BILL ANALYSIS Ó SB 164 Page 1 Date of Hearing: July 13, 2011 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair SB 164 (Simitian) - As Introduced: February 2, 2011 Policy Committee: Revenue and Taxation Vote: 8-0 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill extends, from January 1, 2013 to January 1, 2018, the sunset date for both the State Children's Trust Fund and the Rare and Endangered Species Preservation Program, two voluntary contribution funds currently on the personal income tax return. FISCAL EFFECT This bill is estimated to cost the state about $70,000 per year. This estimate assumes the check-off is added in the 2014-15 fiscal year and donations maintain the 2010 level of $450,000 for the State Children's Trust Fund and $575,000 for the Rate and Endangered Specifies Preservation Program. However, combined donations have been as high as $1.3 million which would lead to somewhat higher estimated revenue losses. COMMENTS 1)Purpose . According to the author, SB 164 would allow these two important programs to continue to receive much needed funds through voluntary contributions on income tax returns until January 1, 2018. The author argues that both the Children's Trust Fund and the Preservation Program have enjoyed significant success as voluntary contributions. SB 164 would allow these two important programs to continue to receive much needed funds through voluntary contributions on PIT returns until January 1, 2018. 2)Voluntary Contribution Funds. California taxpayers can make voluntary contributions to any of 15 funds listed on the state personal income tax return. The contributions are in addition SB 164 Page 2 to tax liabilities so they do not directly reduce the amount of state taxes. As charitable contributions, the taxpayer may deduct the amount of the check-off on the subsequent year's income tax return. These voluntary contributions support various purposes, including cancer research, endangered species preservation and emergency food assistance. Contributions have historically ranged from $300,000 to $800,000 per year. Except for the California Seniors Special Fund, all have sunset dates, and most must meet a minimum annual contribution to remain on the return. 3)Related legislation . The following related bills address personal income tax check-offs and have been introduced in the current legislative session: a) AB 233 (Hall) would authorize the addition of the California YMCA Youth and Government Fund check-off to the personal income tax form upon the removal of another voluntary contribution fund from the form. b) AB 564 (Smyth) would, among other things, add the Municipal Shelter Spay-Neuter Fund to the form. c) AB 764 (Swanson) would add the Child Victim of Human Trafficking Fund check-off to the form. d) AB 971 (Monning) would extend the current repeal date for the current California Sea Otter Fund. e) SB 583 (Vargas) would reauthorize the addition of the ALS/Lou Gehrig's Disease Research Fund check-off. Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081