BILL NUMBER: SB 1160	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  AUGUST 2, 2010
	AMENDED IN SENATE  JUNE 2, 2010
	AMENDED IN SENATE  APRIL 5, 2010

INTRODUCED BY   Senator Dutton

                        FEBRUARY 18, 2010

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


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1160, as amended, Dutton. State fiscal analysis.
   Existing law requires the Legislative Analyst and the Department
of Finance to provide the Legislature with specified fiscal analyses
of matters affecting state finances, including the annual state
budget.
   This bill would require the Legislative Analyst and the
department, to the extent that any fiscal estimate of the annual
state budget involves a change in state tax law, to estimate, except
as specified, the statewide economic impact of the change, using a
dynamic economic analysis that includes probable behavioral responses
of taxpayers, businesses, and other residents of the state, and the
impact of the change on state spending reductions  ,
including reductions in education spending  .
   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.  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, including, but not limited
to, new taxes, tax rate changes, new credits, deductions, exclusions,
or exemptions, or changes to credits, deductions, exclusions, or
exemptions, the Legislative Analyst shall estimate the statewide
economic impact of the change or changes, using dynamic economic
analysis that takes into account probable behavioral responses of
taxpayers, businesses, and other residents of the state  ,
except where it is unreasonable to do so  . The Legislative
Analyst shall also estimate the economic impact of the state spending
reductions that would be necessitated by the proposed state tax
reduction, in accordance with the constitutional requirement that the
state enact a balanced budget each year.  The Legislative
Analyst's estimate of the economic impact of spending reductions
shall identify the reductions in state education spending required by
the tax reduction proposal, and the long-term effect of reduced
education spending on the growth of the state domestic product.
 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  , except where the Legislative Analyst has
determined and reported to the legislature findings to support that
it is unreasonable to do so  .
  SEC. 2.  Section 13305.5 is added to the Government Code, to read:
   13305.5.  To the extent that any fiscal estimate prepared by the
Department of Finance regarding the annual state budget involves one
or more proposed changes in state tax law, including, but not limited
to, new taxes, tax rate changes, new credits, deductions,
exclusions, or exemptions, or changes to credits, deductions,
exclusions, or exemptions, the department shall estimate the
statewide economic impact of the change or changes, using dynamic
economic analysis that takes into account probable behavioral
responses of taxpayers, businesses, and other residents of the state
 , except where it is unreasonable to do so  . The
department shall also estimate the economic impact of the state
spending reductions that would be necessitated by the proposed state
tax reduction, in accordance with the constitutional requirement that
the state enact a balanced budget each year.  The department'
s estimate of the economic impact of spending reductions shall
identify the reductions in state education spending required by the
tax reduction proposal, and the long-term effect of reduced education
spending on the growth of the state domestic product.  The
requirement set forth in this section applies only to a proposed
change in state tax law determined by the department, 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  , except
where the department has determined and reported to the Legislature
findings to support that it is unreasonable to do so  .