1 BEFORE THE CALIFORNIA STATE BOARD OF EQUALIZATION 2 5901 GREEN VALLEY CIRCLE 3 CULVER CITY, CALIFORNIA 4 5 6 7 REPORTER'S TRANSCRIPT 8 JUNE 24, 2011 9 10 ---o0o--- 11 12 LEGISLATIVE COMMITTEE 13 14 ---o0o--- 15 16 17 18 19 20 21 22 23 Reported by: Juli Price Jackson 24 No. CSR 5214 25 26 27 28 1 1 P R E S E N T 2 3 For the Board Jerome E. Horton of Equalization: Chairman 4 5 Michelle Steel Vice-Chairwoman 6 7 Betty T. Yee Member 8 9 George Runner Member 10 11 Marcy Jo Mandel Appearing for John 12 Chiang, State Controller (per 13 Government Code Section 7.9) 14 15 Diane G. Olson Chief, Board 16 Proceedings Division 17 18 For the staff: Margaret Shedd Chief, Legislative 19 and Research Division 20 21 Kevin Hanks Chief, Headquarters 22 Operations Division 23 24 ---oOo--- 25 26 27 28 2 1 5901 GREEN VALLEY CIRCLE 2 CULVER CITY, CALIFORNIA 3 JUNE 24, 2011 4 ---oOo--- 5 MR. HORTON: Our next order of business? 6 MS. OLSON: Our next item is the Legislative 7 Committee. 8 MR. HORTON: Members, we have a couple of items 9 on the Legislative Committee, of which Miss Margaret 10 Shedd will introduce the items for us and give us an 11 overview. 12 MS. SHEDD: Thank you, Mr. Chair and Members of 13 the Committee. 14 There are two items on the agenda. The first 15 is a legislative proposal, which can be considered by 16 the Board to be adopted as a Board-sponsored proposal. 17 This is suggested by Senator Runner. And it 18 would amend the sales tax and use tax law to specify a 19 due date of April 15th for eligible purchasers, as 20 defined, who have incurred use tax liabilities on 21 purchases made during the previous calendar quarter. 22 This date would be April 15th, which is 23 consistent with the new qualified purchaser program that 24 was enacted in 2009. 25 It's also consistent with when taxpayers pay 26 their use tax liability on their FTB form, that is 27 April 15th. This would make that consistent. It does 28 not have a revenue impact. It's meant to be 3 1 clarification and consistency and certainty for 2 taxpayers. 3 And the staff recommendation is support. 4 MR. HORTON: Thank you Ms. Shedd. 5 Discussion, Members? 6 Mr. Runner, none? 7 MR. RUNNER: None. 8 MR. HORTON: Further discussion, Members? 9 MS. YEE: I just have one question. 10 Processwise, where is this going and when? 11 MS. SHEDD: There's thought to put it into -- 12 if there is -- if this is a consent item and it's 13 noncontroversial, which I think it probably is, it will 14 go into one of our Board-sponsored bills, which is a 15 committee bill, and we can do it this year. 16 MS. YEE: Okay, thank you. 17 MR. RUNNER: So moved. 18 MS. STEEL: Second. 19 MR. HORTON: It's been moved and seconded by 20 Ms. Steel. 21 Without objection, Members, such will be the 22 order. 23 Miss Shedd, the next item on the agenda? 24 MS. SHEDD: The next item on the agenda is 25 AB 1424. This bill was recently amended on June 7th. 26 It gutted out Board provisions that were Board-sponsored 27 and it authorized State licensing agencies to suspend or 28 not reactivate, issue or renew a State license, 4 1 including driver's license, for a person whose name 2 appears on the FTB's top 50 -- 250 largest tax 3 delinquency list. 4 And if the State licensing agency does not 5 choose to do so, the bill requires the FTB to suspend 6 the person's license. The amendments to be considered 7 are extending this to the Board of Equalization, with 8 the additional safeguard that requires the Board of 9 Equalization to determine on a case by case basis which 10 debtor it recommends for a license suspension, taking 11 into account all of the facts and circumstances and 12 whether a suspension would be in the best interests of 13 the State. 14 There are several other provisions within the 15 bill that apply to the FTB that could be made applicable 16 to the Board of Equalization. The staff recommendation 17 on these amendments' extension to BOE is neutral. 18 MR. HORTON: Discussion, Members? 19 MS. YEE: Mr. Chairman? 20 MR. HORTON: Member Yee? 21 MS. YEE: Thank you. I appreciate what this 22 proposal is trying to do. I am a little concerned it 23 may be a little too much at once. Let me see if I can 24 kind of focus on the discussion. 25 I think the -- and I am looking also at the -- 26 at these charts that speak to the cost benefit ratio. 27 And I'm concerned about the minimal cost benefit ratio 28 with respect to extending the top 250 list to 500 under 5 1 the scenario of not implementing the pre-letters for 2 delinquencies. 3 And, so, I -- I like the idea of doing the 4 pre-letters, it reaches a broader universe of folks and 5 I think there's potential there to capture some revenue. 6 On the other hand, all of the additional 7 requirements that we would be asking staff to do 8 relative to those taxpayers that are on the 250 -- on 9 the debtor list, I think doing that at the same time is 10 expanding the list to 500 is a lot. And I'd like to see 11 what the outcome would be of imposing those additional 12 steps with respect to the existing 250 list before we 13 expand the list. And I think we actually get a better 14 cost benefit ratio from that. 15 And it's not that I'm opposed to expanding the 16 list, but I think these are new, additional steps that 17 we are going to be having the staff undertake that 18 should be focused. And I think it's actually going to 19 help clear, hopefully, some of that 250 list to where we 20 then can have more of a churning and maybe we can 21 examine the feasibility of how much more we want to 22 expand the length of the list. 23 MR. HORTON: Okay, Members, I would -- I would 24 share -- I mean as the author of the original bill where 25 we sought to disclose the top 250 individuals that owe 26 the State of California $100,000 or more, the concern 27 was is that, you know, the Board had an outstanding 28 accounts receivable and an effort to accelerate the 6 1 collection of those funds. 2 Since that time the other measures within the 3 bill really were not the ones that were affected. They 4 were somewhat condition subsequent to an action being 5 taken. The disclosure, which was kind of interesting 6 when we first discussed the bill, many of the Members 7 thought, "Well, just the mere disclosure, will that 8 actually encourage individuals to pay their liability?" 9 And what we discovered over the period of time 10 is that that's is exactly what happens. From 2007 to 11 2011, the State has recaptured somewhere around 12 $5.5 million as a result of just disclosure. 13 But what happens psychologically is -- what we 14 discovered, which is quite interesting, is that the 15 Board of Directors may not be aware of the liability. 16 And, so, the -- and what happens in this whole process 17 is that other individuals are now made aware of the 18 liability and they decide to engage and ensure that the 19 liability is paid. Because, arguably, as I argued in 20 presenting the bill, this is not necessarily meant to be 21 punitive, this is meant to be informative. And when we 22 provide that information, I actually believe that 23 companies that owe the State of California $100,000 or 24 more will actually comply because these are typically 25 larger companies. 26 And the other provisions I do have some 27 concerns about stripping away a person's license because 28 I don't want to prohibit a person from being able to 7 1 operate. We don't want to kill the goose that's laying 2 the golden egg, in other words. And, so, my concern, as 3 I expressed to the author is that that be a last ditch 4 effort, that be our last alternative. 5 So, many the provisions in the amendments will 6 be discretionary on the part of the Board, but I would 7 express that I don't know that they're all that 8 effective. They're more punitive than anything else, 9 unless the Board is intending to go out and tell the 10 world in addition to disclosing it, you may lose your 11 license and all these other things. 12 And it was interesting to note that if this 13 occurred -- if this occurred on a biannual basis, the 14 revenue would actually go up. 15 And, so, I did a little research to try to 16 figure that out. This is what the Franchise Tax Board 17 currently does. And it goes back to the notion that the 18 disclosure is more effective. And the more often you 19 make the disclosure, the more effective it is. And what 20 the Franchise Tax Board does is that they actually 21 tell -- they will actually inform every individual that 22 you may have this disclosure later on down the road 23 prior to the disclosure actually occurring, which I 24 think is another benefit to the taxpayer, it gives them 25 an opportunity to not be on this list. And, so, it 26 accelerated the funds to the State of California. 27 So, when you expand it to -- when you expand it 28 to the top 500, what happens, you expand it to the top 8 1 500, you disclose it twice, you're disclosing more 2 individuals that owe the State of California $100,000 or 3 more, arguably increasing your opportunity to collect 4 another -- I mean, this is -- we're not just talking 5 about $100,000 per individuals, I mean, you are talking 6 about fifty $100,000, which is a lot for the State of 7 California. 8 And if you look at our outstanding accounts 9 receivable, which has been the topic of the time here 10 lately, $1.4 million -- $1.4 billion outstanding 11 accounts receivable amounts to about 32,000 teachers, 12 firefighters. 13 I mean, it's just a large issue. And the staff 14 has informed us that if we take up disclosing it twice a 15 year, that the return on our cost is 12.8 to 1. You 16 can't get a better return nowhere in the world. 17 So, that's the reason that I support expanding 18 the list to the top 500, disclosing it twice a year. 19 It's a tool that's been proven to be effective and I 20 believe will continue to be effective for the State of 21 California. 22 MR. RUNNER: Yeah. 23 MR. HORTON: Mr. Runner? 24 MR. RUNNER: Yeah, I don't have any issue with 25 the issue's being expansion of the list, I do have some 26 concerns in regards to going after what could be the 27 livelihood which is by -- the means of which they are 28 going to end up, maybe, paying their bill. So, I have 9 1 issues with that. 2 Let me -- just a quick question. 3 And then again, as we've been looking at some 4 of the accounts receivable and the idea of an amount 5 that has been written off, when we say the top 250 or 6 the top 500, are we dealing with the active accounts 7 receivable or -- or are we also including those that are 8 sitting somewhere else called write-offs? 9 MR. HANKS: These aren't amounts that are 10 write-offs and -- 11 MR. RUNNER: These are write-off amounts? 12 MR. HANKS: These are not written -- 13 MR. RUNNER: Oh, these are not written off? 14 MR. HANKS: -- off, so, they're active accounts 15 receivable. 16 MR. RUNNER: Okay. So, these are the ones that 17 are the active accounts receivable and that we've not 18 sent these over to the Controller on our list of 19 write-offs? 20 MR. HANKS: Correct. 21 MR. RUNNER: Okay. The other issue is -- and I 22 think we're going to actually have on our agenda in 23 July -- some discussion in regards to some of this 24 issue. 25 I think we have to create a way to create 26 incentive to help people step forward. You know, I've 27 reviewed and seen what's happening in Indiana, New York, 28 Louisiana, where they've successfully dealt with the 10 1 issue of the eliminating or discounting some of the 2 issue of penalty and interest and have very successful 3 collections as a result of that. 4 And I think that that ultimately is our goal. 5 Our goal, I think as the Chair said, is collections, 6 not -- not punishment at this point because we want to 7 be able to get there. 8 So, I would -- I would tend to agree that I 9 think opening the list, there's nothing wrong with that. 10 People -- and I think letting them know that their 11 names' going to be on a list can be motivational at 12 times. 13 But the idea of going after a livelihood at 14 this point, I don't -- I'm not sure would be able to 15 accomplish any -- and of our goals that would be helpful 16 to us. 17 MR. HORTON: Ms. Shedd, is there a way that the 18 language in the -- in the bill or somewhere in the 19 intent that we can specify that this tool is a tool that 20 only be used under certain circumstances? 21 I mean, I would clarify that the Board doesn't 22 have this authority. And the bill does not mandate that 23 the licensing agency take away the license of these 24 individuals. It's just another item for them to take 25 under consideration. 26 So, if we -- and I can't recall the language at 27 this point, but if the bill were to say that we would 28 provide the information to the licensing agency for 11 1 purposes of information as another measure for them to 2 take under consideration in their own process of 3 adjudication, make their own determination based on 4 that, as opposed to -- and I don't believe it makes it 5 mandatory, but if we can make that clear, would that be 6 something helpful to you, Mr. Runner? 7 MR. RUNNER: Again my trouble is -- I trouble 8 with the assumption that's the bottom line of this bill, 9 which is the issue of being able to take away that. 10 And I also know we have little control about 11 what may happen when this bill starts moving along in 12 the legislature. 13 So, I think we can give whatever opinion we 14 want and I'm afraid that it not be then, at the end of 15 the day, a bill that I feel like I would vote for that 16 would be sponsored by the BOE. 17 Now, obviously, you know, we can sponsor a bill 18 with three members, that's fine. But I think at this 19 point, given the nature of it I just feel like I -- I 20 can't control what that outcome would be and what 21 caveats they'll put in that bill that would make me feel 22 comfortable. 23 MS. MANDEL: Question? 24 MR. HORTON: Ms. Mandel? 25 MS. MANDEL: The Board of Equalization 26 publishes its list twice a year now? 27 MS. SHEDD: Quarterly, I believe. 28 MS. MANDEL: Quarterly? 12 1 MR. HANKS: It is quarterly, yes. 2 MS. MANDEL: Okay, four times a year? 3 MR. HANKS: Yes. 4 MS. MANDEL: And did we have -- I think that 5 this bill goes even beyond the proposals that came out 6 of FTB on license suspension, but didn't we have a 7 proposal at BOE for license suspension? 8 MR. HORTON: We did. 9 MS. SHEDD: That was the Contractors' State 10 License Board. 11 MR. HORTON: Contractors' Board. 12 MS. MANDEL: Oh, it was just contractors, okay. 13 So, the bill goes way beyond -- 14 MR. SHEDD: Yes. 15 MS. MANDEL: -- that one. 16 MS. SHEDD: And driver's license is what -- 17 MS. MANDEL: Well, we -- we didn't have that, 18 that's the bill? Right? 19 MS. SHEDD: Right, that's the bill before us. 20 The only proposal that the Board has is -- 21 MS. MANDEL: Contractors. 22 MS. SHEDD: -- is contractors. 23 MS. MANDEL: Okay. So, this goes -- this goes 24 way beyond what the Board's already. 25 And the way I have it here was the -- that it 26 would be for -- the way the bill's written is that the 27 Board would determine and ask for the suspension of the 28 licenses? 13 1 That's the way the bill's written? I'm just 2 looking at your write up that you gave us. 3 MS. SHEDD: Well, the way the bill is written 4 is that the FTB would notify -- 5 MS. MANDEL: Right, but if it -- but if is 6 inserted, so, just -- 7 MS. SHEDD: -- than rather than have those 8 provisions where we would just give our list to the 9 licensing entities, we would go through it and make a 10 determination on the facts and circumstances of each 11 debtor that a suspension of a license or refusal to 12 issue, reactivate or renew a license of the tax debtor 13 would be in the best interests of the State. 14 So, we would go through is that looking at all 15 the facts and circumstances surrounding that debtor, 16 decide whether it would be a good idea to go ahead and 17 request that the license be suspended. 18 MR. HORTON: Members -- Ms. Mandel, if I may? 19 MS. MANDEL: Go ahead, go ahead. 20 MR. HORTON: Just as a way of suggestion, 21 Members, what -- what -- why not -- instead of endorsing 22 the legislation that will be taken up this month, I 23 believe, June 29th, and it may take a direction counter 24 to what the Members' -- consensus of the Board might be 25 relative to this, why don't -- to the point that we can 26 concur, why don't we send just a letter to the author 27 making certain recommendations as it relates to the 28 concerns of the Board of Equalization? 14 1 And, so, along those lines, I would ask this 2 Board for expanding to the lists of 500, given the cost 3 benefit discussion on that. 4 And it seems that the -- the concern around 5 suspending, revoking, taking away a person's license, 6 that the same concern was expressed in the debate or 7 discussion about the contractor's licenses and the 8 conclusion that the body made was is that we would use 9 that as -- the discretion should be at the Board of 10 Equalization how to use it and that the Board of 11 Equalization would use it as a last alternative, given 12 that the taxpayer just refused to cooperate with the 13 Board. 14 Mindful that the letter is just a 15 recommendation, the author in the legislature will go in 16 the direction that they will go. 17 MS. YEE: So, are you, essentially, 18 Mr. Chairman, looking at -- looking at the staff revenue 19 estimates, it's what's reflected in Alternative 2, which 20 is the -- 21 MR. HORTON: Yes. 22 MS. YEE: -- okay. 23 MS. MANDEL: I don't think I have that. 24 MR. HORTON: Miss Shedd, can you give us some 25 background on Alternative 2? 26 MS. SHEDD: Well, as I understand it, I think 27 Alternative 2 would have it apply to the top 500 for 28 both FTB and BOE, but it would also require that we send 15 1 the pre-letters to all tax debtors that have amounts of 2 $100,000 or more. 3 MR. HORTON: Since we're sending a letter, 4 Members, we currently send it out quarterly. And, so, 5 we should -- I'm always uncomfortable legislating 6 administrative activities. And that if we just raise it 7 to the top 500 and leave the administration up to the 8 Board of Equalization -- 9 MR. RUNNER: Yes. 10 THE COURT: -- it might be better way to go. 11 MS. SHEDD: And that's what FTB does now. They 12 don't have it their authority -- in the statute. They 13 just do it. 14 MS. YEE: I don't have a problem with that, I 15 just want to be sure if there's any additional workload 16 that we identify it and acknowledge it so that we know 17 what's required to make this work. 18 But I agree with you, I don't think we need to 19 legislate it, but we do need to acknowledge that there's 20 additional workload. 21 MS. MANDEL: And our quarterly, is our statute 22 currently requires quarterly or we're just doing it 23 quarterly? 24 MR. HORTON: We're just doing it. 25 MS. MANDEL: I thought there was a difference 26 in the statutes between FTB and BOE. 27 MS. YEE: I think so. 28 MS. SHEDD: I -- 16 1 MR. HORTON: No. 2 MS. MANDEL: No? 3 MR. HORTON: Not to my recollection. And I 4 wrote -- 5 MS. YEE: That's interesting. 6 MR. HORTON: -- I wrote the bill. 7 MS. MANDEL: Oh. 8 MR. HORTON: But maybe so, that was a long time 9 ago. 10 MS. SHEDD: I -- 11 MR. HORTON: I don't remember drawing that 12 distinction between the two. 13 That would have been rather complicated. 14 MS. SHEDD: Well -- 15 MR. HORTON: -- to debate or discuss during the 16 process. 17 MS. SHEDD: And that's -- it's a different 18 issue, really. 19 The 250 that are quarterly posted on the 20 internet is a subset of all of the people that owe 21 $100,000 or more. 22 MS. MANDEL: Right. 23 MS. SHEDD: And that's what FTB is sending 24 letters to like, you know -- 25 MS. YEE: It's a bigger -- 26 MS. SHEDD: -- you may be up there. 27 MR. HORTON: It's a warning. 28 MS. MANDEL: Right, but it's giving -- 17 1 MR. HORTON: Not a warning, but it's a -- it's 2 giving them an -- 3 MS. MANDEL: It's an opportunity. 4 MR. HORTON: -- advance notice, if I will. 5 It's an opportunity. 6 And, so, arguably, since we currently do it 7 quarterly, the numbers that says that we -- we do it 8 biannually wouldn't really change. 9 I mean, I don't know, the cost of pushing a 10 button once a year, once a month or once a quarter is 11 going to change the cost. 12 MS. MANDEL: I think that's why I asked was 13 about how we're collecting it. 14 Because if it's -- if it is -- I mean, FTB, 15 they just -- it's a requirement annually, so, they just 16 do it once a year. 17 I always had the impression that BOE did it 18 more often. 19 MS. SHEDD: We do it quarterly. 20 MR. HORTON: FTB actually does it twice a year; 21 is that right? 22 MS. YEE: I think it's annual. 23 MS. MANDEL: Annually. 24 MS. SHEDD: I think it's annual and the bill 25 would say at least twice a year. 26 MS. MANDEL: Yeah, and -- so, if the bill's 27 going to say at least a twice a year, then whether we're 28 currently statutorily required quarterly or not, we 18 1 could -- I just didn't want us to, you know, shorten -- 2 or lessen the number of times we're doing if the law's 3 requiring it to be more now. And if we do it less that 4 impacts -- 5 MR. HORTON: So, the language -- 6 MS. MANDEL: -- how much we collect or -- but, 7 then, of course if we did it quarterly we might have 8 more cost of sending things out. 9 So, that's why I wondered if it was statutory 10 or not. 11 MR. HORTON: So, the language will say "at 12 least." 13 MS. MANDEL: Okay. 14 MR. HORTON: Okay. We're all on the same page? 15 Further discussion, Members? 16 MS. SHEDD: Can I just reiterate? 17 MR. HORTON: Yes, please? 18 MS. SHEDD: We're going to write a letter to 19 the author saying that we would like to expand it to the 20 top 500 for the Board of Equalization and FTB? 21 Or just BOE? 22 MR. HORTON: I don't that we can -- we can 23 speak on behalf of the FTB. 24 MS. SHEDD: Okay. 25 MS. YEE: You can't. 26 MR. RUNNER: Speak for us. 27 MS. SHEDD: And -- 28 MR. ANDAL: I would suggest that we have a 19 1 conversation with the Director over FTB so that we're on 2 -- we are consistent. 3 MS. SHEDD: Okay. And that with respect to 4 suspending the licensing required -- requirements that 5 currently are in the bill AB 1424 with respect to FTB, 6 we would like to use that as a last resort. 7 And after we have made -- at our discretion 8 have made that determination whether those licenses -- 9 MS. YEE: Why we are not including those 10 provisions at this time. 11 MR. RUNNER: Yeah, I'm not comfortable with 12 addressing that. 13 MS. YEE: I think what -- I thought, Mr. Chair, 14 we were reflecting just what's embedded in the staff 15 estimate for Alternative 2, which is solely increasing 16 the list -- 17 MR. HORTON: Okay. 18 MS. YEE: -- and the pre-letters. 19 MS. SHEDD: And that we would ask for -- the 20 list be expanded but not have a statutory requirement 21 that the pre-letters go out, that is an administrative 22 function? 23 MS. MANDEL: No. 24 MR. HORTON: Administrative function. 25 MS. YEE: Right. 26 MR. HORTON: But, Members, just to -- just to 27 clarify here, this -- my thoughts was -- is that from a 28 legislative perspective that we might want to encourage 20 1 them not to make it mandatory, even -- 2 MS. MANDEL: On the -- 3 MR. HORTON: -- for the FTB on the suspension 4 of the license, the language, at least, to say, 5 "This body is of the opinion that we have 6 enough muscle in order to do this. The 7 disclosure tool is sufficient. And if, in 8 fact, we do need it, it should be at the 9 discretion of the agency." 10 MS. MANDEL: Mr. Horton? 11 MR. HORTON: Yes, Ms. Mandel? 12 MS. MANDEL: Just quickly, two things just 13 quickly. 14 I mean, in that regard I don't know that our 15 contractor licensing -- I understand it was not a -- 16 MR. HORTON: Bill. 17 MS. MANDEL: -- unanimous vote here, but I 18 don't know that our contractor licensing thing is in a 19 bill. 20 At this point I don't remember. 21 MS. SHEDD: It's going AB 1307, it's our kind 22 of tool box. 23 MS. MANDEL: Okay, so -- 24 MR. HORTON: We should be consistent with that? 25 MS. MANDEL: -- at least to the -- to the 26 extent -- if you're making somebody aware of kind of 27 what we're doing -- and I know here it's not -- not 28 everybody's signed on to that one, so, I don't know how 21 1 you deal with it. 2 But that is one that -- that the Board is 3 sponsoring and I thought was discretionary, like you're 4 talking about. 5 At least, that's my vague recollection. So, I 6 don't know how you write it up. 7 The other -- the other point is Sheila Waters 8 just sent me an e-mail saying it's statutory that BOE 9 does it quarterly, FTB do it annually -- just as a point 10 of information for current. 11 MR. HORTON: Okay. 12 MS. MANDEL: Sheila's watching. 13 MR. HANKS: Thank you, Sheila. 14 MR. HORTON: So, for consistency purposes, I 15 would say -- which we might -- may require us to vote on 16 whether or not this is included, I would say that we 17 stay consistent with our views as it relates to the 18 contractor's license. 19 And, so -- but I believe, Sheila, if you are 20 listening, is that -- that is nonmandatory, it is a last 21 tool that we use administratively and that the consensus 22 of the Board is to use it as less as possible and only 23 when it's absolutely necessary. 24 Any concerns about that, Mr. Runner? 25 MR. RUNNER: Well, again I -- we're going off 26 the field from what this is before us. 27 Before us is just this particular bill that's 28 before us and, you know, at this point I guess what I'm 22 1 hearing us say is that we're concerned some the -- how 2 far reaching that particular bill is to some of these 3 license issues. 4 We are feeling comfortable with the one aspect 5 of it, I don't know why we just don't go ahead and 6 support the one aspect and, you know, and that's the 7 part that we support. 8 MR. HORTON: Okay. Let's -- Ms. Olson note 9 objection to the staying consistent with the 10 contractor's licensing language as it relates to the 11 language in the bill for the purpose of including it in 12 a letter. 13 We will take that up as well as the -- seem to 14 be consistency -- I mean, agreement on expanding it to 15 the top 500 and leaving it up to the agency to determine 16 administratively how often that we do this, given that 17 it is now within the statute at least four times, we 18 probably should stay consistent there as well. 19 So, Ms. Olson -- is there a motion to that 20 effect? 21 MS. YEE: I will so move. 22 Miss Shedd looks confused. Let me see if I can 23 reiterate. 24 MR. HORTON: Sure. 25 MS. YEE: Which is to support the legislation 26 that has us increasing the 250 debtor list to 500, that 27 the provisions related to licenses be consistent with 28 what this Board previously approved, albeit not 23 1 unanimously with respect to the Contractors' State 2 License Board and that we acknowledge administratively 3 that we will implement the pre-letter provision. 4 MR. HORTON: Okay. 5 MS. MANDEL: And -- 6 MR. RUNNER: No, I can't -- 7 MR. HORTON: And at this point, we're just 8 sending a letter, we're not supporting the legislation, 9 we're just sending a letter. 10 MS. YEE: Oh, okay, sorry, okay. 11 MR. HORTON: Sending a letter. 12 MS. YEE: All right, sending a letter. 13 MS. MANDEL: And when you say "provision on 14 licenses be consistent," that makes it sound like all 15 the types of licenses they have in here, which I thought 16 you had an issue with. 17 MR. RUNNER: Do we really think that -- do we 18 think it's in our interests to -- to even have the 19 ability to take away somebody's driver's license? 20 Because that's what that bill does. 21 MR. HORTON: If they -- if they have taken away 22 $100,000 from the State of California, it should be 23 considered -- as a means of recouping -- 24 MS. MANDEL: Yeah, I know I went as far as the 25 contractor's license, I haven't -- didn't specifically 26 focus on all these other ones that were in here. 27 MS. YEE: Well, let's check -- 28 MR. HORTON: Okay, we've got a consensus, 24 1 Members -- 2 MS. YEE: Yeah, let's just do -- 3 MR. HORTON: -- on the expanded to the top 500. 4 Let's send a letter of support in that regard and stay 5 silent on the rest. 6 We'll take that up on the consideration later 7 on as the bill moves through. 8 MS. YEE: Can we agendize that for the future 9 Legislative Committee? 10 I mean, obviously, the -- 11 MR. HORTON: Sure, definitely. 12 MS. YEE: -- consideration of these provisions 13 are not going to go away -- 14 MR. HORTON: Definitely. 15 MS. YEE: -- even in the legislature's, I think 16 this Board has to come to grips with them. 17 MR. HORTON: So, we remain neutral on the rest 18 of the bill. We submit a letter as -- asking for -- 19 that the bill be amended to expand the list from the top 20 250 to the top 500 and that the Board have the -- have 21 the administrative authority to determine what's the 22 most effective way to execute that. 23 Consensus? 24 MR. RUNNER: Yep. 25 MR. HORTON: All right. 26 MS. YEE: Okay. 27 MR. HORTON: Without objection -- 28 MS. OLSON: Did we have a second? 25 1 MS. YEE: I'll second. 2 MR. HORTON: Second by -- 3 MR. RUNNER: -- no, but we have consensus. 4 MR. HORTON: -- second by Ms. Yee. 5 Without objection, Members, such will be the 6 order. 7 MS. SHEDD: Thank you, that concludes the 8 business before you. 9 MR. HORTON: That was fun. 10 MS. OLSON: That concludes our meeting for 11 today. 12 MR. HORTON: All right. The meeting of the 13 Board of Equalization hereby adjourns. 14 Thank you so very much for your attention this 15 evening and to all of those who have come to testify 16 before us on both ends of the spectrum. 17 ---o0o--- 18 19 20 21 22 23 24 25 26 27 28 26 1 REPORTER'S CERTIFICATE 2 3 State of California ) 4 ) ss 5 County of Sacramento ) 6 7 I, JULI PRICE JACKSON, Hearing Reporter for the 8 California State Board of Equalization certify that on 9 JUNE 24, 2011 I recorded verbatim, in shorthand, to the 10 best of my ability, the proceedings in the 11 above-entitled hearing; that I transcribed the shorthand 12 writing into typewriting; and that the preceding pages 1 13 through 26 constitute a complete and accurate 14 transcription of the shorthand writing. 15 16 Dated: July 18, 2011 17 18 19 ____________________________ 20 JULI PRICE JACKSON 21 Hearing Reporter 22 23 24 25 26 27 28 27