BILL ANALYSIS Ó
AB 394
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Date of Hearing: April 1, 2013
ASSEMBLY COMMITTEE ON REVENUE AND TAXATION
Raul Bocanegra, Chair
AB 394 (Yamada and Grove) - As Introduced: February 15, 2013
Majority vote. Fiscal committee.
SUBJECT : Personal income tax: voluntary contributions:
Alzheimer's disease
SUMMARY : Extends the repeal date of the California Alzheimer's
Disease and Related Disorders Research Fund (Fund) from January
1, 2015, to December 1, 2020. Specifically, this bill allows
the Fund to remain on the state personal income tax return
through the 2019 taxable year, subject to contributions meeting
the annual minimum contribution amount.
EXISTING LAW :
1)Allows taxpayers to contribute their own funds (and not tax
liability) to any of the 18 voluntary contribution funds
(VCFs) listed on the 2012 state personal income tax return.
One such VCF is the Fund.
2)Provides that the Fund shall remain on the state personal
income tax return until it sunsets or the Franchise Tax Board
(FTB) projects the Fund will fail to meet its minimum annual
contribution amount. The Fund's current sunset date is
January 1, 2015, and the minimum contribution amount for the
2012 calendar year is $335,154. The minimum contribution
amount adjusts annually for inflation, based on the percentage
change in the California Consumer Price Index.
3)Provides that all money transferred to the Fund, upon
appropriation by the Legislature, goes to the:
a) FTB and the State Controller for reimbursement of all
costs incurred in administering the Fund; and,
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b) Appropriate state department as established by the
Secretary of California Health and Human Services in
consultation with the Department of Aging. These funds are
to be expended for the purpose of conducting research
relating to the care, treatment, and the cure of
Alzheimer's disease through contracts or grants.
4)Allows individual taxpayers to deduct charitable contributions
for the taxable year in which the contribution was made. For
example, in 2013 a taxpayer designates a contribution to the
Fund on her 2012 tax return. The taxpayer may take an
itemized deduction on her 2013 tax return, which she must file
in 2014.
FISCAL EFFECT : The FTB staff estimates annual revenue losses of
roughly $10,000 resulting from itemized charitable deductions,
beginning in the 2016-17 fiscal year.
COMMENTS :
1)The author has provided the following statement in support of
this bill:
588,208 Californians 55 and over [live] with Alzheimer's
disease[,] which is one-tenth of the nation's Alzheimer's
patients. Among California's baby boomers aged 65 and
over, one in eight will develop Alzheimer's disease, and
half of people 85 or older will have the disease. By 2030,
this number will nearly double in California; rising to
over 1.1 million. Alzheimer's disease is now the sixth
leading cause of death in California and is the only
leading cause of death that lacks a means of prevention or
reversal.
2)Proponents State:
According to our recently released Alzheimer's Association
2013 Alzheimer's Disease Facts and Figures, Alzheimer's
disease is now the 5th leading cause of death in
California, and is the only leading cause of death that
does not have a means to prevent or reverse the progression
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of the disease. With an aging population, projections
estimate the number of Californians living with Alzheimer's
will grow to more than 660,000 by 2025, as increased age is
the primary risk factor for developing the disease. It is
therefore imperative that California continue to fund
research that can slow or reverse the progression of this
memory-robbing disease.
General Fund support for Alzheimer's research was
eliminated in 2009, when the Legislature reduced funding
for the California Alzheimer's Disease Centers by 50%.
Since it first appeared on the tax return in 1987, this
fund has collected more than $11.3 million in donations and
funded 122 research studies. By extending this tax
check-off fund, we can ensure that funds are available to
investigate the causes of and treatments for this disease.
3)Committee Staff Comments:
a) So Many Causes, So Little Space : There are countless
worthy causes that would benefit from the inclusion of a
VCF on the state's income tax returns. At the same time,
space on the returns is limited. Thus, it could be argued
that the current system for adding and keeping VCFs on the
form is subjective and essentially rewards causes whose
proponents can convince the Legislature to include their
fund on the form.
b) Related Legislation : The following related bills were
introduced in previous Legislative Sessions:
i) 2009: AB 292 (Yamada) extended the Fund's sunset to
January 1, 2015.
ii) 2004: AB 1799 (Mullin) extended the Fund's sunset to
January 1, 2010.
iii) 1999: AB 160 (Alquist) extended the Fund's sunset to
January 1, 2005.
iv) 1996: SB 1447 (Mello) extended the Fund's sunset to
January 1, 2000.
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The following related bills have been introduced in the
current Legislative Session:
i) AB 247 (Wagner) would extend the repeal date of the
California Fund for Senior Citizens until December 1,
2020. AB 247 has been referred to this Committee.
ii) AB 511 (Pan) would establish and allow taxpayers to
make voluntary contributions to the American Red Cross,
California Chapters Fund. AB 511 has been referred to
this Committee.
iii) AB 754 (Muratsuchi) would establish and allow
taxpayers to make voluntary contributions to the
California Beach and Coastal Enhancement Account. AB 754
has been referred to this Committee.
iv) AB 1286 (Skinner) would suspend the annual
adjustment of the minimum contribution amount threshold
for the California Breast Cancer Research Fund. AB 1286
has been referred to this Committee.
v) SB 116 (Liu) would extend the repeal date of the
Emergency Food for Families Fund from January 1, 2014, to
January 1, 2019. SB 116 has been referred to the Senate
Committee on Governance and Finance.
vi) SB 571 (Price) would establish and allow taxpayers
to make voluntary contributions to the Arts for Kids Fund
on their state personal income tax returns. SB 571 has
been referred to the Senate Committee on Governance and
Finance.
REGISTERED SUPPORT / OPPOSITION :
Support
Alzheimer's Association (sponsor)
California Assisted Living Association
California Association of Area Agencies on Aging
California Association for Health Services at Home
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Leading Age California
Opposition
None on file
Analysis Prepared by : Edward Beeby and M. David Ruff/ REV. &
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