BILL ANALYSIS
AB 2457
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Date of Hearing: April 28, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2457 (Salas) - As Introduced: February 19, 2010
Policy Committee: Banking and
Finance Vote: 11-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill permits the state controller to accept private
donations to fund efforts to enhance financial literacy.
Specifically, the bill:
1)Establishes the California financial literacy fund in the
state treasury.
2)States that the purpose of the fund is to enable partnerships
with the financial services community and governmental and
nongovernmental stakeholders to improve California's financial
literacy, to enable the controller to develop and share
financial literacy materials, and to connect resources no
organized in a systematic manner.
3)Authorizes the controller to deposit into the fund donations
from entities with no direct financial interest in any
financial products.
4)Requires money deposited into the fund to be made available
upon appropriation in the annual Budget Act.
5)Requires the controller, beginning in 2012, to report to the
specified committees of the Legislature annually on or before
August 30 on the implementation on the initiative and any
recommendations to enhance financial literacy in California.
FISCAL EFFECT
Unknown staffing costs, potentially in excess of $150,000 (GF),
AB 2457
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to the controller to administer the new initiative and prepare
annual reports.
COMMENTS
1)Rationale. The bill is intended to deal with financial
illiteracy, which the author asserts is a growing problem in
California.. The author asserts that the creation of a
financial literacy fund would provide a central funding source
for organizations to partner with California on financial
literacy efforts.
According to the sponsor, the California State Controller,
"This bill would express the state's financial interest in
reducing unmanageable credit card debt, bankruptcy, and
predatory lending misfortunes like those that contributed to
the current economic meltdown.
2)Key issue. While financial literacy is a worthwhile goal, the
bill raises the question of whether it is appropriate for the
controller's office to be launching a new initiative during
the current austere budget period.
3)Recent legislation. This bill is similar to AB 550 (Lieu) of
2009, which was held under submission by this committee.
Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081