BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                        AB 485|
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                                   THIRD READING 


          Bill No:  AB 485
          Author:   Williams (D)
          Amended:  9/4/15 in Senate
          Vote:     21  

           SENATE GOVERNANCE & FIN. COMMITTEE:  7-0, 7/1/15
           AYES:  Hertzberg, Nguyen, Beall, Hernandez, Lara, Moorlach,  
            Pavley

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 8/27/15
           AYES:  Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

           ASSEMBLY FLOOR:  77-0, 5/7/15 - See last page for vote

           SUBJECT:   Personal income taxes:  voluntary  
                     contributionsPersonal income taxes: voluntary  
                     contributions: Prevention of Animal Homelessness and  
                     Cruelty Fund.


          SOURCE:    Author


          DIGEST:  This bill authorizes the addition of the Prevention of  
          Animal Homelessness and Cruelty Fund (Fund) check-off to the  
          personal income tax return.    




          Senate Floor Amendments of 9/4/15 allows the Department of Food  
          and Agriculture to consult with the Department of Public Health  
          to develop the grant process, allows the Department of Food and  
          Agriculture to use up to 5% of the funds collected to create  
          public awareness about the check-off, and prohibits the use of  








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          money from the check-off fund to be used to supplant state  
          General Fund money for any purpose.




          ANALYSIS:


          Existing law:

          1)Allows taxpayers to contribute money to voluntary contribution  
            funds (check-offs) by checking a box on their state income tax  
            returns.  

          2)Requires contributions made through check-offs to be made from  
            taxpayers' own resources and not from their tax liability, as  
            is possible on federal tax returns.

          3)Allows taxpayers to claim check-off amounts as charitable  
            contributions on taxpayers' tax returns in the subsequent  
            year.

          This bill:

          1)Adds the Prevention of Animal Homelessness and Cruelty Fund  
            (Fund), and allows a taxpayer to make a voluntary contribution  
            to the Fund on the state personal income tax return, beginning  
            once an existing check-off for charitable fund contribution  
            has been removed, or as soon as space is available.  

          2)Requires the Fund to meet a minimum contribution threshold of  
            $250,000, indexed yearly for inflation.

          3)Provides that all money transferred to the Fund, upon  
            appropriation by the Legislature, be allocated as follows:

                 To the Franchise Tax Board (FTB)  and the State  
               Controller for reimbursement of all costs incurred in  
               administering the check-off,

                 The first $250,000, shall be distributed by the  








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               Department of Food and Agriculture, to a city, county, or  
               city and county animal control agency or for the sole  
               purpose of supporting spay and neuter activities by that  
               entity to prevent and eliminate cat and dog homelessness.

                 Any amount collected over $250,000, shall be distributed  
               by the Department of Food and Agriculture, to be used by  
               programs designed to prevent and eliminate cat and dog  
               homelessness or programs for the prevention, investigation,  
               and prosecution of animal cruelty and neglect. 

          1)Allows the Department of Food and Agriculture to consult with  
            the Department of Public Health to develop the grant process.

          2)Allows the Department of Food and Agriculture to use up to 5%  
            of the funds collected to create public awareness about the  
            check-off.

          3)Prohibits the use of money from the check-off fund to be used  
            to supplant state General Fund money for any purpose.

          4)Provides that the bill automatically sunsets on January 1 of  
            the fifth taxable year following the Fund's first appearance  
            on the personal income tax form, or January 1, 2022, whichever  
            occurs first.

          Background
          
          The Legislature adds individual check-offs yearly.  With a few  
          exceptions, check-offs remain on the return until they are  
          repealed by a sunset date or fail to generate a minimum  
          contribution amount.  In general, the minimum contribution  
          amounts are adjusted annually for inflation.  For most  
          check-offs, the minimum contribution amount is $250,000,  
          beginning in the fund's second year.  The following check-offs  
          do not have a minimum contribution requirement:

          1)California Firefighters' Memorial Foundation Fund,
          2)California Peace Officer Memorial Foundation Fund, and 
          3)California Seniors Special Fund.

          When a taxpayer contributes to check-offs, FTB deposits the  








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          total of all contributions into the fund created as part of the  
          check-offs legislative authorization.  For some check-offs, such  
          as the Protect Our Coast and Ocean Fund, taxpayers'  
          contributions are allocated to a state agency for use in a state  
          administered grant program.  Other check-off authorizing  
          statutes direct administrative agencies to allocate donations to  
          a private organization.  For example, the Office of Emergency  
          Services passes check-offs funds to the American Red Cross.   
          Other funds require the State Controller to send the funds  
          directly to private organizations without passing through an  
          administrative agency, such as the California Fire Foundation.   
          FTB, the Controller, and an administrative agency may deduct  
          from the amount of donations each check-off receives for direct  
          costs of administering a fund.  

          There are currently 18 check-offs listed on the tax return form.  
           The tax check-off program collects approximately $5 million in  
          annual contributions for all check-offs.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No

          According to the Senate Appropriations Committee:

          1)FTB estimates that this bill would result in an annual General  
            Fund revenue loss of about $8,000.

          2)The State Controller's Office and FTB and would be reimbursed  
            from the Fund for related administrative costs.

          3)The California Department of Food and Agriculture would incur  
            first-year General Fund costs of $66,000, and ongoing annual  
            costs of $125,000.  The specific timing of these expenses  
            would depend on when the check-off were to appear on the tax  
            form.



          SUPPORT:   (Verified9/4/15)


          American Society for the Prevention of Cruelty to Animals








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          Humane Society of the United States
          State Humane Association of California


          OPPOSITION:   (Verified9/4/15)


          California Department of Finance


          ARGUMENTS IN SUPPORT:  The supporters of this bill argue that  
          this bill will provide much needed funding to California's  
          animal shelters to improve animal welfare.  Specifically, the  
          bill will ensure over 200,000 animals undergo the necessary  
          spay/neuter procedure for every $1 million dollars collected.   
          This will decrease the number of homeless pets in California.


          ARGUMENTS IN OPPOSITION:     The opponent of this bill argues  
          that this bill could result in a loss to the General Fund and is  
          of limited value.

          ASSEMBLY FLOOR:  77-0, 5/7/15
          AYES:  Achadjian, Alejo, Travis Allen, Baker, Bigelow, Bloom,  
            Bonilla, Bonta, Brough, Brown, Burke, Calderon, Chang, Chau,  
            Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly,  
            Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina  
            Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,  
            Gordon, Gray, Grove, Hadley, Harper, Holden, Irwin, Jones,  
            Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,  
            Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin,  
            Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Perea,  
            Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago, Mark  
            Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams,  
            Wood, Atkins
          NO VOTE RECORDED:  Campos, Roger Hernández, Steinorth

          Prepared by:Myriam Bouaziz / GOV. & F. / (916) 651-4119
          9/9/15 10:11:59
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