WEST virginia Legislature
2016 regular session
Introduced
House Bill 4003
By Delegates E. Nelson, Shott, Hanshaw, Ireland, R. Smith, Storch, R. Phillips, B. White, McCuskey, Waxman and Summers
[Introduced January
13, 2016; Referred
to the Committee on Finance.]
A BILL to amend and reenact §11-13V-4 of the Code of West Virginia, 1931, as amended, relating to expiring certain severance taxes that are dedicated to the Workers’ Compensation Debt Reduction Fund effective no later than February 1, 2016; and removing expired provisions
Be it enacted by the Legislature of West Virginia:
That §11-13V-4 of the Code of West Virginia, 1931, as amended, be amended and reenacted to read as follows:
ARTICLE 13V. WORKERS’ COMPENSATION DEBT REDUCTION ACT.
§11-13V-4. Imposition of tax.
(a) Imposition of additional tax on
privilege of severing coal. -- Upon every person exercising the privilege
of engaging within this state in severing, extracting, reducing to possession
or producing coal for sale, profit or commercial use, there is hereby imposed
an additional annual severance tax for exercising the privilege after November
30, 2005. The tax shall be is $.56 per ton and the measure of
the tax is tons of clean coal severed or produced in this state by the taxpayer
after November 30, 2005, for sale, profit or commercial use during the taxable
year. When the person mining the coal sells raw coal, the measure of tax shall
be ton of clean coal determined in accordance with rules promulgated by the Tax
Commissioner as provided in article three, chapter twenty-nine-a of this code.
If this rule is filed for public comment before July 1, 2005, the rule may
be promulgated as an emergency legislative rule. This tax shall be is
in addition to all taxes imposed with respect to the severance and production
of coal in this state including, but not limited to, the taxes imposed by
articles twelve-d and thirteen-a of this chapter and the taxes imposed by
sections eleven and thirty-two, article three, chapter twenty-two of this code,
if applicable.
(b) Imposition of additional tax on
privilege of severing natural gas. -- For the privilege of engaging or
continuing within this state in the business of severing natural gas for sale,
profit or commercial use, there is hereby levied and shall be collected from
every person exercising this privilege an additional annual privilege tax. The
rate of this additional tax shall be is $.047 per mcf of natural
gas and the measure of the tax is natural gas produced after November 30, 2005,
determined at the point where the production privilege ends for purposes of the
tax imposed by section three-a, article thirteen-a of this chapter, and with
respect to which the tax imposed by section three-a of said article
thirteen-a is paid. The additional tax imposed by this subsection shall be
collected with respect to natural gas produced after November 30, 2005.
(c) Imposition of additional tax on
privilege of severing timber. -- For the privilege of engaging or
continuing within this state in the business of severing timber for sale,
profit or commercial use, there is hereby levied and shall be collected from
every person exercising this privilege an additional annual privilege tax equal
to two and seventy-eight hundredths percent of the gross value of the timber
produced, determined at the point where the production privilege ends for
purposes of the tax imposed by section three-b, article thirteen-a of this
chapter and upon which the tax imposed by section three-b of said
article thirteen-a is paid. The additional tax imposed by this subsection shall
be collected with respect to timber produced after November 30, 2005: Provided,
That during the period of discontinuance of the tax as provided in subsection
(d), section three-b, article thirteen-a of this chapter, the additional tax
imposed by this subsection shall be determined as provided in this subsection
in the same manner as if the tax described under section three-b, article
thirteen-a of this chapter is being imposed and collected, subject to the
provisions of subsection (g) of this section.
(d) No pyramiding of tax burden. -- Each ton of coal and each mcf of natural gas severed in this state after the effective date of the taxes imposed by this section shall be included in the measure of a tax imposed by this section only one time.
(e) Effect on utility rates. -- The Public Service Commission shall, upon the application of any public utility that, as of the effective date of the taxes imposed by this section, is not currently making periodic adjustments to its approved rates and charges to reflect changes in its fuel costs because the mechanism historically used to make such periodic adjustments is suspended by an order of the commission, allow such utility to defer, for future recovery from its customers, any increase in its costs attributable to the taxes imposed by this section upon: Coal and natural gas severed in this state and utilized in the production of electricity generated or produced in this state and sold to customers in this state; coal and natural gas severed in this state and utilized in the production of electricity not generated or produced in this state that is sold to customers in this state; and natural gas severed in this state that is sold to customers in this state.
(f) Dedication of new taxes. -- The net amount of all moneys received by the Tax Commissioner from collection of the taxes imposed by this section, including any interest, additions to tax, or penalties collected with respect to these taxes pursuant to article ten, chapter eleven of this code, shall be deposited in the Workers’ Compensation Debt Reduction Fund created in article two-d, chapter twenty-three of this code. As used in this section, “net amount of all taxes received by the Tax Commissioner” means the gross amount received by the Tax Commissioner less the amount of any refunds paid for overpayment of the taxes imposed by this article, including the amount of any interest on the overpayment amount due the taxpayer under the provisions of section fourteen, article ten of this chapter.
(g) Sunset expiration date of taxes. -- The new taxes imposed by this section shall expire and not be imposed with respect to privileges exercised on and after either the first day of the month following the month in which the Governor certifies to the Legislature that: (1) The revenue bonds issued pursuant to article two-d, chapter twenty-three of this code, have been retired, or payment of the debt service provided for; and (2) that an independent certified actuary has determined that the unfunded liability of the old fund, as defined in chapter twenty-three of this code, has been paid or provided for in its entirety, or February 1, 2016, whichever occurs first: Provided, That if February 1, 2016, occurs first, and the effective date of the amendments to this section made during 2016 occurs after that date, the amendments are expressly made retrospective to February 1, 2016. Expiration of the taxes imposed in this section as provided in this subsection shall not relieve any person from payment of any tax imposed with respect to privileges exercised before the expiration date.
NOTE: The purpose of this bill is to eliminate the severance taxes imposed on coal, natural gas and timber for Workers’ Compensation debt reduction purposes effective February 1, 2016, if the Governor has not yet provided the certification necessary to expire them earlier.
Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.