Bill
HB 5359
Creates a dedicated Electric Grid Stabilization and Security Fund funded by new high voltage transmission line property taxes to lower West Virginia electric rates.
HB 5359 (2026 Session, West Virginia)
Summary of the Bill
Purpose and intent
- Objective: Create a dedicated funding stream from property taxes on new high voltage electric transmission line projects, with the aim of lowering electric rates for West Virginians.
- Geographic/operational scope: Applies to high voltage electric transmission line property placed in service on or after July 1, 2026.
- Policy approach: Directs a portion of property tax revenue and tax increment from new transmission line properties to fund grid stabilization, security, and related reductions in electric rates.
Key provisions and changes
1) Establishment and funding framework (Electric Grid Stabilization and Security Fund)
- Codified continuation of the Electric Grid Stabilization and Security Fund within the existing Economic Development Act framework.
- Administered by the Department of Commerce.
- Fund sources include: appropriations, external sources, investment income, moneys received under §11-6M-1 et seq., and other enumerated sources.
- Allowed uses: grid stabilization for regulated utilities and grid security, including development, efficiency, and environmental upgrades. Excludes decommissioning/replacement of existing facilities, maintenance of utility-owned generation, and transmission resources that solely serve WV ratepayers.
- End-of-year balances: any unused fund balance remains in the fund (not General Revenue) and may be invested; investment earnings restricted to fund purposes.
- Authority to promulgate rules, including emergency rules, to administer the fund.
2) Special tax treatment for high voltage transmission line property (new Article §11-6M)
- Definitions (Section §11-6M-1):
- Affiliated group, base/current assessed value, high voltage transmission line property, incremental value, situs county, and tax increment definitions. The text clarifies how property is valued and how increments are calculated.
- Annual returns (Section §11-6M-2):
- Owners/operators must file a yearly return by May 1 with the Board of Public Works for the preceding calendar year.
- Returns must be sworn and on forms prescribed by the Board of Public Works.
- Compliance aligned with existing public utility assessment provisions, with references to current law on public service business assessments.
- Tax distribution rules (Special provisions; Section §11-6M-3)
- Effective July 1, 2026, new properties placed in service are subject to special tax distribution rules.
- The State Auditor must maintain separate accounting for each high voltage transmission line project; distributions to situs counties are project-specific.
- Ad valorem distribution framework (for properties placed in service after July 1, 2026):
- Calculations consider current assessed value, base assessed value, and levy rates (regular, GO bond debt service, and excess levies).
- Distribution shares are determined for each levying body and then allocated accordingly.
- A portion of annual revenues is allocated to a dedicated fund at construction time.
- In years with a positive tax increment, the increment is distributed as follows:
- 80% to the Electric Grid Stabilization and Security Fund (as described in §5B-2N-2a).
- 10% to the situs county.
- 10% to all counties on a per-capita basis (based on latest census).
- Provisions on payment in lieu of taxes and tax increment financing: explicitly state no P.I.T. payments shall be entered for property subject to this article and no tax increment financing shall be undertaken for such property.
- Applicability (Section §11-6M-4)
- Applies only to high voltage electric transmission line property placed in service on/after July 1, 2026.
Properties placed in service before that date are excluded.
3) Procedural and administrative aspects
- Returns and data collection are filed with the Board of Public Works and subject to the fixed filing deadline (May 1 annually).
- The Department of Commerce may adopt rules to implement the fund and the new tax framework.
- The State Auditor plays a central role in computing tax increments and distributing revenues to the fund and to localities as specified.
Potential impact and who is affected
Notes
- The bill uses strike-through/underline markers to indicate amendments to existing law, and adds new sections establishing the new fund and tax treatment.
- Its stated purpose is to lower electric rates by reinvesting incremental property tax revenue into grid-related improvements.
Compiled from official sources — confirm details with the bill’s official record.
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