Amended in Assembly March 24, 2015

California Legislature—2015–16 Regular Session

Assembly BillNo. 1247


Introduced by Assembly Member Irwin

February 27, 2015


An act tobegin delete add and repeal Section 14502.2 of the Food and Agricultural Code, relating to fertilizer.end deletebegin insert amend Section 6358 of the Revenue and Taxation Code, relation to taxation, to take effect immediately, tax levy.end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 1247, as amended, Irwin. begin deleteFertilizer: organic input materials. end deletebegin insertSales and use taxes: exemption: organic input material.end insert

begin insert

Existing sales and use tax laws impose a tax on retailers measured by the gross receipts from the sale of tangible personal property sold at retail in this state, or on the storage, use, or other consumption in this state of tangible personal property purchased from a retailer for storage, use, or other consumption in this state. That law provides various exemptions from those taxes, including an exemption for fertilizer to be applied to land, the products of which are to be used as food for human consumption or are to be sold in the regular course of business.

end insert
begin insert

This bill would additionally exempt from those taxes the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, organic input material, as defined, to be applied to land, the products of which are to be used as food for human consumption or are to be sold in the regular course of business.

end insert
begin insert

The Bradley-Burns Uniform Local Sales and Use Tax Law authorizes counties and cities to impose local sales and use taxes in conformity with the Sales and Use Tax Law, and existing law authorizes districts, as specified, to impose transactions and use taxes in accordance with the Transactions and Use Tax Law, which generally conforms to the Sales and Use Tax Law. Amendments to state sales and use taxes are incorporated into these laws.

end insert
begin insert

Section 2230 of the Revenue and Taxation Code provides that the state will reimburse counties and cities for revenue losses caused by the enactment of sales and use tax exemptions.

end insert
begin insert

This bill would provide that, notwithstanding Section 2230 of the Revenue and Taxation Code, no appropriation is made and the state shall not reimburse any local agencies for sales and use tax revenues lost by them pursuant to this bill.

end insert
begin insert

This bill would take effect immediately as a tax levy, but its operative date would depend on its effective date.

end insert
begin delete

Existing law requires the labeling and registration, as specified, of fertilizing materials, including organic input materials. Organic input materials are commercial fertilizers, agricultural minerals, auxiliary soil and plant substances, specialty fertilizers, or soil amendments, excluding pesticides, that are to be used in organic crop and food production and that comply with specified national standards.

end delete
begin delete

Existing law requires all moneys, except for fines and penalties, collected by the State Air Resources Board from the auction or sale of allowances as part of a market-based compliance mechanism relative to reduction of greenhouse gas emissions, to be deposited in the Greenhouse Gas Reduction Fund.

end delete
begin delete

This bill would require the Secretary of Food and Agriculture, on or before June 30, 2016, to provide to the Legislature a plan to expand the Department of Food and Agriculture’s promotion of organic input materials for the production of food and fiber. The bill would express the Legislature’s intent that the secretary’s plan and the department’s promotion of organic input materials be funded, all or in part, by the Greenhouse Gas Reduction Fund. The bill would make findings and declarations regarding the ways in which agricultural practices, including the application of fertilizer, remove carbon dioxide from the atmosphere.

end delete

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

P2    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertSection 6358 of the end insertbegin insertRevenue and Taxation Codeend insert
2begin insert is amended to read:end insert

P3    1

6358.  

There are exempted from the taxes imposed by this part,
2the gross receipts from the sale in this state of, and the storage,
3use, or other consumption in this state of:

4(a) Any form of animal life the products of which ordinarily
5constitute food for human consumption.

6(b) Feed for any form of animal life the products of which
7ordinarily constitute food for human consumption or are to be sold
8in the regular course of business.

9(c) Seeds and plants the products of which ordinarily constitute
10food for human consumption or are to be sold in the regular course
11of business.

12(d) Fertilizer to be applied to land the products of which are to
13be used as food for human consumption or are to be sold in the
14regular course of business.

begin insert

15(e) (1) Organic input material to be applied to land, the
16products of which are to be used as food for human consumption
17or are to be sold in the regular course of business.

end insert
begin insert

18(2) For purposes of this subdivision, “organic input material”
19means auxiliary soil and plant substance, specialty fertilizer, or
20soil amendment, excluding pesticides, that complies with the
21requirements of the National Organic Program standards, as
22specified in Part 205 (commencing with Section 205.1) of
23Subchapter M of Chapter I of Subtitle B of Title 7 of the Code of
24Federal Regulations.

end insert
begin delete

25(e)

end delete

26begin insert(f)end insert On or after January 1, 1997, drugs or medicines, including
27oxygen, the primary purpose of which is the prevention or control
28of disease, that are administered to animal life the products of
29which ordinarily constitute food for human consumption.

30begin insert

begin insertSEC. 2.end insert  

end insert
begin insert

Notwithstanding Section 2230 of the Revenue and
31Taxation Code, no appropriation is made by this act and the state
32shall not reimburse any local agency for any sales and use tax
33revenues lost by it under this act.

end insert
34begin insert

begin insertSEC. 3.end insert  

end insert
begin insert

This act provides for a tax levy within the meaning of
35Article IV of the Constitution and shall go into immediate effect.
36However, the provisions of this act shall become operative on the
37first day of the first calendar quarter commencing more than 90
38days after the effective date of this act.

end insert
begin delete
39

SECTION 1.  

The Legislature finds and declares both of the
40following:

P4    1(a) A variety of agricultural practices that enhance carbon
2storage or sequestration include conservation tillage, cover
3cropping, crop rotation, and application of compost and fertilizer
4to agricultural and range lands.

5(b) Improved soil and water quality, decreased nutrient loss,
6reduced soil erosion, increased water conservation, and greater
7crop production may result from increasing the amount of carbon
8dioxide stored in agricultural lands, which in turn removes that
9carbon dioxide from the atmosphere.

10

SEC. 2.  

Section 14502.2 is added to the Food and Agricultural
11Code
, to read:

12

14502.2.  

(a) On or before June 30, 2016, the secretary shall
13provide to the Legislature a plan to expand the department’s
14promotion of organic input materials for the production of food
15and fiber.

16(b) It is the intent of the Legislature to fund all or part of these
17requirements, including the secretary’s plan and the department’s
18promotion of organic input materials, with the Greenhouse Gas
19Reduction Fund.

20(c) (1) A report to be submitted pursuant to subdivision (a)
21shall be submitted in compliance with Section 9795 of the
22Government Code.

23(2) Pursuant to Section 10231.5 of the Government Code, this
24 section is repealed on June 30, 2020.

end delete


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