BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 1416|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
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UNFINISHED BUSINESS
Bill No: SB 1416
Author: Stone (R), et al.
Amended: 6/15/16
Vote: 21
SENATE GOVERNANCE & FIN. COMMITTEE: 7-0, 4/20/16
AYES: Hertzberg, Nguyen, Beall, Hernandez, Lara, Moorlach,
Pavley
SENATE APPROPRIATIONS COMMITTEE: 6-0, 5/9/16
AYES: Lara, Beall, Hill, McGuire, Mendoza, Nielsen
NO VOTE RECORDED: Bates
SENATE FLOOR: 37-0, 5/27/16
AYES: Allen, Anderson, Bates, Beall, Block, Cannella, De León,
Fuller, Gaines, Galgiani, Glazer, Hall, Hancock, Hernandez,
Hertzberg, Hill, Hueso, Huff, Jackson, Leno, Leyva, Liu,
McGuire, Mendoza, Mitchell, Monning, Moorlach, Morrell,
Nguyen, Nielsen, Pan, Pavley, Roth, Stone, Vidak, Wieckowski,
Wolk
NO VOTE RECORDED: Berryhill, Lara, Runner
ASSEMBLY FLOOR: 78-0, 8/11/16 (Consent) - See last page for
vote
SUBJECT: Voluntary contribution: Revive the Salton Sea Fund
SOURCE: Author
DIGEST: This bill authorizes the addition of the Revive the
Salton Sea Fund as a voluntary contribution fund on the personal
income tax return.
SB 1416
Page 2
Assembly Amendments require a competitive grant process to
distribute funds and provide that funds cannot be used for
administrative costs.
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
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return until they are repealed by a sunset date or fail to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.
SB 1416
Page 3
This bill:
1)Adds the Revive the Salton Sea Fund (Fund), and allows a
taxpayer to make a voluntary contribution to the Fund on the
state personal income tax return.
2)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 Natural Resources Agency for distribution of
competitive grants to provide funds or supplement funding
of state, county and local agencies, nonprofit
organizations, and projects identified as necessary for the
restoration and maintenance of the Salton Sea, including
projects identified by the Salton Sea Authority.
c) Up to five percent of the funds to the Natural Resources
Agency for development of a mechanism to provide ongoing
public awareness through activities that will promote the
charitable tax deduction for the Fund and seek continued
contributions. These activities may include convening a
philanthropic roundtable, developing literature for use by
city, county, or local agencies and programs, and whatever
other activities are deemed necessary and appropriate to
promote the fund.
3)Provides that specified Fund moneys shall not be used for
administrative costs.
SB 1416
Page 4
4)Provides that money in the Fund shall not be used to supplant
state General Fund money for any purpose.
5)Requires the Fund to meet a standard minimum contribution
amount of $250,000 indexed for inflation in subsequent years.
6)Provides that the Fund's statutory provisions shall remain
operative only until January 1 of the fifth taxable year
following the Fund's first appearance on the personal income
tax return.
Background
When a taxpayer contributes to VCFs, the FTB deposits the total
of all contributions, less an administrative fee, into the fund
created as part of the VCF's legislative authorization. For
some VCFs, such as the Protect Our Coast and Ocean Fund,
taxpayers' contributions are allocated to a state agency for use
in a state administered grant program. Other VCFs' authorizing
statutes direct administrative agencies to allocate donations to
a private organization. For example, the Office of Emergency
Services passes VCF funds to the American Red Cross. Other
funds require the State Controller to send the funds directly to
private organizations without passing through an administrative
agency, such as the California Fire Foundation. The State
Controller and administrative agencies may deduct
administrations fees from the amount of donations each VCF
receives.
There are currently 19 check-offs listed on the tax return form.
The tax check-off program typically collects $4-5 million in
annual contributions for all VCFs.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
SB 1416
Page 5
According to the Assembly Appropriations Committee, this bill
results in minor ongoing General Fund revenue losses of
approximately $8,000 per year resulting from itemized taxpayer
deductions.
SUPPORT: (Verified8/12/16)
None received
OPPOSITION: (Verified8/12/16)
Department of Finance
ARGUMENTS IN SUPPORT: According to the author, "One of the
most critical issues facing residents of Southern California and
the 28th Senate District is the restoration of the Salton Sea.
In May of 2015, Governor Brown created the Salton Sea Task Force
to begin the important work of implementing the Salton Sea
management plan, and create short and long term goals protect
the regional air quality and the natural resources at the Sea.
SB 1416 is designed to complement the on-going work of the Task
Force by creating the Revive the Salton Sea Fund, which would be
a tax check-off fund found on one's State Income Tax Form. The
money collected from the check-off would be used to help fund
the restoration and maintenance of the Salton Sea, and provide
public awareness."
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.
SB 1416
Page 6
ASSEMBLY FLOOR: 78-0, 8/11/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,
Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley,
Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth
Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto,
Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper,
Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine,
Linder, Lopez, Maienschein, Mathis, Mayes, McCarty, Medina,
Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen,
Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago,
Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber,
Wilk, Williams, Wood, Rendon
NO VOTE RECORDED: Roger Hernández, Low
Prepared by:Myriam Bouaziz / GOV. & F. / (916) 651-4119
8/12/16 13:23:55
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