BILL ANALYSIS Ó
AB 2371
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Date of Hearing: May 11, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2371 (Frazier) - As Amended March 18, 2016
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|Policy |Revenue and Taxation |Vote:|9 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill requires the addition of the Special Olympics Fund
(Fund) checkoff to the personal income tax (PIT) return upon the
removal of another voluntary contribution fund (VCF) from the
return, or as soon as space is available. Specifically, this
bill:
1)Requires that all money transferred to the Fund, upon
appropriation by the Legislature, will be allocated as
follows:
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a) Franchise Tax Board (FTB) and the State Controller for
reimbursement of all cost incurred in administering the
VCF; and,
b) Special Olympics Northern California (SONC) and Special
Olympics Southern California (SOSC). The funds will be
divided proportionately according to each organization's
jurisdiction based on the county of the taxpayers
contributing, for the purpose of supporting children and
adults with intellectual disabilities.
2)Provides for the Fund provisions' automatic sunset on January
1 of the fifth taxable year following the Fund's first
appearance on the PIT return.
3)Requires the Fund to meet a minimum contribution threshold of
$250,000 indexed for inflation to remain on the PIT return.
FISCAL EFFECT:
1)Minor and absorbable costs to administrate the fund.
2)Minor ongoing GF revenue losses of up to $15,000 per year
resulting from itemized taxpayer deductions.
COMMENTS:
1)Purpose. According to the author, AB 2371 will allow
individuals to make voluntary contributions to the Special
Olympics Fund, which will help provide athletic opportunities
to children and adults with intellectual disabilities and
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instilling the confidence they need to succeed in life.
2)Background and purpose. Current state tax law allows taxpayers
to make contributions on their tax returns to a number of
VCFs. Like many other VCFs, AB 2371 would require the Fund to
meet a current minimum contribution amount to return on state
tax returns ($250,000, indexed to inflation after the second
year). Unlike other VCFs, AB 2371 would not establish an
administering agency to oversee allocation of funds.
3)Special Olympics. The author notes that the California Special
Olympics divided into two chapters in 1995, SONC and SOSC.
What started originally as a small grassroots organization has
since become a powerful voice for athletes with intellectual
disabilities. SONC and SOSC have provided athletic
opportunities to over 40,000 athletes throughout the state.
4)New VCF Bills in 2016. Four Assembly bills were introduced in
2016 that would either extend existing VCFs or create new
ones. In addition to AB 2497, those bills are:
a) AB 1789 (Santiago), also on today's Committee agenda,
extends the voluntary contribution for the School Supplies
for Homeless Children Fund.
b) AB 2430 (Beth Gaines), also on today's Committee agenda,
adds a voluntary contribution for the Type 1 Diabetes
Research Fund.
c) AB 2497 (Wagner), also on today's Committee agenda,
repeals the voluntary contribution for the California
Senior Legislature Fund and replaces it with a voluntary
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contribution for the California Senior Citizen Advocacy
Fund.
1)Amendments. Staff suggests amending the bill to assign an
administrating agency, whose administrative costs are capped
as a percentage of the Fund, to distribute the funds to the
different chapters of the Special Olympics. Typically, new
VCFs are given an administrative agency with issue are
expertise to oversee fund distribution.
Analysis Prepared by:Luke Reidenbach / APPR. / (916)
319-2081