BILL ANALYSIS �
SB 1571
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Date of Hearing: July 2, 2012
ASSEMBLY COMMITTEE ON REVENUE AND TAXATION
Henry T. Perea, Chair
SB 1571 (DeSaulnier) - As Amended: May 25, 2012
Majority vote. Fiscal committee.
SENATE VOTE : 36-3
SUBJECT : Personal income taxes: voluntary contribution:
School Supplies for Homeless Children Fund
SUMMARY : Authorizes the addition of the School Supplies for
Homeless Children Fund (Fund) checkoff to the personal income
tax (PIT) form upon the removal of another voluntary
contribution fund (VCF) from the form. Specifically, this bill :
1)Provides that all money transferred to the Fund, upon
appropriation by the Legislature, shall be allocated as
follows:
a) To the Franchise Tax Board (FTB), the State Controller,
and the State Department of Education (CDE) for
reimbursement of all costs incurred in administering the
checkoff; and,
b) To the CDE, for distribution of grants to school
districts for the sole purpose of assisting pupils in
California under the federal McKinney-Vento Homeless
Assistance Act (42 U.S.C. Sec. 11301 et seq.) by providing
school supplies and health-related products to homeless
children.
2)Requires the CDE to develop a formal grant process that
includes application forms, deadlines, and audit procedures,
subject to the following requirements:
a) A grant shall be awarded in an amount of $5,000 or less,
on a first-come, first-serve basis; and,
b) Less than 2% of the grant award shall be spent for
administrative purposes.
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3)Allows a school district to provide school supplies and
health-related products to homeless children through the
services of a nonprofit 501(c)(3) organization if the
district's grant application specifies this purpose.
4)Specifies that the Fund provisions shall remain in effect only
until January 1 of the fifth taxable year following the Fund's
first appearance on the PIT return. However, if the FTB
determines that the amount of contributions estimated to be
received during a calendar year will not meet a minimum
contribution threshold, the provisions shall be inoperative
with respect to taxable years beginning on or after January 1
of that calendar year.
EXISTING LAW :
1)Allows taxpayers to designate on their PIT returns a
contribution to any of 18 VCFs.
2)Provides a specific sunset date for each VCF, except for the
California Seniors Special Fund.
3)Provides that each VCF must meet a minimum annual contribution
amount to remain in effect, except for the California Seniors
Special Fund, the California Firefighters' Memorial Fund, and
the California Peace Officer Memorial Foundation Fund.
FISCAL EFFECT : The FTB estimates annual revenue losses of
roughly $20,000 resulting from itemized deductions.
COMMENTS :
1)The author has provided the following statement in support of
this bill:
California has the nation's largest population of homeless
children. As of 2010, there were upwards of 300,000
homeless students attending California elementary, middle
and high schools. Among many other problems, homeless
students often lack basic school supplies like backpacks,
binders, and pencils or pens, as well as dental supplies
essential to good oral health. Consequently, homeless
children are at a critical disadvantage in school. These
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students consistently test well below average in math and
English, and only graduate from high school. While not
solving all of the problems that come with homelessness, SB
1571 will help to level the material playing field by
giving compassionate taxpayers the opportunity to cover the
costs of basic school supplies and health services for
homeless children.
2)Proponents state:
Homelessness has been a burden many of California's
children have faced. Unfortunately, the housing market
collapse has dramatically increased the number of homeless
families and children. In addition to suffering from
personal hardship, these children are also faced with going
to schools that have been decimated from budget cuts. As a
result, these children have been faced with greater need
and less supportive services, just when they need those
services most.
SB 1571 provides a ray of hope for these children by
providing taxpayers an opportunity to designate
contributions through their tax returns. These donations
will be used to provide homeless children with school
supplies and dental kits. This support will ensure that
children who have the most need will receive a supportive
hand to help them in their time of need.
3)Committee staff comments:
a) What would this bill do? : This bill would authorize the
addition of a new VCF to the PIT return. The CDE would use
Fund moneys to distribute grants to school districts for
the sole purpose of assisting California students under the
federal McKinney-Vento Homeless Assistance Act.
Specifically, Fund moneys would be used to provide school
supplies and "health-related products" to homeless
children.
b) So many causes, so little space : There are countless
worthy causes that would benefit from the inclusion of a
new VCF on the state's income tax returns. At the same
time, space on the return is limited. Thus, it could be
argued that the current system for adding VCFs to the form
is subjective and essentially rewards causes that can
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convince the Legislature to include their fund on the form.
c) Related legislation : Committee staff notes the
following related bills from the 2011-12 legislative
session:
i) AB 564 (Smyth), Chapter 549, Statutes of 2011,
reauthorized the addition of the Municipal Shelter
Spay-Neuter Fund checkoff to the PIT return upon the
removal of another VCF from the form.
ii) AB 764 (Swanson), Chapter 465, Statutes of 2011,
authorized the addition of the Child Victims of Human
Trafficking Fund checkoff to the PIT return upon the
removal of another VCF from the form.
iii) AB 971 (Monning), Chapter 209, Statutes of 2011,
reauthorized the addition of the California Sea Otter
Fund checkoff to the PIT form beginning with the 2011
return.
iv) SB 164 (Simitian), Chapter 699, Statutes of 2011,
extended, from January 1, 2013, to January 1, 2018, the
sunset date for two VCFs currently on the PIT return.
Specifically, SB 164 extended the VCF provisions for both
the State Children's Trust Fund and the Rare and
Endangered Species Preservation Program.
v) SB 583 (Vargas), Chapter 711, Statutes of 2011,
reauthorized the addition of the ALS/Lou Gehrig's Disease
Research Fund checkoff to the PIT return upon the removal
of another VCF from the form.
REGISTERED SUPPORT / OPPOSITION :
Support
California Teachers Association
Opposition
None on file
Analysis Prepared by : M. David Ruff / REV. & TAX. / (916)
319-2098
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