BILL ANALYSIS Ó
AB 924
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Date of Hearing: May 13, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
924 (Cooley) - As Amended April 29, 2015
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|Policy |Revenue and Taxation |Vote:|7 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill reauthorizes the addition of the State Children's
Trust 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 checkoff for charitable fund
contribution has been removed.
Funds raised would, upon appropriation by the Legislature, be
allocated to the Department of Social Services (DSS), up to 10%
of which may be used for public education about child abuse and
neglect prevention and early intervention, and the remainder of
which may be used for innovative child abuse and neglect
AB 924
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prevention and intervention programs operated by nonprofit
organizations and public institutions of higher education.
The bill requires the Fund to meet the minimum annual
contribution threshold of $250,000, indexed for inflation, and
would require the Fund's provisions to automatically sunset on
January 1 of the fifth taxable year following the Fund's first
appearance on the personal income tax return.
FISCAL EFFECT:
1)Minor and absorbable costs to the DSS to administer program
and grants, funded by up to 5% of the contributions to the
Fund; insignificant administrative costs to the Franchise Tax
Board (FTB), reimbursed from contributions to the Fund.
2)Estimated GF revenue decreases of approximately $8,000 in each
year the voluntary contribution fund remains on the personal
income tax return.
COMMENTS:
1)Purpose. According to the author, the State Children's Trust
Fund received between $305,00- and $760,000 annually over the
past 5 years from the voluntary checkoff program, representing
half of the revenue deposited in the Fund. The author claims
the loss of this funding has resulted in fewer prevention
AB 924
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programs that directly target child abuse and neglect. AB 924
reinstates the State Children's Trust Fund as a donation
option on the tax form, restoring that source of potential
funding.
2)Worthy Cause, Modest Support. With few exceptions, voluntary
contribution funds remain on the personal income tax return
until they are either repealed or fail to meet their minimum
contribution amount, typically $250,000, indexed for
inflation. If FTB estimates a contribution fund is likely to
fail to meet the minimum contribution amount, that fund is
repealed effective January 1 of that calendar year.
An identically-named voluntary contribution fund first
appeared on the 1983 personal income tax return. By 2014, the
inflation-adjusted minimum contribution threshold was
$324,972, but the fund only received contributions of
approximately $303,000. As a result, the fund was not
included on the 2014 personal income tax return (which is
filed in 2015) and discontinued. Reauthorizing the Fund
effectively resets the minimum contribution to $250,000 in
contravention of the general policy for voluntary contribution
funds.
3)Spend Money to Make Money. This bill allows DSS to spend up
to 10% of Fund moneys to encourage additional contributions to
the Fund, presumably to prevent the Fund from being removed
again for failing to meet its minimum contribution threshold.
With limited space for voluntary contribution funds and
increasing competition among charitable causes for inclusion,
this evolutionary mechanism may help funds better defend their
position on the Darwinian voluntary checkoff page of the
personal income tax return.
AB 924
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Analysis Prepared by:Joel Tashjian / APPR. / (916)
319-2081