Both Brandon Powers and George Runner below make reference to this issue…. Here is a memo on it from the Prince of Darkness, co-signed by Mike Villines…

  FROM:   Assembly Speaker Fabian Nunez Assembly Republican Leader Mike Villines

  DATE:   July 20, 2007

  RE:   Drafting Error in Senate Bill 98 Related to Research and Development Credit    

We write both to bring to your attention an inadvertent drafting error by Legislative Counsel in Senate Bill 98, which passed off the Assembly Floor last night with strong bipartisan support, and to express our mutual understanding to address this drafting error in August.

  As you know, SB 98 contains numerous provisions, all of which provide enhanced taxpayer incentives to bring new jobs and capital investment to California.  One particular area of emphasis in Senate Bill 98 is the area of research and development tax credits, and in particular conforming California’s tax law to the federal Alternative Incremental Credit (AIC).  SB 98 provides a full five-year conformity to this enhanced federal credit.  

However, in the final draft of Senate Bill 98, a technical drafting error inadvertently applied this five-year sunset to the existing research and development provisions of California law, and not the specific change to the AIC.  All parties to the debate, discussion and drafting of SB 98 agree that this was not the intended result.  

As Speaker and Assembly Republican Leader, respectively, we are pleased to have been able to come to agreement on a significant tax incentive and economic  stimulus package.  Upon our return from the Summer Recess, we will take the necessary steps to correct any concerns or inadvertent consequences due to this drafting error.

(Posted via PDA so pardon formatting)

This entry was posted on Friday, July 20th, 2007 at 12:00 am and is filed under Blog Posts.