The 2021 WV State Legislature has been in session for the past few weeks. Under consideration is WV Senate Joint Resolution 7 (SJR7) which would eliminate the taxation of certain properties and add taxes on other items.
The following is a copy of SRJ-7 and the response from the County Commission Association and the WV Association of Counties:
WEST VIRGINIA LEGISLATURE
2021 REGULAR SESSION
Committee Substitute for Senate Joint Resolution 7
By Senators Trump, Roberts, Rucker, Phillips, Nelson, Karnes,
Maroney, and Smith
[Originating in the Committee on Finance; reported on March 27, 2021]
Proposing an amendment to the Constitution of the State of West Virginia, amending article X thereof, by adding thereto a new section, designated section one-d, relating generally to ad valorem taxation and assessment of tangible personal property; authorizing the Legislature to exempt one or more species of tangible personal property from taxation; authorizing the Legislature to reduce the rate of taxation or assessment for one or more species of tangible personal property; authorizing the Legislature to establish different statewide rates of taxation, statewide rates of assessment, and statewide methods of valuation for different species of tangible personal property; clarifying that the Legislature and levying bodies remain subject to constitutional limits on rate of taxation and assessment; authorizing the Legislature to classify property as real or personal for taxation purposes; numbering and designating such proposed amendment; and providing a summarized statement of the purpose of such proposed amendment.
Resolved by the Legislature of West Virginia, two thirds of the members elected to each house agreeing thereto:
That the question of ratification or rejection of an amendment to the Constitution of the State of West Virginia be submitted to the voters of the state at the next general election to be held in the year 2022, which proposed amendment is that article X thereof be amended by adding thereto a new section, designated section one-d, to read as follows:
ARTICLE X. TAXATION AND FINANCE.
§1d. Legislative Authority Related to Ad Valorem Taxation and Assessment of Tangible Personal Property.
Notwithstanding any other provision of this Constitution, the Legislature may, by general law, do one or more of the following:
(1) Exempt one or more species of tangible personal property from ad valorem property taxation;
(2) Reduce the rate of taxation or assessment for one or more species of tangible personal property;
(3) Establish different statewide rates of taxation, statewide rates of assessment, and statewide methods of valuation for different species of tangible personal property: Provided, That uniformity in taxation is not required among the different species of tangible personal property: Provided, however, That neither the Legislature nor a levying body may establish a rate of taxation or assessment for any species of tangible personal property that exceeds the applicable limitations contained in this article, except as expressly authorized by the other sections of this article; and
(4) Classify property as real property or as personal property for the purposes of ad valorem property taxation.
Resolved further, That in accordance with the provisions of article eleven, chapter three of the Code of West Virginia, 1931, as amended, such amendment is hereby numbered “Amendment No. 1” and designated as the “Motor Vehicle and Other Personal Property Tax Reduction Amendment” and the purpose of the proposed amendment is summarized as follows: “The purpose of this amendment is to permit the Legislature to eliminate or lower the ad valorem personal property tax on motor vehicles and all other species of tangible personal property; to permit the Legislature to establish different statewide rates of taxation, rates of assessment, and methods of valuation for different species of tangible personal property; and to permit the Legislature to classify property as real property or personal property for ad valorem taxation.”
CCAWV and WVACo issue statement on SJR7
CHARLESTON, W.Va. — CCAWV and WVACo believe county government is essential to a strong state government and economy. We acknowledge the West Virginia Legislature as it continues to work to address economic issues in West Virginia. Regarding SJR7, and the desire to explore options such as elimination of personal property tax, there are major concerns when it comes to the future continuity of county government.
If approved by voters, SJR7 would open up personal property so that it could be defined in order to address eliminating this tax. In addition, SJR7 could eliminate constitutionally protected revenues and even if replacement revenues are put in code, that can be changed by any future legislature. This creates a great cloud of uncertainty for counties.
As a reminder, counties provide funding for local parks, 911 centers, health departments, animal shelters, fairs and festivals, 4-H programs, inspections, solid waste authorities and libraries. We also fund other elected official’s offices that ensure fair and equal taxation as state law demands; run free, fair and safe elections during the pandemic; and provide justice through our courts and law enforcement. Sheriffs are the biggest departments in many counties. Sheriff departments answer the most calls in the state. This bill could potentially defund law enforcement, ambulances, and fire service.
Simply put, counties are an extension of state government. Counties rely on tax revenue for their budgets, which mostly comes from property taxes, including business and inventory. The county only receives about 27 cents for every dollar collected, because most of that tax money is used to fund the public school system. This is not just about county budgets. This is also about education and services that counties provide to every citizen of West Virginia.
Counties do understand the importance of the citizens of West Virginia having a voice and the desire to put this decision on the ballot in the 2022 election. However, we are concerned that this legislation could result in a transfer of the responsibility of funding through elimination of these tax revenues on to citizens and their property. There needs to be careful consideration of the possible consequences of this type of decision on counties. Although there appears to be a desire for counties to have a “seat at the table” during these discussions, some of the actions over the past few weeks speak volumes to the actual consideration of county input. It appears that workgroups have been created and meeting addressing issues that directly affect counties, but to our knowledge we were not invited nor involved in these meetings. Counties are key stakeholders and their input is vital.
Our associations thank you for your time and consideration. Like you, we want to work to find ways to better improve the state’s business climate and keep our best and brightest. We want more people to come here for all of the amenities our state has to offer. We want progress. We just cannot sacrifice our counties to get there.