BILL ANALYSIS AB 658 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 658 (Hayashi and Lieu) As Amended March 4, 2010 Majority vote ----------------------------------------------------------------- |ASSEMBLY: |65-1 |(January 25, |SENATE: |30-2 |(August 12, | | | |2010) | | |2010) | ----------------------------------------------------------------- Original Committee Reference: REV. & TAX. SUMMARY : Authorizes the addition of the California Police Activities League (CALPAL) Fund checkoff to the personal income tax (PIT) form upon the removal of another voluntary contribution fund (VCF) from the form. The Senate amendments : 1)Provide that any contribution made by a taxpayer who is located within a ZIP Code that does not have a CALPAL chapter shall be allocated to the state CALPAL to help establish CALPAL chapters in that ZIP Code, or to fund CALPAL activities and programs. 2)Provide that any contribution made from a ZIP Code that fails to meet the minimum threshold for federal reporting requirements shall be allocated to the state CALPAL to help establish CALPAL chapters in that ZIP Code, or to fund CALPAL activities and programs. 3)Provide that the state CALPAL may use up to 15% of the total funds specified above to cover administrative costs necessary to implement this bill. 4)Add a joint author and a co-author. EXISTING LAW : 1)Allows taxpayers to designate on their PIT returns a contribution to any of 15 VCFs. 2)Provides a specific sunset date for each VCF, except the California Seniors Special Fund. AB 658 Page 2 3)Provides that each VCF must meet a minimum annual contribution amount to remain in effect, except for the California Seniors Special Fund, the California Firefighters' Memorial Fund, and the California Peace Officer Memorial Foundation Fund. AS PASSED BY THE ASSEMBLY , this bill: 1)Established the CALPAL Fund in the State Treasury. 2)Provided that all moneys transferred to the CALPAL Fund, upon appropriation by the Legislature, shall be allocated as follows: a) To the Franchise Tax Board (FTB) and the State Controller for reimbursement of costs incurred in administering the checkoff; and, b) To the State Controller for allocation to the CALPAL to fund its programs and services. 3)Required FTB to produce an annual report of CALPAL Fund moneys received, by ZIP Code. The state CALPAL shall use this report to allocate contributions received directly to county CALPAL chapters based on the ZIP Code of where the taxpayer contributions were made. 4)Provided for the CALPAL Fund provisions' automatic repeal on either January 1 of the fifth taxable year following the CALPAL Fund's first appearance on the tax return, or on January 1 of an earlier year, if FTB estimates that the annual contribution amount will be less than $250,000, or an adjusted amount for subsequent years. FISCAL EFFECT : FTB estimates revenue losses, resulting from contribution deductions, to be roughly $15,000 per year. COMMENTS : The author states, "AB 658 allows individuals to designate charitable contributions directly to CALPAL chapters by checking off a box on their personal income tax returns. Local CALPAL chapters are community-based organizations started and operated through the voluntary efforts of concerned law enforcement officers. CALPAL chapters receive no state funding and rely exclusively on donors for financial sustainability. AB AB 658 Page 3 658 would establish another funding source for CALPAL to financially help sustain its operations." The author goes on to state, "More than 100,000 California children . . . benefit each year from the 'Cops & Kids' connection program that connects local law enforcement officers, paid staff, and volunteers with youth. CALPAL personnel and volunteers serve as role models, coaches, tutors, mentors, chaperones and program managers. CALPAL's mission is to build relationships between law enforcement personnel and community residents, with attention spent on youth considered to be at-risk in becoming involved in gangs and crime. CALPAL is the state's largest juvenile crime prevention program, with 125 local CALPAL chapters." Committee staff comments: CALPAL is a 501(c)(3) nonprofit organization founded over 35 years ago by a group of police officers. Based in San Leandro, CALPAL works to strengthen the connections between law enforcement officers and the communities they serve, by providing youth programs that develop discipline, positive self-image, mutual trust, and respect. Analysis Prepared by : M. David Ruff / REV. & TAX / (916) 319-2098 FN: 0005219