Bill Text: CA AB1553 | 2015-2016 | Regular Session | Chaptered
Bill Title: Savings plans: qualified ABLE program.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2016-09-13 - Chaptered by Secretary of State - Chapter 317, Statutes of 2016. [AB1553 Detail]
Download: California-2015-AB1553-Chaptered.html
BILL NUMBER: AB 1553 CHAPTERED
BILL TEXT
CHAPTER 317
FILED WITH SECRETARY OF STATE SEPTEMBER 13, 2016
APPROVED BY GOVERNOR SEPTEMBER 13, 2016
PASSED THE SENATE AUGUST 16, 2016
PASSED THE ASSEMBLY AUGUST 22, 2016
AMENDED IN SENATE AUGUST 10, 2016
AMENDED IN SENATE JUNE 22, 2016
AMENDED IN ASSEMBLY FEBRUARY 29, 2016
INTRODUCED BY Assembly Member Irwin
JANUARY 4, 2016
An act to amend Sections 4875 and 4877 of the Welfare and
Institutions Code, relating to taxation, and declaring the urgency
thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1553, Irwin. Savings plans: qualified ABLE program.
Existing federal law, the Stephen Beck, Jr., Achieving a Better
Life Experience Act of 2014 (ABLE Act), encourages and assists
individuals and families to save private funds for the purpose of
supporting persons with disabilities to maintain their health,
independence, and quality of life by excluding from gross income
distributions used for qualified disability expenses by a beneficiary
of a qualified ABLE program established and maintained by a state,
as specified.
Existing law conforms to these federal income tax law provisions
relating to the ABLE Act under the Personal Income Tax Law and the
Corporation Tax Law, as provided. Existing law defines "eligible
individual" for these purposes. Existing law establishes in state
government the ABLE program trust for purposes of implementing the
federal ABLE Act. Existing law also establishes the ABLE Act Board
and authorizes the board to adopt regulations to implement the
program.
The existing State Contract Act, in connection with contracts
entered into by any state agency for services to be rendered to the
state, prohibits a person, firm, or subsidiary thereof that has been
awarded a consulting services contract from submitting a bid for, or
being awarded a contract for, the provision of services, the
procurement of goods or supplies, or any other related action that is
required, suggested, or otherwise deemed appropriate in the end
product of the consulting services contract. A willful violation of
these provisions is a misdemeanor, under other provisions.
This bill would modify the definition of "eligible individual."
The bill would also exempt the ABLE Act Board from the above
prohibition in the State Contract Act for a contract with a program
consultant for the qualified ABLE program but would require such a
contract to be publicly disclosed in a manner specified by the board
prior to entering into the contract.
This bill would declare that it is to take effect immediately as
an urgency statute.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 4875 of the Welfare and Institutions Code is
amended to read:
4875. For purposes of this chapter:
(a) "ABLE account" or "account" means the account established and
owned by a designated beneficiary pursuant to this chapter for the
purpose of meeting the qualified disability expenses of the
designated beneficiary of the account.
(b) "Administrative fund" means the fund used to administer this
chapter.
(c) "Board" means the California ABLE Act Board established under
this chapter.
(d) "California ABLE Program Trust" or "ABLE program trust" means
the trust created pursuant to this chapter.
(e) "Designated beneficiary" means the eligible individual who
established an ABLE account and is the owner of the account.
(f) "Eligible individual" means an individual who is eligible
under the program for a taxable year if blindness or disability
occurred before the date on which the individual attained 26 years of
age, and during that taxable year either of the following criteria
are satisfied:
(1) The individual is entitled to benefits based on blindness or
disability under Title II or XVI of the federal Social Security Act,
and that blindness or disability occurred before the date on which
the individual attained 26 years of age.
(2) A disability certification, as defined in the federal ABLE
Act, with respect to the individual is filed pursuant to the
requirements set forth in the federal ABLE Act.
(g) "Federal ABLE Act" means the federal Stephen Beck, Jr.,
Achieving a Better Life Experience Act of 2014.
(h) "Investment management" means the functions performed by a
manager contracted to perform functions delegated by the board.
(i) "Investment manager" means a manager contracted to perform
functions delegated by the board.
(j) "Program fund" means the program fund established by this
chapter, which shall be held as a separate fund within the California
ABLE Program Trust.
(k) "Qualified ABLE Program" or "program" means the program
established by this chapter to implement the federal ABLE Act
pursuant to Section 529A of the Internal Revenue Code.
( l ) "Qualified disability expenses" means any expenses
related to the eligible individual's blindness or disability that
are made for the benefit of an eligible individual who is the
designated beneficiary, including the following expenses: education,
housing, transportation, employment training and support, assistive
technology and personal support services, health, prevention and
wellness, financial management and administrative services, legal
fees, expenses for oversight and monitoring, funeral and burial
expenses, and other expenses, which are approved by the Secretary of
the Treasury under regulations and consistent with the purposes of
the federal ABLE Act.
SEC. 2. Section 4877 of the Welfare and Institutions Code is
amended to read:
4877. (a) There is hereby created an instrumentality of the State
of California to be known as the California ABLE Program Trust.
(b) The purposes, powers, and duties of the California ABLE
Program Trust are vested in, and shall be exercised by, the board.
(c) The board, in the capacity of trustee, shall have the power
and authority to do all of the following:
(1) Sue and be sued.
(2) (A) Make and enter into contracts necessary for the
administration of the ABLE program trust, and engage personnel,
including consultants, actuaries, managers, counsel, and auditors, as
necessary for the purpose of rendering professional, managerial, and
technical assistance and advice.
(B) Subdivision (a) of Section 10365.5 of the Public Contract Code
shall not apply to a contract with a program consultant for the
qualified ABLE program. Any contract with a program consultant for
the qualified ABLE program that would have been prohibited by that
subdivision shall be publicly disclosed in a manner specified by the
board prior to entering into the contract.
(3) Adopt a corporate seal and change and amend it from time to
time.
(4) Cause moneys in the program fund to be held and invested and
reinvested.
(5) Accept any grants, gifts, appropriations, and other moneys
from any unit of federal, state, or local government or any other
person, firm, partnership, or corporation for deposit to the
administrative fund or the program fund.
(6) Enter into agreements with designated beneficiaries or
eligible individuals to establish and maintain an ABLE account.
(7) Make provisions for the payment of costs of administration and
operation of the ABLE program trust.
(8) Carry out the duties and obligations of the ABLE program trust
pursuant to this chapter and the federal ABLE Act pursuant to
Section 529A of the Internal Revenue Code and federal regulations
issued pursuant to that code, and have any other powers as may be
reasonably necessary for the effectuation of the purposes,
objectives, and provisions of this chapter.
(9) Carry out studies and projections in order to advise
designated beneficiaries or eligible individuals regarding present
and estimated future qualified disability expenses and the levels of
financial participation in the ABLE program trust required in order
to assist designated beneficiaries or eligible individuals.
(10) Participate in any other way in any federal, state, or local
governmental program for the benefit of the ABLE program trust.
(11) Promulgate, impose, and collect administrative fees and
charges in connection with transactions of the ABLE program trust,
and provide for reasonable service charges, including penalties for
cancellations.
(12) Set minimum and maximum investment levels.
(13) Administer the funds of the ABLE program trust.
(14) Procure insurance against any loss in connection with the
property, assets, or activities of the ABLE program trust.
(15) Procure insurance indemnifying any member of the board from
personal loss or liability resulting from a member's action or
inaction as a member of the board.
(d) The Treasurer shall, on behalf of the board, appoint an
executive director, who shall not be a member of the board and who
shall serve at the pleasure of the board. The Treasurer shall
determine the duties of the executive director and other staff as
necessary and set his or her compensation. The board may authorize
the executive director to enter into contracts on behalf of the board
or conduct any business necessary for the efficient operation of the
board.
SEC. 3. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to allow ABLE accounts to be accessed at the earliest
possible time, it is necessary that this act take effect immediately.
