BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  April 21, 2015


           ASSEMBLY COMMITTEE ON ARTS, ENTERTAINMENT, SPORTS, TOURISM, AND  
                                   INTERNET MEDIA


                             Ian Charles Calderon, Chair


          AB 932  
          (Daly) - As Amended April 8, 2015


          SUBJECT:  Specialized license plates:  professional sports


          SUMMARY:  Requires the State Department of Parks and Recreation  
          (DPR) to apply to the Department of Motor Vehicles (DMV) to  
          sponsor a specialized license plate program using professional  
          sport team logos, as specified. Establishes the California State  
          Parks Account (Account) and specifies that revenues from the  
          Account be used by DPR to fund local park and recreation  
          programs.





          EXISTING LAW: 





          1)Allows any state agency to apply to DMV to sponsor a  
            specialized license plate program.  

          2)Requires DMV to issue specialized license plates for that  








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            program if the agency complies with all statutory  
            requirements.  

          3)Prohibits DMV from establishing a specialized license plate  
            program for an agency until it has received not less than  
            7,500 paid applications for that agency's specialized license  
            plates.  

          4)Requires the agency to collect and hold applications for the  
            plates. Once the agency has received at least 7,500  
            applications, it must submit the applications, along with the  
            necessary fees, to DMV.  

          5)Prohibits advance payment to DMV of its administrative costs  
            associated with the issuance of a particular specialized  
            license plate from constituting compliance with the 7,500  
            application threshold requirement.  

          6)Requires funds accruing to a sponsoring state agency from the  
            sale of specialized license plates to be expended exclusively  
            for projects and programs that promote that agency's official  
            policy, mission, or work.  

          7)Allows specialized license plates to feature a distinctive  
            design, decal, or distinctive message in a two-inch by  
            three-inch space to the left of the plate's numerical sequence  
            and a space not larger than 5/8-inch in height below the  
            numerical series.



          FISCAL EFFECT:  Unknown


          COMMENTS:  


          1)Author's statement: pro sports specialty license plates are a  
            win win.








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            According to the author, "A report by the Resources for the  
            Future found that while parks have grown in popularity and  
            demand, park spending has remained relatively flat and  
            actually decreased during the past two economic recessions.  
            The economic, health, and environmental benefits of parks is  
            well documented; however it has become increasingly difficult  
            for municipal governments to provide funding for them.  
            California is home to millions of sports fans, and this  
            legislation provides an easy way for drivers to show support  
            for their favorite sports team, and parks and recreational  
            programs simultaneously. In addition, the professional sports  
            charities will be able to grow their programs, which will also  
            provide benefit to the People of California."

          2)Background.


             a)   Requirements for constitutionality of specialty tags.  
               Prior to 2007, any new specialized license plate required  
               specific legislative authorization. That practice was held  
               to be unconstitutional by the federal courts in that the  
               Legislature approved some of the plates and rejected  
               others, while using no standardized or objective criteria  
               for those decisions.  In response to the court decision, AB  
               84 (Leslie), Chapter 454, Statutes of 2006, established the  
               current specialized license plate program to provide a  
               forum for government speech that promotes California's  
               state policies. AB 84 excludes private organizations from  
               seeking specialized license plates as a forum for private  
               speech, and thus addresses the court's objection.  


          Plates now created and the revenue they generate must publicize  
          or promote a state agency, or the official policy, mission, or  
          work of a state agency. Furthermore, the process requires that  
          at least 7,500 paid applications must be received by the state  
          agency prior to notifying DMV. The 7,500-application threshold  








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          was previously put into statute for specialized license plates  
          and was arrived at in an attempt to assure that DMV's startup  
          costs would be fully covered by the portion of the registration  
          fee surcharge that is directed to DMV and to avoid a  
          proliferation of different types of plates, which can be  
          troublesome from a law enforcement perspective.  

             b)   Professional sports specialty plates elsewhere.  
               Currently, 25 states and Washington D.C. have implemented  
               specialized license plate programs in some form using  
               professional sport team logos. Revenues from these programs  
               have been used to fund programs such as, youth development,  
               homelessness, and academic scholarships. Overall,  
               information provided by the author demonstrates that these  
               programs using professional team logos have been successful  
               in raising revenue for various social programs.  

          3)Process for professional team DMV specialty plate designation.


            To begin the process, professional sports teams interested in  
            participating in the specialty license plate program will  
            contact the Department, and an Memorandum of Understanding  
            (MOU) agreement will be signed between the parties outlining  
            the nature of the charitable activities of the professional  
            sports team (Charity) in order to assure compliance with legal  
            requirements for specialty plates discussed in Comment 2  
            above, and license fee to be collected on behalf of the  
            Charity.





            The Department will then submit a Letter of Intent to DMV  
            which contains a financial plan stating the purpose(s) for  
            which the revenue will be used.  The parties will then have  
            12-months to collect 7,500 applications. Each individual team  
            must submit a request, and gather 7,500 fan applications prior  








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            to the striking of the first plate. A process exists for  
            extension of time should a team fail to meet the one year  
            deadline.





            Once sufficient commitment applications have been gathered, a  
            license plate prototype must be submitted for approval, and  
            the design, logo, and message on the plate must publicize or  
            promote the official policy, mission, or work of the  
            sponsoring state agency. After plate design approval by DMV  
            and the California Highway Patrol, the DMV will authorize the  
            plate prototype to be manufactured. The implementation cost  
            for the specialized license plates is approximately $400,000.  
            The cost is recovered from the sale of the license plates.   
            Once the implementation costs have been met, a deduction  
            (Administrative Service Fee) will be taken for ongoing  
            administrative costs from every application thereafter.



            After deducting implementation costs and ongoing  
            Administrative Service Fees, the remainder of the monies will  
            be allocated as follows:

             a)   Sequential plate configurations go into the Specialized  
               License Plate Fund.  
             b)   Personalized configurations go into two different funds:  
                
               i)     A Specialized License Plate Fund for your plate  
                 program.
               ii)    Environmental License Plate Fund for the portion of  
                 fees that is attributable to each.



            Upon appropriation of the funds by the Legislature to the  








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            California State Parks Account, created by this bill within  
            the Specialized License Plate Fund, the Department will remit  
            the portion of the fee collected on behalf of the Charity  
            pursuant to the MOU.





          4)Department of Parks and Recreation Office of Grants and Local  
            Services (OGAL)


            According to the Department, the following types of services  
            and equipment could be 


            purchased for local parks under the income generated by the  
            bill, based upon the experience of their typical  grant  
            programs - which have ranged in size from $2 million to $184  
            million.  They also advise that a key component to a  
            successful grant program is to tailor the program to the  
            amount of funding available; if the amount of funding is  
            relatively small, it would be worth considering having a match  
            requirement, limiting the types and locations of eligible  
            entities, and being specific about the types of projects that  
            are eligible. At any amount less than $10 million, it would be  
            worth considering a match requirement to reduce the number of  
            applications.





            OGALS typically limits the maximum grant amount to no more  
            than 10% of the entire program. So, if the program amount is  
            $2 million, the maximum grant is $200,000 (this ensures at  
            least ten awards).









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            Here's the approximate cost of some typical items OGALS funds:


                Programs for children (summer day camps, field trip  
            programs, etc.) - $25k to $200k


                Playgrounds (build/replace) - $50k to $250k


                Sports field irrigation system - $50k to $100k


                Restrooms - $100k to $250k


                Sports field lighting - $150k


                Artificial turf for one soccer field - $500k to $750k


          5)Professional sports charities. According to information found  
            on the Internet, each professional sports team in major sports  
            is involved in local charities. A sample list of sports and  
            teams includes the following charitable efforts:


             a)   National Football League (NFL)

          Oakland Raiders. Organizations involved with: Brave Kids, Boys &  
          Girls Club of Oakland, California Department of Social Services,  
          Children's Hospital Oakland, KDOL Sports Forum, food drive,  
          Football 101, Komen Race for the Cure, Menlo Charity Horse Show,  
          Oakland Police Department, Read Aloud Day 2000, Special  








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          Olympics, Toys for Tots. Team programs: Battle of the Bay  
          basketball charity game, donations of turkey and ham during  
          Thanksgiving, Football 101, Let Us Play! Sports Camp for girls,  
          Offense-Defense Football Camp, toy drive.

          San Diego Chargers. Organizations involved with: California  
          Interscholastic Federation Championship football games,  
          Children's Hospital and Health Center, Pop Warner football, San  
          Diego Blood Bank. Team programs: Alex Spanos All Star Classic  
          (high school all-star football game), Chargers Blood Drive,  
          Chargers Champions (benefiting youth, education and sports in  
          San Diego County), High School Coach of the Week, Toss for Tots  
          (members make a donation for each Chargers touchdown during the  
          season).

          San Francisco 49ERS. Charitable arm: 49ers Foundation.  
          Organizations involved with: Brave Kids, The Drug Abuse  
          Resistance Program, Emergency Housing Consortium, Glide Memorial  
          Church, Hamilton Family Center, Make-A-Wish Foundation, Susan G.  
          Komen Breast Cancer Foundation.  Team programs: 49ers Academy  
          (personalized education setting for students at risk of dropping  
          out), 49ers Coat Drive, 49ers Food Drive, Bay Area All-Star  
          Scholarship Team (in partnership with the NBA Golden State  
          Warriors, MLB Oakland As, NFL Oakland Raiders, MLB San Francisco  
          Giants and NHL San Jose Sharks awarded to six students),  
          Football 101, Gatorade/49ers Junior Training Camp, High School  
          Coach of the Week, Holiday Hospital Visits, Operation Blessing  
          2000.

             b)   Major League Baseball (MLB).

          Los Angeles Angels of Anaheim Charity. Through their involvement  
          in a variety of outreach programs and non-profit organizations,  
          Angels Baseball has proven to be a valuable member of the  
          surrounding community. From laying down the foundation one brick  
          at a time with the Angels Brick Project to helping fund local  
          and national youth organizations, the Angels Baseball Foundation  
          focuses on initiatives aimed to create and improve Education,  
          Healthcare, Arts & Sciences, and Community related youth  








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          programs throughout the region, in addition to providing  
          children the opportunity to experience the great game of  
          baseball and its countless positive attributes.

          Los Angeles Dodgers Charity. Founded in 1998, the Dodgers Dream  
          Foundation (DDF) was created to provide educational, athletic  
          and recreational opportunities for the youth of the Greater Los  
          Angeles community. The Foundation places special emphasis on  
          helping traditionally under-served youth.

          Oakland Athletics Charity. The Oakland Athletics host numerous  
          community events including Golf Classics, Awareness Days, as  
          well as support youth baseball programs and educational  
          endeavors.

          San Diego Padres Charity. The Padres Foundation for Children,  
          established in 1995 by Padres Chairman John Moores, is the  
          primary source of funding for the club's outreach initiatives in  
          the areas of children's health, education and youth  
          baseball/softball. The Foundation raises funds through corporate  
          sponsorships and through a number of programs in which fans can  
          participate, including Scoreboard Surprises, an online  
          charitable auction, and the annual Shirts Off Their Backs  
          fundraiser.

          San Francisco Giants Charity. The Giants' work in the community  
          translates into a variety of unique and progressive programs  
          dedicated to addressing some of the most pressing needs of  
          Northern California children and their families, including  
          health, violence prevention, youth fitness and recreation,  
          education and literacy.

             c)   National Basketball Association (NBA). 

          Since the NBA launched its NBA Cares initiatives in 2005, the  
          league, its teams and players have raised and donated more than  
          $242 million to charity; completed more than 3 million hours of  
          community service; and created nearly 1,000 places where  
          children and families can live, learn or play. The league counts  








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          KaBoom!, Special Olympics, YMCA, Boys and Girls Clubs of  
          America, UNICEF, the Make-A-Wish Foundation, Share Our Strength  
          and GLAAD among its social responsibility partners.

          6)Extra fees paid above DMV registration for specialty license  
            plates are tax deductible.


            According to a 2009 FTB Information Letter requesting  
            clarification on the deductibility of special interest license  
            plate fees as a charitable contribution under California law,  
            "When a taxpayer, with the intention of making a gift,  
            purchases an item of value from a qualified charity, the  
            excess of the payment over the value received is a charitable  
            contribution. As a result, taxpayers who pay the additional  
            fee are entitled to treat as a charitable contribution the  
            difference between the amounts paid for the Arts Council  
            license plate and a regular California license plate...This  
            same conclusion is applicable to registrants that purchase  
            environmental license plates as well as other similarly  
            situated registrants when purchasing other special license  
            plates that support other charitable purposes."

          7)Committee comment: no definition of professional sports. Other  
            states which have enacted similar legislation have offered a  
            rather broad definition of professional sports, for instance  
            New Jersey law provides, "As used in this act, 'professional  
            sports team' includes, but is not limited to, teams and  
            franchises associated with the National Hockey League; Major  
            League Baseball Properties, Inc.; NASCAR; NFL Properties, LLC;  
            and National Basketball Properties, Inc." By contrast Ohio  
            offers plates of specific teams and not sports per se, such as  
            the Cincinnati Reds, Cincinnati Bengals, Cleveland Browns,  
            Cleveland Indians and Columbus Blue Jackets. As the bill moves  
            forward the author may wish to consider adding some parameters  
            to the teams who may participate in the specialty plate  
            program.










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          8)Prior and related legislation.


             a)   AB 270 (Nazarian), would require the State Department of  
               Public Health to apply to the DMV to sponsor a diabetes  
               awareness, education, and research specialized license  
               plate program (program), as specified. Currently pending  
               before the Assembly Appropriations Committee. 
           
           According to the Assembly Transportation Committee, over the  
          past 5 years 13 bills have been introduced directing a state  
          agency to sponsor a specialized license plate for a variety of  
          causes.  Of the 13 bills, eight passed the Legislature and were  
          signed by the Governor. Most recently:

             b)   AB 482 (Atkins), Chapter 590, Statutes of 2014, aka, the  
               Snoopy Plate, heard and passed out of this committee,  
               supporting small capital projects in museums.

             c)   AB 1096 (Nestande), Chapter 353, Statutes of 2014,  
               supporting Salton Sea restoration.

             d)   AB 2450, (Logue), Chapter 359, Statutes of 2014,  
               supporting kidney disease research. 

             e)   AB 49 (Buchanan), Chapter 351, Statutes of 2014,  
               supporting breast cancer awareness. 

             f)   AB 2321 (Gomez), Chapter 358, Statutes of 2014,  
               supporting domestic violence prevention.
          


          REGISTERED SUPPORT / OPPOSITION:




          Support








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          Anaheim Ducks


          Los Angeles Angels


          Los Angeles Dodgers


          Oakland A's


          San Diego Padres


          San Francisco Giants




          Opposition




          There is no opposition on file 


          Analysis Prepared by:Dana Mitchell  / A.,E.,S.,T., & I.M. /  
          (916) 319-3450















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