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Committee caps Build West Virginia tax credits at $2 million per year, creates reserve fund

Senate Economic Development Committee · January 29, 2026

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Summary

The committee approved a substitute to Senate Bill 627 that would cap new Build West Virginia tax credit liability at $2,000,000 per fiscal year, create a $2,000,000 reserve fund for refundable credits, and allow the Division of Economic Development to approve smaller projects in designated rural areas; the substitute was approved and will be referred to Finance.

The Senate Economic Development Committee agreed to a committee substitute for Senate Bill 627 that would change how tax credits for Build West Virginia projects are awarded and limit new tax-credit liability to $2,000,000 per fiscal year.

Committee counsel summarized the substitute, saying it would change how contractors claim tax credits and set eligibility thresholds: generally a Build West Virginia project must cost at least $3,000,000 or provide six or more residential units to qualify, and current law limits approved Build West Virginia credits to $150,000,000 in the aggregate for any fiscal year. Counsel told the committee, "For new projects, the bill would limit the available tax credits to $2,000,000 per year per fiscal year." She said the Division of Economic Development would allocate a tax-credit reservation to the fiscal year in which a contractor estimates project completion, and when cumulative credit liability reaches $2,000,000 for that fiscal year no further approvals could be made.

The substitute also creates a reserve fund "to be used exclusively to support the refundable portion of the tax credit," with an initial capitalization of $2,000,000 and annual replenishment to ensure funds are available for refund claims. Counsel added that the Division may approve projects below the $3,000,000 threshold or with fewer than six units if the project "is located in a rural area," which the substitute defines as counties or municipalities not part of a metropolitan statistical area or those meeting rural characteristics determined by the Division. A fiscal note has been requested and the substitute was noted as having a second reference to the Committee on Finance.

The committee recorded no amendments or further questions and approved the substitute by voice vote. The vice chair moved to report the substitute to the full Senate with the recommendation that it do pass and first be referred to Finance; the motion carried by voice vote.