BILL NUMBER: SB 1160	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Dutton

                        FEBRUARY 18, 2010

   An act to amend Section 11346.3 of, and to add Sections 9143.5 and
13305.5 to, the Government Code, relating to state fiscal analysis.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1160, as introduced, Dutton. State fiscal analysis.
   (1) Existing law requires the Legislative Analyst, operating under
the authority of the Joint Legislative Budget Committee, to provide
the Legislature with specified fiscal analyses of matters affecting
state finances.
   This bill would require the Legislative Analyst, to the extent
that any fiscal estimate of the annual state budget involves one or
more proposed changes in state tax law having a designated fiscal
impact, to prepare the estimate, except as specified, on the basis of
assumptions that estimate the probable behavioral responses of
taxpayers and others to the proposed changes, and to include in the
fiscal estimate a statement identifying those assumptions.
   (2) Existing law requires a state agency proposing to adopt,
amend, or repeal any administrative regulation to assess the effect
of the proposed regulation on jobs and businesses within the state.
   This bill would require the assessment to be performed using a
dynamic revenue analysis technique.
   (3) Existing law requires the Department of Finance to perform
various duties pertaining to the preparation and analysis of the
annual state budget, and the fiscal analysis of legislative proposals
before the Legislature.
   This bill would require the Department of Finance, to the extent
that any fiscal impact estimate involves one or more proposed changes
in state tax law having a designated fiscal impact, to prepare the
estimate, except as specified, on the basis of assumptions that
estimate the probable behavioral responses of taxpayers and others to
the proposed changes, and to include in the fiscal estimate a
statement identifying those assumptions.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  It is the intent of the Legislature to ensure that, to
the extent reasonable, dynamic estimating techniques are used in
predicting the fiscal impact of proposals to enact laws and
promulgate regulations.
  SEC. 2.  Section 9143.5 is added to the Government Code, to read:
   9143.5.  To the extent that any fiscal estimate prepared by the
Legislative Analyst regarding the annual state budget involves one or
more proposed changes in state tax law, the Legislative Analyst
shall prepare the estimate, except where it is unreasonable to do so,
on the basis of assumptions that estimate the probable behavioral
responses of taxpayers, businesses, and other citizens to those
proposed changes, and shall include in the fiscal estimate a
statement identifying those assumptions. The requirement set forth in
this section applies only to a proposed change in state tax law
determined by the Legislative Analyst, pursuant to a static fiscal
estimate, to have a fiscal impact in excess of ten million dollars
($10,000,000) in any one fiscal year.
  SEC. 3.  Section 11346.3 of the Government Code is amended to read:

   11346.3.  (a) State agencies proposing to adopt, amend, or repeal
any administrative regulation shall assess the potential for adverse
economic impact on California business enterprises and individuals,
avoiding the imposition of unnecessary or unreasonable regulations or
reporting, recordkeeping, or compliance requirements. For purposes
of this subdivision, assessing the potential for adverse economic
impact shall require agencies, when proposing to adopt, amend, or
repeal a regulation, to adhere to the following requirements, to the
extent that these requirements do not conflict with other state or
federal laws:
   (1) The proposed adoption, amendment, or repeal of a regulation
shall be based on adequate information concerning the need for, and
consequences of, proposed governmental action.
   (2) The state agency, prior to submitting a proposal to adopt,
amend, or repeal a regulation to the office, shall consider the
proposal's impact on business, with consideration of industries
affected including the ability of California businesses to compete
with businesses in other states. For purposes of evaluating the
impact on the ability of California businesses to compete with
businesses in other states, an agency shall consider, but not be
limited to, information supplied by interested parties.
   It is not the intent of this section to impose additional criteria
on agencies, above that which exists in current law, in assessing
adverse economic impact on California business enterprises, but only
to assure that the assessment is made early in the process of
initiation and development of a proposed adoption, amendment, or
repeal of a regulation.
   (b) (1) All state agencies proposing to adopt, amend, or repeal
any administrative regulations shall assess  , by using a dynamic
revenue analysis,  whether and to what extent it will affect
the following:
   (A) The creation or elimination of jobs within the State of
California.
   (B) The creation of new businesses or the elimination of existing
businesses within the State of California.
   (C) The expansion of businesses currently doing business within
the State of California.
   (2) This subdivision does not apply to the University of
California, the Hastings College of the Law, or the Fair Political
Practices Commission.
   (3) Information required from state agencies for the purpose of
completing the assessment may come from existing state publications.
   (c) No administrative regulation adopted on or after January 1,
1993, that requires a report shall apply to businesses, unless the
state agency adopting the regulation makes a finding that it is
necessary for the health, safety, or welfare of the people of the
state that the regulation apply to businesses.
  SEC. 4.  Section 13305.5 is added to the Government Code, to read:
   13305.5.  To the extent that any fiscal impact estimate prepared
by the Department of Finance involves one or more proposed changes in
state tax law, the department shall prepare the estimate, except
where it is unreasonable to do so, on the basis of assumptions that
estimate the probable behavioral responses of taxpayers, businesses,
and other citizens to those proposed changes, and shall include in
the fiscal impact estimate a statement identifying those assumptions.
The requirement set forth in this section shall apply only to a
proposed change in state tax law determined by the Department of
Finance, pursuant to a static fiscal estimate, to have a fiscal
impact in excess of ten million dollars ($10,000,000) in any one
fiscal year.