SB 1571
Page 1
SENATE THIRD READING
SB 1571 (DeSaulnier)
As Amended May 25, 2012
Majority vote
SENATE VOTE: 36-3
REVENUE & TAXATION 6-0
APPROPRIATIONS
Ayes:
Ayes:
Fuentes, Blumenfield, Bradford,
Charles Calderon, Campos, Davis,
Gatto, Hall, Hill, Lara, Mitchell,
Solorio
Nays:
Harkey, Donnelly, Nielsen, Norby,
Wagner
Perea, Beall, Cedillo, Fuentes,
Gordon, Nestande
12-5
SUMMARY: Authorizes the addition of the School Supplies for Homeless Children Fund
(Fund) checkoff 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 Fund, upon appropriation by the Legislature, shall
be allocated as follows:
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 checkoff;
and,
b) To the CDE, for distribution of grants to school districts for the sole purpose of assisting
pupils in California under the federal McKinney-Vento Homeless Assistance Act (42
U.S.C. Section 11301 et seq.) 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 following requirements:
a) A grant shall be awarded in an amount of $5,000 or less, on a first-come, first-serve
basis; and,
b) Less than 2% of the grant award shall be spent for administrative purposes.
3) Allows a school district to provide school supplies and health-related products to homeless
children through the services of a nonprofit 501(c)(3) organization if the district's grant
application specifies this purpose.
4) Specifies that the Fund provisions shall remain in effect only until January 1 of the fifth
taxable year following the Fund's first appearance on the PIT return. However, if the FTB
determines that the amount of contributions estimated to be received during a calendar year
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will not meet a minimum contribution threshold, the provisions shall be inoperative with
respect to taxable years beginning on or after January 1 of that calendar year.
EXISTING LAW:
1) Allows taxpayers to designate on their PIT returns a contribution to any of 18 VCFs.
2) Provides a specific sunset date for each VCF, except for the California Seniors Special Fund.
3) Provides that each VCF must meet a minimum annual contribution amount to remain in
effect, except for the California Seniors Special Fund, the California Firefighters' Memorial
Fund, and the California Peace Officer Memorial Foundation Fund.
FISCAL EFFECT: The FTB estimates annual revenue losses of roughly $20,000 resulting from
itemized deductions.
COMMENTS: The author has provided the following statement in support of this bill:
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. 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. Consequently, homeless children are at a critical disadvantage in
school. These students consistently test well below average in math and English, and
only one-fourth graduate from high school. While not solving all of the problems that
come with homelessness, SB 1571 will help to level the material playing field by giving
compassionate taxpayers the opportunity to cover the costs of basic school supplies and
health services for homeless children.
Assembly Revenue and Taxation Committee staff comments:
What would this bill do?: This bill would authorize the addition of a new VCF to the PIT return.
The CDE would use Fund moneys to distribute grants to school districts for the sole purpose of
assisting California students under the federal McKinney-Vento Homeless Assistance Act.
Specifically, Fund moneys would be used to provide school supplies and "health-related
products" to homeless children.
So many causes, so little space: There are countless worthy causes that would benefit from the
inclusion of a new VCF on the state's income tax returns. At the same time, space on the return
is limited. Thus, it could be argued that the current system for adding VCFs to the form is
subjective and essentially rewards causes that can convince the Legislature to include their fund
on the form.
Related legislation: Assembly Revenue and Taxation Committee staff notes the following
related bills from the 2011-12 legislative session:
1) AB 564 (Smyth), Chapter 549, Statutes of 2011, reauthorized the addition of the Municipal
Shelter Spay-Neuter Fund checkoff to the PIT return upon the removal of another VCF from
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the form.
2) AB 764 (Swanson), Chapter 465, Statutes of 2011, authorized the addition of the Child
Victims of Human Trafficking Fund checkoff to the PIT return upon the removal of another
VCF from the form.
3) AB 971 (Monning), Chapter 209, Statutes of 2011, reauthorized the addition of the California
Sea Otter Fund checkoff to the PIT form beginning with the 2011 return.
4) 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. Specifically, SB 164
extended the VCF provisions for both the State Children's Trust Fund and the Rare and
Endangered Species Preservation Program.
5) SB 583 (Vargas), Chapter 711, Statutes of 2011, reauthorized the addition of the ALS/Lou
Gehrig's Disease Research Fund checkoff to the PIT return upon the removal of another VCF
from the form.
Analysis Prepared by:
M. David Ruff / REV. & TAX. / (916) 319-2098
FN: 0004631