BILL ANALYSIS
AB 1508
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Date of Hearing: May 28, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1508 (Torrico) - As Amended: May 20, 2009
Policy Committee: Revenue and
Taxation Vote: 9-0
Education 9-1
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill authorizes, for tax years 2010 through 2012,
businesses to take a credit equal to 25% of the amount of
qualified expenses incurred in lending its employee to a public
school to assist in the teaching of mathematics or science.
Specifically, the bill:
1)Specifies that the credit is available only for qualified
expenses incurred with teaching math or science in a "Title I
public school", which is defined as a high school in a
district in which at least 40% of the students enrolled are
from low-income families eligible to receive federal Title I
funds.
2)Defines qualified expenses to include expenses paid by the
taxpayer for teaching supplies, class materials, and equipment
associated with the teaching of math and science in Title I
public schools, and for wages paid by the employer for time
spent by the employee in a Title I public school.
3)Requires the Legislative Analyst's Office to submit a report
to the Legislature evaluating the tax credit established
pursuant to this section.
FISCAL EFFECT
1)FTB estimates that this bill will result in annual revenue
losses of $30,000 in 2009-10 (partial year) and full year
losses of about $100,000 in 2010-11 and $150,000 in 2011-12.
AB 1508
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2)These estimates assume that the salaries paid to the employees
loaned to the schools are the same as a median high school
teacher. However, to the extent that private industry salaries
in the math and science fields are higher, the amount of
credits (which are tied to the wages paid by the employer to
its loaned employees) could exceed these estimates by a
considerable amount.
3)LAO would incur an unknown, probably minor cost for
preparation of the report.
COMMENTS
1)Rationale . According to the author California is facing a
serious shortage in the workforce, especially in the areas
involving math and science. The bill is intended to address
the high-tech industry industry's need for a well-educated
workforce skilled in mathematical and scientific theory and
applications.
2)Opponents (California Tax Reform Association) question whether
the proposed tax credit would make a difference in the
employer's decision to pay for, and loan, an employee to
schools.
Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081