House 5678

WEST VIRGINIA LEGISLATURE

2026 REGULAR SESSION

Introduced

House Bill 5678

By Delegates Toney, Statler, Ellington, Dittman, Cooper, and Roop

[Introduced February 17, 2026; referred to the Committee on Finance]

A BILL to amend and reenact §5B-2L-16 of the Code of West Virginia, 1931, as amended, relating to the Build WV Act; replacing the project cost with a cap on new tax credit liability; clarifying that the cost cap applies only to new project approvals; allowing credit for smaller projects in rural areas; requiring periodic review and adjustment to reflect demand and usage; and establishing a Build WV credit reserve fund, adjusted annually

Be it enacted by the Legislature of West Virginia:

ARTICLE 2L. BUILD WV ACT.

§5B-2L-16. Project application; evaluation standards; approval of projects.

(a) Each eligible company or group of multiple party project participants that seeks certification of a proposed project as a certified BUILD WV project must shall file a written application for approval and certification of the project with the Department of Economic Development.

(b) With respect to each eligible company or group of multiple party project participants making an application to the Department of Economic Development seeking certification of a proposed project as a certified BUILD WV project the Department of Economic Development shall make inquiries and request documentation, including a completed application, from the applicant that shall include the following:  

(1) A description and location of the proposed project;

(2) Capital and other anticipated expenditures for the project and the sources of funding therefor;

(3) The anticipated employment, revenues and expenses generated by the project; and

(4) Anything else determined necessary by the Department of Economic Development.

(c) The aggregate sum of approved costs for all projects for any fiscal year shall not exceed $150 million. Any project application submitted for certification in the fiscal year after the sum of $150 million has been reached shall not be approved or certified. Notwithstanding any other provision of this code, for any fiscal year,

the The aggregate amount of property value adjustment tax credits authorized for award under this article may not exceed $2 million in new project approvals per fiscal year, based on the estimated date of project completion as declared by the applicant in their approved certification. This cap shall apply only to credits authorized for projects first approved during the fiscal year in question and may not include credits previously allocated to projects approved in prior years.

At the time of application, each project shall provide an anticipated date of completion. The Department of Economic Development shall allocate a tax credit reservation for that project to the fiscal year of estimated completion and may not approve additional new projects for that fiscal year once the estimated cumulative credit liability reaches $2 million.

The estimated property value adjustment tax credit shall be calculated at the time of project approval using the credit formula outlined in §5B-2L-10 of this code. For the purposes of estimating the property value adjustment tax credit under §5B-2L-10 of this code, the value used for the statewide average Class III property tax rate shall be the average of the published statewide Class III property tax rates for the three calendar years immediately preceding the date of project approval. This average shall be used solely for administrative estimation and fiscal cap compliance purposes and may not affect the final credit awarded, which shall still be calculated using the actual Class III rate for the year in which the project is completed.

The Department may allow applicants to amend the estimated completion year prior to project completion, subject to availability under the revised fiscal year’s credit cap.

The fiscal cap established in this subsection shall be reviewed and revised, as appropriate, by the Department of Economic Development at least once every five years, based on program participation, demonstrated demand, and actual usage trends across approved projects.

A Build WV Credit Reserve Fund shall be created and maintained in the State Treasury. The fund shall be used exclusively to support the refundable portion of the property value adjustment tax credits authorized under §5B-2L-11 of this code.

The Reserve Fund shall be capitalized initially at $2 million and replenished annually to ensure availability for refund claims associated with completed Build WV projects. The Department of Economic Development shall determine an appropriate funding level each year based on the number of completed projects, anticipated claims, and historical refund utilization trends.

The Department shall manage the allocation and oversight of the Reserve Fund and shall publish an annual report outlining the fund’s balance, projected obligations, and any potential shortfall risk. The Legislature may appropriate additional funds as needed to address increases in program participation or actual refund demands.

The Secretary of the Department of Economic Development may not approve any single proposed project as a certified BUILD WV project for the fiscal year unless the proposed project has an aggregate sum of approved costs that is at least $3 million or the proposed project includes at least six residential units or houses.

However, a project located in a designated rural area may be approved by the Secretary with aggregate certified costs below $3 million or fewer than six residential units, if the project otherwise meets the requirements of subsection (d) of this section and demonstrates a substantial positive economic or community impact.

"Rural area" means any county or municipality that is not part of a Metropolitan Statistical Area as defined by the United States Office of Management and Budget, or that meets other rural characteristics as determined by the state’s Department of Economic Development, including but not limited to low population density, distance from urban centers, or housing scarcity.

(d) The Secretary of the Department of Economic Development, within 60 days following receipt of an application or receipt of any additional information requested by the Department of Economic Development respecting the application, whichever is later, shall act to grant or not to grant certification of the project, based on the following criteria:

(1) The project will have approved costs of at least $3 million or includes at least six residential units or houses; except that, for projects located in a rural area as defined by §5B-2L-2 of this code or as otherwise designated by the Secretary, these thresholds may be reduced.

(2) The project will have a significant and positive economic impact on the state;

(3) The quality of the proposed project and how it addresses economic problems in the area in which the project will be located;

(4) Whether there is substantial and credible evidence that the project is likely to be started and completed in a timely fashion;

(5) Whether the project will, directly or indirectly, improve the opportunities in the area where the project will be located for the successful establishment or expansion of other commercial businesses;

(6) Whether the project will, directly or indirectly, assist in the creation of additional employment opportunities in the area where the project will be located;

(7) Whether the project helps to diversify the local economy;

(8) Whether the project is consistent with the goals of this article;

(9) Whether the project is economically and fiscally sound using recognized business standards of finance and accounting;

(10) Whether the proposed project demonstrates that the project will meet the immediate future needs of the area; and

(11) The ability of the eligible company or group of multiple party project participants to carry out the project.

(e) Exclusions.

(1) In no case shall may any property or space that is used, in whole or in part, as a residential timeshare, commercial timeshare, or as part of any similar arrangement, constitute certified project property, or any part thereof.

(2) In no case shall may any property or space that is used in whole or in part as an industrial or manufacturing operation, constitute certified project property, or any part thereof.

(3) In no case shall may any property or space that is used in whole or in part as a warehouse, distribution center, telephone call center, or telemarketing operation, constitute certified project property, or any part thereof.

(4) In no case shall may any property or space that is used, in whole or in part, as an airport constitute certified project property, or any part thereof.

(5) In no case shall may any property or space that is used primarily for business activity, business, or other operation or activity excluded from certification by the Department of Economic Development by rule or administrative notice, constitute certified project property, or any part thereof.

(f) The Department of Economic Development may establish additional criteria for consideration when evaluating and approving applications for certified BUILD WV housing projects.

(g) The decision by the Secretary of the Department of Economic Development as to certification of a proposed project, refusal to certify a proposed project, decertification, or revocation of certification of a project is final.

NOTE: The purpose of this bill is to replace the Build WV project cost with a cap on new tax credit liability. The bill clarifies that the cost cap applies only to new project approvals; allows credit for smaller projects in rural areas; requires periodic review and adjustment to reflect demand and usage; and establishes a Build WV credit reserve fund adjusted annually.

Strike-throughs indicate language that would be stricken from a heading or the present law and underscoring indicates new language that would be added.