BILL ANALYSIS
AB 137
Page 1
ASSEMBLY THIRD READING
AB 137 (Correa)
As Amended March 5, 2003
Majority vote
REVENUE & TAXATION 6-0 APPROPRIATIONS 25-0
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|Ayes:|Chavez, Wyland, Harman, |Ayes:|Steinberg, Bates, Berg, |
| |Laird, Leno, Simitian | |Calderon, Cohn, Corbett, |
| | | |Correa, Daucher, Diaz, |
| | | |Firebaugh, Goldberg, |
| | | |Haynes, Leno, Maldonado, |
| | | |Nation, Negrete McLeod, |
| | | |Nunez, Pacheco, Pavley, |
| | | |Ridley-Thomas, Runner, |
| | | |Samuelian, Laird, |
| | | |Wiggins, Yee |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Extends the sunset date on the California Fund for
Senior Citizens (Fund) tax checkoff to January 1, 2010, provided
the fund receives at least a specified, minimum level of
contributions annually. Specifically, this bill :
1)Extends the sunset date on the Fund checkoff from January 1,
2005 to January 1, 2010.
2)Retains the requirement that the Fund receive at least a
minimum amount in annual checkoff contributions in order to
appear on the income tax form in the subsequent year. This
minimum amount equaled $250,000 in 2001 and is indexed for
inflation in subsequent years.
EXISTING LAW allows taxpayers to contribute money to one or more
of 11 voluntary contribution funds by checking a box on their
state income tax return. California law requires contributions
made through checkoffs to be made from taxpayers' own resources
(not from their tax liability, as is possible on federal tax
returns). Checkoff amounts may be claimed as charitable
contributions on taxpayers' tax returns during the subsequent
year.
FISCAL EFFECT : The Franchise Tax Board (FTB) estimates that
AB 137
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extending this checkoff will result in annual revenue losses of
approximately $16,000 per year beginning in fiscal year 2006-07.
COMMENTS : This bill is sponsored by the California Senior
Legislature (CSL) and is intended to allow the Fund to remain on
the income tax form beyond the 2004 tax year. This income tax
checkoff fund provides the sole source of funding for CSL, and
this bill's author would like to provide that organization with
the assurance that their funding will continue beyond 2004.
The Fund checkoff first appeared on the income tax form in 1983.
From 1983 through 1999, the checkoff was not directly subject
to minimum contribution requirements; instead, the law specified
that minimum contribution requirements would be imposed if the
sunset date of the checkoff were eliminated.
AB 1697 (Alquist), Chapter 228, Statutes of 1999, extended the
checkoff's sunset date to January 1, 2004. However, in response
to concerns of FTB, both legislative tax policy committees, and
both legislative fiscal committees, that California's 540-Series
tax forms were in danger of expanding to three pages because of
a proliferation of income tax checkoffs, Assemblymember Alquist
agreed to impose minimum contribution requirements on the Fund
checkoff. 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.
Analysis Prepared by : Eileen Roush / REV. & TAX. / (916)
319-2098
FN: 0000365