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2015 SESSION

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Senate Committee on Finance

Co-Chair: Walter A. Stosch - Co-Chair: Charles J. Colgan

Clerk: Patty Lung
Staff: Lisa Wallmeyer, Nicole Brenner
Date of Meeting: February 17, 2015
Time and Place: 9:00 a.m. - Senate Room B
Revised to add HBs 1329,1666, 2029 & 2306

H.B. 324 Virginia Virtual School; established, report, effective date.

Patron: Bell, Richard P.

Virginia Virtual School established. Establishes the Board of the Virginia Virtual School as a policy agency in the executive branch of state government for the purpose of governing the online educational programs and services offered to students enrolled in the Virginia Virtual School. The Secretary of Education is responsible for such agency. The 13-member Board is given operational control of the School and assigned powers and duties. The bill requires the School to be open to any school-age person in the Commonwealth and provide an educational program meeting the Standards of Quality for grades kindergarten through 12. The bill has a delayed effective date of July 1, 2015.

H.B. 1279 Motor vehicle sales and use tax; expands certain exemption.

Patron: Garrett

Motor vehicle sales and use tax; exemption. Expands the exemption from payment of the motor vehicle sales and use tax for gifts of vehicles to certain family members to include gifts to a parent.

H.B. 1286 Income tax, state; refund payments.

Patron: Ware

Individual income tax refunds; payment. Requires the Tax Commissioner and State Comptroller to implement procedures to allow an individual to elect to have his income tax refund paid by check mailed to his address. The bill applies to individual income tax returns relating to taxable year 2015 and taxable years thereafter.

H.B. 1287 Forfeiture of property used in connection with commission of crimes; conviction required.

Patron: Cole

Forfeiture of property used in connection with the commission of crimes; conviction required. Requires that any action for the forfeiture of property used in connection with the commission of a crime be stayed until the person whose property is the subject of the forfeiture action has been convicted of the crime authorizing the forfeiture and has exhausted all appeals. The bill provides that property may be forfeited even though no final conviction order is entered if (i) the forfeiture is ordered by the court pursuant to a plea agreement or (ii) the owner of the property has not submitted a written demand for the return of the property within one year from the date the property was seized. This bill incorporates HB 1468.

H.B. 1297 Machinery and tools tax; production of renewable energy.

Patron: Rasoul

Machinery and tools tax; production of renewable energy. Classifies machinery and tools owned by a business and used directly in producing or generating renewable energy as a separate class of property for tax rate purposes. The bill authorizes each locality to impose a tax on such machinery and tools at a rate less than that generally applicable in the locality to machinery and tools.

H.B. 1329 Out-of-state concealed handgun permits; photo identification.

Patron: Ware

Out-of-state concealed handgun permits; photo identification. Removes certain requirements for an out-of-state concealed handgun permit or license to be recognized and accepted in Virginia and instead requires an out-of-state permit or license holder to carry a government-issued photo identification and present such identification upon demand by a law-enforcement officer in order for his out-of-state permit or license to be recognized and accepted in Virginia.

H.B. 1400 Budget Bill.

Patron: Jones

Budget Bill. Amends Chapter 3, 2014 Special Session I Acts of Assembly.

H.B. 1489 Local taxes; payment by a third party.

Patron: Habeeb

Local taxes; payment by a third party. Increases from 24 months to 96 months the maximum reimbursement time period for third-party tax payment agreements, in which a taxpayer repays a third party who paid local taxes on the taxpayer's behalf.

H.B. 1554 Recyclable materials; changes tax credit by extending expiration date to January 1, 2020.

Patron: Marshall, D.W.

Recyclable materials tax credit. Changes the recyclable materials tax credit by (i) extending the expiration date of the credit by five years to January 1, 2020, (ii) increasing the credit allowed from 10 to 20 percent of the purchase price of qualifying machinery and equipment, (iii) prohibiting denial of the credit based solely on another person's use of goods produced by the credit applicant from recyclable materials, (iv) clarifying that no credit will be allowed for machinery and equipment that does not manufacture, process, compound, or produce items of tangible personal property from recyclable materials, and (v) establishing an annual cap of $2 million in recyclable materials tax credits that may be issued by the Department of Taxation. The provisions of the bill are effective for taxable years beginning on or after January 1, 2015.

H.B. 1560 Electronic summons systems; fees assessed by towns.

Patron: Rust

Electronic summons systems; fees; towns. Allows towns to assess a fee not to exceed $5, as part of the costs in each criminal or traffic case in the district or circuit courts located where such cases are brought, to be used for the implementation and maintenance of an electronic summons system.

H.B. 1589 Personal property; tax relief on certain motor vehicles leased by members of the military.

Patron: Krupicka

Personal property tax relief; certain motor vehicles. Requires each locality receiving personal property tax reimbursement from the Commonwealth to ensure that the reimbursement covers all of the tax attributable to the first $20,000 of value on each qualifying vehicle leased by an active duty member of the United States military, his spouse, or both, pursuant to a contract requiring the active duty member to pay the tangible personal property tax on such vehicle, if the vehicle would not be taxed in Virginia if it were owned.

H.B. 1648 Sales and use tax; exemption includes gold, silver, or platinum whose sales price exceeds $1,000.

Patron: Miller

Sales and use tax exemption; bullion. Exempts from sales and use tax gold, silver, and platinum bullion. The bill expires July 1, 2020.

H.B. 1666 Firearms or ammunition for firearms; petition for permit of restoration of right to possess, venue.

Patron: Fowler

Firearms; restoration of rights; venue. Permits a nonresident of the Commonwealth prohibited from possessing a firearm, ammunition, or a stun weapon because of a felony conviction or a juvenile adjudication of delinquency of certain offenses to petition the circuit court where his last felony conviction or adjudication of delinquency occurred for restoration of his right to possess, transport, or carry a firearm, ammunition or a stun weapon. Current law does not provide for venue for a nonresident's restoration petition. The bill also provides that if a circuit court grants a restoration petition and issues a permit to allow a person to possess, transport, or carry a firearm, ammunition, or a stun weapon, the clerk of the court shall certify and forward a copy of the permit to the Central Criminal Records Exchange.

H.B. 1705 Gas severance tax; no tax shall be imposed on or after January 1, 2018.

Patron: Morefield

Gas severance tax. Extends the sunset date from December 31, 2015, to January 1, 2018, for the local gas severance tax that is dedicated to (i) the local Coal and Gas Road Improvement Fund, (ii) the Virginia Coalfield Economic Development Fund, and (iii) water, sewer, and natural gas systems and lines. Incorporates HB 2282.

H.B. 1721 Real property tax; exemption for surviving spouses of members of armed forces killed in action.

Patron: Ramadan

Real property tax exemption; surviving spouses of members of armed forces killed in action. Exempts from taxation the principal residence of a surviving spouse of a member of the armed forces of the United States killed in action regardless of the value of the residence. Pursuant to subdivision (b) of Section 6-A of Article X of the Constitution of Virginia, which was adopted by the voters in 2014, the General Assembly enacted legislation exempting from taxation the principal residence of such surviving spouse, provided that the assessed value of the residence was not in excess of the averaged assessed value of dwellings in the county or city situated on property zoned as single family residential. The bill exempts the principal residence of any such surviving spouse regardless of assessed value. Subdivision (b) of Section 6-A of Article X provides that the exemption will cease if the surviving spouse remarries.

H.B. 1756 Tourism zones; tax revenues for tourism projects.

Patron: James

Tourism zones; tax revenues for tourism projects. Decreases from 80 percent to 70 percent the share of the total cost of a tourism project that the project must have in place before being eligible to receive a percentage of the state and local sales tax revenues generated on the premises of the project, to be used towards debt service to bridge the gap between available debt and equity and the expected costs of the project.

H.B. 1766 Real property tax; exemption for certain leasehold interests.

Patron: Loupassi

Real property tax exemption; certain leasehold interests. Authorizes localities to exempt from real property tax the leasehold interest in property in which the lessor is exempt from real property tax and the lessee is entitled to federal rehabilitation tax credits related to the property and uses the property for charitable, literary, scientific, cultural, or educational purposes.

H.B. 1784 Virginia Port Authority; capital projects.

Patron: Massie

Virginia Port Authority; capital projects. Restricts expenditures by the Virginia Port Authority on capital projects, except certain specified projects, to those located on real property that is owned, leased, or operated by the Virginia Port Authority.

H.B. 1790 State agency or official; prohibition on payments without an appropriation, prohibition on IOUs.

Patron: Massie

Prohibition on payments without an appropriation; prohibition on IOUs. Prohibits a state agency or official from attempting, guaranteeing, or purporting to pay for a good or service or  a debt unless the General Assembly has appropriated funds or funds are otherwise lawfully available, to pay the same. The prohibition on payment does not apply to payments required by federal law. The bill also prohibits a state agency or official from furnishing an IOU in exchange for any good or service, as a means to pay for any good or service, or in lieu of a payment on a debt.

H.B. 1828 Land preservation; tax credit.

Patron: Ware

Land preservation tax credit. Makes several changes to the credit by (i) reducing the maximum amount of tax credits that may be issued in each calendar year from $100 million to $75 million beginning in 2015; (ii) with the exception of credits issued for fee simple interest donations, reducing the maximum amount of the land preservation tax credit that may be claimed in any year from $100,000 in taxable year 2014 to $20,000 in taxable years 2015 and 2016 and $50,000 for each taxable year thereafter; (iii) requiring that a complete application for tax credit with regard to a conveyance be filed with the Department of Taxation by December 31 of year following the calendar year of the conveyance; and (iv) prohibiting the Department of Taxation from issuing any tax credit for a donation from any allocation or pool of tax credits attributable to a calendar year prior to the year in which the complete tax credit application for the donation was filed.

H.B. 1842 Virginia Investment Partnership Act; certain performance and incentive grants.

Patron: James

Performance and incentive grants. Provides (i) that no more than $15 million in Virginia Investment Performance Grants may be outstanding at any time on or after July 1, 2015, (ii) that grant payments under the Major Eligible Employer Grant Program will begin three years following approval of the employer's grant application by the Secretary of Commerce and Trade, and (iii) for the MEI Project Approval Commission to review incentive packages in which the aggregate amount of incentives offered by the Commonwealth is in excess of $10 million in value. Under current law, grant payments under the Major Eligible Employer Grant Program begin six years following approval by the Secretary of Commerce and Trade.

The bill also repeals the Clean Energy Manufacturing Incentive Grant Program effective July 1, 2015, and the Commonwealth's semiconductor performance grant programs effective July 1, 2016. 

H.B. 1879 Coalfield employment enhancement; extends expiration date of tax credit to January 1, 2019.

Patron: Kilgore

Coal tax credits. Limits the amount of the credit that may be claimed for the coal employment and production incentive tax credit to $500,000 per return. The bill also reduces the tax credit from $3 per ton of coal purchased and consumed by an electricity generator to $2 per ton. The bill also limits the credits that may be transferred by an electricity generator to the dollar amount of credits transferred by that electricity generator in taxable year 2012. Any unused tax credits may be carried forward for 5 taxable years. However, any coal employment and production incentive tax credit earned prior to January 1, 2015, may be carried forward for the 12 taxable years following the year in which the credit was earned.

The bill also extends the sunset date of the coalfield employment enhancement tax credit through taxable year 2018.

The provisions of the bill would become effective for taxable years beginning on and after January 1, 2015.

H.B. 1885 Virginia Retirement System; revocation of participation of political subdivision.

Patron: O'Quinn

Virginia Retirement System; Town of Damascus allowed to revoke agreement to contribute to VRS for future creditable service. Allows the Town of Damascus, based on it not having made contributions to VRS for 25 consecutive years, to revoke in writing its agreement to contribute to VRS for creditable service rendered by employees subsequent to the revocation. This is an exception to the general rule that election to participate in the Retirement System is irrevocable.

H.B. 1890 Virginia Retirement System; purchase of service credit for prior service.

Patron: Jones

Virginia Retirement System; purchase of service credit for prior service. Makes numerous changes to the purchase of service credit program to simplify it and make it more cost-neutral to the fund and more in line with other states' programs. The bill has a delayed effective date of January 1, 2017.

H.B. 1968 Recordation tax; open line deeds of trust.

Patron: DeSteph

Recordation tax; open line deeds of trust. Requires that the recordation tax on a deed of trust securing an open line of credit when the amount of the line of credit is increased be paid only on the difference between the amount of the original line of credit and the new amount.

H.B. 1969 Virginia Retirement System; cash balance retirement plan.

Patron: Jones

Virginia Retirement System; cash balance retirement plan. Directs the Virginia Retirement System to develop a proposed cash balance retirement plan and provide the proposal to the General Assembly no later than November 1, 2015.

H.B. 2019 Virginia Port Authority; additional exemptions from the Public Procurement Act.

Patron: BaCote

Virginia Port Authority; exemptions from the Public Procurement Act. Adds (i) conveyance and transfers of real property by state agencies and (ii) temporary transfers of use of property between state agencies and lease to private entities to the list of exemptions for the Virginia Port Authority. The bill also allows the Board to approve policies in order for Authority to have specified exemptions from the Public Procurement Act. Current law only allows exemptions with Board approval of regulations.

The bill requires the Virginia Port Authority to develop policies or adopt regulations for the implementation of the bill's provisions no later than January 1, 2017, prior to which date the Virginia Port Authority may exercise the authority granted by the bill subject to the approval of the Secretary of Transportation.

H.B. 2029 Concealed handgun permits; background check, exemption for permit holders.

Patron: Wilt

Concealed handgun permits; fees; background check; exemption for permit holders. Provides that a licensed firearms dealer does not have to have a criminal background check performed to determine a person's eligibility to purchase a firearm if the purchaser possesses a valid concealed handgun permit and presents a photo ID issued by an agency of the Commonwealth or the Department of Defense. The bill increases from $10 to $20 the fee charged by the circuit court clerk for processing an application and issuing a permit. The bill also sets at $30 the maximum fee that is charged for conducting a background investigation of an applicant for a concealed handgun permit. Of this maximum $30 fee, $10 must be paid to the State Police to cover its costs associated with processing the application and the local law-enforcement agency may charge a fee not to exceed the remaining $20. The bill also requires that the State Police, in preparing the report from the Central Criminal Records Exchange for the circuit court with regard to an applicant for a concealed handgun permit, shall initiate a search of the National Instant Criminal Background Check System for purposes of obtaining criminal history record information regarding the applicant. The bill also provides that an applicant for a concealed handgun permit must include his alien number or admission number if he is not a citizen of the United States. Finally, the bill provides that a person is disqualified from obtaining a concealed handgun permit if he is otherwise disqualified from possessing or receiving a firearm pursuant to state or federal law. 

H.B. 2098 Tangible personal property; miscellaneous and incidental property.

Patron: Toscano

Tangible personal property; miscellaneous and incidental property. Declares miscellaneous and incidental property used in a trade or business with an original cost of less than $250 as a separate classification of tangible personal property and thereby permitting localities to impose a lower tax rate on such property. The bill also authorizes localities to permit taxpayers to provide an aggregate estimate of the total value of such property instead of an itemized list.

 

 

 

H.B. 2161 State recordation taxes and fees.

Patron: Minchew

State recordation taxes and fees. Clarifies and makes substantive and technical changes to state recordation taxes and fees, including requiring that the recordation tax on any deed of trust that is supplemental to an existing deed of trust be calculated only on that portion of the debt that is in addition to the original debt on which the tax has been paid. Under current law, such calculation of the recordation tax is restricted to supplemental deeds of trust with the same lender.

H.B. 2162 Income tax, corporate; taxable income of taxpayers with enterprise data center operations.

Patron: Hugo

Apportionment of corporate income tax; taxpayers with enterprise data center operations. Requires taxpayers with certain enterprise data center operations to use a formula for apportioning taxable income to the Commonwealth based on multiplying their incomes by the sales factor. The apportionment formula would only apply taxpayers that have entered into a memorandum of understanding with the Virginia Economic Development Partnership to make a new capital investment of at least $150 million in an enterprise data center on or after July 1, 2015, and such taxpayer would begin using the formula in the taxable year that the Virginia Economic Development Partnership certifies that the investment has been completed. The provisions of the bill would be effective for taxable years beginning July 1, 2016, and would be phased in with the apportionment formula having a 100 percent sales factor by July 1, 2017.

H.B. 2173 Real property tax; waiver of delinquent taxes.

Patron: Orrock

Real property tax; waiver of delinquent taxes. Authorizes any locality to waive delinquent taxes on real property in exchange for the owner's donating the property to Habitat for Humanity or other similar nonprofit organization.

H.B. 2178 Hybrid retirement program; disclosure of services, etc., associated with voluntary contributions.

Patron: Poindexter

Hybrid retirement program; school division deferred compensation and cash match plans. Allows school divisions the option of establishing and administering their own deferred compensation and cash match plans for the hybrid retirement program. Employees of such school divisions would have the option of participating in such programs. The bill has a delayed effective date of January 1, 2016.

H.B. 2179 Tax information; release to Commonwealth Attorneys and the Attorney General.

Patron: Herring

Release of certain tax information. Permits the Department of Taxation to provide information subpoenaed by a grand jury without first submitting it to a court for a determination that the value of the information to the grand jury outweighs the value of confidentiality.

H.B. 2204 Line of Duty Act; codifying revisions to the Act.

Patron: Jones

Line of Duty Act. Revises the Line of Duty Act (the Act) by codifying revisions to the Act in the appropriation act, transferring overall administration of the Act to the Virginia Retirement System, transferring administration of health insurance benefits under the Act to the Department of Human Resource Management, and providing for an administrative appeal process. The bill also directs the Virginia Retirement System ("VRS") and the Department of Human Resource Management ("DHRM"),  with the input of all stakeholders, to develop proposals, on ways the Act can be improved  and to ensure its long-term fiscal viability.  Except for the proposals by VRS and DHRM, the bill becomes effective July 1, 2016, and only if reenacted by the 2016 Session of the General Assembly.

H.B. 2277 Life insurance; coverage for retired state employees.

Patron: Ingram

Life insurance for retired state employees. Provides that the basic life insurance coverage for retired state employees with 30 or more years of creditable service shall not be reduced to less than $8,000, indexed to the amount of post-retirement supplements for retirees as calculated for employees hired on or after July 1, 2010.

H.B. 2306 ABLE savings trust accounts; established, administered by the Virginia College Savings Plan.

Patron: Filler-Corn

Achieving a Better Life Experience (ABLE) savings trust accounts established; administered by the Virginia College Savings Plan. Establishes ABLE savings trust accounts to be administered by the Virginia College Savings Plan to facilitate the saving of private funds for paying the qualified disability expenses of certain disabled individuals. Under the federal Achieving a Better Life Experience Act of 2014, Congress authorized states to establish ABLE savings trust accounts to assist individuals and families in saving and paying for the education, housing, transportation, employment training and support, assistive technology and personal support services, health, prevention and wellness, financial management and administrative services, and other expenses of individuals who were disabled or blind prior to the age of 26. The Virginia College Savings Plan will be the designated state agency administering ABLE savings trust accounts. Earnings on contributions to ABLE savings trust accounts are exempt from federal income tax.

The bill provides that to the extent excluded from federal adjusted gross income, there shall be added to the Virginia taxable income of an individual any income attributable to an ABLE account as defined under § 529A of the Internal Revenue Code. This has the effect of allowing individuals to take advantage of the exclusion from tax at the federal level for income on ABLE accounts, but requires individuals to add such income to their taxable income that is subject to Virginia individual income tax.

The bill also requires the chief executive officer of the Virginia College Savings Plan to submit a written report by December 1, 2016, to the General Assembly identifying and explaining the agency's workload standards and methodologies used to determine staffing levels.

 

H.B. 2307 Withholding taxes; employer may request a waiver from Tax Commissioner.

Patron: Sullivan

Payment of withholding taxes. Provides that the Tax Commissioner may grant a waiver from the semi-weekly payment of withholding taxes to employers with five or less employees subject to withholding. Under current law, an employer whose average monthly liability can reasonably be expected to be at least $1,000 with an aggregate amount required to be withheld exceeding $500 must pay the withholding tax semi-weekly. If the Tax Commissioner grants the waiver, the employer would be authorized to file the withholding return and pay the withholding tax monthly, on or before the twenty-fifth day of the following month.