Amended in Assembly July 2, 2014

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 Sections 18897 and 18898 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 Social Services 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 local 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 begin insert , the State Department of Social
Services, end insert and the Controller for reimbursement of all costs incurred
by the Franchise Tax Board, the Controller, and the State
Department of Social Services in connection with their duties under
this article.

(b) To the State Department of Social Services as follows:

(1)  begin delete (A) end delete begin delete   end delete 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 local education agencies for distribution to homeless
children, as defined by the federal McKinney-Vento Homeless
Assistance Act (42 U.S.C. Sec. 11434a). 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 Social Services shall enter into a subvention services
agreement with begin delete a end delete begin insert the end insert nonprofit organization.

begin delete

(B)

end delete

begin insert (2) end insert  The State Department of Social Services’ 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 Social
Services shall designate the same or a different nonprofit
organization pursuant to this section. The State Department of
Social Services may revoke the designation begin delete should end delete begin insert if end insert the nonprofit
organization begin delete fail end delete begin insert fails end insert to comply with the provisions of this article.
If a designation is revoked, the State Department of Social Services
shall designate a new nonprofit organization within three calendar
months.

begin delete

(C)

end delete

begin insert (3) end insert  Funds shall be distributed by the State Department of Social
Services only after evidence is presented to the State Department
of Social Services that demonstrates that the local education
agencies or domestic violence shelters have received the materials
begin insert described in paragraph (1) end insert .

begin delete

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

end delete

(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 local 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

(d) The State Department of Social Services shall verify that
the designated nonprofit organization procured school supplies
and health-related products and provided matching funds or
in-kind materials as described in this section.

end insert

SEC. 2.  

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

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
Social Services 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.