Department of Revenue Fiscal Note — 6137 SB: Cooperative finance org. B&O
Summary
Department of Revenue Fiscal Note (Agency 140) for Bill Number 6137 SB, titled Cooperative finance org. B&O. The note states it reflects Senate amendment S-5246.1 to SB 6137, 2020 Legislative Session. Its Part I tables list estimated cash receipts to the GF-State account and to a second account, with totals of 178,000 and 474,000 shown in parentheses, and estimated expenditures totaling 24,400. The narrative begins by saying the bill creates a business and occupation (B&O) tax deduction. A job classification table lists Excise Tax Ex 3 and Mgmt Analyst 4 positions, and Part IV and Part V are marked NONE.
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“Department of Revenue Fiscal Note — 6137 SB: Cooperative finance org. B&O.”
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Department of Revenue Fiscal Note
Bill Number: 6137 SB Title: Cooperative finance org. B&O Agency: 140-Department of
S-5246.1/20 Revenue
Part I: Estimates
No Fiscal Impact
Estimated Cash Receipts to:
Account FY 2020 FY 2021 2019-21 2021-23 2023-25
GF-STATE-State (148,000) (148,000) (394,000) (394,000)
01 - Taxes 05 - Bus and Occup Tax
Workforce Educationa Investment (30,000) (30,000) (80,000) (80,000)
Account-State
01 - Taxes 05 - Bus and Occup Tax
Total $ (178,000) (178,000) (474,000) (474,000)
Estimated Expenditures from:
FY 2020 FY 2021 2019-21 2021-23 2023-25
FTE Staff Years 0.2 0.1
Account
GF-STATE-State 001-1 24,400 24,400
Total $ 24,400 24,400
Estimated Capital Budget Impact:
NONE
The cash receipts and expenditure estimates on this page represent the most likely fiscal impact. Factors impacting the precision of these estimates,
and alternate ranges (if appropriate), are explained in Part II.
Check applicable boxes and follow corresponding instructions:
If fiscal impact is greater than $50,000 per fiscal year in the current biennium or in subsequent biennia, complete entire fiscal note
X
form Parts I-V.
If fiscal impact is less than $50,000 per fiscal year in the current biennium or in subsequent biennia, complete this page only (Part I).
X Capital budget impact, complete Part IV.
Requires new rule making, complete Part V.
Legislative Contact: Clinton McCarthy Phone: 360-786-7319 Date: 01/14/2020
Agency Preparation: Melissa Howes Phone: 360-534-1518 Date: 01/16/2020
Agency Approval: Don Gutmann Phone: 360-534-1510 Date: 01/16/2020
OFM Review: Ramona Nabors Phone: (360) 902-0547 Date: 01/21/2020
Request # 6137-2-1
Form FN (Rev 1/00) 155,086.00 1 Bill # 6137 SB S-5246.1/20
FNS062 Department of Revenue Fiscal Note
Part II: Narrative Explanation
II. A - Brief Description Of What The Measure Does That Has Fiscal Impact
Briefly describe, by section number, the significant provisions of the bill, and any related workload or policy assumptions, that have revenue or
expenditure impact on the responding agency.
Note: This fiscal note reflects Senate amendment S-5246.1 to SB 6137, 2020 Legislative Session.
This bill creates a business and occupation (B&O) tax deduction for amounts received by cooperative finance
organizations where the amounts are derived from loans to rural electric cooperatives or other non-profit or governmental
providers of utility services organized under Washington's laws.
A cooperative finance organization means a non-profit organization with the primary purpose of providing, securing, or
otherwise arranging financing for rural electric cooperatives.
A rural electric cooperative means a non-profit customer-owned organization that provides utility services to rural areas.
The B&O tax deduction expires January 1, 2030.
This bill takes effect on July 1, 2020.
II. B - Cash receipts Impact
Briefly describe and quantify the cash receipts impact of the legislation on the responding agency, identifying the cash receipts provisions by section
number and when appropriate the detail of the revenue sources. Briefly describe the factual basis of the assumptions and the method by which the
cash receipts impact is derived. Explain how workload assumptions translate into estimates. Distinguish between one time and ongoing functions.
ASSUMPTIONS
- Only one taxpayer qualifies for this deduction. The taxpayer has no significant growth in gross or taxable revenue, so
this estimate assumes no growth through January 1, 2030.
- Amounts derived from loans to rural electric cooperatives or other non-profit or governmental providers of utility
services organized under Washington's laws represent 96.4 percent of the gross Service and Other Activities income of the
taxpayer.
- The taxpayer is subject to the Workforce Education Surcharge.
- The taxpayer reports on a quarterly basis; estimate reflects 9 months of cash collections for Fiscal Year 2021.
DATA SOURCES
- Department of Revenue Excise Tax data
REVENUE ESTIMATES
This bill decreases state revenues by an estimated $178,000 in the 9 months of impacted collections in Fiscal Year 2021,
and by $237,000 in Fiscal Year 2022, the first full year of impacted collections. There is no Local Government impact.
TOTAL REVENUE IMPACT:
State Government (cash basis, $000):
FY 2020 - $ 0
FY 2021 - $ (178)
FY 2022 - $ (237)
FY 2023 - $ (237)
FY 2024 - $ (237)
FY 2025 - $ (237)
Request # 6137-2-1
Form FN (Rev 1/00) 155,086.00 2 Bill # 6137 SB S-5246.1/20
FNS062 Department of Revenue Fiscal Note
II. C - Expenditures
Briefly describe the agency expenditures necessary to implement this legislation (or savings resulting from this legislation), identifying by section
number the provisions of the legislation that result in the expenditures (or savings). Briefly describe the factual basis of the assumptions and the method
by which the expenditure impact is derived. Explain how workload assumptions translate into cost estimates. Distinguish between one time and
ongoing functions.
ASSUMPTIONS:
This bill affects one taxpayer.
FIRST YEAR COSTS:
The Department of Revenue (Department) will not incur any costs in Fiscal Year 2020.
SECOND YEAR COSTS:
The Department will incur total costs of $24,400 in Fiscal Year 2021. These costs include:
Labor Costs - Time and effort equates to 0.2 FTEs.
- Test and verify computer system changes to create a new business and occupation tax deduction and modify reports as
needed.
- Respond to additional telephone questions, email and written correspondence.
- Examine accounts and make corrections as necessary.
Object Costs - $4,400.
- Contract computer system programming.
ONGOING COSTS:
There are no ongoing costs.
Part III: Expenditure Detail
III. A - Expenditures by Object Or Purpose
FY 2020 FY 2021 2019-21 2021-23 2023-25
FTE Staff Years 0.2 0.1
A-Salaries and Wages 12,700 12,700
B-Employee Benefits 3,800 3,800
C-Professional Service Contracts 4,400 4,400
E-Goods and Other Services 2,200 2,200
J-Capital Outlays 1,300 1,300
Total $ $24,400 $24,400
III. B - Detail: List FTEs by classification and corresponding annual compensation. Totals need to agree with total FTEs in Part I
and Part IIIA
Job Classification Salary FY 2020 FY 2021 2019-21 2021-23 2023-25
EXCISE TAX EX 3 57,948 0.1 0.1
MGMT ANALYST4 68,892 0.1 0.1
Total FTEs 0.2 0.1
III. C - Expenditures By Program (optional)
NONE
Part IV: Capital Budget Impact
Request # 6137-2-1
Form FN (Rev 1/00) 155,086.00 3 Bill # 6137 SB S-5246.1/20
FNS062 Department of Revenue Fiscal Note
NONE
None.
Part V: New Rule Making Required
Request # 6137-2-1
Form FN (Rev 1/00) 155,086.00 4 Bill # 6137 SB S-5246.1/20
FNS062 Department of Revenue Fiscal Note
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