Bill Text: CA SB1207 | 2013-2014 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: California Voluntary Contribution Program.

Spectrum: Slight Partisan Bill (Democrat 2-1)

Status: (Engrossed - Dead) 2014-08-14 - Set, second hearing. Held under submission. [SB1207 Detail]

Download: California-2013-SB1207-Amended.html

---

BILL NUMBER: SB 1207	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MAY 27, 2014
	AMENDED IN SENATE  APRIL 28, 2014
	AMENDED IN SENATE  APRIL 2, 2014

INTRODUCED BY   Senator Wolk
   (Coauthors: Senators Knight and Liu)

                        FEBRUARY 20, 2014

   An act to add and repeal Article 1 (commencing with Section 18701)
of Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation
Code, relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1207, as amended, Wolk. California Voluntary Contribution
Program.
   Under the existing Personal Income Tax Law, taxpayers are allowed
to contribute amounts in excess of their tax liability for the
support of specified funds. Existing law provides for various
voluntary contribution check-off funds to be listed on the income tax
return.
   This bill would modify the existing voluntary check-off system by
establishing the California Voluntary Contribution Program to be
administered by the office of California Volunteers to expand the
contribution options for a taxpayer. The bill would provide that the
purpose of the program is to promote charitable giving and collect
through the personal income tax return individual taxpayers'
voluntary contributions  to   either to
specified charities in a pool of up to 200  qualified
applicants, defined to include any charitable organization meeting
certain requirements or a state or local agency  or to make a
general charitable gift  . Not later than January 1, 2017, the
bill would require the office to, among other things, develop the
application to participate in the program and establish application
and renewal fees. The bill would authorize the office to adopt
specified policies and guidelines to regulate the number of qualified
applicants participating in the program. The bill would authorize
the office to adopt regulations necessary to carry out these
provisions and would make these regulations subject to the
Administrative Procedure Act. The bill would require the Franchise
Tax Board to revise the personal income tax form in a manner
necessary to inform an individual about how to make  a
designation to any qualified applicant   designations to
qualified applicants or to the Charitable Giving Fund  .
   Commencing on January 1, 2017, this bill would allow an individual
 taxpayer  to designate a contribution to  any
qualified applicant   up to 5 qualified applicants or to
the Charitable Giving Fund  . The bill would require an
applicant wishing to receive contributions to submit an application
to the program, including an application fee. The bill would require
the office to approve an application if specified requirements, and
other reasonable requirements, are met, thereby making a qualified
applicant eligible to receive voluntary contributions. The bill would
require these contributions to be transferred from the Personal
Income Tax Fund to the California Voluntary Contribution 
Fund,   Fund or to the Charitable Giving Fund, both of
which are  created by this bill. The bill would require moneys
in the California Voluntary Contribution  Fund and the Charitable
Giving  Fund, upon appropriation by the Legislature, to be
allocated to the Franchise Tax Board and the Controller for
reimbursement of costs, as provided, and the balance  from the
California Voluntary Contribution Fund  to the office of
California Volunteers for distribution to each qualified applicant
designated by an individual  and the balance from the Charitable
Giving Fund to the office for distribution as grants for charitable
purposes, in accordance with policies and procedures established by
the office  . The bill would establish a specified minimum
contribution amount for each qualified applicant. The bill would
prohibit a qualified applicant from receiving voluntary contributions
if, among other things, the average amount of contributions received
during certain calendar years did not equal the minimum contribution
amount.
   This bill would annually require the office to provide the
Legislature with a report containing specified information on the
program. The bill would also require this report to be made available
to the public.  The bill would also require the office to work
in consultation with the Department of Finance to develop a strategy
to propose to the Legislature for a continuous appropriation to
distribute taxpayers' contributions to the designated qualified
applicants. 
   This bill would repeal these provisions on January 1, 
2030, unless a later enacted statute deletes or extends that date
  2023  .
   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.  (a) The Legislature finds and declares that the state
has a role in informing the public of the value and need for
community service, volunteerism, and charitable giving as a form of
civic engagement in order to support important social and community
programs. The Legislature further finds and declares that there are
many worthy charitable causes in California that may benefit from
taxpayers' voluntary charitable contributions on the tax form, but
are not able to do so under the existing tax check-off process.
Therefore, it is the intent of the Legislature to promote civic
engagement by establishing a program where taxpayers have the
opportunity to give to a wide range of charitable causes on their tax
return.
   (b) It is the intent of the Legislature to retain all existing
funds currently on the tax return form until their repeal dates, and,
in legislation to be enacted at a later date, transition the
remaining funds to the California Voluntary Contributions Program by
2020. It is further the intent of the Legislature that the dates of
repeal for the California Fund for Senior Citizens, the California
Firefighters' Memorial Fund, and the California Peace Officer
Memorial Foundation Fund be extended in legislation to be enacted at
a later date.
  SEC. 2.  Article 1 (commencing with Section 18701) is added to
Chapter 3 of Part 10.2 of Division 2 of the Revenue and Taxation
Code, to read:

      Article 1.  California Voluntary Contribution Program


   18701.  For the purposes of this article, the following
definitions shall apply:
   (a) "Charitable organization" means an organization exempt from
income tax as an organization described in Section 23701d.
   (b) "Local agency" and "state agency" have the same meanings as
defined in Section 6252 of the Government Code.
   (c) "Office" means the office of California Volunteers, as
established by Executive Order S-24-06, or its successor.
   (d) "Program" means the California Voluntary Contribution Program
 established by this article  .
   (e) "Qualified applicant" means either of the following:
   (1) A charitable organization that meets all of the following
requirements:
   (A) Has registered in this state with the Attorney General's
Registry of Charitable Trusts for each of the three years prior to
the date of application and has met each of the requirements that
apply to the applicant, under statute and as established by the
Attorney General for the Registry of Charitable Trusts.
   (B) Has submitted annual returns or statements with the Franchise
Tax Board, pursuant to Section 23771, 23772, or 23774 for each of the
three years prior to the date of application.
   (C) Has average annual total revenues in excess of the minimum
contribution  level   amount  described in
Section 18705, as calculated from each of the three years prior to
the date of application, not including those contributions made by a
designation in excess of the tax liability on an individual's tax
return.
   (2) Is a local agency or state agency.
   18702.  (a) There is hereby established in state government the
California Voluntary Contribution  Program .  
Program. 
   (b) The purpose of the program is to promote charitable giving and
provide individual taxpayers' voluntary contributions to qualified
applicants. The office  or a successor agency, 
shall be responsible for administering the program. 
   (c) The number of qualified applicants that may participate in the
program each taxable year shall be no more than 200, less the number
of funds established pursuant to Chapter 3 (commencing with Section
18711) of Part 10.2 of Division 3. 
   18703.  (a) A qualified applicant that wishes to receive voluntary
contributions through the program shall submit an application to the
office by a date established by the office. The application shall
include all of the following:
   (1) Evidence satisfactory to the office that the applicant is a
qualified applicant. All documents submitted to the office shall be
made public.
   (2) An application fee, as established by the office pursuant to
Section 18710 in an amount sufficient to cover the reasonable costs
of administering the application process.
   (b) The office shall approve an application if the requirements of
subdivision (a) and other reasonable requirements consistent with
this article are met, thereby making a qualified applicant eligible
to receive voluntary contributions.
   (c) This section shall become operative on January 1, 2017.
   18704.  A qualified applicant whose application is approved by the
office may continue to receive voluntary contributions if the
following requirements are met:
   (a) Contributions received by the qualified applicant through the
program in the prior year meet or exceed the minimum contribution
 level   amount  established for the
program, as described in Section 18705.
   (b) The qualified applicant continues to meet the requirements
established for qualified applicants in subdivision (e) of Section
18701.
   (c) The qualified applicant submits an application for renewal and
pays a renewal fee, as determined by the office pursuant to Section
18710.
   (d) This section shall become operative on January 1, 2017.
   18705.  (a) The minimum contribution amount for each approved
qualified applicant is one hundred thousand dollars ($100,000).
   (b) Notwithstanding subdivision (a), the office  shall
  may  adopt regulations to adjust the minimum
contribution  requirement every five calendar years,
  amount  beginning  with the third
calendar year after the first appearance of the "California Voluntary
Contributions Fund" on the personal income tax return  
on January 1, 2020  .
   (c) This section shall become operative on January 1, 2017.
   18706.  (a) A qualified applicant may no longer receive voluntary
contributions if either of the following apply:
   (1) The average amount of contributions received during three
calendar years did not equal the minimum contribution 
requirement,   amount,  as described in Section
18705.
   (2) The designee no longer meets the definition of a "qualified
applicant" pursuant to subdivision (e) of Section 18701.
   (b) When a qualified applicant is no longer eligible to receive
voluntary charitable contributions pursuant to this article, the
office shall revoke the eligibility of the qualified applicant from
the program and notify the Franchise Tax Board of the revocation 
by a date specified by that board  . 
   (c) A qualified applicant whose eligibility is revoked may
participate in the program for the subsequent calendar year if the
Franchise Tax Board is unable to revise the tax form and related
materials for that year.  
   (c) 
    (d)  A qualified applicant whose eligibility is revoked
from participation in the program may reapply to the program no
sooner than  five   three  years after the
eligibility was revoked. 
   (d) 
    (e)  This section shall become operative on January 1,
2017.
   18707.  (a) An individual may designate on the personal income tax
return that a contribution in excess of the tax liability, if any,
be made  to a specific   as follows: 
    (1)     To up to five specific 
qualified  applicant     applicants
 whose  application has   applications have
 been approved pursuant to Section 18703.  The
contribution shall be deposited in the California Voluntary
Contribution Fund established by Section 18708. That designation is
to be used as a voluntary contribution on the tax return. 

   (2) To the Charitable Giving Fund pursuant to Section 18708. 

   (b) The contributions shall be in full dollar amounts and may be
made individually by each signatory on a joint return.
   (c) A designation under subdivision (a) shall be made for any
taxable year on the original return for that taxable year, and once
made shall be irrevocable. If payments and credits reported on the
return, together with any other credits associated with the
individual's account, do not exceed the individual's liability, the
return shall be treated as though no designation has been made.
   (d) The Franchise Tax Board, in consultation with the office,
shall revise the tax form of the return to allow for the designation
permitted under subdivision (a). The form shall also include in the
instructions information that the contribution may be in the amount
of one dollar ($1) or more and that the contribution shall be used to
support  the   a designated  qualified
applicant  or applicants or the Charitable Giving Fund, as 
specified by the taxpayer.
   (e) A deduction shall be allowed under Article 6 (commencing with
Section 17201) of Chapter 3 of Part 10 for any contribution made
pursuant to subdivision (a).
   (f) This section shall become operative on January 1, 2017.
   18708.  (a)  (1)    There is hereby established
in the State Treasury the California Voluntary Contribution Fund to
receive contributions  to qualified applicants  made
pursuant to Section 18707. 
   (2) (A) There is hereby established in the State Treasury the
Charitable Giving Fund to receive contributions made pursuant to
Section 18707.  
   (B) The office shall administer the Charitable Giving Fund and
develop policies and procedures, including, but not limited to, a
competitive grant process, to distribute the funds to charitable
organizations. 
   (b) The Franchise Tax Board shall notify the Controller of both
the amount of money paid by individuals in excess of their tax
liability and the amount of refund money  which 
 that  individuals have designated pursuant to Section 18707
to be transferred to the California Voluntary Contribution Fund 
and the Charitable Giving Fund  . The Controller shall transfer
from the Personal Income Tax Fund to the California Voluntary
Contribution Fund an amount not in excess of the sum of the amounts
designated by individuals  to qualified applicants  pursuant
to Section 18707 for payment into that fund  and shall transfer
to the Charitable Giving Fund an amount not in excess of the sum of
the amounts designated by individuals for that fund  .
   (c) This section shall become operative on January 1, 2017.
   18709.  (a) All money transferred to the California Voluntary
Contribution  Fund and the Charitable Giving  Fund, upon
appropriation by the Legislature, shall be allocated as follows:
   (1) To the Franchise Tax Board, the Controller, and the office for
reimbursement of all costs incurred in connection with their duties
under this article.
   (2)  To   From the Cali   fornia
Voluntary   Contribution Fund, to  the office for
distribution to each qualified applicant designated by a taxpayer.

   (3) From the Charitable Giving Fund, to the office for
distribution according to the regulations established for
distributions from the fund. 
   (b) On and after January 1, 2020, no more than 5 percent of money
from the  fund,   funds,  exclusive of fee
revenues, shall be used for administrative purposes.
   (c) All moneys may be carried over from the year in which they
were received and encumbered in any following year.
   (d) In the event that no designee is specified or the specified
designee is not a qualified applicant, the contribution shall, after
reimbursement of the direct actual costs of the Franchise Tax Board
for the collection and administration of funds under this article, be
transferred to the office to further the purposes of this article.
   (e) In the event an individual designates a contribution to a
qualified applicant whose eligibility for receiving voluntary
contributions has been revoked, but that was eligible to receive a
voluntary contribution for the taxable year in which the designation
was made, the contribution shall be distributed to the qualified
applicant.
   (f) In the event an individual designates a contribution to more
than one qualified applicant listed on the tax return, and the amount
available is insufficient to satisfy the total amount designated,
the contribution shall be allocated among the designees on a pro rata
basis.
   (g) This section shall become operative on January 1, 2017.
   18710.  (a) The office shall, not later than January 1, 2017, do
all of the following:
   (1) Develop the application and related materials to be completed
by applicants to participate in the program, including the types of
proof necessary to comply with the program.
   (2) By regulation, establish reasonable and necessary application
and renewal fees in an amount not to exceed the reasonable costs of
administering the application and renewal process.
   (3) Develop procedures and adopt regulations to inform taxpayers
on how to contribute directly to a charitable organization or state
or local agency if that charitable organization or state or local
agency is not eligible to receive contributions because it did not
meet the required minimum contribution amount.
   (4) In consultation with other agencies that regulate charitable
organizations, develop policies and procedures to ensure that
qualified applicants are in compliance with applicable statutes
affecting those charitable organizations.
   (5) Develop a plan to transition the remaining funds on the tax
return to the program. That plan should be submitted to the relevant
committees of the Legislature by January 1, 2020. 
   (6) Work in consultation with the Department of Finance to develop
a strategy to propose to the Legislature for a continuous
appropriation to distribute taxpayers' contributions to the
designated qualified applicants. 
   (b) The office may do the following:
   (1) Form an advisory body or related bodies as deemed necessary.
   (2) Contract with other agencies, public or private, as deemed
necessary in pursuit of the duties described in this act.
   (3) Adopt regulations necessary for the administration of this
article.
   (4) In order to develop the program and sustain the integrity of
its operations, the office may adopt policies and guidelines that may
include, but not be limited to, application cut-off dates, a
first-come-first-served system, or a lottery, to  regulate
  limit  the number of qualified applicants 
within the number specified in subdivision (c) of Section 18702,
 participating in the program based on legislative
appropriations and workforce capacity.  This paragraph shall
become inoperative on January 1, 2023. 
   (c) (1) The office shall annually provide to the Legislature, and
make publicly available, a report on the program, including goals, a
baseline, metrics and targets to track, over time, the effectiveness
of efforts to encourage charitable giving. The annual report shall
include information on total contributions received, administrative
and related costs, and total contribution distributed to qualified
applicants.
   (2) (A) A report to the Legislature pursuant to this section shall
be submitted in compliance with Section 9795 of the Government Code.

   (B) This subdivision shall be become inoperative on January 1,
2020, pursuant to Section 10231.5 of the Government Code.
   (d) The Franchise Tax Board shall revise the tax form and any
other related materials, including online materials, in order to
allow an individual to designate a contribution to any one of the
qualified applicants approved pursuant to Section 18703  and to
the Charitable Giving Fund  . These forms and materials may
include, but not be limited to, a separate schedule, booklet, or any
other material necessary to inform an individual about qualified
applicants and how to make a designation on the personal income tax
return.
   18711.  Any regulation adopted pursuant to this article shall be
adopted pursuant to the Administrative Procedure Act (Chapter 3.5
(commencing with Section 11340) of Part 1 of Division 3 of Title 2 of
the Government Code).
   18712.  This article shall remain in effect only until January 1,
 2030,   2023,  and as of that date is
repealed, unless a later enacted statute, that is enacted before
January 1,  2030,   2   023, 
deletes or extends that date.