BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 2371|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
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THIRD READING
Bill No: AB 2371
Author: Frazier (D)
Amended: 5/12/16 in Assembly
Vote: 21
SENATE GOVERNANCE & FIN. COMMITTEE: 6-0, 6/29/16
AYES: Hertzberg, Nguyen, Beall, Hernandez, Lara, Moorlach
NO VOTE RECORDED: Pavley
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/1/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
ASSEMBLY FLOOR: 75-0, 5/19/16 - See last page for vote
SUBJECT: Voluntary contributions: Special Olympics Fund
SOURCE: Author
DIGEST: This bill requires the addition of the Special
Olympics Fund (Fund) check-off to the personal income tax
return.
ANALYSIS:
Existing law:
1)Allows taxpayers to contribute money to voluntary contribution
funds (VCFs) by checking a box on their state income tax
returns. California law requires contributions made through
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so-called "check-offs" to be made from taxpayers' own
resources and not from their tax liability, as is possible on
federal tax returns.
2)Allows contribution amounts to be claimed as charitable
contributions on taxpayers' tax returns in the subsequent
year.
3)Requires that each VCF is individually added to the tax return
by legislation. With a few exceptions, VCFs remain on the
return until they are repealed by a sunset date or fail to
generate a minimum contribution amount. In general, the
minimum contribution amounts are adjusted annually for
inflation. For most VCFs, the minimum contribution amount is
$250,000, beginning in the fund's second year. The following
check-offs do not have a minimum contribution requirement:
a) California Firefighters' Memorial Foundation Fund,
b) California Peace Officer Memorial Foundation Fund, and
c) California Seniors Special Fund.
This bill:
1)Adds the Fund, and allows a taxpayer to make a voluntary
contribution to the Fund on the state personal income tax
return, beginning once an existing check-off for charitable
fund contribution has been removed, or as soon as space is
available.
2)Requires the Fund to meet a minimum contribution threshold of
$250,000 in the second calendar year the Fund appears on the
tax form, and the amount is indexed yearly for inflation.
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3)Provides that all money transferred to the Fund, upon
appropriation by the Legislature, be allocated as follows:
a) To the Franchise Tax Board (FTB) and the State
Controller for reimbursement of all costs incurred in
administering the VCF.
b) To the State Department of Developmental Services where
the balance shall be disbursed between the Special Olympics
Northern California (SONC) and Special Olympics Southern
California (SOSC) 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.
4)Prohibits funds to be used for administrative costs by SONC
and SOSC, and limits the State Department of Developmental
Services to 3% of the moneys allocated to it for
administrative costs.
5)Provides that the bill automatically sunsets on January 1 of
the fifth taxable year following the Fund's first appearance
on the personal income tax form.
Background
SONC and SOSC are chapters of Special Olympics, an organization
founded by Eunice Kennedy Shriver in 1968 that provides
year-round sports training and athletic competition for children
and adults with intellectual disabilities. The Special
Olympics' global reach is approximately 4.4 million athletes.
According to the proponents of this bill, SONC and SOSC serve
59,000 athlete families, receive assistance from over 45,000
volunteers and 18,000 law enforcement volunteers, and benefit
from 36,000 current donors. This wide base of support, coupled
with a big social media push during tax season if the voluntary
contribution designation is enacted, would help the Fund meet
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its minimum contribution requirement.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee:
FTB estimates that, beginning in 2017- 18, this bill would
result in an annual revenue loss of $8,000 (General Fund) for
every $250,000 contributed by itemizing taxpayers.
The State Controller's Office and FTB and would be reimbursed
for related administrative costs. Reimbursement to the
Department of Developmental Services would be limited to three
percent of moneys allocated to it.
SUPPORT: (Verified8/3/16)
Association of Regional Center Agencies
Special Olympics Northern California
Special Olympics Southern California
The Arc and United Cerebral Palsy California Collaboration
OPPOSITION: (Verified8/3/16)
California Department of Finance
ARGUMENTS IN SUPPORT: According to the author, "The Special
Olympics Northern California (SONC) and Southern California
(SOSC) provide athletic opportunities to children and adults
with intellectual disabilities, instilling the confidence they
need to succeed in life. Through the power of sports, people
with intellectual disabilities discover new strengths and
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abilities, skills and success. SONC and SOSC athletes find joy,
confidence and fulfillment - on the playing field and in life.
They also inspire people in their communities and elsewhere to
open their hearts to a wider world of human talents and
potential. 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 has
provided athletic opportunities to over 40,000 athletes
throughout the state. AB 2371 will allow individuals to make a
voluntary contribution in excess of their tax liability, if any,
to the Special Olympics Fund. Contributions to the Special
Olympics Fund shall be used to conduct activities of Special
Olympics Northern California and Special Olympics Southern
California."
ARGUMENTS IN OPPOSITION: Opponent argues that this bill is
of limited value and results in a loss to the General Fund.
Additionally, it is unclear why special preference should be
given to one organization over the countless others that are not
on the tax form.
ASSEMBLY FLOOR: 75-0, 5/19/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,
Calderon, Campos, Chau, Chávez, Chiu, Chu, Cooley, Cooper,
Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines,
Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,
Gomez, Gonzalez, Gray, Grove, Hadley, Harper, Roger Hernández,
Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine,
Linder, Lopez, Low, Maienschein, Mayes, Medina, Melendez,
Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson,
Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth,
Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk,
Wood, Rendon
NO VOTE RECORDED: Chang, Gordon, Mathis, McCarty, Williams
Prepared by:Myriam Bouaziz / GOV. & F. / (916) 651-4119
8/3/16 19:33:36
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