding year.
(g) The amount to which each county and municipality is
entitled from the "all counties and municipalities revenue fund"
shall be determined in accordance with the provisions of this
subsection. For purposes of this subsection "population" means the
population as determined by the most recent decennial census taken
under the authority of the United States:
(1) The treasurer shall first apportion the total amount of
moneys available in the "all counties and municipalities revenue
fund" by multiplying the total amount in
such the fund by the
percentage which the population of each county bears to the total
population of the state. The amount thus apportioned for each
county is the county's "base share".
(2) Each county's "base share" shall then be subdivided into
two portions. One portion is determined by multiplying the "base
share" by that percentage which the total population of all
unincorporated areas within the county bears to the total
population of the county, and the other portion is determined by
multiplying the "base share" by that percentage which the total
population of all municipalities within the county bears to the
total population of the county. The former portion shall be paid to the county and the latter portion shall be the "municipalities'
portion" of the county's "base share". The percentage of
such the
latter portion to which each municipality in the county is entitled
shall be determined by multiplying the total of
such the latter
portion by the percentage which the population of each municipality
within the county bears to the total population of all
municipalities within the county.
(h) Moneys distributed to any county or municipality under the
provisions of this section, from either or both special funds,
shall be deposited in the county or municipal general fund and may
be expended by the county commission or governing body of the
municipality for such purposes as the county commission or
governing body shall determine to be in the best interest of its
respective county or municipality:
Provided, That in counties with
population in excess of two hundred thousand at least seventy-five
percent of
such the funds received from the oil and gas county
revenue fund shall be apportioned to, and expended within the oil
and gas producing area or areas of the county,
said the oil and
gas-producing areas of each county to be determined generally by
the state tax commissioner:
Provided, however, That the moneys
distributed to any county or municipality under the provisions of
this section shall not be budgeted for personal services in an amount to exceed one fourth of the total amount of
such the moneys.
(i) On or before the twenty-eighth day of March, one thousand
nine hundred ninety-seven, and each twenty-eighth day of March
thereafter, each county commission or governing body of a
municipality receiving any such moneys shall submit to the tax
commissioner on forms provided by the tax commissioner a special
budget, detailing how
such the moneys are to be spent during the
subsequent fiscal year.
Such The budget shall be followed in
expending
such the moneys unless a subsequent budget is approved by
the state tax commissioner. All unexpended balances remaining in
the county or municipality general fund at the close of a fiscal
year shall remain in the general fund and may be expended by the
county or municipality without restriction.
(j) On or before the fifteenth day of December, one thousand
nine hundred ninety-six, and each fifteenth day of December
thereafter, the tax commissioner shall deliver to the clerk of the
Senate and the clerk of the House of Delegates a consolidated
report of
such the budgets, created by subsection (i) of this
section, for all county commissions and municipalities as of the
fifteenth day of July of the current year.
(k) The state tax commissioner shall retain for the benefit of
the state from the dedicated tax attributable to the severance of oil and gas the amount of thirty-five thousand dollars annually as
a fee for the administration of
such the additional tax by the tax
commissioner.
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