BILL NUMBER: AB 658 CHAPTERED 09/16/04 CHAPTER 562 FILED WITH SECRETARY OF STATE SEPTEMBER 16, 2004 APPROVED BY GOVERNOR SEPTEMBER 16, 2004 PASSED THE ASSEMBLY AUGUST 27, 2004 PASSED THE SENATE AUGUST 24, 2004 AMENDED IN SENATE JULY 22, 2004 AMENDED IN SENATE JUNE 21, 2004 AMENDED IN SENATE MARCH 24, 2004 AMENDED IN SENATE AUGUST 27, 2003 AMENDED IN SENATE JULY 27, 2003 AMENDED IN SENATE JULY 14, 2003 AMENDED IN SENATE JUNE 26, 2003 AMENDED IN ASSEMBLY JUNE 3, 2003 INTRODUCED BY Assembly Member Nakano (Principal coauthor: Assembly Member Cox) (Principal coauthor: Senator Burton) (Coauthors: Assembly Members Bermudez, Canciamilla, Harman, Lieber, Maddox, Maldonado, Mullin, Nation, Oropeza, Parra, Pavley, Plescia, Steinberg, Strickland, and Wesson) (Coauthors: Senators Perata and Torlakson) FEBRUARY 19, 2003 An act to add and repeal Article 13.5 (commencing with Section 18845) of Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation Code, relating to public health. LEGISLATIVE COUNSEL'S DIGEST AB 658, Nakano. Taxpayer contributions: California Prostate Cancer Research Fund. Provisions relating to the administration of personal income taxes allow individual taxpayers to contribute amounts in excess of their tax liability for the support of specified funds. This bill would allow taxpayers to designate on their tax returns that a specified amount in excess of their tax liability be transferred to the California Prostate Cancer Research Fund, which would be created by this bill. However, the bill would provide that a voluntary contribution designation for this fund may not be added on the tax return until another voluntary contribution designation is removed from that return. This bill would require that all moneys contributed to the fund pursuant to these provisions, upon appropriation by the Legislature, be allocated to the Franchise Tax Board, the Controller, and the State Department of Health Services for allocation to the California Coalition to Cure Prostate Cancer, as provided. This bill would make legislative findings and declarations regarding prostate cancer. This bill would provide that these voluntary contribution provisions are repealed on January 1 of the 5th taxable year following the taxable year the fund first appears on the tax return. The bill would further provide that these provisions are repealed for taxable years beginning on or after January 1 of the calendar year in which the Franchise Tax Board estimates by September 1 that the contributions made on returns filed in that calendar year will be less than $250,000, or an adjusted amount for subsequent taxable years. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature finds and declares the following: (a) Prostate cancer is the most common nonskin cancer in America, striking 230,000 men each year in the United States, including 27,000 in California. (b) Over the next decade, as men reach the target zone for prostate cancer, beginning at age 50 years, the number of new cases will increase 50 percent. This will result in prostate cancer being the cancer with the most rapid increase in incidence. (c) Each year, prostate cancer takes the lives of 30,000 American men, including 3,600 in California. (d) As the home to many leading cancer research centers, California is also the home of some of the most promising cancer research programs. SEC. 2. Article 13.5 (commencing with Section 18845) is added to Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation Code, to read: Article 13.5. California Prostate Cancer Research Fund 18845. (a) An individual may designate on the tax return that a contribution in excess of the tax liability, if any, be made to the California Prostate Cancer Research Fund established by Section 18845.1. That designation is to be used as a voluntary contribution on the tax return. (b) The contributions shall be in full dollar amounts and may be made individually by each signatory on a joint return. (c) A designation shall be made for any taxable year on the initial return for that taxable year and once made is irrevocable. If payments and credits reported on the return, together with any other credits associated with the taxpayer's account, do not exceed the taxpayer's liability, the return shall be treated as though no designation has been made. If no designee is specified, the contribution shall be transferred to the General Fund after reimbursement of the direct actual costs of the Franchise Tax Board for the collection and administration of funds under this article. (d) If an individual designates a contribution to more than one account or fund listed on the tax return, and the amount available is insufficient to satisfy the total amount designated, the contribution shall be allocated among the designees on a pro rata basis. (e) The Franchise Tax Board shall revise the form of the return to include a space labeled the "California Prostate Cancer Research Fund" to allow for the designation permitted. The form shall also include in the instructions information that the contribution may be in the amount of one dollar ($1) or more and that the contribution shall be used to further the research of prostate cancer. (f) Notwithstanding any other provision of law, a voluntary contribution designation for the California Prostate Cancer Research Fund may not be added on the tax return until another voluntary contribution designation is removed. (g) A deduction shall be allowed under Article 6 (commencing with Section 17201) of Chapter 3 of Part 10 for any contribution made pursuant to subdivision (a). 18845.1. There is in the State Treasury the California Prostate Cancer Research Fund to receive contributions made pursuant to Section 18845. The Franchise Tax Board shall notify the Controller of both the amount of money paid by taxpayers in excess of their tax liability and the amount of refund money that taxpayers have designated pursuant to Section 18845 to be transferred to the California Prostate Cancer Research Fund. The Controller shall transfer from the Personal Income Tax Fund to the California Prostate Cancer Research Fund an amount not in excess of the sum of the amounts designated by individuals pursuant to Section 18845 for payment into that fund. 18845.2. All moneys transferred to the California Prostate Cancer Research Fund, upon appropriation by the Legislature, shall be allocated as follows: (a) To the Franchise Tax Board and the Controller for reimbursement of all costs incurred by the Franchise Tax Board and the Controller in connection with their duties under this article. (b) To the State Department of Health Services for allocation to the California Coalition to Cure Prostate Cancer for the award of grants to support prostate cancer research. The funds shall not be used for the administrative costs of the State Department of Health Services. 18845.3. (a) Except as otherwise provided in subdivision (b), this article shall remain in effect only until January 1 of the fifth taxable year following the first appearance of the California Prostate Cancer Research Fund on the tax return, and as of that date is repealed, unless a later enacted statute, that is enacted before the applicable date, deletes or extends that date. (b) If, in the second calendar year after the first taxable year the California Prostate Cancer Research Fund appears on the tax return, the Franchise Tax Board estimates by September 1 that contributions described in this article made on returns filed in that calendar year will be less than two hundred fifty thousand dollars ($250,000), or the adjusted amount specified in subdivision (c) for subsequent taxable years, as may be applicable, then this article is repealed with respect to taxable years beginning on or after January 1 of that calendar year. The Franchise Tax Board shall estimate the annual contribution amount by September 1 of each year using the actual amounts known to be contributed and an estimate of the remaining year's contribution. (c) For each calendar year, beginning with the third calendar year that the California Prostate Cancer Research Fund appears on the tax return, the Franchise Tax Board shall adjust, on or before September 1 of that calendar year, the minimum estimated contribution amount specified in subdivision (b) as follows: (1) The minimum estimated contribution amount for the calendar year shall be an amount equal to the product of the minimum estimated contribution amount for the prior September 1 multiplied by the inflation factor adjustment as specified in paragraph (2) of subdivision (h) of Section 17041, rounded off to the nearest dollar. (2) The inflation factor adjustment used for the calendar year shall be based on the figures for the percentage change in the California Consumer Price Index received on or before August 1 of the calendar year pursuant to paragraph (1) of subdivision (h) of Section 17041. (d) Notwithstanding the repeal of this article, any contribution amounts designated pursuant to this article prior to its repeal shall continue to be transferred and disbursed in accordance with this article as in effect immediately prior to that repeal.