Amended in Assembly June 10, 2014

Amended in Senate January 17, 2014

Amended in Senate January 6, 2014

Amended in Senate May 24, 2013

Senate Bill No. 761

Introduced by Senator DeSaulnier

February 22, 2013

An act to amend begin delete Section end delete begin insert Sections end insert 18897 begin insert and 18898 end insert of the Revenue and Taxation Code, relating to taxation.

LEGISLATIVE COUNSEL’S DIGEST

SB 761, as amended, DeSaulnier. Personal income taxes: voluntary contributions: School Supplies for Homeless Children Fund.

The Personal Income Tax Law authorizes an individual to contribute amounts in excess of his or her tax liability for the support of specified funds, including the School Supplies for Homeless Children Fund. Existing law requires the moneys deposited in the School Supplies for Homeless Children Fund to be allocated, upon appropriation by the Legislature, to the State Department of Education for the sole purpose of assisting pupils in California pursuant to the federal McKinney-Vento Homeless Assistance Act by providing school supplies and health-related products to homeless children through competitive grant programs, as provided.

This bill would instead require the same moneys, upon appropriation by the Legislature, to be allocated to the State Department of begin delete Education end delete begin insert Social Services end insert for distribution to a nonprofit organization, exempt from taxation, for the sole purpose of assisting pupils in California pursuant to the federal McKinney-Vento Homeless Assistance Act by providing grants of school supplies and health-related products to partnering begin delete learning end delete begin insert local end insert education agencies, as provided.

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 18897 of the Revenue and Taxation Code
is amended to read:

18897.  

All moneys transferred to the School Supplies for
Homeless Children Fund, upon appropriation by the Legislature,
shall be allocated as follows:

(a) To the Franchise Tax Board and the Controller for
reimbursement of all costs incurred by the Franchise Tax begin delete Board
and the Controller end delete begin insert Board, the Controller, and the State Department
of Social Services end insert in connection with their duties under this article.

(b) To the State Department of begin delete Education end delete begin insert Social Services end insert as
follows:

(1) (A) For distribution to a nonprofit organization exempt from
federal income tax as an organization described in Section
501(c)(3) of the Internal Revenue Code for the sole purpose of
assisting pupils in California pursuant to the federal
McKinney-Vento Homeless Assistance Act (42 U.S.C. Sec. 11301
et seq.) by providing school supplies and health-related products
to partnering begin delete learning end delete begin insert local end insert education agencies for distribution to
homeless children, as defined by the federal McKinney-Vento
Homeless Assistance Act (42 U.S.C. Sec. begin delete 11301 et seq.) end delete begin insert 11434a) end insert .
The nonprofit organization shall provide a minimum 100 percent
match for all funds received from the School Supplies for Homeless
Children Fund. The State Department of begin delete Education end delete begin insert Social Services end insert
shall enter into a begin delete memorandum of understanding with the end delete
begin insert subvention services agreement with a end insert nonprofit organization.

(B) The State Department of begin delete Education’s end delete begin insert Social Services end insert begin insert ’ end insert first
designation of a nonprofit organization shall be valid until January
1, 2017. On that date, and every three calendar years thereafter,
while this section is operative and in effect, the State Department
of begin delete Education end delete begin insert Social Services end insert shall designate the same or a different
nonprofit organization pursuant to this section. The State
Department of begin delete Education end delete begin insert Social Services end insert may revoke the
designation should the nonprofit organization fail to comply with
the provisions of this article. If a designation is revoked, the State
Department of begin delete Education end delete begin insert Social Services end insert shall designate a new
nonprofit organization within three calendar months.

(C) Funds shall be distributed by the State Department of
begin delete Education end delete begin insert Social Services end insert only after evidence is presented to the
State Department of begin delete Education end delete begin insert Social Services end insert that demonstrates
that the begin delete learning end delete begin insert local end insert education agencies or domestic violence
shelters have received the materials.

(2) For reimbursement of all costs incurred by the State
Department of begin delete Education end delete begin insert Social Services end insert in connection with
verifying that the designated nonprofit organization procured
school supplies and health-related products and provided matching
funds begin insert or in-kind materials as described in this section end insert .

(c) (1) Funds distributed to the nonprofit organization pursuant
to this section shall be used only for costs incurred to procure,
assemble, and ship school supplies and health-related products.
Funds made available pursuant to this section shall not be used for
administrative purposes, to reimburse costs associated with
administering grants of school supplies and health-related products
to begin delete learning end delete begin insert local end insert education agencies or domestic violence shelters,
or for any purpose relating to the operation of the nonprofit
organization.

(2) The nonprofit organization may provide school supplies and
health-related products to children living in domestic violence
shelters.

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 18898 of the end insert begin insert Revenue and Taxation Code end insert begin insert is
amended to read: end insert

18898.  

(a) Except as otherwise provided in subdivision (b),
this article shall remain in effect only until January 1 of the fifth
taxable year following the first appearance of the School Supplies
for Homeless Children Fund on the personal income tax return,
and is repealed as of December 1 of that year.

(b) (1) By September 1 of the second calendar year and each
subsequent calendar year that the School Supplies for Homeless
Children Fund appears on the tax return, the Franchise Tax Board
shall do all of the following:

(A) Determine the minimum contribution amount required to
be received during the next calendar year for the fund to appear
on the tax return for the taxable year that includes that next calendar
year.

(B) Provide written notification to the State Department of
begin delete Education end delete begin insert Social Services end insert of the amount determined in
subparagraph (A).

(C) Determine whether the amount of contributions estimated
to be received during the calendar year will equal or exceed the
minimum contribution amount determined by the Franchise Tax
Board for the calendar year pursuant to subparagraph (A). The
Franchise Tax Board shall estimate the amount of contributions
to be received by using the actual amounts received and an estimate
of the contributions that will be received by the end of that calendar
year.

(2) If the Franchise Tax Board determines that the amount of
the contributions estimated to be received during a calendar year
will not at least equal the minimum contribution amount for the
calendar year, this article shall be inoperative with respect to
taxable years beginning on or after January 1 of that calendar year
and shall be repealed on December 1 of that year.

(3) For purposes of this section, the minimum contribution
amount for a calendar year means two hundred fifty thousand
dollars ($250,000) for the second calendar year after the first
appearance of the School Supplies for Homeless Children Fund
on the personal income tax return or the adjusted minimum
contribution amount adjusted pursuant to subdivision (c).

(c) For each calendar year, beginning with the third calendar
year after the first appearance of the School Supplies for Homeless
Children Fund on the personal income tax return, the Franchise
Tax Board shall adjust, on or before September 1 of that calendar
year, the minimum contribution amount specified in subdivision
(b) as follows:

(1) The minimum estimated contribution amount for the calendar
year shall be an amount equal to the product of the minimum
estimated contribution amount for the calendar year multiplied by
the inflation factor adjustment as specified in subparagraph (A) of
paragraph (2) of subdivision (h) of Section 17041, rounded off to
the nearest dollar.

(2) The inflation factor adjustment used for the calendar year
shall be based on the figures for the percentage change in the
California Consumer Price Index for all items received on or before
August 1 of the calendar year pursuant to paragraph (1) of
subdivision (h) of Section 17041.

(d) Notwithstanding the repeal of this article, any contribution
amounts designated pursuant to this article prior to its repeal shall
continue to be transferred and disbursed in accordance with this
article as in effect immediately prior to that repeal.