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This is the latest in an ongoing series of articles examining the issues, records and platforms of West Virginia's candidates for governor. Today's installment focuses on taxes.  Twenty years ago, a group of volunteers helped complete a landmark 
  • tudy of land ownership and property taxes in Appalachia.
  •   They found, among other things, that large landowners shoulder a 
  • maller part of the tax burden than they should. To make up
  •  for it, homeowners and families pay more than they should, the study found.  
    This year, two of those volunteers from the Appalachian Land Ownership Task Force are running for governor of West Virginia.  Both Democratic Rep. Bob Wise and third-party candidate Denise Giardina 
  • ay that some large landowners still aren't paying their fair share of
  •  taxes, although Giardina says it much more often and much more loudly than Wise.  Incumbent Gov. Cecil Underwood's "Agenda For Fair Taxation" doesn't include such a proposal for large landholders, such as coal companies. Underwood wants to eliminate several current taxes on businesses, including the corporate income tax and the property tax on machinery and equipment, and replace them with a single business tax of 2 percent.  Although the state Tax Department recently reappraised coal reserves, the total appraised value of the state's coal reserves remained basically the same. But some counties have seen their coal reserves devalued, while their property taxes continue to rise.  For example, Kanawha County's coal reserves were appraised at $91 million in 1996, but the value dropped to $55 million in 2000. Over the 
  • ame period, the appraised value of the average Kanawha County house rose
  •  by nearly $40,000, from $97,000 to $136,500.  "They [land values] ought to be re-evaluated, just out of fairness," Wise said last week. "We've gone through a couple of reappraisals, but there's still a lot of work that needs to be done. We can do that with an aggressive Tax Department."  Wise, a longtime congressman, hasn't made property taxes a main theme in his campaign, though. Giardina, of the newly formed Mountain Party, has.  "Despite subsequent reappraisals, this situation has hardly improved,"  
  • he says on her campaign Web site. "The state Tax Department has
  •  been challenged on numerous occasions to come up with fair appraisals, but every administration, Democratic and Republican, has refused to make absentee owners pay their fair share of property tax."  She also favors an "excess acreage" tax on landowners who control more than 10,000 acres in West Virginia.  Underwood, the Republican candidate, did not return a phone call 
  • eeking comment for this story. On his questionnaire from Project Vote
  •  Smart, a national voter education group, he says he would leave taxes on mineral reserves the way they are.  Another gubernatorial candidate, Libertarian Bob Myers, would do away with any tax on coal reserves and property, according to the survey he filled out for Project Vote Smart.  That's not surprising because Libertarians generally favor hands-off government in every way possible. If it's a tax, chances are Myers wants to cut it or get rid of it. He singles out the food tax on his campaign Web site: "There is nothing desirable about living in a state that taxes food."  
    Wise, Underwood and Giardina have all said they'd like to get rid of the 6 percent food tax as well. Underwood says he'll replace it with a general excise tax. Wise says he'd like to cut the food tax, but can't because of the financial hole such a move would leave in the state's budget.  "When we get to the point where we can cut taxes, the food tax ought to be the first one we cut," he said. "But I can't look people in the eye and say I'm going to cut this tax next year, because we're just not in a position to do it."  Underwood's "Fair Taxation" plan would also exempt families below the federal poverty level from paying any income tax.  He wants to offer tax relief to West Virginia residents in other ways, including repealing the personal property tax on every car and truck in the state. The tax may be the most unpopular in the 
  • tate, and Underwood's critics accused him of using the tax to
  •  pander to voters.  "For the working poor to get up and go to work, they have to have a car," Robin Capehart, Underwood's former tax commissioner and the chairman of his Fair Taxation Commission, said when the proposal was unveiled. "Having a tax on that car is extremely regressive."  Wise suggested tying residents' personal property tax to their income, so if their property took a sudden jump in value, they wouldn't be left with a huge tax bill they couldn't pay.  Eliminating the personal property tax, as Underwood wants to do, would also mean that businesses wouldn't pay taxes on their equipment, machinery and inventory. Wise said that's not very fair taxation.  "It seems to shift some of the tax burden from traditional industry to the kind of businesses we should be trying to develop, particularly high-technology businesses," he said. "I don't think taking a significant burden off the coal industry and putting it 
  • omewhere else is the way to go."
  •   This year, the Legislature approved a bill that would have required business owners to prove they had paid their property taxes before they could renew their business licenses, in much the same way that drivers have to produce their property tax receipt to register their car each year. The West Virginia Association of Counties says that nearly 4,000 businesses in 21 counties owe $3.5 million in back property taxes.  Underwood vetoed the bill, saying the proposal would be hard to manage. Also, the state Chamber of Commerce said the bill was anti-business.  Both Wise and Underwood have room in their economic plans for small businesses. Underwood's plan calls for businesses that bring in less than $100,000 a year to be exempt from his proposed single business tax.    Wise suggests allowing small businesses to avoid paying taxes for their first two years. "They're not going to pay much anyhow for the first couple of years," he said.  It's questionable whether Underwood's tax plan will ever gain enough support from the Legislature to get off the ground. Last year, the governor wanted to call a special session to enact his tax changes, but that never happened.  This year, legislators agreed to send out 10,000 alternative tax returns to state businesses, to see how they would fare under Underwood's proposed tax reform. "It's a step in the right direction," Underwood said during this year's session.  To contact staff writer Greg Moore, use e-mail or call 348-1211.  
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