BILL NUMBER: AB 1088	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MARCH 1, 2010
	AMENDED IN ASSEMBLY  JANUARY 25, 2010
	AMENDED IN ASSEMBLY  JANUARY 11, 2010
	AMENDED IN ASSEMBLY  JANUARY 4, 2010

INTRODUCED BY   Assembly Member Fletcher
   (Coauthors: Assembly Members Block, Conway, DeVore, Gilmore,
 V. Manuel Perez,     and
Nestande   Knight,   Nestande,   and
V. Manuel Perez  )
    (   Coauthor:   Senator   Wiggins
  ) 

                        FEBRUARY 27, 2009

   An act to amend Section 1048 of, and to repeal and add Section
1051 of, the Military and Veterans Code, and to add and repeal
Article 11.3 (commencing with Section 18810) of Chapter 3 of Part
10.2 of Division 2 of, and to repeal Article 11.5 (commencing with
Section 18825) of Chapter 3 of Part 10.2 of Division 2 of, the
Revenue and Taxation Code, relating to veterans.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1088, as amended, Fletcher. Taxpayer contributions: California
Veterans Homes Fund.
   Under existing law regulating the administration of the Personal
Income Tax Law, individual taxpayers are allowed to contribute
amounts in excess of their tax liability for the support of specified
funds or accounts, including, among others, the Veterans' Quality of
Life Fund. Existing law requires the expenditure of all moneys
contributed to the fund, upon appropriation by the Legislature, for
administrative costs and for distribution into the Morale, Welfare,
and Recreation Fund for each of the veterans homes, as provided.
   This bill would repeal those provisions, and instead allow
individuals to designate on their tax returns that a specified amount
in excess of their tax liability be transferred to the California
Veterans Homes 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, like the expenditure of all moneys contributed to
the Veterans' Quality of Life Fund, require the expenditure of all
moneys contributed to the California Veterans Homes Fund, upon
appropriation by the Legislature, for administrative costs and for
distribution into the Morale, Welfare, and Recreation Fund for each
of the veterans homes, as provided. This bill would require any funds
remaining in the Veterans' Quality of Life Fund to be transferred to
the California Veterans Homes Fund.
   This bill would provide that these voluntary contribution
provisions be repealed on January 1 of the 5th taxable year following
the taxable year the fund first appears on the personal income tax
return. This bill would further provide that these provisions would
be 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.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 1048 of the Military and Veterans Code is
amended to read:
   1048.  (a) The Morale, Welfare, and Recreation Fund shall include
proceeds from the California Veterans Homes Fund, operations of the
Veterans' Home Exchange, revenue derived from the issuance of
prisoner-of-war special license plates pursuant to Section 5101.5 of
the Vehicle Code, all funds derived from golf course green fees and
range ball fees, all donations to the fund, interest earned on
invested funds, funds derived from the estates of deceased members,
and any other moneys or property described in this chapter,
including, but not limited to, moneys and properties received by the
home from estate assets located outside the home, regardless of
amount.
   (b) The administrator shall prepare an itemized report that is
organized by category and accounts for all funds deposited into the
Morale, Welfare, and Recreation Fund and transmitted to the
Controller under Section 1047 during the previous fiscal year and
shall submit the report on or before August 20 of each year to all of
the following:
   (1) The secretary.
   (2) The fiscal committees of the Assembly and the Senate.
   (3) The committees of the Assembly and the Senate that have
subject matter jurisdiction over veterans affairs.
   (4) The Veterans' Home Allied Council.
  SEC. 2.  Section 1051 of the Military and Veterans Code is
repealed.
  SEC. 3.  Section 1051 is added to the Military and Veterans Code,
to read:
   1051.  (a) There is hereby established in the State Treasury the
California Veterans Homes Fund to receive those amounts transferred
to the fund pursuant to Section 18811 of the Revenue and Taxation
Code.
   (b) Any funds remaining in the Veterans' Quality of Life Fund, as
established by Section 2 of Chapter 143 of the Statutes of 2005,
shall be transferred to the California Veterans Homes Fund
established by subdivision (a).
  SEC. 4.  Article 11.3 (commencing with Section 18810) is added to
Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation
Code, to read:

      Article 11.3.  California Veterans Homes Fund


   18810.  (a) Any individual may designate on the tax return that a
contribution in excess of the tax liability, if any, be made to the
California Veterans Homes Fund established by Section 1051 of the
Military and Veterans Code. 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
  if  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) The Franchise Tax Board shall revise the form of the return to
include a space labeled the "California Veterans Homes 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 for veterans homes operations.
   (e) Notwithstanding any other law, a voluntary contribution
designation for the California Veterans Homes Fund may not be added
on the tax return until another voluntary contribution designation is
removed.
   (f) 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).
   18811.  The contributions made pursuant to Section 18810 shall be
transferred for deposit in the California Veterans Homes Fund
established by Section 1051 of the Military and Veterans Code.
   18812.  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 18810 to be transferred to the
California Veterans Homes Fund established by Section 1051 of the
Military and Veterans Code. The Controller shall transfer from the
Personal Income Tax Fund to the California Veterans Homes Fund an
amount not in excess of the sum of the amounts designated by
individuals pursuant to Section 18810 for payment into that fund.
   18813.  All moneys transferred to the California Veterans Homes
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 Department of Veterans Affairs for allocation to the
administrators of veterans homes. Moneys allocated pursuant to this
subdivision shall be distributed proportionally to the Morale,
Welfare, and Recreation Fund of each veterans home pursuant to
Section 1047 of the Military and Veterans Code.
   (c) Appropriations from the General Fund for the funding of those
purposes described in subdivision (b) may not be reduced for the
purpose of, or to have the effect of, requiring increased
expenditures from the California Veterans Homes Fund for those
described purposes.
   18814.  It is the intent of the Legislature that this article
create an additional funding source for veterans homes and shall be
used to supplement, not supplant, other funding sources for veterans
homes.
   18815.  (a) This article shall remain in effect only until January
1 of the fifth taxable year following the first appearance of the
California Veterans Homes 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) (1) By September 1 of the second calendar year, and by
September 1 of each subsequent calendar year that the California
Veterans Homes Fund appears on a tax return, the Franchise Tax Board
shall do all of the following:
   (A) Determine the minimum contribution amount required to be
received during the next calendar year for the fund to appear on the
tax return for the taxable year that includes the next calendar year.

   (B) Provide written notification to the Department of Veterans
Affairs of the amount determined in subparagraph (A).
   (C) Determine whether the amount of contributions estimated to be
received during the calendar year will equal or exceed the minimum
contribution amount determined by the Franchise Tax Board for the
calendar year pursuant to subparagraph (A). The Franchise Tax Board
shall estimate the amount of contributions to be received and an
estimate of the contributions that will be received by using the
actual amounts received by the end of that calendar year.
   (2) If the Franchise Tax Board determines that the amount of
contributions estimated to be received during a calendar year will
not at least equal the minimum contribution amount for the calendar
year, this article is repealed with respect to taxable years
beginning on or after January 1 of that calendar year.
   (3) For purposes of this section, the minimum contribution amount
for a calendar year means two hundred fifty thousand dollars
($250,000) for the second calendar year after the first appearance of
the California Veterans Homes Fund on the personal income tax return
or the adjusted minimum contribution amount adjusted pursuant to
subdivision (c).
   (c) For each calendar year, beginning with the third calendar year
that the California Veterans Homes 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
contribution amount for the prior September 1 multiplied by the
inflation factor adjustments 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.
  SEC. 5.  Article 11.5 (commencing with Section 18825) of Chapter 3
of Part 10.2 of Division 2 of the Revenue and Taxation Code is
repealed.