BILL ANALYSIS �
SB 1571
Page 1
Date of Hearing: August 8, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 1571 (DeSaulnier) - As Amended: May 25, 2012
Policy Committee: Revenue and
Taxation Vote: 6-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill authorizes the addition of the School Supplies for
Homeless Children Fund check-off 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 School Supplies for
Homeless Children Fund, upon appropriation by the Legislature,
shall be used for the following purposes:
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
check-off.,
b) To the CDE, for distribution of grants to school
districts for assisting pupils in California under the
federal McKinney-Vento Homeless Assistance Act 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 specified requirements.
3)Provides for the automatic repeal of the check-off on January
1 of the fifth taxable year following the fund's first
appearance on the PIT return or on an earlier date if the
check-off fails to meet a minimum contribution amount
initially set at $250,000 and adjusted for inflation annually
thereafter.
SB 1571
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FISCAL EFFECT
1)Based on past tax check-offs, annual revenues are expected to
be in the $300,000-$800,000 range, although some check-offs
have received less revenues.
2)FTB estimates this bill will cost the state about $20,000 per
year in lost revenues. This estimate assumes the check-off is
added in the 2012-13 fiscal year, donations meet the average
amount for the other tax check-offs and taxpayers deduct these
charitable donations. Revenue losses would be similar in
subsequent years.
3)The Department of Education estimates that it will cost
approximately $100,000-$150,000 to administer the program
established by this bill. The costs for FTB and the State
Controller are minor and absorbable.
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COMMENTS
1)Purpose. The author states that 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. The author notes, 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, leaving them
at a critical disadvantage in school. The author states these
students consistently test well below average in math and
English, and only 25% graduate from high school. The author
argues while it will not solve all of the problems that come
with homelessness, SB 1571 will help by giving compassionate
taxpayers the opportunity to cover the costs of basic school
supplies and health services for homeless children.
2)Voluntary Contribution Funds. California taxpayers can make
voluntary contributions to any of 15 funds listed on the state
PIT return. The contributions are in addition to tax
liabilities so they do not directly reduce the amount of state
taxes in that tax year. As charitable contributions, the
taxpayer may deduct the amount of the check-off on the
subsequent year's income tax return, reducing state tax
collections. These voluntary contributions support various
purposes, including cancer research, endangered species
preservation and emergency food assistance. Contributions
have historically ranged from $300,000 to $800,000 per year.
Except for the California Seniors Special Fund, all have
sunset dates, and most must meet a minimum annual contribution
to remain on the return.
3)Related legislation . SB 803 (DeSaulnier) establishes the
California Youth Leadership Project (Project) under the State
Department of Education (CDE) to promote youth civic
engagement and authorizes the addition of the California Youth
Leadership Fund (Fund) check-off to the PIT form.
4)Previous legislation . The following bills PIT check-offs were
introduced in 2011.
a) AB 233 (Hall), authorizes the addition of the California
YMCA Youth and Government Fund check-off to the PIT form
upon the removal of another VCF from the form. This bill
is in the Senate Appropriations Committee.
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b) AB 564 (Smyth), Chapter 549, Statutes of 2011,
reauthorized the addition of the Municipal Shelter
Spay-Neuter Fund check-off to the PIT return upon the
removal of another VCF from the form.
c) AB 764 (Swanson), Chapter 465, Statutes of 2011,
authorized the addition of the Child Victims of Human
Trafficking Fund check-off to the PIT return upon the
removal of another VCF from the form.
d) AB 971 (Monning), Chapter 209, Statutes of 2011,
reauthorized the addition of the California Sea Otter Fund
check-off to the PIT form beginning with the 2011 return.
e) 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 the
State Children's Trust Fund and the Rare and Endangered
Species Preservation Program.
f) SB 583 (Vargas), Chapter 711, Statutes of 2011,
reauthorized the addition of the ALS/Lou Gehrig's Disease
Research Fund check-off to the PIT return upon the removal
of another VCF from the form.
Analysis Prepared by : Roger Dunstan / APPR. / (916) 319-2081