CLARKSBURG, W.Va. (WBOY) — Business interests and local governments have very different perspectives about Amendment 2, which West Virginia voters will get to decide on during the upcoming General Election on Nov. 8.
The amendment is deemed the Property Tax Modernization Amendment. It would give the state legislature control of 27% of the fund generated from the Tangible Personal Property (TPP) tax. The legislature has said it will use that power to provide personal property exemptions for equipment and inventory that is directly used for business. Click here to read the amendment in its entirety.
The West Virginia Manufacturers Association (WVMA) Friday released an impact study. It found that national site selection consultants who recently considered locations in West Virginia for one or more clients considered the TPP tax a competitive disadvantage when compared to similar states. It also found that manufacturers currently located in West Virginia consider the TPP tax a disadvantage, which also diverts resources that could go into expanding operations in West Virginia away.
The report put a steep price tag on losing manufacturing projects to other states.
An economic and fiscal impact analysis which was prepared by a team which regularly prepares such analyses demonstrates that on a very conservative basis the cost to West Virginia in losing even one representative project is highly costly to West Virginia resulting in:
• An annual loss of direct, indirect, and induced economic impacts equal to $580,277,062.
• A loss over five years of state and local taxesequal to $25,224,175.
Consider the losses over a number of years resulting from multiple manufacturing projects dropping West Virginia from consideration.
The WVMA’s TPP tax impact study
Click here to read the full WVMA report.
On the other hand, several local governments have come out in opposition to Amendment 2. The Marion County Commission recently issued a statement raising concerns that there is no plan for reimbursement of funds that the TPP generates.
Earlier this month, Harrison County Assessor Rocky Romano told 12 News, “The legislatures are trying to put together a plan and I understand their plan is probably good. But the bottom line is we don’t see that plan right now. We don’t know when this would happen. Myself and other county officials, we’re working to educate people to let them know that you’re not voting for an exemption, you are voting to give them the authority to do so. And the plan that they’re putting together there is a difference between the House and the Senate, and others.”
The West Virginia Center for Budget & Policy has raised concerns that the amendment could risk there being less money for public services like libraries, schools, fire departments, parks and other institutions funded by TPP tax.