From: Subject: SB 1502 Senate Bill - Bill Analysis Date: Thu, 17 Apr 2008 08:34:59 -0700 MIME-Version: 1.0 Content-Type: text/html; charset="Windows-1252" Content-Transfer-Encoding: quoted-printable Content-Location: http://www.leginfo.ca.gov/pub/07-08/bill/sen/sb_1501-1550/sb_1502_cfa_20080409_091720_sen_comm.html X-MimeOLE: Produced By Microsoft MimeOLE V6.00.2900.3198 SB 1502 Senate Bill - Bill Analysis 
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               BILL ANALYSIS                                             =
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            SENATE REVENUE & TAXATION COMMITTEE

            Senator Jenny Oropeza, Chair

                                                 SB 1502 - Steinberg

                                                 Amended: April 3, 2008

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            Hearing: April 9, 2008                          Fiscal: YES




            SUMMARY: Adds the Lou Gehrig's Disease Fund as a Voluntary =20
                      Contribution on the Personal Income Tax Form.=20


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                 EXISTING LAW allows taxpayers to contribute (not tax =20
            liabilities) to one or more of the 11 voluntary =20
            contribution funds listed on the state personal income tax =20
            return.

                 Each voluntary contribution fund must meet a minimum =20
            annual contribution of $250,000.  The minimum contribution =20
            amount does not apply to the California Seniors Special =20
            Fund, the California Firefighters Memorial Fund, and the =20
            California Peace Officer Foundation Memorial Fund. This =20
            minimum contribution amount is adjusted annually for =20
            inflation for all voluntary contribution funds, except for =20
            those referenced above, and the California Fund for Senior =20
            Citizens.  Except for the California Seniors Special Fund, =20
            each voluntary contribution fund has a sunset date.

                 THIS BILL creates the Lou Gehrig's Disease Fund as a =20
            voluntary contribution on the PIT form.  This fund has a =20
            sunset date of January 1, 2013.  Additionally, this fund =20
            has a minimum contribution amount of $250,000, which is =20
            adjusted annually for inflation.  The bill repeals the fund  =

            if its contributions fail to meet the minimum contribution =20
            amount.  The bill provides for the reimbursement of the =20






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            costs incurred by the Franchise Tax Board to administer =20
            fund.




            FISCAL EFFECT:=20

                 The Franchise Tax Board (FTB) estimates no fiscal =20
            impact for fiscal year 2008-09 and revenue losses of less =20
            than $150,000 in fiscal years 2009-10 and 2010-11. =20




            COMMENTS:


            A.   Purpose of the Bill

                 According to the author "SB 1502 will create a tax =20
            check-off for Amyotrophic Lateral Sclerosis (more commonly =20
            known as Lou Gehrig's Disease), allowing tax-payers to =20
            designate on their tax returns, that a specified amount in =20
            excess of their tax liability be transferred to the Lou =20
            Gehrig's Disease Research Fund. =20

            ALS is a fatal disease. According to the ALS Association, =20
            as many as 30,000 Americans have the disease at any given =20
            time, and 5,600 Americans are diagnosed each year.  Most =20
            ALS patients die within two to five years of symptom onset,  =

            and the one drug approved by the federal Food and Drug =20
            Administration for the treatment of ALS shows little, if =20
            any, efficacy in slowing the progression of the disease. =20

            All moneys contributed to the Fund will be awarded in the =20
            form of grants to eligible physicians, hospitals, =20
            laboratories, educational institutions, and other =20
            organizations and persons for the purpose of enabling =20
            organizations and persons to conducting research."








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            B.   The Iron Horse

                 Most baseball fans know of Lou Gehrig because of his =20
            incredible achievements, including playing in 2,130 =20
            consecutive games, a record not broken until 1995 by Cal =20
            Ripken, Jr.  Most Americans undoubtedly recognize his =20
            iconic speech in which a month after discovering he had ALS  =

            he said, "? today, I consider myself, the luckiest man on =20
            the face of the earth."  Yet both baseball fans and average  =

            Americans alike may not be aware ALS.  ALS is a =20
            neurodegenerative disease that causes an inability to =20
            control muscles, with no known cause, prevention, =20
            treatment, or cure for this fatal disease.  Funds raised =20
            through this new voluntary contribution go to researching =20
            ALS treatments, causes, and potential cures.=20



            C.   Enough Room?

                 Currently there are eleven voluntary contribution =20
            funds.  There is a maximum amount of space available for =20
            these contributions on the income tax form.  In addition to  =

            this bill, five other bills create new voluntary =20
            contribution funds and one extends a sunset.  Those other =20
            bills are as follows:

                 AB 1812 (Arambula), pending in Assembly Government =20
            Organization

                 AB 1935 (Fuller), pending in Assembly Revenue and =20
            Taxation

                 AB 2219 (Mendoza), pending in Assembly Revenue and =20
            Taxation

                 AB 2581 (Torrico), pending in Assembly Appropriations

                 SB 1101 (Cedillo), pending in this committee







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            The Franchise Tax Board says there is enough room on =20
            existing tax forms to accommodate the new voluntary =20
            contribution funds and extend the sunset on the Emergency =20
            Food Assistance Program Fund.




            D.   Many Good Causes

                 In the past, the Committee has expressed concern that =20
            countless worthy causes could be funded by tax check-offs.   =

            The Committee has stated that the current check-off system =20
            forces them to choose between worthy charities and =20
            non-profits for a spot on the tax return.  The current =20
            system remains subjective and is limited to those =20
            organizations who can convince the Legislature to include =20
            them on the form.  Additionally, taxpayers may currently =20
            contribute portions of their refunds to worthy =20
            organizations.  Taxpayers may also claim a deduction for =20
            charitable contributions.  The Committee may wish to =20
            consider whether the state should use the tax code to =20
            encourage contributions to certain charitable =20
            organizations.



            E.   2007 Check-Offs

                 Contributions to voluntary funds in 2007 were as =20
            follows:


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             -----------------------------------------------------=20
            |                          |                          |
            |  Voluntary Contribution  |    2007 Contributions    |
            |           Fund           |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |






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            |  California Alzheimer's  |         $485,401         |
            |      Research Fund       |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            | California Breast Cancer |         $571,855         |
            |      Research Fund       |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            | California Firefighters' |         $213,236         |
            |      Memorial Fund       |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |   California Fund for    |         $264,645         |
            |     Senior Citizens      |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            | California Peace Officer |         $166,602         |
            | Memorial Foundation Fund |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |California Sea Otter Fund |         $42,956          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |    California Seniors    |         $47,679          |
            |       Special Fund       |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |Emergency Food Assistance |         $391,023         |
            |       Program Fund       |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |   Rare and Endangered    |         $572,043         |
            |   Species Preservation   |                          |
            |         Program          |                          |






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            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |  State Children's Trust  |         $499,827         |
            |  for the Prevention of   |                          |
            |       Child Abuse        |                          |
            |                          |                          |
            |--------------------------+--------------------------|
            |                          |                          |
            |   California Military    |         $260,878         |
            |    Family Relief Fund    |                          |
            |                          |                          |
             -----------------------------------------------------=20
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            F.   Suggested Amendments

                 The committee may wish to consider the following =20
            amendments, which the author has agreed to, to correct =20
            drafting errors.

            On page 5, line 18, strike out "Lou Gehrig's Disease" and =20
            insert: ALS/Lou Gehrig's Disease

            On page 6, line 11, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 6, line 23, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 6, line 30, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 6, line 35, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 6, line 40, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 7, line 2, before "Lou Gehrig's Disease" insert: =20






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            ALS/

            On page 7, line 5, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 7, line 23, before "Lou Gehrig's Disease" insert: =20
            ALS/

            On page 8, strike out lines 1-4 inclusive, and insert: =20
            dollars ($250,000) for calendar year 2010, or the minimum =20
            contribution amount adjusted pursuant to subdivision (c).

            On page 8, strike out lines 5-7 inclusive, and insert: For =20
            each calendar year beginning with the 2011 calendar year, =20
            the Franchise Tax Board shall adjust, on or before




            Support and Opposition

                 Support:  The California ALS Advocacy Committee =20
            (sponsor)                     Kimberly Hindley =20
            (individual)Stephen Hall (individual)                  The =20
            Association of California Water Agencies              =20

                 Oppose: None received=20



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            Consultant: Brendan P. Hughes















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