Expansion of the Home-Rule Pilot Project and the creation of the Morgantown TIF won’t be free. The state legislature approved a bill Thursday that could potentially allow the state Tax Dept. to charge more money for collecting the taxes.
Current law allows the dept. to charge one percent for the taxes it collects and sends back home-rule cities and TIF districts but the bill could increase that to five percent in the years ahead.
Some are calling it a money grab by the state but House of Delegates Finance Committee Chairman Harry Keith White says it’s costing the tax dept. more to administer the tax money.
“Just to administer the collections, the recording and the mailing back of the tax collections, they are actually going in the hole,” White said Thursday before the bill gained final approval.
He added the costs will likely increase with as many as 20 cities soon to be part of the home-rule program thanks to the bill lawmakers passed.
But several members of the House and Senate urged caution during Thursday’s floor session.
“They are doing it at one percent right now. I don’t know what reason the tax department would need any additional money and why it would cost more than it does now,” Sen. Bob Plymale, D-Wayne, said. “I want to make sure this doesn’t cost Huntington anything.”
Lawmakers will have the final say on the rate during next year’s legislative session.
Kanawha County Sen. Brooks McCabe says raising the fee to five percent could cost Charleston as much as $250,000 for the changes it plans under home rule and its TIF district.
There were several no votes on the bill in both the House and Senate.