MORGANTOWN — Legislators hope a tax break for companies that extract and produce rare earth elements and critical minerals will encourage them to set up in West Virginia.
HB 3012 provides for a nine-year break in severance taxes for a company that severs, extracts and produces for sale, profit or commercial use rare earth elements and critical minerals — starting July 1, 2023.
Rare earth elements are 17 metallic elements necessary in more than 200 products including cell phones, computer hard drives, electric and hybrid vehicles, flat-screen monitors and televisions, along with windmills, fuel cells and solar panels. Virtually all of these elements come from China and Africa.
Critical minerals include aluminum, beryllium, chromium, cobalt, magnesium, manganese, nickel, platinum, tungsten, zinc, uranium and more.
Cobalt is used in lithium-ion batteries in cell phones, computers and EVs, and there has been much recent media discussion about cobalt mining in the Democratic Republic of Congo — where more than half the world’s supply originates — in conditions that amount to slave labor. The cobalt then heads to China for refining; about 80% of the world’s supply is refined in China.
WVU’s Water Research Institute is paving the way for domestic production of rare earth elements by developing a way to extract them from acid mine drainage.
Debate on the bill was brief. Delegate Adam Vance, R-Wyoming, opposed the bill, saying he’d offered an amendment in committee to reduce the tax break to five years.
A company is coming to his county to produce rare earth elements from coal waste, he said. If the company takes two years to set up, it will see seven years of not generating tax revenue for the county and the state. The county will still see the 100 projected jobs, but no taxes.
Delegate Elliott Pritt, D-Fayette, raised the same concern about the lost tax revenue, but still supported the bill. “My hope in the end is that there will be enough jobs created and economic development that it will be a net benefit.” It also opens an opportunity to clean up a lot of waste sites.
The vote was 91-7, with all the nay votes from Republicans.
Insulin bill
Across the Capitol, the Senate Health Committee approved SB 577, capping the cost of a 30-day supply of insulin at $35, and $100 for devices (a blood glucose test strip, glucose monitor, lancet, lancing device, or insulin syringe; but not insulin pumps). The cost sharing maximums are aggregate, regardless of quantity or type.
A prescription would not be required to obtain blood testing kit for ketones.
PEIA is not included in the bill. Committee chair Mike Maroney, R-Marshall, said PEIA’s costs are about the same as those in the bill so inclusion was unnecessary.
The committee passed the bill unanimously and sent it to the Senate floor.
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