Amended in Assembly July 3, 2014

Amended in Assembly April 2, 2014

Amended in Assembly March 5, 2014

California Legislature—2013–14 Regular Session

Assembly BillNo. 1560


Introduced by Assembly Memberbegin delete Gorellend deletebegin insert Quirk-Silvaend insert

begin delete

(Coauthors: Assembly Members Bigelow, Chávez, Donnelly, Hagman, Harkey, Jones, Nestande, and Waldron)

end delete
begin delete

(Coauthors: Senators Berryhill, Cannella, Gaines, Huff, and Vidak)

end delete
begin insert

(Principal coauthors: Assembly Members Gorell, Linder, Muratsuchi, Salas, and Wilk)

end insert

January 29, 2014


An act tobegin delete add Section 100509 to the Government Code, relating to health care coverage,end deletebegin insert amend Sections 17059.2 and 23689 of the Revenue and Taxation Code, relating to economic development, andend insert declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

AB 1560, as amended, begin deleteGorellend delete begin insertQuirk-Silvaend insert. begin deleteCalifornia Health Benefit Exchange: confidentiality of personal information. end deletebegin insertIncome taxes: credits: California Competes Tax Credit.end insert

begin insert

Existing law allows a credit against the taxes imposed under the Corporation Tax Law and the Personal Income Tax Law for each taxable year beginning on or after January 1, 2014, and before January 1, 2025, in an amount as provided in a written agreement between the Governor’s Office of Business and Economic Development and the taxpayer, agreed upon by the California Competes Tax Credit Committee, and based on specified factors, including the number of jobs the taxpayer will create or retain in the state and the amount of investment in the state by the taxpayer. Existing law limits the aggregate amount of credits allocated to taxpayers to a specified sum per fiscal year.

end insert
begin insert

This bill would reduce this aggregate amount of credits that may be allocated to taxpayers per fiscal year by the phased aggregate amount allowed to taxpayers pursuant to the credit proposed by Assembly Bill 2389 with regard to the manufacture of a new advanced strategic aircraft, and would also authorize the Director of Finance to increase the aggregate amount of the economic development credits that may be allocated to taxpayers each year by $25 million per year through 2019. These provisions would become operative only if AB 2389 is enacted and becomes effective on or before January 1, 2015.

end insert
begin delete

Existing law, the federal Patient Protection and Affordable Care Act (PPACA), requires each state to establish an American Health Benefit Exchange by January 1, 2014, that makes available qualified health plans to qualified individuals and small employers. PPACA prohibits an Exchange from using or disclosing the personally identifiable information it creates or collects other than to the extent necessary to carry out specified functions. Existing law also requires an Exchange to establish and implement privacy and security standards that are consistent with specified principles and to require the same or more stringent privacy and security standards as a condition of contract or agreement with individuals or entities. A person who knowingly and willfully uses or discloses information in violation of PPACA is subject to a civil penalty of no more than $25,000 per person or entity, per use or disclosure, in additional to any other penalties prescribed by law.

end delete
begin delete

Existing state law establishes the California Health Benefit Exchange within state government, specifies the powers and duties of the board governing the Exchange, and requires the board to facilitate the purchase of qualified health plans through the Exchange by qualified individuals and small employers by January 1, 2014. Existing law requires the board to employ necessary staff and authorizes the board to enter into contracts. Under existing law, the board of the Exchange is required to submit fingerprint images to the Department of Justice for all employees, prospective employees, contractors, subcontractors, volunteers, or vendors of the Exchange whose duties include access to specified personal information for the purposes of obtaining state or federal conviction records, as specified.

end delete
begin delete

This bill would prohibit the Exchange from disclosing an individual’s personal information, as defined, to 3rd parties for the purpose of determining eligibility for, or enrolling the individual in, health care coverage unless, prior to the disclosure, the individual confirms his or her eligibility for a qualified health plan offered by the Exchange, and receives an estimate for the cost of the qualified health plans he or she may purchase, and the Exchange obtains the individual’s written consent to the disclosure, as prescribed. The bill would also require the Exchange to immediately notify the public of any breach of the security of personal information created, collected, or maintained by the Exchange, regardless of the severity of the breach and regardless of whether personal information was acquired by an unauthorized person during the breach.

end delete

This bill would declare that it is to take effect immediately as an urgency statute.

Vote: 23. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P3    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 17059.2 of the end insertbegin insertRevenue and Taxation
2Code
end insert
begin insert is amended to read:end insert

3

17059.2.  

(a) (1) For each taxable year beginning on and after
4January 1, 2014, and before January 1, 2025, there shall be allowed
5as a credit against the “net tax,” as defined in Section 17039, an
6amount as determined by the committee pursuant to paragraph (2)
7and approved pursuant to Section 18410.2.

8(2) The credit under this section shall be allocated by GO-Biz
9with respect to the 2013-14 fiscal year through and including the
102017-18 fiscal year. The amount of credit allocated to a taxpayer
11with respect to a fiscal year pursuant to this section shall be as set
12forth in a written agreement between GO-Biz and the taxpayer and
13shall be based on the following factors:

14(A) The number of jobs the taxpayer will create or retain in this
15state.

16(B) The compensation paid or proposed to be paid by the
17taxpayer to its employees, including wages and fringe benefits.

18(C) The amount of investment in this state by the taxpayer.

P4    1(D) The extent of unemployment or poverty in the area
2according to the United States Census in which the taxpayer’s
3project or business is proposed or located.

4(E) The incentives available to the taxpayer in this state,
5including incentives from the state, local government, and other
6entities.

7(F) The incentives available to the taxpayer in other states.

8(G) The duration of the proposed project and the duration the
9taxpayer commits to remain in this state.

10(H) The overall economic impact in this state of the taxpayer’s
11project or business.

12(I) The strategic importance of the taxpayer’s project or business
13to the state, region, or locality.

14(J) The opportunity for future growth and expansion in this state
15by the taxpayer’s business.

16(K) The extent to which the anticipated benefit to the state
17exceeds the projected benefit to the taxpayer from the tax credit.

18(3) The written agreement entered into pursuant to paragraph
19(2) shall include:

20(A) Terms and conditions that include the taxable year or years
21for which the credit allocated shall be allowed, a minimum
22compensation level, and a minimum job retention period.

23(B) Provisions indicating whether the credit is to be allocated
24in full upon approval or in increments based on mutually agreed
25upon milestones when satisfactorily met by the taxpayer.

26(C) Provisions that allow the committee to recapture the credit,
27in whole or in part, if the taxpayer fails to fulfill the terms and
28conditions of the written agreement.

29(b) For purposes of this section:

30(1) “Committee” means the California Competes Tax Credit
31Committee established pursuant to Section 18410.2.

32(2) “GO-Biz” means the Governor’s Office of Business and
33Economic Development.

34(c) For purposes of this section, GO-Biz shall do the following:

35(1) Give priority to a taxpayer whose project or business is
36located or proposed to be located in an area of high unemployment
37or poverty.

38(2) Negotiate with a taxpayer the terms and conditions of
39proposed written agreements that provide the credit allowed
40pursuant to this section to a taxpayer.

P5    1(3) Provide the negotiated written agreement to the committee
2for its approval pursuant to Section 18410.2.

3(4) Inform the Franchise Tax Board of the terms and conditions
4of the written agreement upon approval of the written agreement
5by the committee.

6(5) Inform the Franchise Tax Board of any recapture, in whole
7or in part, of a previously allocated credit upon approval of the
8recapture by the committee.

9(6) Post on its Internet Web site all of the following:

10(A) The name of each taxpayer allocated a credit pursuant to
11this section.

12(B) The estimated amount of the investment by each taxpayer.

13(C) The estimated number of jobs created or retained.

14(D) The amount of the credit allocated to the taxpayer.

15(E) The amount of the credit recaptured from the taxpayer, if
16applicable.

17(d) For purposes of this section, the Franchise Tax Board shall
18do all of the following:

19(1) (A) Except as provided in subparagraph (B), review the
20books and records of all taxpayers allocated a credit pursuant to
21this section to ensure compliance with the terms and conditions
22of the written agreement between the taxpayer and GO-Biz.

23(B) In the case of a taxpayer that is a “small business,” as
24defined in Section 17053.73, review the books and records of the
25taxpayer allocated a credit pursuant to this section to ensure
26compliance with the terms and conditions of the written agreement
27between the taxpayer and GO-Biz when, in the sole discretion of
28the Franchise Tax Board, a review of those books and records is
29appropriate or necessary in the best interests of the state.

30(2) Notwithstanding Section 19542:

31(A) Notify GO-Biz of a possible breach of the written agreement
32by a taxpayer and provide detailed information regarding the basis
33for that determination.

34(B) Provide information to GO-Biz with respect to whether a
35taxpayer is a “small business,” as defined in Section 17053.73.

36(e) In the case where the credit allowed under this section
37exceeds the “net tax,” as defined in Section 17039, for a taxable
38year, the excess credit may be carried over to reduce the “net tax”
39in the following taxable year, and succeeding five taxable years,
40if necessary, until the credit has been exhausted.

P6    1(f) Any recapture, in whole or in part, of a credit approved by
2the committee pursuant to Section 18410.2 shall be treated as a
3mathematical error appearing on the return. Any amount of tax
4resulting from that recapture shall be assessed by the Franchise
5Tax Board in the same manner as provided by Section 19051. The
6amount of tax resulting from the recapture shall be added to the
7tax otherwise due by the taxpayer for the taxable year in which
8the committee’s recapture determination occurred.

9(g) (1) The aggregate amount of credit that may be allocated
10in any fiscal year pursuant to this section and Section 23689 shall
11be an amount equal to the sum of subparagraphs (A), (B), and (C),
12less the amount specified inbegin delete subparagraph (D)end deletebegin insert subparagraphs (D)
13and (E), and plus the amount specified in paragraph (f)end insert
:

14(A) Thirty million dollars ($30,000,000) for the 2013-14 fiscal
15year, one hundred fifty million dollars ($150,000,000) for the
162014-15 fiscal year, and two hundred million dollars
17($200,000,000) for each fiscal year from 2015-16 to 2017-18,
18inclusive.

19(B) The unallocated credit amount, if any, from the preceding
20fiscal year.

21(C) The amount of any previously allocated credits that have
22been recaptured.

23(D) The amount estimated by the Director of Finance, in
24consultation with the Franchise Tax Board and the State Board of
25Equalization, to be necessary to limit the aggregation of the
26estimated amount of exemptions claimed pursuant to Section
276377.1 and of the amounts estimated to be claimed pursuant to
28this section and Sections 17053.73, 23626, and 23689 to no more
29than seven hundred fifty million dollars ($750,000,000) for either
30the current fiscal year or the next fiscal year.

31(i) The Director of Finance shall notify the Chairperson of the
32Joint Legislative Budget Committee of the estimated annual
33allocation authorized by this paragraph. Any allocation pursuant
34to these provisions shall be made no sooner than 30 days after
35written notification has been provided to the Chairperson of the
36Joint Legislative Budget Committee and the chairpersons of the
37committees of each house of the Legislature that consider
38appropriation, or not sooner than whatever lesser time the
39Chairperson of the Joint Legislative Budget Committee, or his or
40her designee, may determine.

P7    1(ii) In no event shall the amount estimated in this subparagraph
2be less than zero dollars ($0).

begin insert

3(E) (i) For the 2015-16 fiscal year and each fiscal year
4thereafter, the aggregate amount of credit that may be allocated
5pursuant to this section and Section 23689 shall be reduced by the
6amount of credit allowed to all qualified taxpayers pursuant to
7subparagraph (A) or subparagraph (B) of paragraph (1) of
8subdivision (c) of Section 23636.

end insert
begin insert

9(ii) If the amount available per fiscal year pursuant to this
10section and Section 23689 is less than the aggregate amount of
11credit allowed to qualified taxpayers pursuant to subparagraph
12(A) or subparagraph (B) of paragraph (1) of subdivision (c) of
13Section 23636, the aggregate amount allowed pursuant to Section
1423636 shall not be reduced and, in addition to the reduction
15required by clause (i), the aggregate amount of credit that may be
16allocated pursuant to this section and Section 23689 for the next
17fiscal year shall be reduced by the amount of that deficit.

end insert
begin insert

18(iii) It is the intent of the Legislature that the reductions specified
19in this subparagraph of the aggregate amount of credit that may
20be allocated pursuant to this section and Section 23689 shall
21continue if the repeal dates of the credits allowed by this section
22and Section 23689 are removed or extended.

end insert
begin insert

23(F) In addition to the amounts determined pursuant to
24paragraph (1), the Director of Finance may increase the aggregate
25amount by up to twenty-five million dollars ($25,000,000) per year
26through 2019. The amount of any increase made pursuant to this
27paragraph, when combined with any increase made pursuant to
28subparagraph (F) of paragraph (1) of subdivision (g) of Section
2923689, shall not exceed twenty-five million dollars ($25,000,000)
30per year through 2019.

end insert
begin insert

31(G) It is the intent of the Legislature that the Director of Finance
32increase the aggregate amount under subparagraph (F) in order
33to mitigate the reduction of the amount available due to the credit
34allowed to all qualified taxpayers pursuant to subparagraph (A)
35or subparagraph (B) of paragraph (1) of subdivision (c) of Section
3623636.

end insert
begin insert

37(H) Subparagraphs (E), (F), and (G) shall become operative
38only if Assembly Bill 2389 is enacted and becomes effective on or
39before January 1, 2015, and adds Section 23636.

end insert

P8    1(2) Each fiscal year, 25 percent of the aggregate amount of the
2credit that may be allocated pursuant to this section and Section
323689 shall be reserved for small business, as defined in Section
417053.73 or 23626.

5(3) Each fiscal year, no more than 20 percent of the aggregate
6amount of the credit that may be allocated pursuant to this section
7shall be allocated to any one taxpayer.

8(h) GO-Biz may prescribe rules and regulations as necessary to
9carry out the purposes of this section. Any rule or regulation
10prescribed pursuant to this section may be by adoption of an
11emergency regulation in accordance with Chapter 3.5 (commencing
12with Section 11340) of Part 1 of Division 3 of Title 2 of the
13Government Code.

14(i) A written agreement between GO-Biz and a taxpayer with
15respect to the credit authorized by this section shall comply with
16existing law on the date the agreement is executed.

17(j) (1) Upon the effective date of this section, the Department
18of Finance shall estimate the total dollar amount of credits that
19will be claimed under this section with respect to each fiscal year
20from the 2013-14 fiscal year to the 2024-25 fiscal year, inclusive.

21(2) The Franchise Tax Board shall annually provide to the Joint
22Legislative Budget Committee, by no later than March 1, a report
23of the total dollar amount of the credits claimed under this section
24with respect to the relevant fiscal year. The report shall compare
25the total dollar amount of credits claimed under this section with
26respect to that fiscal year with the department’s estimate with
27respect to that same fiscal year. If the total dollar amount of credits
28claimed for the fiscal year is less than the estimate for that fiscal
29year, the report shall identify options for increasing annual claims
30of the credit so as to meet estimated amounts.

31(k) This section is repealed on December 1, 2025.

32begin insert

begin insertSEC. 2.end insert  

end insert

begin insertSection 23689 of the end insertbegin insertRevenue and Taxation Codeend insertbegin insert is
33amended to read:end insert

34

23689.  

(a) (1) For each taxable year beginning on and after
35January 1, 2014, and before January 1, 2025, there shall be allowed
36as a credit against the “tax,” as defined in Section 23036, an amount
37as determined by the committee pursuant to paragraph (2) and
38approved pursuant to Section 18410.2.

39(2) The credit under this section shall be allocated by GO-Biz
40with respect to the 2013-14 fiscal year through and including the
P9    12017-18 fiscal year. The amount of credit allocated to a taxpayer
2with respect to a fiscal year pursuant to this section shall be as set
3forth in a written agreement between GO-Biz and the taxpayer and
4shall be based on the following factors:

5(A) The number of jobs the taxpayer will create or retain in this
6state.

7(B) The compensation paid or proposed to be paid by the
8taxpayer to its employees, including wages and fringe benefits.

9(C) The amount of investment in this state by the taxpayer.

10(D) The extent of unemployment or poverty in the area
11according to the United States Census in which the taxpayer’s
12project or business is proposed or located.

13(E) The incentives available to the taxpayer in the state,
14including incentives from the state, local government and other
15entities.

16(F) The incentives available to the taxpayer in other states.

17(G) The duration of the proposed project and the duration the
18taxpayer commits to remain in this state.

19(H) The overall economic impact in this state of the taxpayer’s
20project or business.

21(I) The strategic importance of the taxpayer’s project or business
22to the state, region, or locality.

23(J) The opportunity for future growth and expansion in this state
24by the taxpayer’s business.

25(K) The extent to which the anticipated benefit to the state
26exceeds the projected benefit to the taxpayer from the tax credit.

27(3) The written agreement entered into pursuant to paragraph
28(2) shall include:

29(A) Terms and conditions that include the taxable year or years
30for which the credit allocated shall be allowed, a minimum
31compensation level, and a minimum job retention period.

32(B) Provisions indicating whether the credit is to be allocated
33in full upon approval or in increments based on mutually agreed
34upon milestones when satisfactorily met by the taxpayer.

35(C) Provisions that allow the committee to recapture the credit,
36in whole or in part, if the taxpayer fails to fulfill the terms and
37conditions of the written agreement.

38(b) For purposes of this section:

39(1) “Committee” means the California Competes Tax Credit
40Committee established pursuant to Section 18410.2.

P10   1(2) “GO-Biz” means the Governor’s Office of Business and
2Economic Development.

3(c) For purposes of this section, GO-Biz shall do the following:

4(1) Give priority to a taxpayer whose project or business is
5located or proposed to be located in an area of high unemployment
6or poverty.

7(2) Negotiate with a taxpayer the terms and conditions of
8proposed written agreements that provide the credit allowed
9pursuant to this section to a taxpayer.

10(3) Provide the negotiated written agreement to the committee
11for its approval pursuant to Section 18410.2.

12(4) Inform the Franchise Tax Board of the terms and conditions
13of the written agreement upon approval of the written agreement
14by the committee.

15(5) Inform the Franchise Tax Board of any recapture, in whole
16or in part, of a previously allocated credit upon approval of the
17recapture by the committee.

18(6) Post on its Internet Web site all of the following:

19(A) The name of each taxpayer allocated a credit pursuant to
20this section.

21(B) The estimated amount of the investment by each taxpayer.

22(C) The estimated number of jobs created or retained.

23(D) The amount of the credit allocated to the taxpayer.

24(E) The amount of the credit recaptured from the taxpayer, if
25applicable.

26(d) For purposes of this section, the Franchise Tax Board shall
27do all of the following:

28(1) (A) Except as provided in subparagraph (B), review the
29books and records of all taxpayers allocated a credit pursuant to
30this section to ensure compliance with the terms and conditions
31of the written agreement between the taxpayer and GO-Biz.

32(B) In the case of a taxpayer that is a “small business,” as
33defined in Section 23626, review the books and records of the
34taxpayer allocated a credit pursuant to this section to ensure
35compliance with the terms and conditions of the written agreement
36between the taxpayers and GO-Biz when, in the sole discretion of
37the Franchise Tax Board, a review of those books and records is
38appropriate or necessary in the best interests of the state.

39(2) Notwithstanding Section 19542:

P11   1(A) Notify GO-Biz of a possible breach of the written agreement
2by a taxpayer and provide detailed information regarding the basis
3for that determination.

4(B) Provide information to GO-Biz with respect to whether a
5taxpayer is a “small business,” as defined in Section 23626.

6(e) In the case where the credit allowed under this section
7exceeds the “tax,” as defined in Section 23036, for a taxable year,
8the excess credit may be carried over to reduce the “tax” in the
9following taxable year, and succeeding five taxable years, if
10necessary, until the credit has been exhausted.

11(f) Any recapture, in whole or in part, of a credit approved by
12the committee pursuant to Section 18410.2 shall be treated as a
13mathematical error appearing on the return. Any amount of tax
14 resulting from that recapture shall be assessed by the Franchise
15Tax Board in the same manner as provided by Section 19051. The
16amount of tax resulting from the recapture shall be added to the
17tax otherwise due by the taxpayer for the taxable year in which
18the committee’s recapture determination occurred.

19(g) (1) The aggregate amount of credit that may be allocated
20in any fiscal year pursuant to this section and Section 17059.2 shall
21be an amount equal to the sum of subparagraphs (A), (B), and (C),
22less the amount specified inbegin delete subparagraph (D)end deletebegin insert subparagraphs (D)
23and (E), and plus the amount specified in subparagraph (F)end insert
:

24(A) Thirty million dollars ($30,000,000) for the 2013-14 fiscal
25year, one hundred fifty million dollars ($150,000,000) for the
262014-15 fiscal year, and two hundred million dollars
27($200,000,000) for each fiscal year from 2015-16 to 2017-18,
28inclusive.

29(B) The unallocated credit amount, if any, from the preceding
30fiscal year.

31(C) The amount of any previously allocated credits that have
32been recaptured.

33(D) The amount estimated by the Director of Finance, in
34consultation with the Franchise Tax Board and the State Board of
35Equalization, to be necessary to limit the aggregation of the
36estimated amount of exemptions claimed pursuant to Section
376377.1 and of the amounts estimated to be claimed pursuant to
38this section and Sections 17053.73, 17059.2, and 23626 to no more
39than seven hundred fifty million dollars ($750,000,000) for either
40the current fiscal year or the next fiscal year.

P12   1(i) The Director of Finance shall notify the Chairperson of the
2Joint Legislative Budget Committee of the estimated annual
3allocation authorized by this paragraph. Any allocation pursuant
4to these provisions shall be made no sooner than 30 days after
5written notification has been provided to the Chairperson of the
6Joint Legislative Budget Committee and the chairpersons of the
7committees of each house of the Legislature that consider
8appropriation, or not sooner than whatever lesser time the
9Chairperson of the Joint Legislative Budget Committee, or his or
10her designee, may determine.

11(ii) In no event shall the amount estimated in this subparagraph
12be less than zero dollars ($0).

begin insert

13(E) (i) For the 2015-16 fiscal year and each fiscal year
14thereafter, the aggregate amount of credit that may be allocated
15pursuant to this section and Section 17059.2 shall be reduced by
16the amount of credit allowed to all qualified taxpayers pursuant
17to subparagraph (A) or subparagraph (B) of paragraph (1) of
18subdivision (c) of Section 23636.

end insert
begin insert

19(ii) If the amount available per fiscal year pursuant to this
20section and Section 17059.2 is less than the aggregate amount
21allowed to qualified taxpayers pursuant to subparagraph (A) or
22subparagraph (B) of paragraph (1) of subdivision (c) of Section
2323636, the aggregate amount allowed pursuant to Section 23636
24shall not be reduced and, in addition to the reduction required by
25clause (i), the aggregate amount available pursuant to this section
26and Section 17059.2 for the next fiscal year shall be reduced by
27the amount of that deficit.

end insert
begin insert

28(iii) It is the intent of the Legislature that the reductions specified
29in this subparagraph of the aggregate amount of credit that may
30be allocated pursuant to this section and Section 17059.2 shall
31continue if the repeal dates of the credits allowed by this section
32and Section 17059.2 are removed or extended.

end insert
begin insert

33(F) In addition to the amounts determined pursuant to
34paragraph (1), the Director of Finance may increase the aggregate
35amount by up to twenty-five million dollars ($25,000,000) per year
36through 2019. The amount of any increase made pursuant to this
37paragraph, when combined with any increase made pursuant to
38subparagraph (F) of paragraph (1) of subdivision (g) of Section
3917059.2, shall not exceed twenty-five million dollars ($25,000,000)
40per year through 2019.

end insert
begin insert

P13   1(G) It is the intent of the Legislature that the Director of Finance
2increase the aggregate amount under subparagraph (F) in order
3to mitigate the reduction of the amount available due to the credit
4allowed to all qualified taxpayers pursuant to subparagraph (A)
5or Subparagraph (B) of paragraph (1) of subdivision (c).

end insert
begin insert

6(H) Subparagraphs (E), (F), and (G) shall become operative
7only if Assembly Bill 2389 is enacted and becomes effective on or
8before January 1, 2015, and adds Section 23636.

end insert

9(2) Each fiscal year, 25 percent of the aggregate amount of the
10credit that may be allocated pursuant to this section and Section
1117059.2 shall be reserved for “small business,” as defined in
12Section 17053.73 or 23626.

13(3) Each fiscal year, no more than 20 percent of the aggregate
14amount of the credit that shall be allocated pursuant to this section
15may be allocated to any one taxpayer.

16(h) GO-Biz may prescribe rules and regulations as necessary to
17carry out the purposes of this section. Any rule or regulation
18prescribed pursuant to this section may be by adoption of an
19emergency regulation in accordance with Chapter 3.5 (commencing
20with Section 11340) of Part 1 of Division 3 of Title 2 of the
21Government Code.

22(i) (1) A written agreement between GO-Biz and a taxpayer
23with respect to the credit authorized by this section shall not
24restrict, broaden, or otherwise alter the ability of the taxpayer to
25assign that credit or any portion thereof in accordance with Section
2623663.

27(2) A written agreement between GO-Biz and a taxpayer with
28respect to the credit authorized by this section must comply with
29existing law on the date the agreement is executed.

30(j) (1) Upon the effective date of this section, the Department
31of Finance shall estimate the total dollar amount of credits that
32will be claimed under this section with respect to each fiscal year
33from the 2013-14 fiscal year to the 2024-25 fiscal year, inclusive.

34(2) The Franchise Tax Board shall annually provide to the Joint
35Legislative Budget Committee, by no later than March 1, a report
36of the total dollar amount of the credits claimed under this section
37with respect to the relevant fiscal year. The report shall compare
38the total dollar amount of credits claimed under this section with
39respect to that fiscal year with the department’s estimate with
40respect to that same fiscal year. If the total dollar amount of credits
P14   1claimed for the fiscal year is less than the estimate for that fiscal
2year, the report shall identify options for increasing annual claims
3of the credit so as to meet estimated amounts.

4(k) This section is repealed on December 1, 2025.

begin delete
5

SECTION 1.  

Section 100509 is added to the Government Code,
6to read:

7

100509.  

(a) The Exchange shall not disclose an individual’s
8personal information to third parties for the purpose of determining
9eligibility for, or enrolling the individual in, health care coverage
10unless both of the following requirements are satisfied prior to the
11disclosure:

12(1) The individual, through communication with the Exchange,
13including the Internet Web site of the Exchange, confirms his or
14her eligibility for a qualified health plan offered by the Exchange
15and receives an estimate of the cost of the qualified health plans
16offered by the Exchange that he or she may purchase.

17(2) After paragraph (1) has been satisfied, the Exchange obtains
18written consent from the individual on a stand-alone item in
1912-point font that requests the individual’s consent for disclosure
20of personal information to third parties for the purposes of
21determining eligibility for, or enrolling the individual in, health
22care coverage.

23(b) The Exchange shall immediately notify the public of any
24 breach of the security of personal information, regardless of the
25severity of the breach and regardless of whether personal
26information was acquired by an unauthorized person during the
27breach. This subdivision shall apply in addition to any other
28disclosure requirements applicable to the Exchange, including, but
29not limited to, Section 1798.29 of the Civil Code.

30(c) For purposes of this section, the following definitions shall
31 apply:

32(1) “Exchange” includes an employee of the Exchange or a
33member of the board of the Exchange.

34(2) “Personal information” means any information that is
35created, collected, or maintained by the Exchange that identifies
36or describes an individual, including, but not limited to, his or her
37name, social security number, physical description, home address,
38home telephone number, education, financial matters, and medical
39or employment history. “Personal information” includes statements
40made by, or attributed to, the individual.

P15   1(3) “Third party” means a person or entity other than the
2Exchange.

end delete
3

begin deleteSEC. 2.end delete
4begin insertSEC. 3.end insert  

This act is an urgency statute necessary for the
5immediate preservation of the public peace, health, or safety within
6the meaning of Article IV of the Constitution and shall go into
7immediate effect. The facts constituting the necessity are:

8begin deleteThe California Health Benefit Exchange is currently releasing
9to third parties the personal information of individuals using the
10Covered California Internet Web site without their knowledge. In
11order to protect the privacy rights of individuals applying for health
12care coverage through the Exchange, end delete
begin insertIn order to ensure the public
13good by providing certainty regarding the incentives available for
14attracting and retaining jobs in economically distressed areas of
15the state, end insert
it is necessary that this act take effect immediately.



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