BILL NUMBER: SB 1252	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 9, 2012

INTRODUCED BY   Senator Rubio

                        FEBRUARY 23, 2012

   An act to  amend Sections 32100 and 32150 of the Public
Resources   add Division 4 (commencing with Section
64200) to Title 6.7 of the Government  Code, relating to
 urban waterfront restoration   state
infrastructure  .


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1252, as amended, Rubio.  Urban Waterfront Area
Restoration Financing Authority Act.   State
Infrastructure Projects Fund.  
   The Personal Income Tax Law and the Corporation Tax Law impose
taxes upon income, including income generated from any gain from the
sale or exchange of a capital asset.  
   Existing law requires state and local governments to carry out
specific duties related to the infrastructure of the state,
including, but not limited to, transportation and rail projects.
 
   This bill would require the Department of Finance, in consultation
with the Franchise Tax Board and the Employment Development
Department, on specified dates, to estimate the amount of revenues
derived from income taxes imposed on income generated as a result of
capital gains related to the Facebook, Inc. initial public offering,
as provided, and would direct the Controller to transfer an amount
equal to the total estimated amount from the General Fund to the
State Infrastructure Projects Fund, a fund that would be created by
the bill. This bill would allocate the moneys in the State
Infrastructure Projects Fund, upon appropriation by the Legislature,
for various infrastructure projects, as provided.  
   The Urban Waterfront aREA Restoration Financing Act Authority
creates in state government the California Urban Waterfront Area
Restoration Financing Authority, consisting of specified members, and
prescribes the functions and duties of the authority with regard to
the implementation of an economically feasible method of financing
urban waterfront restoration. The act provides for the issuance of
bonds to finance the activities of the authority relating to urban
waterfront restoration, but prohibits the total amount of bonds that
may be outstanding at any one time under the act from exceeding
$650,000,000.The act further specifies that the authority is not
required to pay any property taxes or assessments upon, or with
respect to, an urban waterfront restoration project or any property
acquired by or for the authority under the act or upon the income
from those bonds, so long as the authority holds title to the
project, or to the property or facilities comprised in the project.
 
   This bill would make technical, nonsubstantive changes these
provisions. 
   Vote: majority. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


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

   SECTION 1.    The Legislature finds and declares the
following:  
   (a) California's reliance on volatile capital gains income has
been a substantial reason why the state has found it so difficult to
budget properly in recent years.  
   (b) Capital gains taxes cause unanticipated boom-and-bust cycles
that contribute to California's budget volatility and have negative
impacts on the state's credit rating.  
   (c) According to Department of Finance figures, capital gains tax
revenue as a percentage of the state's General Fund plummeted from 12
percent to just 3 percent between 2007 and 2009 as investors pulled
away from the stock market.  
   (d) When Google went public in August 2004, and 19.6 million
shares were sold for $1.67 billion, capital gains earnings in the
state jumped 49 percent the year after that offering.  
   (e) The year after Google went public, tax revenue in California
unexpectedly grew by $7 billion.  
   (f) According to Department of Finance figures, within two years,
taxes on those earnings accounted for 11 percent of the budget, up
from 8 percent initially.  
   (g) Facebook's potential offering, which is often called the
"Facebook effect," would value the company at about $100 billion,
making it unique in terms of its impact on revenue forecasts. 

   (h) The Legislative Analyst's Office estimates that California
will receive an additional $2 billion through June 2013 in Facebook
IPO-related income tax payments.  
   (i) The potential one-time revenue generated by the Facebook
effect will not last and should therefore be set aside for one-time
infrastructure projects. 
   SEC. 2.    Division 4 (commencing with Section 64200)
is added to Title 6.7 of the   Government Code   ,
to read:  

      DIVISION 4.  State Infrastructure Projects Fund


   64200.  (a) (1) On or before February 1, 2013, the Department of
Finance, in consultation with the Franchise Tax Board and the
Employment Development Department, shall estimate and report to the
Controller the amount of revenues derived from taxes imposed on
income generated as a result of capital gains in the 2012 calendar
year from the initial public offering by Facebook, Inc.
   (2) On or before March 1, 2013, the Controller shall transfer from
the General Fund to the State Infrastructure Projects Fund an amount
equal to the estimate provided by the Department of Finance pursuant
to paragraph (1).
   (b) (1) On or before December 31, 2013, the Department of Finance,
in consultation with the Franchise Tax Board and the Employment
Development Department, shall reconcile and report to the Controller
the final increase in revenues derived from the taxes imposed on
income generated as a result of the capital gain in the 2012 calendar
year from the initial public offering by Facebook, Inc.
   (2) On or before January 31, 2014, the Controller shall transfer
from the General Fund to the State Infrastructure Projects Fund an
amount equal to the difference between the estimated increase in
revenues determined pursuant to paragraph (1) of subdivision (a) and
the final increase in revenues determined pursuant to paragraph (1).
   64201.  There is hereby established in the State Treasury the
State Infrastructure Projects Fund. All moneys in the State
Infrastructure Projects Fund, upon appropriation by the Legislature,
shall be allocated for the following purposes:
   (a) Transportation projects within the state.
   (b) The erection, construction, alteration, repair, or improvement
of dams within the state.
   (c) The erection, construction, alteration, repair, or improvement
of levees within the state.
   (d) The erection, construction, alteration, repair, or improvement
of buildings or structures of rail lines, rail beds, stations,
platforms, switches, yards, terminals, parking lots, and any and all
other facilities and equipment necessary or convenient for the
conduct of rail transit service within the state.
   (e) The erection, construction, alteration, repair, or improvement
of facilities consisting of the means and equipment necessary for
the movement of passengers or goods via public transit within the
state.
   (f) The erection, construction, alteration, repair, or improvement
of water treatment facilities within the state.  
  SECTION 1.    Section 32100 of the Public
Resources Code is amended to read:
   32100.  The total amount of bonds that may be outstanding at any
time under this division shall not exceed six hundred fifty million
dollars ($650,000,000). Bonds for which moneys or securities in
amounts necessary to pay or redeem the principal, interest, and any
redemption premium thereon have been deposited in trust shall not be
deemed outstanding for purposes of this section.  
  SEC. 2.    Section 32150 of the Public Resources
Code is amended to read:
   32150.  The authority is not required to pay any property taxes or
assessments upon, or with respect to, an urban waterfront
restoration project or any property acquired by or for the authority
under this division or upon the income therefrom, so long as the
authority holds title to the project, property, or facilities
comprised in the project.
   The exemption of the authority from taxation of any project ceases
when title to the property is transferred from the authority to any
normally taxable participating party. This section does not exempt
any normally taxable participating party from taxation, including,
but not limited to, taxation upon a possessory interest, with respect
to any project, or the property or facilities comprised in any
project, which may otherwise be applicable to the participating
party.