The Center of the California Enterprise Zone Information Universe


State Senator Wants To Publish Your Tax Return

What would you say about a bill that required certain sensitive parts of your tax return to be made public? How about a list in the Los Angeles Times of the gambling losses you itemized on your return? Or how about website that lists your name, address and how much of a tax credit you claimed to adopt a child?

Preposterous.

But this is exactly what a bill by State Senator Gil Cedillo (D-Los Angeles) proposes for economic development subsidies in California.

SB 103 just passed through the Senate Committee on Local Government by a 3-2 vote on March 7. The bill calls for requiring local jurisdictions to release to the public and post to the internet the name and address of any entity or individual that is the beneficiary of an “economic development subsidy.” The bill states that:

“Economic development subsidy” means any expenditure of public funds or loss of revenue to a local agency in the amount of twenty-five thousand dollars ($25,000) or more, for the purpose of stimulating economic development within a local agency, including, but not limited to, bonds, grants, loans, loan guarantees, enterprise zone or empowerment zone incentives, tax-increment financing, fee waivers, land price subsidies, matching funds, tax abatements, tax exemptions, and tax credits.

Let’s suppose you are the owner of an LLC in the Enterprise Zone. You contribute to your community by investing in such an economically challenged area. The government has informed you (through the creation of an Enterprise Zone) that it is so valuable for you to hire individuals with certain demonstrable barriers to employment that they would like to give you a rebate on your taxes if you do so. Instead of then congratulating you for participating in a great public-private partnership to improve your City’s economy, the State instead requires the City to publish a website containing your name, address and how much Enterprise Zone tax credit you claimed. Then, anyone with a calculator can simply deduce a good estimate of what your personal income is.

SB 103 has been referred to the Senate Committee on Appropriations where a similar billed (SB 1268) died last year. If you would like to voice your concern about this bill simply write a note and (snail) mail it to: Senate Committee on Appropriations, State Capitol Room 2206, Sacramento, CA 95814.

[A side note on writing letters of support or opposition on bills: My understanding is that the committees essentially just make a list of those in support and those in opposition. Little attention, if any, would be paid to well formulated arguments in such letters. Therefore, it is effective to simply send a letter (preferably on letterhead) stating that you are supporting or opposing a given bill.]

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