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Statehouse Beat: Tax credits given out by state total millions

Now that Tax Day is over for another year, I’m guessing many readers did not get a share of the $134.5 million in tax credits the state projects it will give out this budget year.

About $91 million of those credits, according to the state Budget Office, are intended to spur economic development.

The largest single credit, Industrial Expansion and Revitalization, totals $52 million. That goes primarily to electric companies that invested in pollution abatement equipment for coal-fired power plants.

The second-largest credit, the Alternative-Fuel Motor Vehicles, is projected to cost the state $14.5 million in lost tax revenue this budget year.

You may recall that credit, which allows car buyers to write off 35 percent of the purchase price of their vehicles on their state income taxes, was originally intended to apply only to natural gas-powered vehicles, but the bill was amended on the last night of the 2011 session to apply to all alternative fuel and flex-fuel vehicles.

That took the credit from minimal fiscal impact to costing the state a total of $100 million in lost taxes over the life of the credit. (It was repealed last April.)

While we think of tax credits as benefiting big companies, two of the larger credits are for low-income families and senior citizens.

The Low-Income Family Tax Credit, an income tax credit for low- to moderate-income families, totaled $17.5 million, while the Homestead exemption on property taxes for seniors totaled $12.7 million.

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Because state law restricts tax credit disclosures to amount categories, and not actual dollar amounts, with the largest category being simply “more than $1 million,” we can assume the power companies got the largest amounts of tax credits.

The most recent state tax credit report, for 2008 (the lag is because credits can be claimed over multiple years) lists four companies that hit the $1 million-plus level for the Industrial Expansion/Revitalization credit: Allegheny Energy, Appalachian Power, Ohio Power, and Virginia Electric Power Co. dba Dominion Energy.

Allegheny Energy and Appalachian Power also each got Low-Income Utility Discount credits of $1 million-plus.

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In terms of number and scope of tax credits, the winner far and away is Mylan Pharmaceuticals. Mylan claimed credits for Economic Opportunity ($1 million-plus), Industrial Expansion/Revitalization ($100,000 to $250,000); Manufacturing Investment ($100,000 to $250,000), Research and Development ($500,000 to $1 million), Strategic Research and Development ($1 million-plus against business franchise taxes), Strategic Research and Development ($1 million-plus against corporate net), Super credit ($1 million-plus against business franchise taxes), Super credit ($500,000 to $1 million against corporate net).

The Canonsburg, Pa.-headquartered company also claimed a Historic Rehabilitated Buildings credit of between $1 and $50,000.

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Meanwhile, frequent losing political candidate John Raese campaigns on a platform of keeping government off the backs of business when it comes to regulation, but evidently doesn’t mind taking a government handout, or three, or four.

In 2008, Raese’s businesses got somewhere between $250,000 and $550,000 in state tax credits.

Greer Industries got credits for Industrial Expansion/Revitalization ($100,000 to $250,000 against severance taxes), Industrial Expansion/Revitalization ($50,000 to $100,000 against business franchise taxes), Manufacturing Investment ($50,000 to $100,000), while West Virginia Newspaper Publishing Co. (the Dominon Post) got an Industrial Expansion/Revitalization credit of $50,000 to $100,000.

(The Nutting Co. of Wheeling also got an Industrial Expansion/Revitalization credit of $100,000 to $250,000. Let’s hope they invested the savings in the Pirates and not Ogden Newspapers.)

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Rep. David McKinley, R-W.Va., got credits against his personal income taxes for Historic Rehabilitated Buildings ($1 to $50,000), and Qualified Rehabilitated Residential ($50,000 to $100,000).

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Other tax credits of interest: Massey Energy got a Coal Loading Facility credit of between $500,000 and $1 million, and a Industrial Expansion/Revitalization credit of $50,000 to $100,000.

Coldwater Creek, the women’s clothing company that is liquidating as part of its Chapter 11 bankruptcy, got a Super credit for $50,000 to $100,000.

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Finally, the May 16 release of the motion picture “Million Dollar Arm,” based on a true story about the winners of an Indian reality TV series of the same name, and their journey to America to try to become major league pitchers, could be a shot in the arm for the West Virginia Power.

Power fans will recall that one of stars portrayed in the film, Rinku Singh, was a pretty good middle relief pitcher for the Power for part of the 2011 season, and all of 2012.

(In 2011, Singh frequently relieved flamethrower Jameson Taillon, and the 10-mph difference in their fastball velocities befuddled most opposing batters.)

Singh missed the 2013 season due to injury, and is now in extended spring training in Pirate City in Florida, with the expectation he’ll be reassigned to the Power at some point this season — potentially at the same time interest in the film, starring Jon Hamm of “Mad Men,” will be peaking.

Reach Phil Kabler at philk@wvgazette.com or 304-348-1220.


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