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HB 4035

Relating to providing a credit against the business and occupation tax imposed on coal-fired electric generating units to help off-set environmental compliance costs

2026 Regular Session

HB 4035 creates a B&O tax credit for coal-fired electric generators to offset environmental compliance costs.

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Bill Summary · HB 4035

Summary of HB 4035 (2026) – West Virginia

Purpose and Intent

HB 4035 seeks to provide a tax relief mechanism for coal-fired electric generating units by offering a credit against the state's business and occupation (B&O) tax. The overarching aim is to help offset environmental compliance costs associated with operating coal-fired plants, potentially improving the financial viability of those facilities while maintaining their role in electricity generation.

Key Provisions

  • Tax Credit Authorization: Establishes a credit against the West Virginia B&O tax for coal-fired electric generating units (power plants that burn coal to produce electricity).
  • Scope of Credit: The credit is specifically tied to costs incurred for environmental compliance related to operating coal-fired units. This may include costs such as pollution control technology, permitting, reporting, and other regulatory compliance expenses.
  • Calculation and Limitations:
    • The bill sets out how the credit is calculated relative to eligible environmental compliance costs.
    • There may be caps, annual limits, or carryover provisions, though the exact numerical figures (e.g., dollar caps, percentage limits, carryforward duration) would be specified in the bill text.
  • Eligibility Criteria:
    • Applies to coal-fired electric generating units that are subject to environmental compliance requirements in West Virginia.
    • May require units to demonstrate incurred costs, provide documentation, or meet other administratively defined criteria to qualify for the credit.
  • Administration:
    • Likely to be administered by the West Virginia Tax Department or another designated state agency.
    • Provisions may include application processes, verification, audit rights, and deadlines for claiming the credit.
  • Effective Date and Sunset:
    • The bill would specify when the credit takes effect (e.g., a particular tax year) and whether there is an expiration or sunset date, or if the credit is permanent subject to annual appropriation.
  • Interaction with Other Provisions:
    • The credit would reduce B&O tax liability for qualifying units, potentially offsetting other credits or incentives to the extent allowed by law.
    • The bill may contain standard anti-abuse provisions to prevent double-dipping or improper claims.

Who Would Be Affected

  • Coal-Fired Electric Generating Units in WV: Primary beneficiaries, as their B&O tax liability could be reduced by the environmental compliance credit.
  • Electric Utilities/Owners of Coal Plants: Entities operating or owning qualifying units would need to track and document compliant costs to claim the credit.
  • State Tax Administration: Responsible for implementing the credit, processing claims, verifying eligibility, and ensuring compliance.

Procedural and Timeline Aspects

  • Effective Date: The bill specifies when the credit becomes available (commonly the start of a tax year or fiscal year following enactment).
  • Claim Process: There will be a defined process to apply for the credit, including required documentation and timelines for submitting claims.
  • Monitoring and Reporting: Potential annual reporting on credit utilization and impact on state revenue, with any audit rights preserved.
  • Duration: If a sunset is included, the bill would outline the date at which the credit expires unless renewed.

Notes

  • The above summary reflects typical elements of a credit-type provision in a B&O tax context for coal-fired generating units. For precise figures (credit rate, caps, carryforward terms, eligible costs definition, application deadlines, and sunset provisions), the full text of HB 4035 is required.

Compiled from official sources — confirm details with the bill’s official record.

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