BILL ANALYSIS                                                                                                                                                                                                    Ó

                                                                  AB 2641
                                                                  Page  1

          AB 2641 (Skinner)
          As Amended  August 23, 2012
          Majority vote
          |ASSEMBLY:  |51-23|(May 30, 2012)  |SENATE: |35-1 |(August 28,    |
          |           |     |                |        |     |2012)          |
           Original Committee Reference:    G.O.  

           SUMMARY  :  Requires the Governor's Office of Business and 
          Economic Development (GO-Biz) to post on its Internet Web site 
          information to assist a person in starting a nonprofit 
          corporation and to assist nonprofit corporations to achieve 
          compliance with the state's statutory and regulatory 

           The Senate amendments  :

          1)Delete the requirement for specified agencies to provide 
            GO-Biz with accurate and updated information about its 

          2)Delete language that would have required GO-Biz to be 
            responsible for maintaining updated information on the 
            requirements of the Internal Revenue Service.

          3)Require the Internet Web site to contain direct links to 
            information on the incorporation, registration, and renewal 
            requirements of specified state agencies.

          4)Require specified state agencies to provide GO-Biz with direct 
            links to information to assist nonprofit corporations to 
            achieve compliance with the state's statutory and regulatory 

           EXISTING LAW  :

          1)Provides for the organization and governance of nonprofit 
            public benefit corporations, nonprofit mutual benefit 
            corporations, and nonprofit religious corporations.

          2)Requires nonprofit corporations to prepare and file articles 


                                                                  AB 2641
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            of incorporation with the Secretary of State (SOS), and within 
            90 days of that filing, and biennially thereafter, to file a 
            form prescribed by the SOS specifying information regarding 
            certain specified information.

          3)Requires charitable corporations to file periodic written 
            reports with the Attorney General beginning within four months 
            and 15 days following the close of the first calendar or 
            fiscal year in which it initially receives property stating 
            information as to the nature of the assets held for charitable 
            purposes and the administration thereof.

          4)Requires charitable corporations, unincorporated associations 
            and trusts to be filed with the Attorney General articles of 
            incorporation, or other documents governing the organization's 
            operations within 30 days after initial receipt of property.

          5)Requires charitable corporations with gross revenues of $2 
            million or more to prepare annual financial statements audited 
            by an independent certified public accountant. 

          6)Requires charities with gross revenues of $2 million or more 
            to establish and maintain an audit committee. 

          7)Requires executive compensation by charitable corporations, 
            unincorporated associations and charitable trusts must be 
            review and approved. 

           FISCAL EFFECT  :  Unknown

           COMMENTS  :  

           Governor's Office of Business and Economic Development  :  GO-Biz 
          was created by Governor Edmund G. Brown Jr. to serve as 
          California's single point of contact for economic development 
          and job creation efforts.  GO-Biz offers a range of services to 
          business owners including: attraction, retention and expansion 
          services, site election, permit streamlining, clearing of 
          regulatory hurdles, small business assistance, international 
          trade development, assistance with state government, and much 

           Purpose of the bill  :  According to the author, "there is no 
          single government website that lists all of the incorporation 
          and renewal requirements. Different websites for government 


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          agencies lists select requirements, but there is no complete, 
          comprehensive list that details the requirements for both 
          incorporation and renewal."

          The author further contends that, "larger nonprofits have the 
          resources to hire lawyers for the creation and renewal of the 
          organization, while ensuring that the organization is in 
          compliance with state law. Smaller nonprofits do not have 
          equivalent resources, resulting in many nonprofits failing to 
          comply with state law.  It is difficult for smaller nonprofits 
          to even know what paperwork needs to be filed on a yearly 

           Arguments in support :  The American Federation of State, County 
          and Municipal Employees (AFSCME), AFL-CIO states that, "AB 2641 
          resolves the issue by simplifying the incorporation and renewal 
          processes for nonprofits by providing a single government 
          website that provides all of the necessary information and 
          forms, while helping the organizations stay in compliance with 
          the law."

           Prior legislation  :  AB 29 (John A. Pérez), Chapter 475, Statutes 
          of 2011.  This bill created, within the Governor's office, the 
          Governor's Office of Business and Economic Development. 

          Analysis Prepared by  :    Felipe Lopez / G. O. / (916) 319-2531 

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