Tag: Property Tax

Landowners Say They Are Being Taxed Unfairly At Public Hearing

The House of Delegates held a public hearing on a bill that would remove a sunset clause from the current oil and gas personal property tax assessment. 

A sunset clause is a note in the bill that gives it an expiration date, unless other legislative action is taken to extend the bill.

The House of Delegates held a public hearing on a bill that would remove a sunset clause from the current oil and gas personal property tax assessment. 

A sunset clause is a note in the bill that gives it an expiration date, unless other legislative action is taken to extend the bill. 

House Bill 2581 in the 2021 session created the formula for how gas operators and property owners are taxed. The bill had a sunset clause, which comes due in July of 2025 

House Bill 4850 would remove that sunset clause from the bill, making the tax formula permanent. 

Del. Vernon Criss, R-Wood, said the bill would help create tax predictability for landowners and well operators. 

“If we do not do this, then there will be no tax collected by the counties,” Criss said. “That is how the law is set up now. So the sunset clause needs to be taken off so that the counties can continue to collect their personal property tax on oil and gas in those counties.”

However, landowners taxed by this bill gathered at the Senate to express opposition.

They said that the 2021 bill taxes them unfairly and lacks transparency. 

Scott Sondo receives royalties for land he owns that has a well on it.  

“Now, one of the major problems is there’s no transparency in the industry,” Sondo said. “So they (well operators) could actually sell the products for a higher price. Tell me, they sell them for a lower price.”

He said that part of the formula for what he is taxed on is based on the prices that the gas actually sold for. The gas operators submit that information to the state but landowners like Sondo never know what that number is.

“When the operators turn these numbers in, they’re used to calculate my boundaries, well, we just would like to know what that value is. And so far, we’ve not been successful in getting that,” Sondo said. 

He said, after taxes, landowners barely have enough to pay the taxes from the royalties they are paid by well operators for the use of their land. 

The code also has proven to be complicated for the state Tax Division.  It has come under scrutiny since the tax code was passed in 2021 for things like providing incorrect assessments and then taking so long to get the correct assessment back to property owners that they don’t have time to appeal the assessment. 

Bill To Raise Taxes On Wind Turbines Advances In Senate

If Senate Bill 231 becomes law, wind turbines would be taxed as real property, not as personal property.

A Senate committee approved a potential tax increase on wind turbines Tuesday.

If Senate Bill 231 becomes law, wind turbines would be taxed as real property, not as personal property.

According to an attached fiscal note, that would increase revenue by $6.1 million annually, funds that would flow to schools, county commissions and the state’s general fund.

However, industry advocates say the move would make wind power less competitive in West Virginia and drive investment to other states.

Wind and solar are currently the cheapest forms of electricity. Supporters of the change say it helps fossil fuels compete with renewables.

The Senate Energy, Industry and Mining Committee approved SB 231 with little debate. The bill now goes to the Finance Committee.

Senate Tax Reform Proposal Gets State Tax Dept. Scrutiny

Details read from a State Tax and Revenue Department Fiscal note on the multifaceted Senate tax reform plan would see a total cost of around $740 million instead of the $600 million Senate projected cost.

Indications that Senate, House and Executive branch leadership were working toward a tax reform compromise got a shake up on the House floor Wednesday.

A state Tax and Revenue Department fiscal note on the Senate tax reform plan indicated a total cost of around $740 million dollars instead of the $600 million Senate projected cost. The note also mentions several problematic references, definitions and other inconsistencies in the bill wording and methodology.

House Finance Committee member, Del. Larry Rowe, D-Kanawha, was troubled by the fiscal note.  

“Basically, it would be to fund what was in Amendment 2 that was on the ballot and that the governor opposed,” Rowe said. “The bill ran in six hours. I’ve never seen that in my life, six hours from introduction to sending it to the House with this rule suspension. It came very fast. It’s also got some problems in the writing of the bill.”    

Del. Marty Gearheart, R-Mercer, said that he’s not prepared to endorse a Senate plan containing property tax relief elements similar to the failed Amendment 2, such as a 50 percent equipment and inventory property tax cut for West Virginia small businesses.

“It doesn’t mean I’m not confused and maybe a little upset that we can’t get past the fact that something that we placed on the ballot, something that I supported and voted for,” Gearheart said. “However, it didn’t pass. We’ve got two and a half weeks to provide relief to West Virginians. We’ve got two and a half weeks to see to it that they pay less tax. Beyond my confusion, let’s find a way to get it done.”

Rowe said the slow-moving tax reform issue is holding up other things lawmakers need to do, like funding $85 million for passed safe schools legislation – to change the security entries at schools statewide

Coalition Opposes Amendments 2 And 4

A coalition of educators, county representatives, nurses and others gathered inside West Virginia’s Capitol Tuesday urging voters to say no to two proposed constitutional amendments on the ballot this November.

A coalition of educators, county representatives, nurses and others assembled at West Virginia’s Capitol Tuesday urging voters to say no to two proposed constitutional amendments on the ballot this November.

Joe White, executive director of W. Va. School Service Personnel Association, joined representatives from WVEA, AFT-WV, deputy sheriffs and county commissioners in a show of solidarity against proposed constitutional amendments 2 and 4.

“The threat is great, we do not need to expand the power of the legislature,” White said. “We need to have some local control, and say, within each county.”

Amendment 2 would give the legislature power to regulate property taxes used to fund schools and libraries. White said an estimated $515 million dollar tax cut would mostly benefit out of state businesses while counties, public schools and libraries, parks, senior services and others stand to lose out.

Amendment 4 would allow the legislature to overturn any proposed rules on education on matters that include what is taught in West Virginia classrooms.

White said the same legislators who are seeking to change the status quo on education introduced 173 bills on education reform in 2021 alone and urged voters to get out to vote in November.

“I encourage y’all to stop this in its tracks and to vote no on amendments 2 and 4. It is not good for the people, it’s not good for the students and it is not good for the state of West Virginia,” White said.

President of the West Virginia Education Association Dale Lee, and Fred Albert, president of the American Federation of Teachers-WV joined White and others present in calling Proposal 4 an attack on the public education system.

Lee said the “disrespect” on the part of the legislature toward the state’s education system partly stems from resentment over 2018-2019 work actions when teachers and school service employees went on strike over low pay and high healthcare costs.

“I think a part of it is those who have a different belief and education philosophy that they are more concerned with, private school or homeschool, than they are public education,” Lee said.

He said bills aimed at improving those options will take money away from public education and dictate to teachers what they can teach, as well as how and when they can teach, including critical race theory.

Former president of the West Virginia NAACP Sen. Owens Brown, D-Ohio, a black man, earlier this year accused Republicans of using Senate Bill 498 as a “weapon or tool in their campaigns” stoking unnecessary fear among citizens.

Lee called critical race theory a political buzzword for what he said is actually a law school class that is only taught in a few states.

“Nowhere in our West Virginia public schools do we teach it. We teach truths; we have to allow our students to become critical thinkers,” Lee said.

He cited the example of Catherine Johnson, saying it was 50 years before anyone knew who the great American mathematician and hero was.

“Those are the truths that need to come out. It’s not about a race being superior, the buzzword they want you to believe,” Lee said. It’s about truths – letting our history be taught in a manner by our experts that have kids think about what happened.”

Two Sides To A Proposal That Would Eliminate W.Va.’s Business Property Taxes

If West Virginia voters say yes to "Amendment 2" on the November ballot, the state legislature will have the authority to eliminate business equipment and inventory taxes and the property tax on vehicles.

If West Virginia voters say yes to “Amendment 2” on the November ballot, the state legislature will have the authority to eliminate business equipment and inventory taxes and the property tax on vehicles.

Senate President Craig Blair, R-Berkeley, embraces the tax cut plan, but many county leaders fear the tax cuts would devastate basic public services.

Blair said one of many examples of the harm caused by West Virginia’s equipment and inventory tax began in 2016, when coal demand was low, mines shut down and moved equipment out of state or sold it. Blair said fast forward to the past two years — he figures the state lost between $75 million to $125 million, because coal demand and prices went up. But miners didn’t have the equipment to get it out of the ground.

“We’re missing out on the severance tax, we’re missing out on the personal income tax, because of the supply chain issues,” Blair said. “The people that sold their equipment, machinery — they can’t get it back fast enough to be able to be part of this wave, and we’re totally missing out on that.”

Blair said to consider the tax plight of long time Cabell County manufacturer Blenko Glass, and the hundreds of molds they use intermittently — but pay tax on every year. He mentioned the possibility of Amazon and other “store and ship” facilities setting up warehouses in West Virginia border counties with no inventory tax.

“I will quote to you from the West Virginia Center on Budget and Policy, which tends to lean a little to the left, I believe,” Jim Morgan said. “One of their facts is that during the past decade states with property taxes on business, machinery, equipment and inventory saw more manufacturing jobs growth on average, than the states without such taxes.”

That statement comes from former state delegate and current Cabell County Commission president Jim Morgan. Morgan said West Virginia counties get up to 40 percent of their operating budget, for fire, law enforcement, schools, solid waste — money from the taxes Blair wants eliminated.

“In Cabell County, we would lose $11 million in total school losses that won’t be made up by the school aid formula,” Morgan said. “That money would just be gone at that point. The legislature has said, that’s okay, we will backfill that and make you whole. Huh? As if we trust the legislature?”

Blair said a continuation of flat line budgets netting state revenue surpluses gained over the past several years will more than make up for the nearly $600 million in tax receipts now covering county bills.

“It’s not a big demand on the government. In fact, it makes it so that our agencies can get rid of the ‘spend it or lose it’ mentality,” Blair said. “That even includes getting rid of the regional jail fees for these counties. There are a multitude of examples out there when somebody is crying wolf, that we’re going to put the counties out of business, or we’re going to hurt the counties. It’s nonsense. What we’re trying to do is give him a hand up instead of being stagnant or declining, like most of them have been.”

Morgan countered that revenue surpluses are never guaranteed, and flat line budgets predicated on less spending have proved disastrous for state maintenance, growth and prosperity.

We have teaching vacancies, we have correction officer vacancies,” Morgan said. “Despite construction being done in high volume areas on major highways, roads are in poor shape. We’ve cut higher education. We’ve cut all kinds of things and he says we have a flat budget. Yet, West Virginia is falling apart.”

When Blair became senate president, he said he wanted 400,000 people to come to West Virginia. He said that can happen with eliminating those business property taxes. He said that will help create the industries and jobs that will keep graduates at home and bring young professionals in.

“And guess what? They’re the baby makers,” Blair said. “They’re the ones that fall in love, and have jobs here and stay here and make babies and send their kids to our school systems. And voting ‘yes’ on these constitutional amendments will actually make it so that we can accelerate the work that we’re doing and put more money into the people’s pockets.”

Morgan argues the legislative tax replacement plan is part of a state power grab.

“One scenario that we like to point out, if we were short $25 million in Cabell County, the legislature could very well say if you need more money, just raise everybody’s property tax in your county. The county commissions would be the bad guys for raising taxes to provide services — volunteer fire departments, EMS, 911 — all those things that the county funds. I believe it’s a mistake.”

The decision will be made on Nov. 8, with voters saying yes or no to “Amendment 2.”

Lawmakers Struggle with Right Course of Action for Tax Reform

As part of a continuing effort exploring possible changes to the state tax code, members of the Joint Select

Committee on Tax Reform held a day-long public hearing at the capitol Tuesday. The hearing allowed West Virginia citizens to share their suggestions for ways to improve the state’s tax structure, and while at least a dozen citizens showed, few lawmakers filled the seats to listen. That, however, didn’t stop members of the public from openly sharing what they think are the right steps for West Virginia.

From eliminating certain taxes to increasing others – the Joint Select Committee on Tax Reform heard it all.

Many speakers at Tuesday’s public hearing brought up issues with the state’s severance tax, property tax, and income tax credit – giving their own ideas to either lessen the pull or to increase revenue.

Some mentioned the benefits of increasing the tax on tobacco, saying it would help to decrease the amount of West Virginia smokers while also bringing in more money at the same time.

Speakers asked lawmakers to remember the children who come from families making minimum wage and live paycheck to paycheck.

Senator Mike Hall, a Republican from Putnam County, shares the chairmanship with Delegate Eric Nelson, a Republican from Kanawha County.

Hall says the tax reform committees in both houses will have a lot to think about.

“We heard a wide array of comments,” Hall noted, “We heard about the income tax credit, which we were aware we would, but we also heard from the coal association, business community, saying there are certain taxes here that really hurt us, and though it will be difficult to deal with those quickly, because there are multi-millions of dollars of revenue, it’s important for us to hear that.”

Hall says the looming question this session will be how to adequately manage reforming the tax structure in a low budget year.

“Revenues are down, can we live with them, there’ll be a lot of pressure from people to raise this or raise that to cover costs, but, right now, so we’re in a mode of seeing where can we operate, the revenues are low, and so it’ll be very hard to talk about tax policy in this climate in the legislative session, but I think at the end of the day, when the committee’s done, we’ll have a few things to propose and some major principles to look at and say going forward as things would permit that we would like to see our tax code be changed in a manner that would be more beneficial to our economy.”

Tax reform is likely to be at the forefront of the 2016 session, and legislators know they face a contentious battle ahead.

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