BILL ANALYSIS                                                                                                                                                                                                    



                                                          AB 97
                                                          Page  1

Date of Hearing:   April 28, 1999

              ASSEMBLY COMMITTEE ON APPROPRIATIONS 
                    Carole Migden, Chairwoman

       AB 97 (Torlakson) - As Amended: February 25, 1999 

Policy Committee:                              Housing and  
Community Development                          Vote:11-0

Urgency:     No                   State Mandated Local  
Program:NoReimbursable:            

  SUMMARY  :

This bill deletes the January 1, 2000 sunset date for the  
state's $50 million annual low-income housing tax credits and  
continues the state credit as long as the federal government  
also offers low-income housing tax credits.

  FISCAL EFFECT  :

The Franchise Tax Board estimates revenue losses as follows (in  
millions):

           2001-02          2002-03           2003-04           2004-05   
        2005-06 and after  
              $2                 $10                $25           
      $40                      $50

  COMMENTS  :

  1)Purpose  . The author has introduced this bill to ensure that  
  the state commits to offering low-income housing credits for  
  at least as long as federal low-income housing credits are  
  available.  State credits are only available to projects that  
  receive federal credits. Competition for low-income housing  
  credits is intense.  Last year, the state received  
  applications for $308 million in credits but was limited by  
  the $50 million cap. State credits may be used to offset  
  personal income, bank and corporation, and/or insurance gross  
  premiums tax liability and must be spread over four years.

  2)Prior Legislation  : Last year, the Legislature increased the  
  annual cap on state credits from $35 million to $50 million  








                                                          AB 97
                                                          Page  2

  (AB 168, Torlakson, Chapter 9, Statutes of 1998) but rejected  
  an attempt to remove the January 1, 2000 sunset date on the  
  credits (AB 1265, Torlakson, which died on the Senate  
  Appropriations Suspense file).  


  Analysis Prepared by  :    Chuck Nicol / APPR. / (916)319-2081