BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 563
                                                                  Page  1

          Date of Hearing:   April 29, 2009

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Kevin De Leon, Chair

                     AB 563 (Cook) - As Amended:  April 2, 2009 

          Policy Committee:                              Revenue and  
          Taxation     Vote:                            9-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:

           SUMMARY 

          This bill makes largely technical changes to how the personal  
          income tax checkoff contributions to the   California Military  
          Family Relief Fund (Fund) are allocated to members of the active  
          and reserve members of the Armed Forces. Specifically, the bill:

          1)Requires that funds currently allocated to the Military  
            Department for the establishment of financial aid grants,  
            shall instead be allocated, for the same purposes, to the  
            California National Guard for distribution to a nonprofit  
            organization that the Guard selects (Selected Nonprofit).

          2)Provides that the non-profit organization selected by the  
            Guard shall establish grant eligibility criteria.  

           FISCAL EFFECT  

          Negligible GF impact.

           COMMENTS  

           1)Rationale  . Last year, AB 3016, (Cook), Statutes of 2008,  
            expanded eligibility of contributions to the California  
            Military Family Relief Fund to reserve members of the United  
            States Armed Forces.  Prior to AB 3016, grants were restricted  
            to members of the National Guard.  The author states this bill  
            is needed to resolve concerns that the grant program, as set  
            up by AB 3016, may unintentionally violate the Department of  
            Defense's Joint Ethics Regulations.  Specifically, there is  
            concern that a grant provided to a non-Guard reserve member  
            might be construed as a "gift" between two branches of the  








                                                                  AB 563
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            military in violation of the Joint Ethics Regulations. This  
            bill seeks to deal with this concern by having a nonprofit  
            make the grants to active and reserve members.

           2)Amendments  . The author has agreed to take technical amendments  
            in committee which would (a) require the Military Department  
            rather than the National Guard to be the entity initially  
            receiving the contributions, (b) have the department, rather  
            than the non-profit it selects, establish grant eligibility  
            criteria, and (c) make other non-substantive changes. 
           
           Analysis Prepared by  :    Brad Williams / APPR. / (916) 319-2081