BILL ANALYSIS Ó
AB 2430
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Date of Hearing: May 11, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2430 (Beth Gaines) - As Amended April 27, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill authorizes the addition of the Type 1 Diabetes
Research Fund (Fund) checkoff to the personal income tax return
upon the removal of another voluntary contribution fund (VCF)
from the return, or as soon as space is available. Specifically,
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this bill:
1)Requires that all money transferred to the Fund, upon
appropriation by the Legislature, will be allocated as
follows:
a) To the Franchise Tax Board (FTB) and the State
Controller for reimbursement of all costs incurred in
administering the Fund; and,
b) To the University of California (UC) for distribution of
grants to authorized diabetes research organizations. Both
the UC and the authorized research organizations may also
use up to 5% of the grant moneys for administrative cost.
2)Defines an "authorized diabetes research organization" as a
California-based university, with a research program or a
nonprofit charitable organization that engages in research.
3)Defines "research" to include expenditures to develop and
advance the understanding, techniques, and modalities
effective in the cure, screening, and treatment of type 1
diabetes.
4)Requires the Fund to meet a standard minimum contribution
requirement of $250,000 in its second year. Thereafter, the
minimum contribution amount will be indexed for inflation.
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5)Sunsets the Fund on the fifth taxable year following the
Fund's appearance on tax returns.
FISCAL EFFECT:
1)Minor ongoing GF revenue losses of up to $15,000 per year
resulting from itemized taxpayer deductions.
2)Minor and absorbable administrative costs for the FTB or UC,
the administering agency responsible for the Fund.
COMMENTS:
1)Purpose. According to the author, AB 2430 would allow
taxpayers to donate directly to an organization such as the
Juvenile Diabetes research Foundation (JDRF), who is the
leading global organization funding Type 1 diabetes research.
The author notes that California has the lowest per capita
funding for diabetes prevention in the nation.
2)Background. Current state tax law allows taxpayers to make
contributions on their tax returns to a number of VCFs. Like
many other VCFs, AB 2430 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). Moreover, AB 2430 would establish an administrating
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agency: The money deposited into the Fund are allocated to the
University of California for distribution of grants to
authorized research organizations.
3)JDRF. According to the nonprofit tracking organization Guide
Star, JDRF currently sponsors $568 million in scientific
research in 17 countries. In 2012, JDRF provided more than
$110 million in research. AB 2430 does not require funds to go
to JDRF, and the author's office notes that JDRF is one
example of an organization that does critical research on Type
1 diabetes.
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 2430, 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 2497 (Wagner), also on today's Committee agenda,
repeals the voluntary contribution for the California
Senior Legislature Fund and replaces it with a voluntary
contribution for the California Senior Citizen Advocacy
Fund.
c) AB 2371 (Frazier), also on today's Committee agenda,
adds a voluntary contribution for the Special Olympics
Fund.
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Analysis Prepared by:Luke Reidenbach / APPR. / (916)
319-2081