House Bill 686 and Senate Bill 742 would implement a two-year delay of county repayments to the Local Income Tax Reserve Account that stems from the ruling in the Comptroller v. Wynne court case. This delay would allow counties to continue to properly plan and take into account the impact that these repayments will have on their budgets, and subsequently their ability to continue to provide comprehensive services to citizens.
Taxpayers have already received their refunds and interest stemming from the Wynne case, and these bills allow counties to smoothly address the repayment of funds into the tax reserve account for an extra two years. MACo Associate Director Barbara Zektick testified in support of both HB 686 and SB 742 before the House Ways and Means and Senate Budget and Taxation Committees on February 21, 2018.
From MACo Testimony:
The amount of money owed by counties for the refunds paid pursuant to the Wynne case is extraordinarily high, at around $250 million. Counties appreciate efforts made by the General Assembly in the past to smooth out the severe, deleterious impact of the Wynne case decision over an extended time, and to delay repayments until the fourth quarter of fiscal 2019.
Now that this date is coming near, unfortunately, counties are grappling with significant uncertainty surrounding their income tax revenues, arising from federal tax reform and the State’s anticipated, yet presently unknown, responses to it. Counties would extremely appreciate this Committee and the General Assembly mitigating this uncertainty by delaying their obligation to refund the Local Income Tax Reserve Account at the same critical juncture.”
For more information on these bills and others, follow MACo’s advocacy efforts during the 2018 legislative session here.