State Legislative - Week of May 14, 2010

 

Cable Television Industry Procurement Practices.  Assembly Bill 2758 (Bradford) would impose requirements that currently apply to regulated public utilities related to Women, Minority, and Disabled Veterans Business Enterprise contracting to competitive cable television and broadband providers.  Cable operators have national procurement processes that promote diversity procurement on a national level should not be subject to state specific requirements.  Moreover, many competitive technologies to cable are unregulated, and a diverse, competitive industry should not be subjected to unnecessary regulation. AB 2758 was scheduled to be heard in the Assembly Appropriations Committee on Wednesday, May 12th, however the bill has been rescheduled to now be heard Wednesday, May 19th.   
 
Split Roll Property Tax.  Assembly Bill 2492 (Ammiano) as recently amended, would allow commercial or business property to be reassessed when 100% of ownership interests in a legal entity is sold or transferred in a single transaction: the property is deemed to have changed ownership or regardless of whether any one entity/individual has acquired more than 50 percent of the ownership interest. The bill also now includes intent language specifying that the target of the bill is mergers and acquisitions by banks and financial institutions. This bill was heard in Assembly Revenue & Taxation Committee on Monday, May 10, 2010.  After a lengthy testimony by both support and opposition, the bill was first moved to the committee’s suspense file, then was pulled off the suspense file and approved on a party-line vote, with Democrats voting “aye” and Republicans voting “no.”  The bill, which will require a two-thirds vote if it reaches the Assembly Floor, now moves to the Assembly Appropriations Committee.
 
Mandatory Single Sales Factor (SSF) Apportionment.  AB 1935 (De Leon) would require all businesses in California to apportion their income pursuant to a single sales factor.  The bill would be effective immediately, if passed, but would be operative for taxable years beginning on or after January 1, 2011.  The Franchise Tax Board has estimated that the adoption of this proposal would result in an annual General Fund gain of:
 
·         $135 million in fiscal year (FY) 2010-11;
·         $450 million in FY 2011-12;
·         $600 million in FY 2012-13; and,
·         $500 million in FY 2013-14.
 
AB 1935 was heard in the Assembly Revenue and Taxation Committee last week and was placed in the committee’s suspense file.”  The Committee this week allowed the author to again present this bill to the Committee for consideration and it was passed out of committee on a party line vote, with Democrats voting “aye” and Republicans voting “no”.  This bill now moves to Assembly Appropriations .  Because it will result in a tax increase for businesses, this bill would require a two-thirds vote of both the Assembly and Senate for ultimate passage.