Amended in Senate August 19, 2016

Amended in Assembly May 12, 2016

Amended in Assembly March 18, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2371

Introduced by Assembly Member Frazier

February 18, 2016

An act to add and repeal Article 2 (commencing with Section 18706) of Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

AB 2371, as amended, Frazier. Voluntary contributions: Special Olympics Fund.

Under existing law, taxpayers are allowed to contribute amounts in excess of their personal income tax liability for the support of various funds. Existing law also contains administrative provisions that are generally applicable to voluntary contributions.

This bill would allow a taxpayer to designate an amount in excess of personal income tax liability to be deposited to the Special Olympics Fund, which the bill would create. The bill would require moneys transferred to the Special Olympics Fund, upon appropriation by the Legislature, to be allocated to the Franchise Tax Board and the Controller, as provided, and to the State Department of begin delete Developmental end delete begin insert Social end insert Services for disbursement between the Special Olympics Northern California and the Special Olympics Southern California for the purpose of funding activities of the Special Olympics in support of children and adults with intellectual disabilities, as provided. The bill would authorize the State Department of begin delete Developmental end delete begin insert Social end insert Services to use up to 3% of the moneys allocated to it for administrative costs. begin insert The bill would require the Special Olympics Northern California and the Special Olympics Southern California to annually provide a report to the State Department of Social Services regarding the expenditure of the moneys disbursed to each organization, as specified. end insert

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

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

SECTION 1.  

Article 2 (commencing with Section 18706) is
added to Chapter 3 of Part 10.2 of Division 2 of the Revenue and
Taxation Code, to read:

 

Article 2.  Special Olympics Fund

 

18706.  

(a) Any individual may designate on the tax return that
a contribution in excess of the tax liability, if any, be made to the
Special Olympics Fund established by Section 18707 to be used
by the Special Olympics Northern California and the Special
Olympics Southern California.

(b) The contribution shall be in full dollar amounts and may be
made individually by each signatory on the joint return.

(c) A designation under subdivision (a) shall be made for any
taxable year on the original return for that taxable year, and once
made shall be irrevocable. If payments and credits reported on the
return, together with any other credits associated with the
individual’s account, do not exceed the individual’s tax liability,
the return shall be treated as though no designation has been made.

(d) (1) The Franchise Tax Board shall revise the form of the
return to include a space labeled “Special Olympics Fund” to allow
for the designation permitted under subdivision (a). The form shall
also include in the instructions information that the contribution
may be in the amount of one dollar ($1) or more and that the
contribution shall be used to conduct the activities of the Special
Olympics Northern California and the Special Olympics Southern
California in support of children and adults with intellectual
disabilities.

(2) Notwithstanding paragraph (1), a voluntary contribution
designation for the Special Olympics Fund shall not be added on
the tax return until another voluntary contribution designation is
removed or space is available, whichever occurs first.

(e) A deduction shall be allowed under Article 6 (commencing
with Section 17201) of Chapter 3 of Part 10 for any contribution
made pursuant to subdivision (a).

18707.  

There is hereby established in the State Treasury the
Special Olympics Fund to receive contributions made pursuant to
Section 18706. The Franchise Tax Board shall notify the Controller
of both the amount of money paid by taxpayers in excess of their
tax liability and the amount of refund money that taxpayers have
designated pursuant to Section 18706 to be transferred to the
Special Olympics Fund. The Controller shall transfer from the
Personal Income Tax Fund to the Special Olympics Fund an
amount not in excess of the sum of the amounts designated by
individuals pursuant to Section 18706 for payment into that fund.

18708.  

All moneys transferred to the Special Olympics Fund
pursuant to Section 18707, upon appropriation by the Legislature,
shall be allocated as follows:

(a) To the Franchise Tax Board and the Controller for
reimbursement of all costs incurred by the Franchise Tax Board
and the Controller in connection with their duties under this article.

(b) To the State Department of begin delete Developmental end delete begin insert Social end insert Services
where the balance shall be disbursed between the Special Olympics
Northern California and begin insert the end insert Special Olympics Southern California
based on the amount of donations provided by taxpayers in each
organization’s jurisdiction based on the county of the taxpayer
contributing, for the purpose of supporting children and adults
with intellectual disabilities. The State Department of
begin delete Developmental end delete begin insert Social end insert Services shall be responsible for overseeing
that disbursement and may use up to 3 percent of the moneys
allocated to it for administrative costs. The Special Olympics
Northern California and the Special Olympics Southern California
shall not use the moneys received pursuant to this article for
administrative costs.

begin insert

(c) The Special Olympics Northern California and the Special
Olympics Southern California shall annually provide a report to
the State Department of Social Services that includes
documentation that the moneys disbursed to each organization
pursuant to this section were not used for administrative costs nor
for any purposes outside of California and that describes in
narrative form the amount of moneys received pursuant to this
section and the purposes for which the moneys were expended.

end insert

18709.  

(a) Except as otherwise provided in paragraph (2) of
subdivision (b), this article shall remain in effect only until January
1 of the fifth taxable year following the first appearance of the
Special Olympics Fund on the personal income tax return, and is
repealed as of December 1 of that year.

(b) (1) By September 1 of the second calendar year and each
subsequent calendar year that the Special Olympics Fund appears
on the tax return, the Franchise Tax Board shall do both of the
following:

(A) Determine the minimum contribution amount required to
be received during the next calendar year for the fund to appear
on the tax return for the taxable year that includes that next calendar
year.

(B) Determine whether the amount of contributions estimated
to be received during the calendar year will equal or exceed the
minimum contribution amount determined by the Franchise Tax
Board for the calendar year pursuant to subparagraph (A). The
Franchise Tax Board shall estimate the amount of contributions
to be received by using the actual amounts received and an estimate
of the contributions that will be received by the end of that calendar
year.

(2) If the Franchise Tax Board determines that the amount of
the contributions estimated to be received during a calendar year
will not at least equal the minimum contribution amount for the
calendar year, this article shall be inoperative with respect to
taxable years beginning on or after January 1 of that calendar year
and shall be repealed on December 1 of that year.

(3) For purposes of this section, the minimum contribution
amount for a calendar year means two hundred fifty thousand
dollars ($250,000) for the second calendar year after the first
appearance of the Special Olympics Fund on the personal income
tax return or the minimum contribution amount as adjusted
pursuant to subdivision (c).

(c) For each calendar year, beginning with the third calendar
year after the first appearance of the Special Olympics Fund on
the personal income tax return, the Franchise Tax Board shall
adjust, on or before September 1 of that calendar year, the
minimum contribution amount specified in subdivision (b) as
follows:

(1) The minimum contribution amount for the calendar year
shall be an amount equal to the product of the minimum
contribution amount for the prior calendar year multiplied by the
inflation factor adjustment as specified in subparagraph (A) of
paragraph (2) of subdivision (h) of Section 17041, rounded off to
the nearest dollar.

(2) The inflation factor adjustment used for the calendar year
shall be based on the figures for the percentage change in the
California Consumer Price Index for all items received on or before
August 1 of the calendar year pursuant to paragraph (1) of
subdivision (h) of Section 17041.