Public Meeting Minutes
FRANCHISE TAX BOARD
September 16, 1999
The Franchise Tax Board met in open session at 10:00 a.m. at the State Board of Equalization, 450 N Street, Hearing Room 121, Sacramento, California. Present were Hon. Kathleen Connell, Jean Alexander representing Hon. Johan Klehs, Hon. B. Timothy Gage.
|Franchise Tax Board|
|Gerald Goldberg, Brian Toman, Ralph Shoemaker, John Vranna, Frank Lanza, Lynette Iwafuchi, Titus Toyama, Benjamin Miller, Joan Keegan, Janet Ballou, and Katie Horn.|
|Others Participating:||Theresa Casazza representing American Electronics Association, David Doerr representing Cal-Tax, Lenny Goldberg representing Children Now, Bill Harris representing Intuit, Richard E. V. Harris representing himself, Peggy Jensen representing Family Support Council, Jason Mahler representing Computer and Communications Industry Association, Christina Polley representing Department of General Services, Lucinda Stockwell representing H & R Block, Curt Soderlund representing Board of Control, and Stanley Trom representing Ventura County.|
Item 1. - Approval of Board Minutes
- The Minutes of the July 6, 1999, Franchise Tax Board meeting were unanimously approved.
- The Minutes of the August 12, 1999, Franchise Tax Board meeting were
Item 2. Child Support
- Plan for Expanded Role in Child
John Vranna briefed the Board on the department's expanding child support collection activities.
- Plan for Child Support
Mr. Goldberg introduced Lynette Iwafuchi, Assistant Executive Officer for the Audit Branch, who will be the executive sponsor and have responsibility for the automation project.
Ralph Shoemaker, Assistant Executive Officer for the Technology and Resources Branch, briefed the Board on the department's role in regard to technology.
Upon motion of Chair Connell, seconded by Member Gage, and unanimously carried, the Board delegated all necessary authority to Gerald H. Goldberg to ensure the expeditious and effective completion of the new child support automation project.
Item 3. Electronic Filing - Internet
Status report and Board discussion.
The Board voted (2-0, Chair Connell abstaining) to proceed with the Internet Filing Pilot Project as proposed by staff. In addition, the Board voted unanimously to include on FTB's website only those commercial online services that offer free online filing to single taxpayers with taxable incomes of $50,000 or less and joint return filers with taxable incomes of $100,000 or less.
Item 4. Regulation Matters
- Staff Reports and Requests for Authorization to Commence Formal Regulatory Proceedings:
- Proposed Regulation 25106.5-1 (Combined Reporting Intercompany Transactions). The Board unanimously authorized staff to proceed with formal noticing as a proposed regulation.
Regulation 25137(b) (Property Factor Nonjurisdictional Property).
The Board voted unanimously to postpone further action on the regulation.
- Proposed Regulation 25137(c) (Sales
Factor Occasional Sale of Intangible Assets).
The Board unanimously authorized staff to proceed with formal noticing as a proposed regulation.
- Proposed Regulations 19041 and 19044 (Protests). The
Board directed staff to schedule a symposium.
- Proposed Regulations
25106.5 (Mechanics of Combined Reporting) and 25106.5-2 (Capital Gains in a Combined
Report). The Board received the staff's status report.
Regulation 17951-4 (Income Sourcing). The Board received the staff's status report
and acknowledged a symposium scheduled for September 29, 1999.
Regulations 17252.5-1, 17265-1, 17266-1, 17267.2-1, 24356.2-1, 24356.3-1, 24356.4-1,
24356.7-1 (Recapture of Deduction for Qualified Property Previously Used). The
Board received the staff's status report.
- Proposed Regulation
23334 (Tax Clearance Certificate). The Board received the staff's status report.
- Proposed Regulation 18567 (Extensions of Time for Filing Income Tax Returns). The Board received the staff's status report.
Item 5. - Water's-Edge Matters
Staff reported on a newly identified set of problems and informed the Board that it intends to come forward with a legislative proposal at the December meeting. The Board encouraged staff to continue to find a way to solve these problems.
Item 6. Applications for Voluntary Disclosure
The Board unanimously approved the anonymous Applications for Voluntary Disclosure pursuant to Revenue and Taxation Code Section 19191.
Item 7. Administrative Matters
- FY 2000/01 BCPs.
The Board unanimously approved the following budget change proposals for FY 2000/01:
|BCP #1:||Integrated Nonfiler Compliance Project|
|BCP #2:||Legal Support Program Maintenance|
|BCP #3:||Network Backbone Upgrade|
|BCP #4:||Enterprise Duplex Printing System|
|BCP #6:||UPS Replacement Data Center|
|BCP #7:||Business Tax Reporting|
|BCP #8:||Court Ordered Debt Program|
|BCP #9:||CA Peace Officer Memorial Fund|
|BCP #10:||Limited Liability Company|
|BCP #11:||PASS Project|
|BCP #12:||Accounts Receivable Collection System|
|BCP #13:||E-File Performance Audit Savings|
|BCP #14:||Investigation Bureau Augmentation|
of Control Collections for Victims Restitution Fund.|
Note: After discussion, the Board approved the funding request for
$1,610,000 but requested that the 21 authorized positions be filled by a redirection of 21 positions from vacancies elsewhere in the department.
|BCP#CO1:||Minor Capital Outlay|
Board unanimously approved the following Facilities Action Requests (Form 9):
Hard wall construction and relocation of fingerprint process and orientation sessions
from Building 1 to Building 2; conversion of training room 1811 (hard wall construction)
to office space for Operations Services Bureau Director; and demolition of a wall
in Security Command Center to provide space for additional security equipment.
- Contract United International Investigation Contract.
The Board unanimously approved this contract.
Tax Board Resolution 98-19-"Out of State" Travel Expenditures.
The Board approved the staff request for administrative out-of-state travel above the Resolution limit of $50,000. The specific purposes of the travel include:
- Year 2000 Compliance Effort.
- Integrated Non-filer Compliance Project.
- Child Support Collection System Reform and Requirements.
- Statewide Child Support Automation Project.
These activities and the required travel are described in a memorandum to Board Members from Mr. Goldberg, dated August 31, 1999.
Item 8. Executive Officer's Time
Mr. Goldberg had no items for discussion.
Item 9. Board Member's Time
- The Board unanimously approved all
Employee Recognition Resolutions.
(Herman Adkins, Robert David, Patsy Elliott, Elaine Fales, Duncan Fong, Arlene Hess, Carolyn Manning, Shirley Martinez, Ron Schlenker, Molly Stacy, Ron Stocker.)
- The Board unanimously
approved Resolutions appointing a new Board Secretary (Katie Horn) and commending
the prior Board Secretary (Megan Hall).
The Board discussed the veteran's check-off for the upcoming filing season.
Mr. Goldberg informed the Board that the problem appears to be a legal one, and the
department is working with all appropriate parties in order to retain the check-off.
Item 10. Closed Session Announcement
Chair Connell announced the agenda for the Closed Session, pursuant to Government Code section 11126.3.
The meeting was adjourned at 2:57 p.m.