BILL ANALYSIS �
AB 140
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Date of Hearing: May 27, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 140 (Fuentes) - As Amended: April 6, 2011
Policy Committee:
AppropriationsVote:
Urgency: Yes State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill appropriates $232,000 (GF) to the Department of
Justice (DOJ) to pay settlements in Shaw v Chang ($167,000) and
Lord, et al. v Schwarzenegger, et al. ($65,000). Any funds
appropriated in excess of the amount required for the payment of
these claims shall revert to the GF.
FISCAL EFFECT
This bill appropriates $232,000 (GF) to pay for two settlements,
and specifies that any funds appropriated in excess of the
amount required will revert to the GF.
COMMENT.
1)Rationale. This bill is one of two annual bills carried by the
Appropriations chairs to provide appropriation authority for
state judgments and settlements approved by the DOJ and the
Department of Finance.
2)Case background .
a) Shaw v Chang involves appropriations of gasoline sales
tax revenue known as spillover revenue. Historically,
spillover was transferred from the Retail Sales Tax Fund to
the Public Transportation Account, a trust fund that by
statutory initiative is dedicated to "transportation
planning and mass transportation purposes." (Pub. Util.
Code, � 99310.5.)
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Beginning in 2001, and continuing each year thereafter,
however, the Legislature has amended Revenue and Taxation
Code section 7102(a)(1) to instead transfer all or part of
these spillover revenues to funds other than the Public
Transportation Account so they could be used for other
purposes. The Court of Appeal concluded this practice was
illegal and invalidated related appropriations. The trial
court found that California Transit Association was
entitled to $146,977, plus interest, for fees and costs.
b) Lord, et al. v Schwarzenegger, et al. involves a
constitutional challenge to AB 12 (a budget trailer bill
from July 2009) for violation of the single-subject and
title clauses of Article IV, Section 9 of the California
Constitution. Plaintiffs prevailed, and a judgment was
issued declaring that Section 12 of AB 12, which amended
Government Code sections 22877 to eliminate the Rural
Healthcare Equity Program for qualifying state employees,
was stricken from law. After judgment, plaintiffs moved
for attorney's fees, arguing that the litigation conferred
a significant benefit on the public, there was necessity
for private enforcement of the constitutional provision,
and the advancement of the public benefit was not
coincidental to the attainment of any personal goals and
was not self-serving. Plaintiffs demanded approximately
$90,000.00. The matter was settled for $64,583.
3)Related Legislation . SB 206 (Kehoe), which also appropriates
funds for state settlements, is pending in the Senate.
AB 1714 (Fuentes), chaptered 2010, and SB 911 (Kehoe),
chaptered 2010, appropriated funds for state settlements last
year.
Analysis Prepared by : Geoff Long / APPR. / (916) 319-2081
AB 140
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