AB 1506 (Anderson) State IOUs

Fresno Chamber Position: SUPPORT

This last summer the State Controller began issuing IOUs to pay California's bills as a result of our on-going budget crisis. Since July 2, the state has dispensed 101,930 IOUs. These IOUs total an equivalent of $389 million in vital payments that is effectively being denied to service providers, non-profit organizations, and taxpayers!

While state law requires the public to accept these registered warrants (IOUs) the state is not required to accept such securities as payment. This is a double standard that harms those hardworking taxpayers and contracted businesses caught in the middle.

AB 1506 requires the state to accept its own IOUs as payment for state taxes and fees. This is a fair allowance in order to permit citizens to make necessary payments to the state, such as DMV registration, tax payments, and school tuition.

For example, with this bill if you are a business with state contracts and you receive an IOU for $50,000 from the state, and you also owe the state $50,000 in payroll taxes, you would be able to send the IOU to the Franchise Tax Board as payment for your tax obligation.
 

Contact Kerri Ginis, the Chamber's Government Affairs Manager for more information at (559) 495-4818 or kginis@fresnochamber.com