CHARLESTON, W.Va. – State Treasurer John Perdue’s office reports in a press release that it has disbursed just more than $11 million in coal severance taxes in fiscal year 2016, with six months of payments still to be made to county governments and municipalities. At that rate, it appears state communities will be hard pressed to see the $26.8 disbursed in fiscal 2015.
Such disbursements are made by quarters, in July, October, January and April. January 2016 figures have not been released to the Treasurer’s Office by the Tax Department. Even if the numbers hit the approximate average of $5.5 million collected in each of the first two quarters of FY 2016 – which is in doubt, considering the state’s plummeting coal market – counties and towns would see approximately $22 million, a 23 percent downturn.
Meanwhile, a comparison of disbursements made in fiscal 2016 to payments made in the first two quarters of fiscal 2015 shows a drop-off from $14.4 million to $11.1 million, a 24 percent decrease.
While not every county in West Virginia produces coal, all counties receive a severance tax paid by the coal industry. Coal producing counties receive 75 percent of the net proceeds. The remaining 25 percent of the net proceeds are distributed to all counties and municipalities of the state, based on population.
The state Legislature begins its session Jan. 13. According to the press release, some delegates and senators have mentioned rolling back the coal severance tax rate, as a way to make the business climate more amenable to coal companies.