BILL ANALYSIS Ó AB 2332 Page 1 Date of Hearing: May 16, 2012 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair AB 2332 (Monning) - As Amended: April 12, 2012 Policy Committee: Revenue and Taxation Vote: 8-0 Urgency: Yes State Mandated Local Program:NoReimbursable: SUMMARY This bill provides that any losses sustained in the County of Santa Cruz as a result of the severe storms that occurred in March 2011 may, at the taxpayer's election, be taken into account for the taxable year immediately preceding the taxable year in which the disaster occurred. FISCAL EFFECT The Franchise Tax Board estimates there will be minor revenue impacts from the bill. COMMENTS 1)Purpose . Between March 15 and 27, 2011, California was struck by a devastating storm, destroying and damaging public facilities and private property throughout the state. Santa Cruz County sustained $15 million in damage, 30% of the statewide total. In order to provide timely relief for those who sustained damage or loss as a result of the storm, AB 2332 is an urgency measure. 2)2011 Storms : In March 2011, the County of Santa Cruz was struck by a severe storm that brought heavy rain, high winds, and flooding, damaging or destroying both public facilities and private property throughout the county. The county sustained roughly $15 million in damage. In April 2011, Governor Brown issued an Emergency Proclamation for this storm and asked the federal government to declare the event a major disaster. California's request to the Federal AB 2332 Page 2 Emergency Management Agency was denied, along with the state's subsequent appeal of this decision. For disasters that were the subject of a governor's proclamation, but not the subject of a presidential disaster declaration, enactment of state law identifying a specific event as a disaster for state tax law purposes authorizes effected taxpayers to elect to deduct disaster losses on the return for the prior taxable year. Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081