1 BEFORE THE CALIFORNIA STATE BOARD OF EQUALIZATION 2 450 N STREET 3 SACRAMENTO, CALIFORNIA 4 5 6 7 8 REPORTER'S TRANSCRIPT 9 MARCH 21, 2012 10 11 12 13 14 15 FINAL ACTIONS 16 17 18 19 20 21 22 23 24 25 26 27 REPORTED BY: Kathleen Skidgel 28 CSR NO. 9039 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 Government Code 13 Section 7.9) 14 15 Joann Richmond 16 Chief Board Proceedings Division 17 18 ---oOo--- 19 20 21 22 23 24 25 26 27 28 2 1 2 450 N STREET 3 SACRAMENTO, CALIFORNIA 4 MARCH 21, 2012 5 ---oOo--- 6 MR. HORTON: Ms. Richmond. 7 MS. RICHMOND: Our next item are those matters 8 that have been, um, submitted for decision. 9 C7 -- 10 MR. HORTON: Okay. First item. 11 First item. 12 MS. RICHMOND: C7, Lynnette Marie Shaw. 13 ---oOo--- 14 C7 LYNNETTE MARIE SHAW 15 NO. 507974 (JH) 16 ---oOo--- 17 MR. HORTON: Discussion, Members? 18 Is there a motion? 19 MS. YEE: Um, Mr. Chairman, I'd like to, um, 20 move that we, um, relieve the taxpayer of the liability, 21 um, for the periods, um -- the time of the audit period 22 preceding February 2007. And, uh, otherwise, uh -- and 23 redetermine remainder. 24 MR. HORTON: Okay. 25 MS. STEEL: Okay. 26 MS. YEE: And also inform petitioner of the 27 Offer and Compromise Program. 28 MS. STEEL: Exactly the tax, uh -- the date is 3 1 going to be February 2007 'til the end of this audit 2 period? 3 MS. YEE: Yes, uh-huh. 4 MS. STEEL: Okay. 5 MR. RUNNER: Yeah, October, right? 6 MS. STEEL: Right. 7 MR. RUNNER: 2005. 8 MR. HORTON: Okay. Is that a second, Member 9 Steel? 10 MS. STEEL: Yes. 11 MR. HORTON: Okay. 12 MS. YEE: It's -- it's relieving the liability 13 from October 1st, um, 2005. 14 MR. RUNNER: Right. 15 MS. YEE: Um -- 16 MR. HORTON: To February. 17 MS. YEE: To February. 18 MS. STEEL: 2007. 19 MS. YEE: Seven. Yeah, February 1st, 2007. 20 MR. HORTON: End of February. Why don't we 21 make it March 1st because it's after -- 22 MS. YEE: Yeah. 23 MR. HORTON: February -- 24 MS. YEE: All right. 25 MR. HORTON: -- to June, end of the quarter, 26 all that good stuff. 27 MR. RUNNER: Okay. 28 MR. HORTON: So be it. 4 1 There's a motion by Member Yee, second by 2 Member Steel. 3 Without objection, such will be the order. 4 ---oOo--- 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5 1 MR. HORTON: Ms. Richmond. 2 MS. RICHMOND: Our next item is C8, Trimark 3 Raygal, Inc. 4 ---oOo--- 5 C8 TRIMARK RAYGAL, INC. 6 NO. 257881 (EA) 7 ---oOo--- 8 MR. HORTON: Discussion, Members? 9 Is there a motion? 10 MS. YEE: Um, move to adopt the staff 11 recommendation. 12 MR. HORTON: Moved by Member Yee to adopt staff 13 recommendation. Second by Member Mandel. 14 MS. MANDEL: No. 15 MS. STEEL: Objection. 16 MR. HORTON: Uh, strike that. 17 Second, Ms. Mandel? 18 MS. MANDEL: No. 19 MR. HORTON: Uh, objection noted by Member 20 Steel. 21 Um, discussion, Members? 22 Hearing none, Ms. -- Ms. Richmond, please call 23 the roll. 24 MS. RICHMOND: Mr. Horton. 25 MR. HORTON: Aye. 26 MS. RICHMOND: Mr. Runner. 27 MR. RUNNER: No. 28 MS. RICHMOND: Ms. Steel. 6 1 MS. STEEL: No. 2 MS. RICHMOND: Ms. Yee. 3 MS. YEE: Aye. 4 MS. RICHMOND: Ms. Mandel. 5 MS. MANDEL: No. 6 MR. HORTON: Okay. We got to work on that. 7 Next item, Ms. Richmond? 8 MR. RUNNER: Well, we need a motion. 9 MS. RICHMOND: Motion failed. 10 MS. STEEL: Grant the petition. 11 MR. HORTON: Oh. 12 MR. RUNNER: Second. 13 MR. HORTON: Wait a minute. I must have voted 14 wrong then. 15 MS. MANDEL: I said no. 16 MR. HORTON: Oh, you said no? Oh, okay. 17 MS. MANDEL: No on the motion. 18 MR. HORTON: Oh, okay. Good. 19 MS. MANDEL: And no on the -- 20 MR. HORTON: Is -- is there a subsequent 21 motion? Ms. Mandel? 22 MS. STEEL: Grant the petition. 23 MS. MANDEL: Yeah, grant the petition. 24 MR. HORTON: It's a motion to grant the 25 petition, Member, uh, Steel. Second by Member Runner. 26 MS. YEE: Objection. 27 MR. HORTON: Objection by Member Yee. 28 Uh, Ms. Richmond. I'll get there. 7 1 MS. RICHMOND: Mr. Horton. 2 MR. HORTON: So -- 3 MS. RICHMOND: Pardon me? 4 MR. HORTON: Yeah, I -- I -- I, uh -- 5 Uh, no. 6 Member Steel. 7 MS. RICHMOND: Ms. Steel. 8 MS. STEEL: Aye. 9 MS. RICHMOND: Mr. Runner. 10 MR. RUNNER: Aye. 11 MS. RICHMOND: Ms. Yee. 12 MS. YEE: No. 13 MS. RICHMOND: Ms. Mandel. 14 MS. MANDEL: Aye. 15 MS. RICHMOND: Motion carries. 16 ---oOo--- 17 18 19 20 21 22 23 24 25 26 27 28 8 1 MS. RICHMOND: Our next item is C9, Edwards, Inc. 2 ---oOo--- 3 C9 EDWARDS, INC. 4 NO. 522933 (KH) 5 ---oOo--- 6 MR. HORTON: Discussion, Members? 7 Is there a motion? 8 MS. STEEL: Um, I want to, uh, adopt the staff 9 recommendations, except 2007 they use, uh, bank deposits 10 instead of income tax report. 11 MR. RUNNER: So what is the motion? 12 MS. STEEL: So, fourth quarter 2005 and 2006, 13 adopt the staff recommendations. And 2007 recalculate 14 with the bank deposits, not with the tax return. 15 MR. HORTON: Okay. 16 MR. RUNNER: I'll second that. 17 MR. HORTON: There's a motion to adopt staff 18 recommendation for 2005/2006 and adjust, uh, to the bank 19 statements for 2005. 20 Uh, discussion, Members? 21 MR. RUNNER: Just to clarify, what that means 22 is we're using the -- the -- the -- the bank analysis 23 for the entire audit period -- 24 MS. STEEL: Right. 25 MR. RUNNER: -- correct? 26 MS. STEEL: Right. 27 MR. RUNNER: That's the intention? 28 MR. HORTON: Uh -- 9 1 MS. STEEL: That was my intention. 2 MR. HORTON: Yes. 3 MR. RUNNER: Okay. 4 MS. STEEL: Yes. 5 MR. HORTON: Yes. Um, I would only share, 6 Members, I'd be a "no" on this. Uh, I, uh -- 7 Ms. Richmond, please call the roll. 8 MS. RICHMOND: Mr. Horton. 9 MR. HORTON: No. 10 MS. RICHMOND: Ms. Steel. 11 MR. RUNNER: Aye. 12 MS. RICHMOND: Mr. Runner. 13 MR. RUNNER: Aye. 14 MS. RICHMOND: Ms. Yee. 15 MS. YEE: No. 16 MS. RICHMOND: Ms. Mandel. 17 MS. MANDEL: No. 18 MR. HORTON: Subsequent motion? 19 MS. YEE: Move to adopt the staff 20 recommendation. 21 MR. HORTON: Is there a second? 22 MS. MANDEL: Second. 23 MR. HORTON: Uh, it's been moved and second to 24 adopt staff recommendation, Member Yee, Member Mandel. 25 Uh, objection? 26 MS. STEEL: Objection. 27 MR. HORTON: Objection noted. 28 Ms. Richmond. 10 1 MS. RICHMOND: Mr. Horton. 2 MR. HORTON: Aye. 3 MS. RICHMOND: Ms. Steel. 4 MS. STEEL: No. 5 MS. RICHMOND: Mr. Runner. 6 MR. RUNNER: No. 7 MS. RICHMOND: Ms. Yee. 8 MS. YEE: Aye. 9 MS. RICHMOND: Ms. Mandel. 10 MS. MANDEL: Aye. 11 MS. RICHMOND: Motion carries. 12 MR. RUNNER: That's it. 13 MR. HORTON: Thank you very much, Members and, 14 uh, team members and visitors. Meeting of the Board of 15 Equalization is hereby adjourned. 16 ---oOo--- 17 18 19 20 21 22 23 24 25 26 27 28 11 1 REPORTER'S CERTIFICATE 2 3 State of California ) 4 ) ss 5 County of Sacramento ) 6 7 I, KATHLEEN SKIDGEL, Hearing Reporter for the 8 California State Board of Equalization certify that on 9 March 21, 2012 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 11 constitute a complete and accurate 14 transcription of the shorthand writing. 15 16 Dated: March 23, 2012 17 18 19 ____________________________ 20 KATHLEEN SKIDGEL, CSR #9039 21 Hearing Reporter 22 23 24 25 26 27 28 12