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 SB 1159 (Lara) Page 1 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. SB 1159 (Lara) Page 2 317, 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.