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

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-Introduced.html

---

BILL NUMBER: SB 1207	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Wolk

                        FEBRUARY 20, 2014

   An act to add Article 1 (commencing with Section 18701) to 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 introduced, 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 expand
the contribution options for a taxpayer. Commencing January 1, 2016,
the bill would establish the Office of California Volunteers to
administer the program. 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 qualified applicants, defined to include any
charitable organization or a state or local agency meeting certain
requirements. 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 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.
   Commencing on January 1, 2017, this bill would allow an individual
to designate a contribution to any qualified applicant. 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 these contributions to be transferred from the
Personal Income Tax Fund to the California Voluntary Contribution
Fund, created by this bill. The bill would require moneys in the
California Voluntary Contribution 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
to the Office of California Volunteers for distribution to each
qualified application designated by an individual. 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.
   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. However, it is the intent of the Legislature that the
California Fund for Senior Citizens, the California Firefighters'
Memorial Fund, and the California Peace Officer Memorial Foundation
Fund extend their repeal dates 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 13701d.
   (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.
   (d) "Program" means the California Voluntary Contribution Program.

   (e) A "qualified applicant" means a charitable organization that
meets the requirements of either paragraph (1) or (2):
   (1) (A) Was incorporated in California at least five years prior
to the date of application.
   (B) 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 under the terms of the Attorney General's Registry
of Charitable Trusts.
   (C) Has submitted annual tax-exempt filings with the Internal
Revenue Service for each of the three years prior to the data of
application.
   (D) Has average annual total revenues in excess of the minimum
contribution level described in Section 18705, as calculated from
each of the three years prior to the date of application.
   (2) Is a state or local agency.
   (f) This section shall become operative on January 1, 2016.
   18702.  (a) There is hereby established in state government the
California Voluntary Contribution Program and the Office of
California Volunteers.
   (b) The purpose of the program is to promote charitable giving and
provide individual taxpayers' voluntary contributions to qualified
applicants. The office shall be responsible for administering the
program.
   (c) This section shall become operative on January 1, 2016.
   18703.  (a) An applicant who wishes to receive voluntary
contributions through the program shall submit an application to the
program no later than April 1 of each calendar year. The application
shall include all of the following:
   (1) Evidence satisfactory to the office that the applicant is a
qualified applicant as defined in Section 18701. All documents
submitted to the office shall be made public.
   (2) An application fee, as established by the office pursuant to
Section 18701, in an amount sufficient to cover the reasonable
regulatory cost to the office for carrying out the application
process.
   (b) The office shall approve an application if the requirements of
subdivision (a) 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 each year 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 established for the program, as described in Section 18705.
   (b) The qualified applicant continues to meet the requirements
established for qualified applicants in 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 adopt
regulations to adjust the minimum contribution requirement every five
calendar years, beginning with the third calendar year after the
first appearance of the "California Voluntary Contributions Fund" on
the personal income tax return.
   (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, as
described in Section 18705.
   (2) The designee no longer meets the definition of a "qualified
applicant" pursuant to Section 18701.
   (b) When a qualified applicant is no longer eligible to receive
voluntary charitable contributions pursuant to this article, the
office shall immediately revoke the eligibility of the qualified
applicant from the program.
   (c) A qualified applicant whose eligibility is revoked from
participation in the program may reapply to the program no sooner
than five years after the eligibility was revoked.
   (d) 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 qualified applicant whose application has 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.
   (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 include a space labeled
"California Voluntary Contributions Program," 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 qualified applicant 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) There is hereby established in the State Treasury the
California Voluntary Contribution Fund to receive contributions from
voluntary taxpayer contributions made pursuant to Section 18707.
   (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 individuals have
designated pursuant to Section 18707 to be transferred to the
California Voluntary Contribution 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 pursuant to Section 18707 for payment into
that fund.
   (c) This section shall become operative on January 1, 2017.
   18709.  (a) All money transferred to the California Voluntary
Contribution 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 the office for distribution to each qualified applicant
designated by a taxpayer.
   (b) On and after January 1, 2018, no more than 5 percent of money
from the fund, 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, 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 General Fund.
   (e) In the event an individual designates a contribution to a
qualified applicant whose eligibility for receiving voluntary
contributions has been revoked, the moneys shall be held for up to
five years and may be distributed to the designee only if and when
the designee becomes a qualified applicant once again. If the
designee fails to become a qualified applicant within five years
after their eligibility is revoked, the funds shall be transferred to
the General Fund.
   (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 regulatory
cost 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 since it did not meet
the required minimum contribution amount.
   (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.
   (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) Not later than January 1, 2017, 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. 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.
   (e) This section shall become operative on January 1, 2016.
   18711.  (a) 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).
   (b) This section shall become operative on January 1, 2016.