BILL ANALYSIS
AB 137
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Date of Hearing: April 2, 2003
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Darrell Steinberg, Chair
AB 137 (Correa) - As Amended: March 5, 2003
Policy Committee: Revenue and
Taxation Vote: 6-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill extends the sunset date on the California Fund for
Senior Citizens income tax checkoff for five years, from January
1, 2005 to January 1, 2010. The bill retains the requirement
that the checkoff receive at least a specified, minimum level of
contributions annually in order to appear on the tax form.
FISCAL EFFECT
The Franchise Tax Board (FTB) estimates that extending this
checkoff will result in annual revenue losses of approximately
$16,000 per year beginning in the 2005-06 fiscal year, resulting
from itemized deduction for the contributions.
COMMENTS
1)Background . The California Fund for Senior Citizens checkoff
first appeared on the income tax form in 1983. In 1999, AB
1697 (Alquist), Chapter 228, Statutes of 1999, extended the
checkoff's sunset date to January 1, 2004. To address the
concern that the proliferation of income tax checkoffs would
require California's 540-Series tax forms to be expanded from
two to three pages, at a cost to the state of several million
dollars annually, this bill incorporated minimum contribution
requirements. Under the provisions of AB 1697, this checkoff
was required to receive at least $250,000 in contributions on
the 2001 tax form and an equivalent amount ($250,000 indexed
for inflation) in subsequent years. The indexed amount is
expected to equal approximately $262,000 in the 2002 tax year.
AB 137
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2)Purpose . This bill is sponsored by the California Senior
Legislature, which receives the funds generated by the
checkoff. Although the original version of the bill deleted
the sunset date and eliminated the minimum contribution
requirement, the author amended the bill at the request of the
Assembly Revenue and Taxation Committee to extend, rather than
delete the sunset date, and to maintain the minimum
contribution requirement. Data from the Franchise Tax Board
indicates that the Fund for Senior Citizens checkoff is likely
to meet the minimum contribution requirement for the 2002 tax
year.
Analysis Prepared by : Stephen Shea / APPR. / (916) 319-2081