1 BEFORE THE CALIFORNIA STATE BOARD OF EQUALIZATION 2 450 N STREET 3 SACRAMENTO, CALIFORNIA 4 5 6 7 REPORTER'S TRANSCRIPT 8 SEPTEMBER 16, 2015 9 10 LEGISLATIVE COMMITTEE 11 12 13 14 15 16 17 18 19 Reported by: Juli Price Jackson 20 No. CSR 5214 21 22 23 24 25 26 27 28 1 1 P R E S E N T 2 3 For the Board Fiona Ma, CPA of Equalization: Chair 4 5 Jerome E. Horton Member 6 7 Sen. George Runner (Ret) Member 8 9 Diane L. Harkey Member 10 Yvette Stowers 11 Appearing for Betty T. Yee, State Controller 12 (per Government Code Section 7.9) 13 Joann Richmond 14 Chief, Board Proceedings Division 15 16 17 ---oOo--- 18 19 For Staff: Michele Pielsticker Chief 20 Legislative and Research 21 Division 22 23 ---o0o--- 24 25 26 27 28 2 1 450 N STREET 2 SACRAMENTO, CALIFORNIA 3 SEPTEMBER 16, 2015 4 ---oOo--- 5 MR. HORTON: Ms. Richmond, what is our next 6 matter? 7 MS. RICHMOND: Our next matter on today's 8 agenda is the Legislative Committee. 9 Ms. Ma is the Chair of that committee. 10 Ms. Ma. 11 MS. MA: Thank you, Madam Clerk. 12 We are going to get an update from our 13 Legislative Director Michele Pielsticker. 14 We are opening up the Legislative 15 Committee. 16 Michele. 17 MS. PIELSTICKER: Good morning, Madam Chair 18 and Members, Michele Pielsticker, Legislative and 19 Research Division. 20 And this is to provide an overview of the 21 status of BOE-related bills on the adjournment of 22 the 2015 legislative session. 23 One of the larger issues the legislature 24 addressed this year is medical cannabis regulation. 25 And a number of bills were introduced in the session 26 and a number of bills passed. 27 So, I'll start with the the bill that is 28 going to be continued into January. It's a two-year 3 1 bill, which was sponsored by Chairman Horton, 2 AB 567 (Gipson). And that bill provided for a tax 3 amnesty program for medical cannabis related 4 businessses and imposed other non-tax related 5 restrictions on the sale of medical cannabis. 6 AB 266 enacts the Medical Marijuana 7 Regulation and Safety Act to establish a 8 comprehensive licensing and regulatory framework for 9 the cultivation, manufacture, transportation, 10 storage, distribution, and sale of medical 11 marijuana. 12 And it establishes the Bureau of Medical 13 Marijuana Regulation within the Department of 14 Consumer Affairs to administer and enforce the 15 Medical Marijuana Act. 16 And the licensing and regulatory framework 17 will be administered by the Department of Consumer 18 Affairs. It oversees dispensaries, distributors, 19 transporters and special dispensaries. 20 Department of Food and Agriculture and the 21 Department of Public Health, who would oversee the 22 manufacture and testing of laboratory licenses. 23 Also requires the BOE, in consultation with 24 the Department of Food and Agriculture, to adopt a 25 system for reporting the movement of commercial 26 cannabis and cannabis products through the 27 distribution chain, as specified. 28 And it takes effect on or before January 1, 4 1 2016. 2 Are there any questions about AB 266? 3 Okay. SB 643 enacts an additional 4 licensing and reg -- 5 MS. MA: I am sorry. 6 MS. PIELSTICKER: Yes? 7 MS. MA: Ms. Harkey has a question. 8 MS. HARKEY: I just have a -- I'm going to 9 ask just a few questions. 10 And one is for reporting the movement of 11 commercial cannabis and cannabis production through 12 the distribution chain. 13 What does that mean? 14 MS. PIELSTICKER: That means that -- 15 MS. HARKEY: How -- do we have -- I guess 16 what I'm asking is do we have a procedure that is at 17 least roughly outlined? 18 You don't have to go into every detail, but 19 I'd like to see it if we do and -- 20 MS. PIELSTICKER: Sure. 21 MS. HARKEY: -- just so that -- 'cause, you 22 know, that's a tall order. 23 MS. PIELSTICKER: Right. So, we are to 24 work in coordination with the Department of Food and 25 Ag to develop a track and trace system for the 26 movement through the distribution chain. 27 And that track and trace system would 28 employ secure packaging. And it would enable us to 5 1 know who is selling to whom throughout the 2 distribution chain. 3 So, when the cultivator makes a sale to the 4 distributor or to the manufacturer, we would, at 5 that point, know that the sale occurred, how much 6 was sold, and to whom they sold it, and then on 7 through the distribution chain -- the wholesaler, 8 the dispensary. 9 That track and trace system will also be 10 helpful for auditing on our sales and use tax 11 program because then we can know from -- from whom 12 the dispensary purchased the cannabis. And we can 13 go and see how much they sold and compare that. 14 MS. HARKEY: Okay. Books and records and 15 bank accounts and whatnot have been a problem. 16 Have we been able to quasi address that? 17 MS. PIELSTICKER: Well, in this particular 18 legislation we believe that it will go a long way to 19 helping address that. 20 I think it's going to be a period of time 21 to get people used to coming into compliance, but it 22 certainly will help with our -- our sales and use 23 tax administration. 24 And if an excise tax eventually is enacted, 25 this structure will -- will further that as well. 26 MS. HARKEY: Okay. 27 MS. MA: Mr. Chair. 28 MR. HORTON: Thank you, Madam Chair. 6 1 This isn't similar to AB 71, where we tried 2 to establish the track and trace with cigarettes in 3 order to primariy deal with the underground economy. 4 The one thing that concerns me about the 5 legislation and the effort is a lack of funding in 6 order to be able to address those issues. 7 As we have observed in the past and history 8 dating back to prohibition, whenever there is an 9 appearance of legalization or an appearance of some 10 cooperation on the part of the State, the 11 underground economy just begins to explode. 12 And, so, in order for us to -- to control 13 that, historically, we have found that we need the 14 resources in order to be able to go out and monitor 15 this system as it flows through from the grower to 16 the -- to the manufacturer and so forth. 17 And particularly with California being the 18 largest -- one of -- the largest consumer state in 19 the nation, and I understand the largest distributor 20 as well, distributing it all over the nation, so, it 21 presents a huge challenge for the Board of 22 Equalization without the corresponding funding or 23 staffing in order to accomplish this objective, 24 which, in my mind, is a design for us to -- to fail 25 at this. 26 So, possibly, Madam Chair, we can consider 27 a BCP too in -- consistent with -- in coordination 28 with this or possible subsequent cleanup 7 1 legislation, begin to have those discussions about 2 how we make this works -- work. 3 MS. MA: Yes. So, perhaps -- we've been 4 following these bills since the beginning and these 5 three bills look significantly different than the 6 bills that originally were passed over the desk. 7 Basically the Governor did get involved and 8 he came up with a lot of language and how he wanted 9 to see this whole program. And then basically 10 dropped the language into the three bills. 11 So, I don't think there was a thorough 12 Appropriations Committee hearing in terms of how 13 much everything is going to cost for all of these 14 bills. 15 I'm not sure whether we've even -- they 16 even talked about it in the legislature in terms of, 17 you know, creating these new positions and, you 18 know, BOE also trying to administer this new 19 program. 20 I think that whole process was continued 21 for another day. 22 Am I correct? 23 MS. PIELSTICKER: That is correct. 24 And we are currently working with the 25 Department of Finance to let them know an estimate 26 of -- of costs associated with our role in the 27 program. 28 And that will be a part of the enrolled 8 1 bill report that goes to the Governor's office. 2 MS. MA: There is a lot of technology these 3 days that does a very good job in terms of tracking. 4 So, I don't know how we can work with you 5 and your staff in terms of, you know, how we can 6 come up with a good system and a good budget for us 7 to be able to, you know, be able to bring this 8 program into compliance with our needs. 9 MS. PIELSTICKER: Right now the cost issues 10 that the -- that the program folks are looking at is 11 what would be required to put together an RFP and to 12 work with the other agencies to develop the system. 13 It's a little nebulous as to what our role 14 is in relation to the other two agencies, and that's 15 something that we need to clarify with them. 16 MS. MA: Mr. Runner. 17 MR. RUNNER: Yeah, I think -- first of all, 18 I know we're just talking about the first bill, they 19 ended up dividing this bill in the last two days of 20 session into the three and language came out very 21 fast and last. So, there are a lot of unanswered 22 issues. 23 But let me just say that -- I know that 24 they did -- they did bring in and co-op a lot of 25 language that we -- that the BOE made -- put 26 forward. I know you guys were monitoring it all the 27 time. 28 And I think that -- let me just say I think 9 1 we would have far worse off in regards to a -- in 2 terms of a policy issue and a regulatory scheme if 3 you -- if BOE team was not engaged in that process. 4 And I know that meetings were had even late 5 at nights in order to help make that happen. 6 So, I think you're -- but, as we all know, 7 strange things happen in the midst of the darkness 8 when it comes to the last nights of session. 9 And, so, I think it's important for us to 10 then identify where it is that we need to insert 11 ourselves in this process. 12 And, quite frankly, as I think we all know, 13 oftentimes when things get then done quickly like 14 that, in order to get something done, the attitude 15 is, "Well, it'll get fixed later." 16 And I think we just need to make sure that 17 we are engaged in that fix later part -- portion. 18 And the other issue, at least my 19 understanding, is that the things that have been 20 done in these bills here are all on regulatory side. 21 And, so, therefore, they will be fee driven in terms 22 of helping to pay those bills. 23 Is that -- 24 MS. PIELSTICKER: That is correct. 25 MR. RUNNER: -- right. So, at that point 26 we -- we will help to create the scheme and help 27 then the agencies, whether it's us or others, to 28 create the fee that's necessary for us to support 10 1 our involvement. 2 MS. PIELSTICKER: On our side of things 3 with regard to the track and trace piece, that will 4 likely be some form of appropriation. 5 MR. RUNNER: On that side of it? 6 MS. PIELSTICKER: On that side of it, 7 because we don't have a regulatory requirement at 8 this time. 9 MR. RUNNER: Who will set the fee for that? 10 MS. PIELSTICKER: There won't be a fee. 11 It'll be an appropriation to the BOE. 12 MR. RUNNER: Out of the general fund? 13 MS. PIELSTICKER: I believe so, to cover 14 our costs. 15 MR. RUNNER: Right, and I would again -- 16 that would be one thing that I would -- again the 17 goal should be that these things should be covered 18 by the fee aspect of that -- of whether it be Food 19 and Ag or whoever then who is going to monitor 20 the -- the -- the tracking system. 21 And there's nothing wrong with identifying 22 a fee to do that on. 23 MS. PIELSTICKER: But actually you raise a 24 good point in the sense that we would typically 25 operate with a general fund appropriation, but in 26 this circumstance, you're right there are some other 27 agencies involved that are charging fees -- 28 MR. RUNNER: Right. 11 1 MS. PIELSTICKER: -- and perhaps that could 2 be a consideration. 3 MR. RUNNER: So, that would be an MOU that 4 we would work out with them potentially? 5 MS. PIELSTICKER: I would have to -- 6 MR. RUNNER: Okay. 7 MS. PIELSTICKER: -- look into it 8 further. 9 MR. RUNNER: Okay, okay. Again, I -- you 10 know, I -- again I -- I was quite -- I was still 11 amazed at the fact that they actually got such a 12 heavy lift of the regulatory system in place, in 13 light of the fact that it's been 18 years in that 14 process. 15 So, I think it has -- has been a good 16 accomplishment both on the legislative side and also 17 for the Board's involvement. 18 And I guess I'd almost be -- rather than 19 fixing something that we've got here, as opposed to 20 wringing our hands, knowing that the legislature 21 went another year without doing anything. 22 MS. MA: Okay. 23 MS. PIELSTICKER: I will proceed to the 24 next bill. And all of these bills work together. 25 They started out as one bill and then they were 26 broken out into -- I shouldn't say -- yes, there 27 were a lot of negotiations. 28 Anyway, SB 643 enacts an additional 12 1 licensing and regulatory framework within the 2 Medical Marijuana Act, as established by AB 266. It 3 requires the Governor to appoint a Chief of the 4 Bureau within the Department of Consumer Affairs. 5 It requires the Department of Food and 6 Agriculture to administer the Medical Marijuana Act 7 provisions related to the cultivation of medical 8 cannabis. 9 It requires the Department of Public Health 10 to administer the provisions of the Medical 11 Marijuana Act related to the manufacturing and 12 testing of medical cannabis. 13 It requires the Department of Food and 14 Agriculture, in consultation with the Bureau, to 15 establish a track and trace program for reporting 16 the movement of medical marijuana items throughout 17 the distribution chain that uses a unique 18 indentifier and secure packaging, as provided. 19 And it takes effect on or before January 1, 20 2016. 21 AB 243 enacts additional licensing and 22 regulatory framework within the Medical Marijuana 23 Act, as established by AB 266. 24 And it is specific to the cultivation of 25 medical cannabis. And it requires the California 26 Department of Food and Ag to establish a medical 27 cannabis cultivation program, to license the 28 cultivation of indoor and outdoor medical marijuana. 13 1 It requires the California Department of 2 Food and Ag to establish a unique identifier program 3 for medical marijuana plants. 4 And it requires the Department of Food and 5 Ag to develop and implement regulations to carry out 6 the licensing program and to regulate weighing and 7 measuring devices used to meet the Medical Marijuana 8 Act's requirements. 9 Also taking effect on January 1, 2016. 10 So, some -- another bill was passed 11 addressing the banking issue, Assembly Joint 12 Resolution 125 (Lackey), (sic) urges the President 13 and Congress to support legislation that will 14 provide a comprehensive solution to allow banks and 15 credit unions to perform financial services for 16 marijuana businesses. 17 And then two additional bills were 18 introduced in the last day of session, and those 19 will carry over into january, both by Assembly 20 Member Wood. 21 AB 1549 would establish the California 22 Cannabis Credit Union, allowing businesses and 23 individuals engaged in licensed cannabis activities 24 to have banking services similar those provided by 25 other credit unions. 26 And AB 1548 (Wood) would impose an excise 27 tax on the sale of cannabis products by a licensed 28 cultivator to be collected by a licensed 14 1 distributor. 2 MS. HARKEY: Am I -- 3 MS. MA: Ms. Harkey. 4 MS. HARKEY: -- hi. Yes, I'm glad you 5 brought that up. 6 An AJR is not the establishment of a bank, 7 though, I do appreciate the effort. 8 I'm sure that this Board knows that 9 Colorado's Fourth Corner Credit Union was denied by 10 the fed. 11 And I have here Department of Justice 12 guidelines which they have allowed states to 13 implement legalization. And they are quite 14 prolific, 1 through 8 to be exact. 15 And there's a lot of issues that we are 16 going to have a real hard time, I think, regulating 17 even on medical marijuana use. 18 And that's part of the problem as to why 19 the banking -- this is still not legal at the 20 federal level. And that's why California's going to 21 have some issues. 22 So, I would like to see the impetus still 23 put on whoever is in the industry to pursue fixing 24 things at the federal level because I don't believe 25 without -- without -- knowing that we are approving 26 what is still illegal at the federal level is 27 problematic for a whole multitude of issues. 28 And if we just allow the industry, quote, 15 1 unquote, to slide here, they will not be able -- 2 they will not worry about putting the pressure on 3 the federal level. The pressure will come to the 4 State of California and the people that we 5 represent. 6 So, you know, there is still issues about 7 drunk driving, transferring to other -- other 8 states -- states that aren't legal. 9 I know in Colorado there have been -- I 10 think it's Oklahoma and Nebraska have sued the State 11 of Colorado. 12 There is all sorts of issues at the federal 13 level that still need to be resolved. 14 So, while I appreciate the efforts and I 15 understand that we legalized medical use 18 years 16 ago, I think a regulatory system is necessary. 17 The problem that we're going to have, 18 again, as a tax auditing, collecting and 19 distribution agency is going to be the 20 legitimization of the cash receipts. And the -- the 21 potential danger of being involved in some sort of 22 criminal activity. 23 And, so, I'm just -- you know, I'm just 24 saying I know this is an exciting thing for many 25 people. For me it strikes a little -- a little bit 26 of a fear. 27 I know we can not not do what is authorized 28 by legislation, but I think we have to proceed very 16 1 cautiously and ensure that our influence and our 2 ability to try to effect changes on the federal 3 level, if, in fact, we are going to pursue this 4 course, is very, very important. 5 Otherwise we will be, as a state, having 6 some very serious issues. 7 MR. HORTON: Madam Chair? 8 MS. MA: Mr. Horton. 9 MR. HORTON: Thank you, Madam Chair. 10 The concern that I have is that as we 11 get -- that there's -- there's a huge disconnect 12 between the federal government, as Member Harkey has 13 articulated, the federal government and the state 14 government as to the the legalization of this 15 product. 16 That disconnect feeds into the illegal 17 activity. And it's the illegal activity that allows 18 criminals and those types of individuals to continue 19 to -- to create a -- to camouflage their operation 20 in such a way that it -- that it makes it more 21 difficult for them to be identified by law 22 enforcement and prosecuted is where the concern 23 comes in. 24 And, so, again we just reiterated as the 25 state continues to go down this -- this road, the 26 illegal activity is where the Board of Equalization 27 comes in and our ability to be able to enforce that. 28 We have the skills. We have the strategy 17 1 in place. And the Constitution, as well as the 2 existing law, says that whether it's legal or 3 illegal, it is still subject to tax. 4 And those that are operating illegally and 5 using these funds for illegal activity, such as 6 human trafficking, prostitution and things of that 7 nature, we should do everything in our power to shut 8 them down. 9 And as this becomes a little more 10 complicated, we're going to need additional funding 11 for staffing in order to accomplish that objective. 12 MS. MA: Mr. Runner. 13 MR. RUNNER: Yeah, just real quick. 14 Yeah, I think that -- that not only 15 California, but twenty some other states have 16 medical marijuana, another five that have legalized 17 recreational, are all going to struggle with the 18 challenges that we have with -- with federal law and 19 the -- that issue. 20 And I can tell you the feds do too. I met 21 with the U. S. Attorney, with the FBI and DEA when 22 we were dealing with this issue. And it was 23 interesting because they -- they were basically 24 saying, 25 "Hey, look, we need California to set 26 up some kind of regulatory scheme, so that 27 we can least try to identify some of," 28 I think their phrase was kind of like, 18 1 "well-intentioned players from the 2 real criminal players." 3 And their view was, "Hey, get it together 4 because this will help us." 5 And -- but at the end of the day, it is -- 6 it is the cash that creates the corruption, that 7 creates the violence. 8 And, you know, we really do need to 9 continues to ask the federal government to step up 10 and decide how to handle this issue. 11 I know there's lots of efforts in 12 Washington, D. C. I was glad that the legislature 13 at least put their voice to the issue. And it is an 14 important issue. 15 Because until that -- I think until that 16 gets done, what we have -- tell you what -- I 17 explained it one way to somebody, I said right now 18 we have an unregulated cash business going on and 19 those are impossible. 20 What we're going to end up with is a 21 regulated cash business going on and those are still 22 very difficult. 23 And we need to get -- we need to figure out 24 how to get through that. And until then it's going 25 to always be a challenge, but at least this is a 26 step. 27 MS. MA: Yeah. And, you know, I appreciate 28 Assembly Member Lackey, AJR 25 does encourage 19 1 Congress and the President to work on this issue. 2 We're putting as much pressure as we can on 3 the federal government. There is a bill out there, 4 HR 2076, the Marijuana Businesses Access to Banking 5 Act of 2015. 6 It is probably not going to pass this year 7 as the federal government struggles with other 8 impending issues or issues that they're going to 9 focus on. 10 And, so, in the meantime I think there are 11 43 states that have some sort of medicinal cannabis, 12 recreational or hemp-related bills or legal allowed 13 in their state. That is 43 states that are facing 14 the same issue. 15 None of them have access to banking. And, 16 so, all of the, you know, cash in the streets is not 17 safe, as my colleagues have mentioned. 18 You know, I think California as a state, as 19 one of the biggest states -- the biggest state in 20 this business, I think we need to proactively try to 21 work on some sort of solution while we're putting 22 pressure on the federal government to address many 23 of these issues that they should be working on. 24 But, in the meantime, you know, we're doing 25 what we can as a state, so -- 26 Mr. Horton. 27 MR. HORTON: Yeah, thank you, Madam Chair. 28 I mean I concur with the State putting the 20 1 legislature -- putting pressure on the federal 2 government and the passage of the AJR. I think 3 there's a lot of wisdom in that. 4 The bill that's currently held up by the 5 Senate, passed out of Congress and the Senate's 6 holding it up. And they just have all kinds of 7 concerns -- at least from my conversation with 8 Dianne Feinstein. 9 So, I don't see them doing, as Member Ma 10 has indicated, anything this year or next year in 11 this regard because of those concerns. 12 But to the issue of just the cash, I mean, 13 organized crime has been -- is one of the best 14 entities at laundering money. They've been doing 15 this for years. And, so, moving the cash around is 16 not necessarily their issue. 17 But creating this -- the false perception 18 that it's legal is what causes -- which creates this 19 barrier that law enforcement can't get around 20 between the legitimate guys, those who want to 21 comply with the law, those who want to pay their 22 fair share and contribute to our society, and those 23 who simply don't. 24 And, so, I still echo the need for 25 aggressive enforcement. And as we begin to -- to go 26 down this route, the need to have that funded on all 27 of the levels, including Board of Equalization, 28 District Attorney, A. G., and so forth, 21 1 something similar to what we have with the TRACE 2 program. 3 MS. MA: Okay, please continue. 4 MS. PIELSTICKER: In addition to medical 5 cannabis regulation, the legislature tackled two 6 special sessions, which are still open and have not 7 yet passed any bills to the Governor. 8 The transportation special session bills 9 were introduced. And the -- among other -- among 10 other things, these bills collectively would have 11 increased the diesel fuel sales and use tax rate and 12 the gasoline excise tax rates, and removed the 13 requirement that the BOE adjust the excise tax rate 14 every year to achieve revenue neutrality, as 15 compared to the tax structure that existed prior to 16 the 2010 fuel tax swap. 17 With regard to the health care special 18 session, the -- collectively the bills propose 19 licensing and taxation of e-cigarettes, an increase 20 in the cigarette and tobacco products tax, increased 21 and more frequent imposition of licensing fees on 22 tobacco retailers, as well as increased licensing 23 fees on tobacco distributors, and -- as well as a 24 nickel per drink on cocktails containing distilled 25 spirits. 26 None of those bills passed, but because 27 they are in special session and the session is still 28 open, they are still alive. 22 1 MS. MA: So, perhaps you can give us an 2 update next month if there is any type of movement 3 on these two special session bills? 4 MS. PIELSTICKER: Certainly. 5 So, BOE-sponsored and supported bills that 6 proceeded to the Governor's desk include AB 88, 7 which provides a sales and use tax exemption for 8 public utilities, ENERGY STAR refrigerator or 9 clothes washer purchases that are provided at no 10 cost to low income participants. That bill is 11 enrolled. 12 AB 681 (Ting), which modifies the county 13 assessment practices survey cycle to reduce the time 14 for the BOE to issue a survey report from two years 15 to one year, and allows former assessors to provide 16 feedback on the survey of their former office, also 17 in enrolled. 18 AB 1277, which increases from 1500 to $2300 19 the amount of levied funds that BOE's Taxpayers' 20 Rights Advocate is permitted to return to a taxpayer 21 when the taxpayer can demonstrate that the levy 22 threatens the health or welfare of the taxpayer or 23 family is on the Governor's desk. 24 And SB 321, which authorizes the BOE to 25 make specified adjustments to the motor vehicle fuel 26 tax swap rate using a five-year average fuel price 27 estimate is now in the Assembly Appropriations 28 Committee and was moved to the inactive file. 23 1 SB 640 (Beall), which authorizes a retailer 2 to make an irrevocable election to assign the right 3 to file a claim for refund for excess tax 4 reimbursement in the amount of $1,000 or greater is 5 the Assembly Appropriations Committee as a two-year 6 bill. 7 SB 802, which is the BOE's MTS surcharge 8 clean-up bill, is a two-year bill. 9 And SB 803, which is the BOE's property tax 10 clean-up bill, is enrolled. 11 Other bills sent to the Governor are 12 Chairman Horton's sponsored AB 160, which expands 13 the situations where a sale for resale exclusion can 14 be denied for persons convicted of selling or 15 purchasing counterfeit goods; AB 401, which among 16 other things requires the State Water Resources 17 Board, in collaboration with the BOE and relevant 18 stakeholders, to develop a funding implementation 19 plan for a Low-Income Water Rate Assistance Program 20 and submit a report, was enrolled. 21 AB 1032, which allows a diesel fuel tax 22 refund to a supplier for that portion of tax-paid 23 biodiesel fuel removed from the terminal rack as a 24 dyed biodiesel blend, was enrolled. 25 And AB 1157 (Nazarian), which extends for 26 one year the current property tax law provisions 27 related to commercial air carriers, was enrolled. 28 AB 1534, by the Assembly Revenue and 24 1 Taxation Committee, which requires requires county 2 assessor employee that makes change in ownership 3 decisions or property tax exemption decisions to 4 hold a BOE-issued assessment analyst certificate, 5 was enrolled. 6 SB 533 (Pan), which tightens provisions 7 related to sales tax sharing agreements between 8 local agencies and the private sector, was enrolled. 9 SB 705 (Hill), which authorizes San Mateo 10 and Monterey counties to exceeded the current 2 11 percent cap on total district taxes for countywide 12 transportation purposes, was enrolled. 13 And SB 767, which authorizes the 14 Los Angeles County Metropolitan Transportation 15 Authority to impose an additional half percent 16 transactions and use tax for funding 17 transportation-related projects and programs and 18 exceeding the 2 percent cap, is enrolled. 19 Chaptered bills include AB 301 (Bigelow), 20 which requires CalFire to notify owners of habitable 21 structures subject to the state responsibility area 22 fire prevention fee that when selling the property, 23 they may negotiate the apportionment of the annual 24 fee with the buyer as one of the terms of the sale. 25 SB 598 (Hill), which specifies that an 26 all-volunteer fire department is a consumer, and 27 shall not be considered a retailer of tangible 28 personal property it sells. 25 1 SB 84, that's a bill that passed during the 2 budget this year, which imposes a BOE-collected fee 3 on owners of hazardous materials transported by rail 4 in the state also was chaptered. 5 And that concludes my presentation. 6 MS. MA: Any questions? Mr. Horton. 7 MR. HORTON: I guess in a word, wow! 8 I just want to commend Madam Chair in her 9 leadership in the Legislative Committee and the 10 staff for their exceptional work. 11 Historically the Board of Equalization 12 moving legislation through -- through the process, 13 there was a point in time that it presents -- there 14 was some challenges that we were facing. 15 Your aggressive effort in going out, making 16 the contacts, building the relationships, building 17 the trust and the confidence of the legislature has 18 been very, very, valuable in us having this type of 19 success. 20 I think we may be sponsoring and carrying 21 more legislation than we did when we were in the 22 legislation, you know. 23 And, so, and that's commendable to -- I 24 believe, to all involved. 25 Let me encourage that we reach out to the 26 Chair of the Appropriation Committee on both sides 27 to begin to have -- as I believe Michele is doing, 28 begin to have the conversation about their view of 26 1 our estimates as to the legislation that is going 2 through. 3 I clearly understand that this is an after 4 the fact situation, but to the extent that staff can 5 participate in the legislation prior to, I 6 understand the challenges in that as well. 7 We may be able to provide them some insight 8 on how the -- how to arrange their legislation to 9 minimize the cost to the Board of Equalization and 10 other state agencies. 11 But, basically, I just wanted to commend 12 everybody -- well done. 13 MS. MA: And I'd like to also commend 14 Ms. Pielsticker and her team. They have been very, 15 very active in the building. They have very good 16 reputation and rapport, good communication with 17 Members, as well as committee staff. 18 I know that whenever they ask you to 19 participate, you're always there. You go to a lot 20 of meetings across the street, and definitely show 21 that the BOE is interested in working with 22 legislators, as well as making sure that whatever 23 legislation passes is going to be effective and 24 efficient on the BOE side as well. 25 So, I just really want to commend you. 26 This was my first year working with you on this side 27 versus the capital side. And I know that you're 28 doing a really, really good job. 27 1 So -- 2 MS. PIELSTICKER: Thank you. 3 MS. MA: -- thank you. 4 MS. PIELSTICKER: Appreciate that. 5 Anyone else? 6 Just kidding. 7 MS. HARKEY: You've done well. 8 MS. MA: Okay, that concludes the 9 Legislative Committee. 10 We're adjourning the Legislative Committee. 11 ---o0o--- 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 28 1 REPORTER'S CERTIFICATE. 2 3 State of California ) 4 ) ss 5 County of Sacramento ) 6 7 I, JULI PRICE JACKSON, Hearing Reporter for 8 the California State Board of Equalization certify 9 that on SEPTEMBER 16, 2015 I recorded verbatim, in 10 shorthand, to the best of my ability, the 11 proceedings in the above-entitled hearing; that I 12 transcribed the shorthand writing into typewriting; 13 and that the preceding pages 1 through 28 constitute 14 a complete and accurate transcription of the 15 shorthand writing. 16 17 Dated: October 8, 2015 18 19 20 ____________________________ 21 JULI PRICE JACKSON 22 Hearing Reporter 23 24 25 26 27 28 29