BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          SB 1159 () - Professions and Vocations: License Applications:  
          Federal Tax Identification Number

          Amended: April 7, 2014          Policy Vote: BP&ED 8-1
          Urgency: No                     Mandate: Yes
          Hearing Date: May 5, 2014       Consultant: Robert Ingenito
          
          This bill does not meet the criteria for referral to the  
          Suspense File.


          Bill Summary: SB 1159 would authorize a board, as defined, the  
          State Bar and the Bureau of Real Estate to accept an  
          individual's application containing a federal taxpayer  
          identification number (TIN) for an initial or renewal license in  
          lieu of a social security number.

          Fiscal Impact: 
                 The Department of Consumer Affairs (DCA) indicates that  
               it would incur one-time costs of up to $130,000 (special  
               funds) to update forms, publications, and information  
               technology.

                 The bill could result in potential costs to DCA's boards  
               and bureaus to ensure that new applicants using TINs are  
               complying with child support judgments. The extent of these  
               costs is unknown.

                 The bill would result in an increase in individuals  
               applying for licenses at the various boards and bureaus  
               within DCA, leading to increased licensing revenues. The  
               amount of the increase is unknown.


          Background: Current law requires that individuals applying for a  
          license at one of DCA's boards and bureaus provide their social  
          security number (or a federal employer identification number if  
          the licensee is a partnership). Any licensee who does not  
          provide this information shall be reported to the Franchise Tax  
          Board (FTB) and is subject to a penalty. In addition, a  
          licensing board may elect not to process original license  
          applications from applicants who do not provide their federal  








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          employer identification number or social security number.

          The TIN is a tax processing number only available for certain  
          nonresident and resident aliens, their spouses, and dependents  
          who cannot get a social security number.  It is a 9-digit  
          number, beginning with the number "9" and is formatted like a  
          social security number. An individual must apply to the IRS to  
          obtain a TIN.  The form requires documentation substantiating  
          foreign/alien status and true identity for the individual.

          Proposed Law: This bill would do the following:

                 Provides that each board under DCA, as well as the State  
               Bar and Bureau of Real Estate shall at the time of issuance  
               of an initial or renewal license require that the applicant  
               provide its federal employer identification number, if the  
               applicant is a partnership, or the applicant's federal  
               taxpayer identification number or social security number,  
               if one has been issued, for all other applicants. 

                 Requires that any applicant failing to provide the  
               federal employer identification number or the federal  
               taxpayer identification number or social security number,  
               if one has been issued to the individual, to be reported by  
               the licensing board to the FTB and provides if the  
               applicant fails to provide that information they shall be  
               subject to a penalty.

                 Provides that in addition to a penalty, a licensing  
               board may elect to not process any application for an  
               original license if the applicant or licensee fails to  
               provide its federal employer identification number, or  
               federal taxpayer identification number or social security  
               number, if one has been issued to the individual, where  
               requested on the application.  

                 Requires a licensing board, upon request FTB, to furnish  
               specified information including the federal employer  
               identification number if the entity is a partnership, or  
               the licensee's TIN, if one has been issued to the  
               individual, for all other licensees. 

          
          Staff Comments: This bill is similar to AB 1822 (Berryhill, Ch.  








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          317, Statutes of 2012), which authorized applicants for an  
          architecture license to submit an individual TIN or another  
          identification number, as determined by the California  
          Architects Board, in place of a social security number where the  
          applicant is not eligible for a social security number and is  
          not out of compliance with a child support judgment or order,  
          among other things.