Governor vetoes AB 1181

Image courtesy of Adobe Stock.

On Saturday October 12, 2019, Governor Newsom vetoed California Assembly Bill 1181, which would have required charities filing financial statements with the state Registry of Charitable Trusts to value donated medicine at the fair value in the end recipient market. Essentially this would have required charities filing in the state to use values in the international market instead of the U.S. market.

More discussion will follow later today.

Update: more details in followup post.

Update: The post you are reading here was the initial one published immediately after I learned the governor vetoed the bill. Later on Sunday a wrote a longer post which provided far more background. For some reason, the majority of traffic coming into this blog is going to this short post. To provide more value to those arrive in this page, I will copy the additional info on the longer post here. Hope this info is helpful.

Followup to this post, which was previously published here. Additional info is the text of the governor’s veto message, background on the veto override protocol, and my assessment whether the bill is totally, completely dead or not:

 

The governor announce a list of bills he signed and vetoed. You can find the list here. By my count he signed 69 and vetoed 58 on Saturday.

Veto message

The governor’s veto message can be read here. In it he said:

Office of the Governor

Oct 12 2019

To the Members of the California State Assembly:

I am returning Assembly Bill 1181 without my signature.

This bill would require charitable organizations to report the value of specified in-kind donations using the fair value of the end recipient market. Such a requirement would be unique to California.

I commend Attorney General Xavier Becerra’s action to hold charities accountable when they mislead donors and the public, as evidenced by recent enforcement actions taken against charitable organizations for their deceptive solicitation tactics.

However, I am concerned that this bill may pose burdensome implementation challenges for the charities impacted by its provisions. I agree with the Attorney General that overvaluation is a problem, and my Administration is open to exploring other less burdensome ways to address this issue.

Sincerely,

/s/

Gavin Newsom

 

Governor’s options upon approval of bill

The bill was passed on September 12, 2019 with the session ending the following day. The governor had until October 13, 2019 to either sign or veto the bill.

According to this page at the California State Capital Museum, a bill automatically goes into effect if the governor does not sign it. This page from the state legislature website says the same thing.

Veto override process

As I have said repeatedly, I don’t understand this process and every step I take is a learning step.

This document from the state legislature, date not known and full source not know, says on page 130 the legislature has 60 days, excluding recess, to attempt override of a veto. Footnote refers to joint rule 58.5.

The Senate Concurrent Resolution for the 2019-2020 Regular Session outlines the 60 day override window. It says:

Vetoes

58.5.The Legislature may consider a Governor’s veto for only 60 days, not counting days when the Legislature is in joint recess.

What that tells me is that a veto during the winter recess does not kill the bill. The legislature has 60 days, starting when they return on January 6, 2020, to attempt an override.

Vote requirement for override

This page from the state legislature website, mentioned earlier, says an override requires 2/3rd vote in both houses.

  • In the Assembly, AB 1181 passed with 68 aye, 1 nay, and 10 votes not recorded. Two-thirds of 80 would be 54.
  • In the Senate, the bill passed with 31 aye, 8 nay, and 1 vote not recorded. Two-thirds of 40 would be 27.

So the raw votes are present for override. I have no clue whatsoever on whether the behind-the-scenes willpower or time exists to attempt an override. Among the other things for which I have no clue is how much influence the governor’s opposition would influence whether leadership wants to attempt an override and whether his opposition would sway lots of previous ‘ayes’ to ‘nayes.’

My exquisitely limited ability to assess the situation says the bill is not completely, absolutely dead, but odds on it becoming law are quite low. Anyone bold enough to offer any ideas on how to read this situation?

 

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