With early voting underway, West Virginians are beginning to weigh in on Amendment 2, the so-called Property Tax Modernization Amendment. If passed, Amendment 2 could undermine funding and services that voters have already chosen to prioritize via the passage of excess levies and bonds in their communities. If the tax exemptions in Amendment 2 are enacted, local governments statewide could see an estimated $205 million in revenue from excess and bond levies wiped out—undermining both the will of the voters and the programs and services those excess bonds and levies promised to provide.
Excess levies are an excess property tax used to provide supplemental funding for libraries, ambulance services, school building improvements, extracurricular activities, and other essential community services. Counties and municipalities may impose an excess levy for up to five years if it is approved by 60 percent of the voters in a special levy election; school districts can impose an excess levy for up to five years with the approval of a simply majority of voters.
Further, counties, school districts, and municipalities may levy a property tax based on any bonds they have issued. This tax rate is determined by the amount of money that must be raised to pay the principal and interest of the bond and – when combined with the regular county, school, or municipal rate – may not exceed the maximum rate for that taxing authority.
Currently, 44 of West Virginia’s 55 school districts have excess levies in place. In addition, 20 school districts have active bond levies.
Further, 20 counties fund fire services with property-tax funded excess levies.
Sixteen counties fund ambulance and EMS services with property tax-funded excess levies.
In each of these counties, a significant percentage of the excess levy’s value is at risk under Amendment 2. Counties across West Virginia could see anywhere from 7 percent to 37 percent of their total property tax revenue lost if the tax exemptions included in Amendment 2 are enacted and could subsequently lose that percentage of the value of their excess levy.
While some Senators have proposed a plan to replace counties’ lost revenue, that plan is based on flawed revenue and spending assumptions, does not have the support of the full legislature and governor, and is not guaranteed anywhere in the text of Amendment 2.
Rejecting Amendment 2 is the only way to ensure that excess levies that provide schools, fire departments, and emergency services across the state with necessary funding are protected.
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