BILL ANALYSIS
SJR 2
Page 1
Date of Hearing: July 1, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
SJR 2 (Liu) - As Introduced: February 25, 2009
Policy Committee: Higher
EducationVote:9-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This resolution calls for the state to adopt a higher education
tax credit-similar to the federal American Opportunity Tax
Credit-once the state's economic conditions improve.
The resolution also makes several findings regarding the high
cost of textbooks and the resulting burden on students.
FISCAL EFFECT
The revenue loss from a new tax credit would depend on the
parameters of that credit, but given the state's significant
student enrollment, the revenue loss could likely be in the tens
of millions on dollars. (For example, if 100,000 students took
advantage of a $500 credit, the revenue loss would be $50
million.)
COMMENTS
1)Background . The Federal American Opportunity Tax Credit,
which was part of the American Recovery and Reinvestment Act
of 2009, modifies the existing Hope Credit, for tax years 2009
and 2010, to encompass a broader range of taxpayers, including
many with higher incomes and those who owe no tax. It also
expands the list of qualifying expenses to include required
course materials, such as textbooks, and allows the credit to
be claimed for four postsecondary education years instead of
two. The full credit of $2,500 is available to individuals
with income of $80,000 or less or married couples with incomes
of $160,000 or less.
SJR 2
Page 2
2)Purpose . According to the author, a recent California State
Auditor report showed that textbook price increases have
significantly outpaced growth in median household income and
have become a financial burden for many students. The author
believes that providing a means to lessen the impact of
soaring college education costs on students and their families
through a state tax credit will improve college access and
affordability.
3)Related Legislation . SB 48 (Alquist), pending in the Assembly
Higher Education Committee, requires any person or firm
offering textbooks for sale at the University of California,
the California State University, or the California Community
Colleges (CCC), to make them available for sale in an
electronic format by January 1, 2020.
AB 317 (Solorio), also pending in Assembly Higher Education,
requires campus bookstores and any person choosing course
materials at a public postsecondary education institution to
post in the bookstore or on the bookstore website, and in any
course material documents, the open textbook website address
www.collegeopentextbooks.org.
4)Prior Legislation . AB 2261 (Ruskin)/Chapter 671 of 2008,
authorized the CCC Board of Governors to use existing
resources to establish a pilot program to provide resources
for faculty and staff to establish open education resource
centers.
AB 1548 (Solorio)/Chapter 574 of 2007, established the
Transparency in College Textbook Publishing Practices Act.
AB 2477 (Liu)/Chapter 556 of 2004, requested textbook
publishers to take specified actions to reduce the cost of
college textbooks.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081