Approved 2001 Minutes - Thursday, January 4, 2001


Thursday, January 4, 2001

The Board met at its offices at 450 N Street, Sacramento, at 9:30 a.m. with Chairman Parrish, Vice Chairman Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel present on behalf of Dr. Connell in accordance with Government Code Section 7.9.

ANNOUNCEMENT OF CLOSED SESSION

The Board went immediately into closed session with Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel present.

CLOSED SESSION

The Board met to discuss personnel matters and Revenue and Taxation Code 7093.5, 30459.1 and 50156.11 settlements and pending litigation.

The Board recessed at 9:32 a.m. and reconvened at 11:05 a.m. in open session with Mr. Parrish, Mr. Chiang, Mr. Klehs and Mr. Andal present.

EXECUTIVE DIRECTOR'S REPORT

James E. Speed, Executive Director, announced that Delena Bratton, Chief, Customer and Taxpayer Services Division, will be on an extended intergovernmental assignment on behalf of the United States Department of Treasury. She will be heading a customer service program in Macedonia.

ADMINISTRATIVE MATTERS, CONSENT

With respect to the Administrative Matters, Consent Agenda, upon a single motion of Mr. Andal, seconded by Mr. Parrish and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs and Mr. Andal voting yes, Ms. Mandel absent, the Board made the following orders:

Action: Adopt the following resolution (Exhibit 1.5) extending its best wishes on their respective retirements and its appreciation for their service to the Board and the State of California.

Michael J. Violette, Business Taxes Specialist I, Van Nuys District Office
Jesse Ducay, Business Taxes Specialist II, Public Information and Administration Section, Headquarters
Lynda Louise Stewart, Administrative Assistant II, Sales and Use Tax Administration, Field Operations Division, Headquarters

Action: Approve the September 13-14, 2000 minutes.

Action: Approve the non-substantive revision to Compliance Policy and Procedures Manual (CPPM).

Exhibits to these Minutes are incorporated by reference.

LEGISLATIVE COMMITTEE REPORT

Margaret Shedd, Legislative Counsel, presented the Legislative Committee Report (Exhibit 1.6).

Mr. Klehs moved to support Item 1-9 using the same language used in the Legislature's 1993 revision to the Kopp Act. The motion was seconded by Mr. Andal but failed to carry, Mr. Klehs and Mr. Andal voting yes, Mr. Parrish and Mr. Chiang voting no, Ms. Mandel absent.

Mr. Andal moved to support Item 1-11, imposing campaign limits on County Assessors. The motion was seconded by Mr. Klehs but failed to carry, Mr. Andal voting yes, Mr. Parrish, Mr. Chiang and Mr. Klehs voting no, Ms. Mandel absent.

The Board deferred consideration of Item 3.5 to the next Legislative Committee Meeting.

Upon motion of Mr. Andal, seconded by Mr. Chiang and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs and Mr. Andal voting yes, Ms. Mandel absent the Board approved the remaining items on the committee report.

CUSTOMER SERVICES & ADMINISTRATIVE EFFICIENCY COMMITTEE

Delena Bratton, Chief, Customer and Taxpayer Services Division, presented the Customer Services & Administrative Efficiency Committee Report (Exhibit 1.7). Upon motion of Mr. Chiang, seconded by Mr. Andal and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, and Mr. Andal voting yes, Ms. Mandel absent, the Board approved the committee report.

Ms. Mandel entered the Boardroom.

BUSINESS TAXES COMMITTEE

Charlotte Paliani, Program Planning Manager, Sales and Use Tax Department, presented the Business Taxes Committee Report (Exhibit 1.8).

Upon motion of Mr. Chiang, seconded by Mr. Andal and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board approved the committee report.

LEGISLATIVE COMMITTEE REPORT

Ms. Mandel stated for the record she was abstaining on Item 1-9.

CHIEF COUNSEL MATTERS, STATE ASSESSEE PETITIONS FOR REASSESSMENT OF UNITARY VALUE

Upon motion of Mr. Andal, seconded by Mr. Klehs and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs and Mr. Andal voting yes, Ms. Mandel not participating, the Board ordered the following:

All American Pipeline L.P. (465) SAU00-026, 76074

$70,600,000.00

Action: Grant petition for reassessment reducing its 2000 unitary value from $88,600,000.00 to $70,600,000.00.

CHIEF COUNSEL MATTERS, RULEMAKING

Mr. Klehs motioned to approve Option 1, with regards to Regulation 1803.5, Long Term Leases of Motor Vehicles. Mr. Andal offered a substitute motion to approve Option 2. The motion was seconded by Mr. Parrish and duly carried, Mr. Parrish, Mr. Andal and Ms. Mandel voting yes, Mr. Chiang and Mr. Klehs voting no.

LEGAL APPEALS MATTERS, ADJUDICATORY

Molycorp, Inc., SR EH 23-114830; 89000397070; 16864, 48848

1-1-93 to 12-31-98, $00.00 Tax

Considered by the Board: Hearing Request Withdrawn

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Mr. Klehs and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered that the claim for refund be granted as recommended by Appeals.


Arman Vakili, Alex Ghomizadeh & Allen Monshietehadi, SR EAA 99-136397; 89002118100

4-1-95 to 3-31-98, $80,396.69

Considered by the Board: Petition for Rehearing

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Mr. Klehs and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered to deny the petition for rehearing.


Sanchez Celso Apaez, SR AC 13-879905; 89000098170

7-1-94 to 6-30-97, $9,612.51 Tax, $961.26 Penalty, Negligence

Considered by the Board: Hearing Request Withdrawn

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Parrish, seconded by Mr. Andal and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered that the negligence penalty be deleted.

Upon motion of Mr. Andal, seconded by Mr. Klehs, and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered that the petition be redetermined as recommended by Appeals.

FRANCHISE AND INCOME TAX MATTERS, ADJUDICATORY

Jayne E. Okruhlik, 31902

1995, $276.00

Submitted for Decision: November 28, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board adopted a decision sustaining the action of the Franchise Tax Board.


SDV (USA), Inc., 41859

1989, $1.00 or more Claim for Refund

1990, $1.00 or more Claim for Refund

1991, $1.00 or more Claim for Refund

Submitted for Decision: December 14, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board adopted a decision sustaining the action of the Franchise Tax Board.


Yuan Ji Su, 89002459600

1990, $112,281.00 Assessment, $28,070.00 Penalty

1993, $ 15,810.00 Assessment, $ 3,162.00 Penalty

1994, $ 13,610.00 Assessment, $ 2,722.00 Penalty

Considered by the Board: December 14, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board adopted a decision sustaining the action of the Franchise Tax Board.


Ali Tasdighi, 42972

1993, $ 279.00 Assessment

1994, $39,764.00 Assessment

Considered by the Board: December 14, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board adopted a decision sustaining the action of the Franchise Tax Board.


Donald D. Brown, 15711

1993, $1.00 or more Assessment

1996, $1.00 or more Assessment

Submitted for Decision: November 28, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Andal, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board adopted a decision denying the petition for rehearing.


Ralph T. Brandifino, 40694

1997, $1,236.00 Assessment, $309.00 Penalty

Submitted for Decision: December 14, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Ms. Mandel, seconded by Mr. Klehs and duly carried, Mr. Parrish, Mr. Klehs, Mr. Chiang and Ms. Mandel voting yes, Mr. Andal voting no, the Board adopted a decision sustaining the action of the Franchise Tax Board.


Leonard Jaffe, 30751

1991, $12,390.00 Assessment

1992, $ 2,182.00 Assessment

Submitted for Decision: December 14, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Ms. Mandel moved to grant the petition without rehearing, the motion failed for lack of a second.

Mr. Andal motioned to defer this matter to the January 23, 2001 Board meeting. The motion was seconded by Mr. Parrish and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes.


Gerald H. & Elizabeth A. Beaulaurier, 99A-0012; 89002466420

1984, $3,298.00 Assessment

1985, $4,108.00 Assessment


Lothar & Eveline Schmidt, 99R-0022; 89002465680

1983, $1,078.71 Claim for Refund

1984, $2,191.91 Claim for Refund

1985, $3,555.23 Claim for Refund

1986, $1,669.30 Claim for Refund


Clarence E. & Joan M. Bonner; 99N-0013; 89002466520

1984, $3,438.09 Claim for Refund

1985, $5,389.00 Assessment


Howard & Helen Fox, 99R-0032; 89002467610

1983, $4,288.85 Claim for Refund

1984, $5,704.57 Claim for Refund

1985, $4,362.60 Claim for Refund

Submitted for Decision: November 28, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Klehs, seconded by Mr. Andal and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board adopted a decision granting the petition for rehearing.

SPECIAL TAXES MATTERS, ADJUDICATORY

Mobil Oil Corporation, MD MT 007-000754

6-9-93, $95,940.80 Claim for Refund

Considered by the Board: November 2, 2000

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Action: Upon motion of Mr. Klehs, seconded by Mr. Andal and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs and Mr. Andal voting yes, Ms. Mandel not participating, the Board approved the refund as recommended by staff.

LEGAL APPEALS MATTERS, CONSENT

With respect to the Legal Appeals Matters, Consent Agenda, upon a single motion of Mr. Andal, seconded by Mr. Chiang and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board made the following orders:

B T B Events Inc., SR EA 024-861282; 89000476380

10-1-92 to 6-30-95, $5,266.07 Tax

Considered by the Board: Hearing Notice Sent - No Response

Action: Redetermine as recommended by Appeals Section.


Majors Scientific Books, Inc., SC OH 30-619030; 89000812840

4-1-94 to 3-31-97, $9,538.24 Tax

Considered by the Board: Hearing Notice Sent - No Response

Action: Redetermine as recommended by Appeals Section.


Pharmacia, Inc., SS OHA 30-666894; 8900084410

10-1-93 to 4-30-96, $120,487.68 Tax

Considered by the Board: Hearing Notice Sent - Appearance Waived

Action: Redetermine as recommended by Appeals Section.


Couple Up, Inc., SR AA 14-738976; 89000122330, -320

1-1-95 to 10-20-95, $00.00 Tax,

$1,28490 Penalty, Finality

Considered by the Board: Hearing Request Withdrawn

Action: Deny the claim for refund and redetermine as recommended by Appeals Section.


Sgarlato Laboratories, Inc., SR GH 26-827286; 89000689880

-1-93 to 6-30-96, $00.00 Tax

Considered by the Board: Hearing Request Withdrawn

Action: Redetermine as recommended by Appeals Section.


LEHK, Inc. et al., SR GH 99-425620; 89002248140

1-1-94 to 12-31-96, $00.00 Tax

Considered by the Board: Hearing Request Withdrawn

Action: Redetermine as recommended by Appeals Section.


The Kadan Group, SR BHA 99-563480; 89002309980

1-1-95 to 12-31-97, $100,119.81 Tax

Considered by the Board: Hearing Request Withdrawn

Action: Redetermine as recommended by Appeals Section.


Kris Kuo-Shian Yang, SR CH 99-429752-010; 89002250400

1-1-93 to 6-30-96, $00.00 Tax

Considered by the Board: Hearing Request Withdrawn

Action: Redetermine as recommended by Appeals Section.


NEC Electronic U.S.A., Inc., SY GH 26-619802; 89000641790, -770; -780

10-1-87 to 12-31-90, $539,746.80 Refund

SY GH 26-619802; 89000641770

4-1-95 to 12-31-96, $203,046.63 Refund

Considered by the Board: Hearing Request Withdrawn

Action: Redetermine as recommended by Appeals Section.


James T. & Tresa C. Shaw, SR AB 16-653118; 89000183840

4-1-93 to 3-31-96, $5,663.83 Tax, $00.00 Penalty

Considered by the Board: Hearing Request Withdrawn

Action: Grant the petition for rehearing.

FRANCHISE AND INCOME TAX MATTERS, CONSENT

The Board deferred consideration of the following matters: Salvatore & Roberta Gangi, 49555, James & Janice E. Vines, 37455, and Thomas & Betts Corporation, 32822.

With respect to the Franchise & Income Tax Matters, Consent Agenda, upon a single motion of Mr. Andal, seconded by Mr. Chiang and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs Mr. Andal and Ms. Mandel voting yes, the Board made the following orders:

Jackie S. DeVries, 53047

1982, $1.00 or more Claim for Refund

1988, $1.00 or more Claim for Refund

1990, $1.00 or more Claim for Refund

1992, $1.00 or more Claim for Refund

1993, $1.00 or more Claim for Refund

1994, $1.00 or more Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Stephen & Suzanne Diamond, 99A-0150; 89002467110

1993, $247,734.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Anna B. Doughty, 42875

1995, $1,901.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Salvatore & Roberta Gangi, 49555

1981, $2,038.00 Assessment

Action: The Board deferred consideration in this matter.


Enrique A. Grijalva, 62132

1996, $1,658.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Todd R. Jindra & Theresa A. Hayes, 34344

1995, $1,989.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


John M. Huffman, 66428

1996, $1,151.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Kenji Kamiya, 37272

1995, $751.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Ramon & Denise Kolisar, 41123

1995, $869.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Marla C. Larson, 49678

1995, $930.24 Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Layton Enterprises, Inc., 31934

1995, $47,423.82 Assessment

Action: Sustain the action of the Franchise Tax Board.


Stuart & Mary Lichter, 58805

1994, $12,615.70 Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Gary D. Montgomery, 36518

1995, $570.00 Assessment, $142.50 Penalty

Action: Sustain the action of the Franchise Tax Board.


Andrea Nichols, 59609

1982, $1.00 or more Claim for Refund

1983, $1.00 or more Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


P. Perez, 33151

1995, $128.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Charles & Dorothy N. Palmer, 47996

1994, $1,510.60 Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Douglas Park, 41961

1997, $166.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Harold E. Phelps, III, 49765

1995, $128.31 Assessment

Action: Sustain the action of the Franchise Tax Board.


Richard & Kathleen Pimentel, 58906

1996, $1,212.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Philip M. & Beverly A. Purnell, 47187

1991, $5,142.20 Assessment

Action: Sustain the action of the Franchise Tax Board.


Patric & Laura Roesch, 63020

1996, $1.00 or more Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Larin V. & Joan M. Schwab, 41858

1996, $404.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Russell E. Spitler, 37442

1988, $1.00 or more Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Arthur H. & Suzanne G. Stolnitz, 98R-0078; 89002465890

1992, $10,505.00 Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


Donald P. & Carla R. Stuckey, 49606

1995, $1,449.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


W. Robert & Jodi Tibbs, 61396

1995, $219.00 Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


James & Janice E. Vines, 37455

1995, $27,683.00 Assessment

Action: The Board deferred consideration in this matter.


Eric & Mary Louise Weissmann, 42991

1990, $1.00 or more Claim for Refund

Action: Sustain the action of the Franchise Tax Board.


David N. Wilson, 49624

1995, $1,591.00 Assessment

Action: Sustain the action of the Franchise Tax Board.


Gary R. Burns, 27791

1995, $12,180.75 Claim for Refund

1996, $ 3,691.50 Claim for Refund

Action: Deny the petition for rehearing.


George L. Darrow, 98A-1249; 89002460500

1988, $13,557.00 Assessment, $4,067.10 Penalty

1990, $ 2,325.00 Assessment, $ 697.50 Penalty

Action: Deny the petition for rehearing.


Robert E. Davis, 18715

1993, $202.20 Claim for Refund

Action: Deny the petition for rehearing.


Catherine J. Hill, 27566

1997, $1,492.00 Assessment, $373.00 Penalty

Action: Deny the petition for rehearing.


Abbas Kayvan, 27627

1995, $1,447.00 Assessment

Action: Deny the petition for rehearing.


Harold E. Phelps, III, 31722

1994, $1.00 or more Assessment

Action: Deny the petition for rehearing.


Antoinette Sementilli, 18900

1993, $ 3,250.00 Assessment

1994, $21,227.00 Assessment

1995, $ 3,155.00 Assessment

Action: Deny the petition for rehearing.


Thomas & Betts Corporation, 32822

1987, $18,361.00 Assessment

1988, $47,817.00 Assessment

1988, $ 1,981.00 Assessment

1989, $35,191.00 Assessment

1990, $ 2,076.00 Assessment

Action: The Board deferred consideration in this matter.

HOMEOWNER AND RENTER PROPERTY TAX ASSISTANCE MATTERS, CONSENT

The Board deferred consideration of the following matter: R.G. Man, 60937.

With respect to the Homeowner and Renter Property Tax Assistance Matters, Consent Agenda, upon a single motion of Mr. Andal, seconded by Mr. Klehs and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs Mr. Andal and Ms. Mandel voting yes, the Board made the following orders:

Bette Dean, 79055

1997, $660.40 Claim for Credit

1998, $ 77.50 Claim for Credit

Submitted for Decision: October 13, 2000

Action: Sustain the action of the Franchise Tax Board.


Kathy Fant, 60048

1998, $147.50 Claim for Credit

Submitted for Decision: October 31, 2000

Action: Sustain the action of the Franchise Tax Board.


Colleen Farnell, 57613

1999, $61.02 Claim for Credit

Submitted for Decision: October 25, 2000

Action: Reverse the action of the Franchise Tax Board and direct FTB to pay additional assistance in the amount of $14.14.


Ralph J. Henz, 60765

1997, $1.00 or more Claim for Credit

Submitted for Decision: September 19, 2000

Action: Sustain the action of the Franchise Tax Board.


Alejandro A. Hernandez, 57619

1997, $77.50 Claim for Credit

Submitted for Decision: October 25, 2000

Action: Sustain the action of the Franchise Tax Board.


June C. Herrmann, 63421

1999, $13.75 Claim for Credit

Submitted for Decision: October 25, 2000

Action: Sustain the action of the Franchise Tax Board.


Cyndi L. Ingram, 63422

1998, $35.00 Claim for Credit

Submitted for Decision: September 19, 2000

Action: Sustain the action of the Franchise Tax Board.


Kathryn Lennon, 48800

1999, $272.76 Claim for Credit

Submitted for Decision: September 29, 2000

Action: Sustain the modified action of the Franchise Tax Board.


James E. London, 63426

1997, $10.00 Claim for Credit

Submitted for Decision: October 30, 2000

Action: Sustain the action of the Franchise Tax Board.


Fernando Lopez, 52433

1999, $1.00 Claim for Credit

Submitted for Decision: September 28, 2000

Action: Sustain the action of the Franchise Tax Board.


R.G. Man, 60937

1998, $92.50 Claim for Credit

Submitted for Decision: October 18, 2000

Action: The Board deferred consideration in this matter.


Rita Martinez, 52442

1999, $1.00 Claim for Credit

Submitted for Decision: September 29, 2000

Action: Sustain the action of the Franchise Tax Board.


Patsy Mays, 42435

1999, $240.00 Claim for Credit

Submitted for Decision: September 29, 2000

Action: Reverse the action of the Franchise Tax Board.


Judith Miller, 55405

1998, $1.00 Claim for Credit

Submitted for Decision: October 18, 2000

Action: Sustain the action of the Franchise Tax Board.


William Mintz, 52447

1999, $7.00 Claim for Credit

Submitted for Decision: September 29, 2000

Action: Sustain the action of the Franchise Tax Board.


Herman Reich, 60930

1999, $345.20 Claim for Credit

Submitted for Decision: October 18, 2000

Action: Sustain the modified action of the Franchise Tax Board.


Lucy T. Sanders, 50934

1999, $1.00 or more Claim for Credit

Submitted for Decision: October 10, 2000

Action: Sustain the action of the Franchise Tax Board.


Adeline M. Sheehan, 50945

1999, $1.00 or more Claim for Credit

Submitted for Decision: October 10, 2000

Action: Sustain the action of the Franchise Tax Board.


Agnes M. Simpkins, 76055

1997, $88.97 Claim for Credit

1998, $ 1.00 Claim for Credit

Submitted for Decision: November 13, 2000

Action: Sustain the action of the Franchise Tax Board.


Aldora Streets, 76056

1998, $240.00 Claim for Credit

Submitted for Decision: October 24, 2000

Action: Sustain the action of the Franchise Tax Board.


Boyd W. Warnock, 51730

1999, $255.60 Claim for Credit

Submitted for Decision: October 10, 2000

Action: Sustain the action of the Franchise Tax Board.

SALES AND USE TAX MATTERS, REDETERMINATIONS AND DENIALS OF CLAIMS FOR REFUNDS, CONSENT

With respect to the Sales and Use Tax, Redeterminations and Denials of Claims for Refunds, Consent Matters, upon a single motion of Mr. Klehs, seconded by Mr. Chiang and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board made the following orders:

Price Pfister Inc., SR AC 013-771444; 89000075590

10-1-93 to 12-31-96, $159,874.23

Action: Redetermine as recommended by staff.


GTEL, SR Z AR 018-702742; 89000240210

1-1-92 to 12-31-95, $402,000.82

Action: Redetermine as recommended by staff.


GTEL, SR Z AR 018-702742; 42525

1-1-96 to 10-31-96, $268,799.64

Action: Redetermine as recommended by staff.


Ross Stores, Inc., SR Y CHA 020-603846; 89000299290

7-1-95 to 9-30-95, $63,461.84

Action: Redetermine as recommended by staff.


AVCO Financial Services of Southern California, Inc., SR Y EAA 024-789986, 48307

4-1-95 to 6-30-98, $1,594,637.21

Action: Redetermine as recommended by staff.


Safeco Credit Company Inc., SR S OH 030-617551; 89000812260

4-1-93 to 6-30-96, $145,129.37

Action: Redetermine as recommended by staff.


Raytheon Engineer & Constructor Inc., SR S OHB 030-679896; 52775

7-1-95 to 6-30-98, $57,043.51

Action: Redetermine as recommended by staff.


R O I Development Corporation, SP H UT 084-008218; 91692

12-19-98, $183,425.00

Action: Redetermine as recommended by staff.


Reno Air, Inc., SR S AS 099-109553; 33981

7-1-94 to 12-31-97, $58,644.00

Action: Redetermine as recommended by staff.


Mac Dermid Equipment Inc., SC OHB 099-116274; 33719

7-1-95 to 9-30-98, $60,959.53

Action: Redetermine as recommended by staff.


Elizabethan Inn Association, Ltd. Ptn., SR KH 099-247284; 89002166070

4-1-88 to 12-31-95, $94,140.77

Action: Redetermine as recommended by staff.


JRH Biosciences, Inc., SC OHA 099-604179; 89002325140

10-1-94 to 9-30-97, $79,095.03

Action: Redetermine as recommended by staff.


Gold Apple Lounge, SR AC 13-607329, 77458

4-1-93 to 3-31-96, $53,100.66

Action: Deny claim for refund as recommended by staff.

SALES AND USE TAX MATTERS, CREDITS, CANCELLATIONS AND REFUNDS, CONSENT

With respect to the Sales and Use Tax, Credits, Cancellations and Refunds, Consent Matters, upon a single motion of Mr. Andal, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs Mr. Andal and Ms. Mandel voting yes, Mr. Chiang not participating in GTE California Incorporated, SR Y OHC 098-000236; 91781, the Board made the following orders:

Ventura Printing, SR AR 015-039860; 94092

10-1-95 to 9-30-98, $70,644.70

Action: Approve credit and cancellation as recommended by staff.


Cytec Industries, Inc., SC OHB 099-426336; 89002248460

1-1-94 to 12-31-96, $1,118,702.49

Action: Approve credit and cancellation as recommended by staff.


Bristol-Myers Company, SR S OHB 011-259445; 60717

1-1-97 to 12-31-99, $631,325.44

Action: Approve refund as recommended by staff.


Monarch Litho Inc., SR AA 017-682278; 60147

1-1-96 to 12-31-98, $68,264.70

Action: Approve refund as recommended by staff.


Budget Rent-A-Car Systems Inc., SR Y OHC 021-761366; 93909

7-1-94 to 6-30-97, $192,789.95

Action: Approve refund as recommended by staff.


No Fear Inc., SR FHB 025-895038; 58152

7-1-96 to 3-31-00, $92,188.58

Action: Approve refund as recommended by staff.


Acuson, SR GH 026-735891; 80561

7-1-98 to 12-31-99, $79,823.21

Action: Approve refund as recommended by staff.


Eddie J. Bailey, SR S KH 028-861482; 93100

1-1-97 to 3-31-00, $128,844.06

Action: Approve refund as recommended by staff.


Digital Equipment Corporation, SR S OHB 030-603292; 93190

4-1-95 to 12-31-99, $603,746.26

Action: Approve refund as recommended by staff.


Valmont Industries Inc., SC OHA 030-640538; 80563

1-1-99 to 3-31-99, $57,391.76

Action: Approve refund as recommended by staff.


Superior National Insurance Group Inc., SR AC 052-008651; 30340

4-1-96 to 12-31-99, $315,319.36

Action: Approve refund as recommended by staff.


Berck's Old Time Plumbing, Heating and Air Conditioning Inc., SR S FHB 097-669782; 93356

10-1-96 to 6-30-00, $77,667.26

Action: Approve refund as recommended by staff.


20th Century Insurance Company, SR AC 097-764846; 89088

4-1-97 to 12-31-99, $112,763.10

Action: Approve refund as recommended by staff.


GTE California Incorporated, SR Y OHC 098-000236; 91781

4-1-93 to 3-31-96, $1,658,574.25

Action: Approve refund as recommended by staff. Mr. Chiang not participating.


The Coca Cola Company, SR Z OHC 098-040866; 47179

1-1-96 to 3-31-97, $94,110.53

Action: Approve refund as recommended by staff.


The Dupuis Group, LLC, SR AC 099-876318; 27233

4-2-96 to 12-31-98, $158,112.12

Action: Approve refund as recommended by staff.


SPECIAL TAXES MATTERS, DENIALS OF CLAIM FOR REFUND AND REDETERMINATIONS, CONSENT

With respect to the Special Taxes Matters, Denials of Claim for Refund and Redeterminations, Consent Agenda, upon a single motion of Mr. Andal, seconded by Mr. Klehs and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, Mr. Chiang not participating in Chemical Waste Management, Inc., HA EF 036-000163; 90694, Ms. Mandel not participating in Tosco Corporation, MD MT 007-000977; 66230, the Board made the following orders:

Tosco Corporation, MD MT 007-000977; 66230

11-1-96 to 11-30-96, $76,340.88

Action: Deny the claim for refund as recommended by staff. Ms. Mandel not participating.


Chemical Waste Management, Inc., HA EF 036-000163; 90694

6-1-96 to 12-31-98, $246,124.78

Action: Redetermine as recommended by staff. Mr. Chiang not participating.

SPECIAL TAXES MATTERS, CREDITS, CANCELLATIONS AND REFUNDS, CONSENT

With respect to the Special Taxes Matters, Credits, Cancellations and Refunds, Consent Agenda, upon a single motion of Mr. Klehs, seconded by Mr. Andal and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs and Mr. Andal and Ms. Mandel voting yes, Ms. Mandel not participating in Tosco Corporation, MD MT 007-000977; 89000006100, Inter-State Assurance Company, IT ET 034-000437; 61498, Farmers New World Life Insurance Company, IT ET 034-000378; 30743, Alexander Hamilton Life Insurance Company of America, IT ET 034-004293; 77121, LifeUSA Insurance Company, IT ET 034-002355, American Home Assurance Company, IT ET 034-001006; 50849, the Board made the following orders:

Tosco Corporation, MD MT 007-000977; 89000006100

12-1-93 to 12-31-93, $674,936.73

Action: Approve the claim for refund as recommended by staff. Ms. Mandel not participating.


City of Sacramento, FR KH 028-654213; 89000742770

6-1-94 to 6-30-95, $56,664.25

Action: Approve the claim for refund as recommended by staff.


Jetro Lov, Inc., CR ET 002-001632; 93945

10-1-00 to 10- 31-00, $50,680.25

Action: Approve the claim refund as recommended by staff.


Inter-State Assurance Company, IT ET 034-000437; 61498

1-1-95 to 12-31-97, $277,289.09

Action: Approve the claim refund as recommended by staff. Ms. Mandel not participating.


Farmers New World Life Insurance Company, IT ET 034-000378; 30743

1-1-95 to 12-31-97, $527,913.34

Action: Approve the claim refund as recommended by staff. Ms. Mandel not participating.


Alexander Hamilton Life Insurance Company of America, IT ET 034-004293; 77121

1-1-96 to 12-31-96, $615,262.93

Action: Approve the claim refund as recommended by staff. Ms. Mandel not participating.


LifeUSA Insurance Company, IT ET 034-002355, 93102

1-1-98 to 12-31-98, $340,274.37

Action: Approve the claim refund as recommended by staff. Ms. Mandel not participating.


American Home Assurance Company, IT ET 034-001006; 50849

1-1-98 to 12-31-98, $84,258.41

Action: Approve the claim refund as recommended by staff. Ms. Mandel not participating.

TAXPAYER BILL OF RIGHTS REIMBURSEMENT CLAIM HEARING

Susan Lorie Tylock, TBR00-002-B; 50485; SR DHF 99-139281

8-8-94 to 3-19-99, $41,452.37 Claim for Reimbursement

For Claimant: Susan Lorie Tylock, President
Diane Moreno, Sales Manager
For Property Tax Department: Warren Astleford, Counsel

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Issues: Whether the Department's position on claimant's petition for redetermination, that the activation of the temperature recorders was a use prior to resale, was justified and reasonable.

Whether the amounts claimed as fees are reasonable.

Action: Upon motion of Mr. Andal, seconded by Mr. Parrish and duly carried, Mr. Parrish, Mr. Andal and Ms. Mandel voting yes, Mr. Chiang and Mr. Klehs voting no, the Board ordered that the claim for reimbursement be granted with respect to the fees.

Upon motion of Mr. Andal, seconded by Ms. Mandel and duly carried, Mr. Parrish, Mr. Chiang, Mr. Andal and Ms. Mandel voting yes, Mr. Klehs voting no, the Board ordered that the claim for reimbursement be granted for 238.7 hours at a rate of $75/hour.

The Board recessed at 11:55 a.m. and reconvened at 1:45 p.m. with Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel present.

BUSINESS TAXES HEARINGS

Estate of Ms. Anne Quarm (Deceased), SR CH 53-000289; 89000970150

William McCrae, SR CH 53-000292; 89000970160

1-1-90 to 6-30-95, $91,394.73 Tax, $16,363.39 Penalties

For Petitioner: Barry D. Ammon, Attorney
William McCrae
Jay Jacobes, Attorney
For Sales and Use Tax Department: Jeffrey Graybill, Counsel

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Issues: Whether the dual determination in the matter of the Estate of Ms. Anne Quarm (Deceased) is barred by the statute of limitations.

Whether taxpayers have met their burden of proving that the Board's determination of the measure of tax is erroneous.

Whether relief from the negligence and finality penalties should be granted.

Action: Upon motion of Mr. Andal, seconded by Mr. Parrish and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered that the negligence penalty be deleted and submitted the remainder of the petition, granting the petitioner 30 days to provide additional documentation, 30 days for the Department to review the documentation and 30 days to the Appeals Section to bring the matter back to the Board with a final recommendation.


Oracle Corporation, SY BHA 26-705155; 89000652330

7-1-89 to 12-31-92, $990,071.55 Tax, $99,007.13 Penalty, Negligence

For Petitioner: Appearance Waived
For Sales and Use Tax Department: David H. Levine, Counsel

Contribution Disclosures pursuant to Government Code Section 15626: Disqualifying contributions to Mr. Andal and Dr. Connell were disclosed. No other contributions were disclosed. Mr. Chiang not participating because of a conflict of interest pursuant to Government Code Section 87100.

Issues: Whether the evidence shows that petitioner's sales to MicroAge Federal/DTL Solutions qualify for exemption as sales to the U.S. Government.

Whether the evidence shows that petitioner's sale to National Federation of Independent Businesses qualifies as a sale in interstate commerce.

Whether petitioner's reported taxable sales, computed by a gross-up calculation method, accurately reflect the true measure of tax.

Whether the evidence shows that petitioner's charges for consulting and training services are nontaxable.

Whether relief from the negligence penalty is warranted.

Mr. Chiang, Mr. Andal and Ms. Mandel left the Boardroom.

Action: The Board deferred consideration to the next Sacramento Board meeting.

Mr. Chiang, Mr. Andal and Ms. Mandel entered the Boardroom.


Andronik Sogoyan, SR ARF 53-000057; 89000969520

4-1-90 to 6-30-92, $14,801.85 Tax, $20,516.47 Penalty, Fraud

$ 1,480.19 Penalty, Finality

FR ARF 53-000426; 89000970540

4-1-90 to 4-30-92, $197,425.38 Tax, $55,621.09 Penalty, Fraud

$19,742.54 Penalty, Finality

For Petitioner: Randall G. Dick, Attorney
Andronik Sogoyan
For Sales and Use Tax Department: Sharon Jarvis, Counsel

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Issues: Whether the Board properly issued Notices of Determination to petitioner as an owner of the business.

Whether relief from the 25 percent penalty imposed for fraud or the intent to evade payment of the tax is warranted.

Whether relief from the 10 percent penalty for failure to pay the determination timely is warranted.

Action: Mr. Parrish moved to grant the petition, the motion was seconded by Mr. Chiang but failed to carry, Mr. Parrish and Mr. Chiang voting yes, Mr. Klehs, Mr. Andal and Ms. Mandel voting no.

Upon motion of Mr. Klehs, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered that the petition be submitted for decision.


Kevin Folsom, SR KHJ 99-633016; 33995

7-1-96 to 12-31-98, $2,301.24

For Petitioner: Appearance Waived
For Sales and Use Tax Department: Sharon Jarvis, Counsel

Contribution Disclosures pursuant to Government Code Section 15626: No contribution disclosure form filed.

Action: Upon motion of Mr. Klehs, seconded by Ms. Mandel and unanimously carried, Mr. Parrish, Mr. Chiang, Mr. Klehs, Mr. Andal and Ms. Mandel voting yes, the Board ordered that the petition be redetermined as recommended by the Appeals Section.


Todd M. Lutes & M. Naser Aboui, SR KH 99-834839-010; 32192

1-2-96 to 12-31-98, $7,050.48

For Petitioner: Todd Lutes
For Sales and Use Tax Department: Robert Tucker, Counsel

Contribution Disclosures pursuant to Government Code Section 15626: No contributions were disclosed.

Issue: Whether the evidence shows that the sales to the out-of-state purchasers are exempt sales in interstate commerce.

Action: Upon motion of Mr. Klehs, seconded by Mr. Andal and unanimously carried, Mr. Andal, Mr. Parrish, Mr. Klehs, Mr. Chiang and Ms. Mandel voting yes, the Board ordered that the petition be submitted for decision.

The Board recessed at 3:05 p.m. and reconvened at 3:10 p.m. with Mr. Parrish, Mr. Chiang, Mr. Andal, Mr. Klehs and Ms. Mandel present.

FINAL ACTION ON PETITIONS HEARD JANUARY 4, 2001

Upon motion of Mr. Andal, seconded by Mr. Klehs and duly carried, Mr. Andal, Mr. Klehs and Ms. Mandel voting yes, Mr. Parrish and Mr. Chiang voting no, the Board ordered that the petition of Andranik Sogoyan, SR ARF 53-000057; 89000969520, FR ARF 53-000426; 89000970540, be denied.

Upon motion of Mr. Andal, seconded by Mr. Klehs and unanimously carried, Mr. Andal, Mr. Parrish, Mr. Klehs, Mr. Chiang and Ms. Mandel voting yes, the Board ordered that the petition of Todd M. Lutes & M. Naser Aboui, SR KH 99-834839-010; 32192, be denied.

The Board adjourned at 3:15 p.m.



The foregoing minutes are adopted by the Board on March 29, 2001.