BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session AB 1765 (Irwin) - CaliforniaVolunteers: nonprofit public benefit corporation ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: April 19, 2016 |Policy Vote: G.O. 13 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: August 1, 2016 |Consultant: Mark McKenzie | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 1765 would authorize CaliforniaVolunteers to form a nonprofit public benefit corporation or other tax-exempt entity for fundraising purposes. The nonprofit's mission would be to support the funding of CaliforniaVolunteers programming and administrative costs, as well as other priorities identified by the CaliforniaVolunteers executive board or the Governor. Fiscal Impact: Estimated CaliforniaVolunteers administrative costs of approximately $200,000 and one PY to staff the nonprofit foundation. (General Fund, private funds) Background: Existing law, pursuant to Executive Order S-24-06, establishes California Volunteers in the Governor's Office (housed within AB 1765 (Irwin) Page 1 of ? the Office of Planning and Research) with the following duties and responsibilities: (1) to recruit and mobilize citizens for volunteer service by identifying service opportunities throughout the state and by recognizing citizen contributions as volunteers and participants in public service; (2) to serve as the state's lead agency for community service and volunteerism, as specified; and (3) to partner with other public agencies at the state, county, and local levels, and the private and not-for-profit sectors, to leverage greater resources and create more opportunities for service and volunteerism. Existing federal law establishes the National and Community Service Trust Act of 1993, which requires each state governor to create and appoint a commission to administer the AmeriCorps volunteer program. AmeriCorps engages Americans in intensive service each year at nonprofits, schools, public agencies, and community and faith-based groups across the country. CaliforniaVolunteers administers the state AmeriCorps program, issuing annual requests for applications and awarding federal grants in a competitive process to eligible applicants, including local governments and nonprofit organizations. The grants support community partnerships that engage AmeriCorps members to meet state and local challenges through service and volunteer action. CaliforniaVolunteers also administers other programs that engage volunteers and foster partnerships to address community needs, such as the Disaster Volunteering and Preparedness program, the Service Enterprise Initiative, and the Business Partners Program. Proposed Law: AB 1765 would authorize CaliforniaVolunteers to form a tax-exempt public benefit nonprofit corporation or other tax-exempt entity that is qualified to raise revenues and receive financial support from public or private sources, for the purpose of undertaking or funding authorized activities. Any grants or financial support received by the nonprofit fundraising entity must be used solely for governmental purposes approved by CaliforniaVolunteers for activities within its authority, and no more than 10 percent of those funds could be AB 1765 (Irwin) Page 2 of ? used for the nonprofit entity's administrative costs. The bill also specifies that the mission of the nonprofit entity would be to support the funding of CaliforniaVolunteers programming and administrative costs, and to support any priorities set forth by the Governor or the CaliforniaVolunteers board of commissioners. The authority to establish the nonprofit fundraising entity would expire if the Governor rescinds the establishment of CaliforniaVolunteers or the executive order that created it. Related Legislation: AB 706 (Bonilla), which was vetoed by the Governor last year, would have established the California AmeriCorps -science, technology, engineering, and math (STEM) program, administered by CaliforniaVolunteers. AB 706 would have also authorized the formation of a nonprofit public benefit corporation similar to the authority provided in this bill. The Governor's veto message stated the following: This bill establishes the California AmeriCorps STEM program and authorizes California Volunteers to form a non-profit foundation for fundraising purposes. I applaud the author for promoting math and science through volunteerism in California, but without a funding source the program established in this bill would not be viable. Staff Comments: This bill would provide CaliforniaVolunteers with the authority to establish a nonprofit entity for fundraising purposes to raise supplemental public and private money that could be used fund a broader range of programs and provide necessary matching funds to enhance AmeriCorps opportunities in rural and low-income communities. Staff assumes that CaliforniaVolunteers would need additional staff with fundraising expertise for the nonprofit foundation, at an annual cost of approximately $200,000. Although these costs would initially be paid from the General Fund, they could be partially or fully offset in future years by a portion of funds raised by the nonprofit entity (up to 10 percent of any grants or AB 1765 (Irwin) Page 3 of ? financial support received by the nonprofit may be used for administrative purposes). -- END --