Amendment ASA1-AB84

ASSEMBLY SUBSTITUTE AMENDMENT 1, TO ASSEMBLY BILL 84

October 14, 2019 - Offered by Representative Tauchen.

AB84-ASA1,1,6 An Act to amend 20.566 (1) (hp), 71.10 (5s) (c) and 71.10 (5s) (e); and to create 71.05 (27), 71.10 (5jm), 71.21 (4m), 71.26 (2) (a) 13., 71.36 (1m) (d), 71.365 (4m) (d) 1m., 71.45 (2) (a) 21. and 115.3415 of the statutes; relating to: imposing requirements related to school lunch and breakfast programs in certain schools, creating an income and franchise tax subtraction for donations to repay school meal debt, and making an appropriation.

Analysis by the Legislative Reference Bureau

This bill 1) requires certain schools to provide a school lunch or breakfast to a pupil who requests such a meal; 2) prohibits those schools from taking certain actions against a pupil who is unable to pay for those meals; 3) allows taxpayers to deduct donations made to schools to repay pupils' meal debts; and 4) creates a checkoff on the individual income tax return for donations to schools to repay pupils' meal debts.

The bill defines “school” as a public school, including an independent charter school, private school, tribal school, the Wisconsin Educational Services Program for the Deaf and Hard of Hearing, or the Wisconsin Center for the Blind and Visually Impaired, provided the school, program, or center receives state aid for providing school lunches and breakfasts (free or reduced-price meals).

Requirement to provide quality meals

Under the bill, the school board of a school district, operator of an independent charter school, governing body of a private school, governing body of a tribal school, director of the program, or director of the center (governing body) must provide a meal that is of a similar quality to a free or reduced-price meal (quality meal) to a pupil who requests such a meal, regardless of the pupil's ability to pay for the meal, and prohibits the governing body from providing a meal of inferior quality in place of a quality meal. If the pupil is homeless and is enrolled in a public school, including an independent charter school, the governing body of the school must provide the quality meal to the pupil at no cost to the pupil.

Prohibited practices

The bill prohibits the governing body of a school from doing any of the following:

1. Publicly identifying or stigmatizing a pupil who is unable to pay for a quality meal or who has outstanding debt related to a quality meal.

2. Requiring a pupil who has received a quality meal to relinquish or throw away that quality meal because the pupil is unable to pay for the quality meal or has outstanding debt related to a quality meal.

3. Communicating directly with a pupil in grades kindergarten to eight concerning the pupil's inability to pay for a quality meal or to pay outstanding debt related to a quality meal.

4. Requiring a pupil who is unable to pay for a quality meal to do chores or other work as a condition of receiving the quality meal, unless the pupil's parent or guardian consents.

5. Restricting a pupil's participation in graduation activities on the basis that the pupil is unable to pay for a quality meal or has outstanding debt related to a quality meal.

6. Withholding a pupil's high school diploma, refusing to promote a pupil to the next grade, or withholding a pupil's high school transcript on the basis that the pupil is unable to pay for a quality meal or has outstanding debt related to a quality meal.

Deduction for school meal debt donations

The bill allows a taxpayer, when calculating income for income or franchise tax purposes, to deduct a donation made to a school's governing body to repay pupils' debts related to quality meals. The maximum amount that a taxpayer may deduct each year is $25,000. A taxpayer may not place any conditions on the donation, such as requesting that it be used to pay the debt of a specific pupil, or receive anything of value in exchange. In order to deduct the donation, the taxpayer must provide the Department of Revenue with written certification from the governing body stating that the governing body will use the donation solely for the purpose of repaying pupils' meal debts.

Tax checkoff program

This bill creates an individual income tax checkoff for donations to a school's governing body to be used solely for the repayment of pupils' debts related to quality meals. A governing body that is owed meal debt may apply to DOR to be included on the list of eligible donees under the checkoff program. The individual making the checkoff donation must specify which listed governing body is to receive the funds. The bill requires that an amount equal to the total amount of designations received, less the total cost of administering the income tax checkoff procedure, be transferred to the designated governing bodies.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB84-ASA1,1 Section 1. 20.566 (1) (hp) of the statutes is amended to read:

AB84-ASA1,3,8 20.566 (1) (hp) Administration of income tax checkoff voluntary payments. The amounts in the schedule for the payment of all administrative costs, including data processing costs, incurred in administering ss. 71.10 (5), (5e), (5f), (5fm), (5g), (5h), (5i), (5j), (5jm), (5k), (5km), and (5m), and 71.30 (10). All moneys specified for deposit in this appropriation under ss. 71.10 (5) (h) 5., (5e) (h) 4., (5f) (i), (5fm) (i), (5g) (i), (5h) (i), (5i) (i), (5j) (i), (5jm) (i), (5k) (i), (5km) (i), and (5m) (i) and 71.30 (10) (i) and (11) (i) shall be credited to this appropriation account.

AB84-ASA1,2 Section 2 . 71.05 (27) of the statutes is created to read:

AB84-ASA1,3,10 71.05 (27) School meal debt donations. (a) In this subsection:

AB84-ASA1,3,13 1. “Claimant" means an individual; an individual partner or member of a partnership, limited liability company, or limited liability partnership; or an individual shareholder of a tax-option corporation.

AB84-ASA1,3,14 2. “Governing body” has the meaning given in s. 115.3415 (1) (a).

AB84-ASA1,3,16 3. “School meal debt” means money owed by a pupil to a governing body due to the pupil receiving a quality meal, as defined in s. 115.3415 (1) (b).

AB84-ASA1,3,19 4. “School meal debt donation” means an amount paid by a claimant to a governing body to be used by the governing body solely for the purpose of repaying school meal debt.

AB84-ASA1,4,3 (b) Subject to the limitations in this subsection, a claimant may subtract from federal adjusted gross income the amount, not to exceed $25,000, of the school meal debt donation paid by the claimant in the year to which the claim relates.

AB84-ASA1,4,6 (c) No subtraction is allowed under this subsection if the claimant places a condition on the school meal debt donation, requests the donation be used to repay the debt of a specific pupil, or receives anything of value in exchange for the donation.

AB84-ASA1,4,11 (d) No subtraction is allowed under this subsection unless the claimant receives certification from the governing body, on a form provided by the department, that the governing body will use the donation solely for the purpose of repaying school meal debt and the claimant includes the form with the claimant's income tax return for the year to which the claim relates.

AB84-ASA1,3 Section 3. 71.10 (5jm) of the statutes is created to read:

AB84-ASA1,4,13 71.10 (5jm) School meal debt donations. (a) Definitions. In this subsection:

AB84-ASA1,4,14 1. “Department" means the department of revenue.

AB84-ASA1,4,16 2. “Eligible governing body” means a governing body, as defined in s. 115.3415 (1) (a), whose application under par. (e) 1. has been approved by the department.

AB84-ASA1,4,18 3. “School meal debt” means money owed by a pupil to a governing body due to the pupil receiving a quality meal, as defined in s. 115.3415 (1) (b).

AB84-ASA1,4,23 (b) Voluntary payments. 1. `Designation on return.' Subject to sub. (5s), every individual filing an income tax return who has a tax liability or is entitled to a tax refund may designate on the return any amount of additional payment or any amount of a refund due that individual as a donation to an eligible governing body for the repayment of school meal debt.

AB84-ASA1,5,3 2. `Designation added to tax owed.' If the individual owes any tax, the individual shall remit in full the tax due and the amount designated under subd. 1. when the individual files a tax return.

AB84-ASA1,5,7 3. `Designation deducted from refund.' Except as provided in par. (d), if the individual is owed a refund for that year after crediting under ss. 71.75 (9) and 71.80 (3) and (3m), the department shall deduct the amount designated under subd. 1. from the amount of the refund.

AB84-ASA1,5,10 (c) Errors; failure to remit correct amount. If an individual who owes taxes fails to remit an amount equal to or in excess of the total of the actual tax due, after error corrections, and the amount designated under par. (b) 1.:

AB84-ASA1,5,15 1. The department shall reduce the designation under par. (b) 1. to reflect the amount remitted in excess of the actual tax due, after error corrections, if the individual remitted an amount in excess of the actual tax due, after error corrections, but less than the total of the actual tax due, after error corrections, and the amount originally designated on the return under par. (b) 1.

AB84-ASA1,5,17 2. The designation under par. (b) 1. is void if the individual remitted an amount equal to or less than the actual tax due, after error corrections.

AB84-ASA1,5,23 (d) Errors; insufficient refund. If an individual is owed a refund that does not equal or exceed the amount designated under par. (b) 1., after crediting under ss. 71.75 (9) and 71.80 (3) and (3m) and after error corrections, the department shall reduce the designation to reflect the actual amount of the refund that the individual is otherwise owed, after crediting under ss. 71.75 (9) and 71.80 (3) and (3m) and after error corrections.

AB84-ASA1,6,6 (e) Eligible governing bodies; failure to select governing body. 1. Annually, no later than July 1, a governing body that is owed school meal debt may apply to the department, on a form provided by the department, to receive donations designated under par. (b) 1. The form shall require that the governing body report the amount of school meal debt owed to it, the number of pupils owing the debt, and any other information requested by the department. Upon a determination by the department that a governing body has complied with this paragraph, the department shall approve the governing body's application.

AB84-ASA1,6,9 2. A designation under par. (b) 1. shall be void if the individual fails to select, on the individual's income tax return, an eligible governing body to receive the donation.

AB84-ASA1,6,11 (f) Conditions. A designation under par. (b) 1. shall be void if the individual places any conditions on the designation.

AB84-ASA1,6,15 (g) Tax return and instructions. 1. The secretary of revenue shall provide a place for the designations under this subsection, including a place for an individual to select the eligible governing body to receive the donation designated under par. (b) 1.

AB84-ASA1,6,21 2. The secretary shall list all eligible governing bodies in the instructions for the individual income tax return. The instructions shall state that the listed governing bodies are eligible to receive donations to be used solely to repay school meal debt and that an individual who chooses to make a donation must select one of the listed governing bodies to receive the donation and may not request that the donation be used to repay the school meal debt of a specific pupil.

AB84-ASA1,6,24 (h) Certification of amounts. Annually, no later than September 15, the secretary of revenue shall certify to the department of administration and the state treasurer all of the following:

AB84-ASA1,7,3 1. The total amount of the administrative costs, including data processing costs, incurred by the department in administering this subsection during the previous fiscal year.

AB84-ASA1,7,5 2. The total amount received from all designations under this subsection during the previous fiscal year.

AB84-ASA1,7,8 3. The net amount remaining after the administrative costs, including data processing costs, under subd. 1. are subtracted from the total received under subd. 2.

AB84-ASA1,7,16 (i) Appropriations. From the moneys received from designations under this subsection, an amount equal to the sum of administrative expenses, including data processing costs, certified under par. (h) 1. shall be deposited in the general fund and credited to the appropriation account under s. 20.566 (1) (hp), and the net amount remaining that is certified under par. (h) 3. shall be transferred to the eligible governing bodies selected to receive donations under par. (b) 1. An amount transferred to a governing body under this paragraph shall be used only for the purpose of repaying the school meal debt owed to the governing body.

AB84-ASA1,7,19 (j) Void designations. If a designation under par. (b) 1. is void for any reason, the department shall disregard the designation and determine amounts due, owed, refunded, and received without regard to the void designation.

AB84-ASA1,8,2 (k) Amounts subject to refund. Amounts designated under this subsection are not subject to refund to the taxpayer unless the taxpayer submits information to the satisfaction of the department, within 18 months after the date on which the taxes are due or the date on which the return is filed, whichever is later, that the amount designated is clearly in error. Any refund granted by the department under this paragraph shall be deducted from the moneys received under this subsection in the fiscal year for which the refund is certified.

AB84-ASA1,4 Section 4. 71.10 (5s) (c) of the statutes is amended to read:

AB84-ASA1,8,10 71.10 (5s) (c) Beginning in September 2014, based on the amounts certified by the secretary of revenue in August or September 2013, and 2014, as specified in subs. (5) (h), (5e) (h), (5f) (h), (5g) (h), (5h) (h), (5i) (h), (5j) (h), (5jm) (h), (5k) (h), (5km) (h), and (5m) (h), and for every 2-year period thereafter, the secretary of revenue shall rank the checkoffs based on the total amount of designations received for each checkoff for each 2-year period. For each 2-year period, beginning with 2014, the secretary of revenue shall rank every checkoff that is created under this section.

AB84-ASA1,5 Section 5. 71.10 (5s) (e) of the statutes is amended to read:

AB84-ASA1,8,18 71.10 (5s) (e) For any taxable year that begins after December 31, 2014, individuals may not make a designation for any checkoff which did not generate at least an average of $50,000 of designations per year over the most recent 3-year period as certified by the secretary of revenue under subs. (5) (h) 3., (5e) (h) 2., (5f) (h) 2., (5fm) (h) 2., (5g) (h) 2., (5i) (h) 2., (5j) (h) 2., (5jm) (h) 2., (5k) (h) 2., (5km) (h) 2., and (5m) (h) 2. Once a checkoff is affected by this paragraph, no further checkoffs may be designated to that checkoff in any taxable year.

AB84-ASA1,6 Section 6 . 71.21 (4m) of the statutes is created to read:

AB84-ASA1,8,20 71.21 (4m) (a) In this subsection:

AB84-ASA1,8,21 1. “Governing body” has the meaning given in s. 115.3415 (1) (a).

AB84-ASA1,8,23 2. “School meal debt” means money owed by a pupil to a governing body due to the pupil receiving a quality meal, as defined in s. 115.3415 (1) (b).

AB84-ASA1,9,3 3. “School meal debt donation” means an amount paid by a taxpayer to a governing body to be used by the governing body solely for the purpose of repaying school meal debt.

AB84-ASA1,9,6 (b) Subject to the limitations in this subsection, an amount, not to exceed $25,000, that is equal to the school meal debt donation paid by the taxpayer in the taxable year may be subtracted from the taxpayer's income.

AB84-ASA1,9,9 (c) No subtraction is allowed under this subsection if the taxpayer places a condition on the school meal debt donation, requests the donation be used to repay the debt of a specific pupil, or receives anything of value in exchange for the donation.

AB84-ASA1,9,14 (d) No subtraction is allowed under this subsection unless the taxpayer receives certification from the governing body, on a form provided by the department, that the governing body will use the donation solely for the purpose of repaying school meal debt and the taxpayer includes the form with the income tax return for the year to which the claim relates.

AB84-ASA1,7 Section 7 . 71.26 (2) (a) 13. of the statutes is created to read:

AB84-ASA1,9,25 71.26 (2) (a) 13. Minus the amount, not to exceed $25,000, equal to the school meal debt donation, as defined in s. 71.21 (4m) (a) 3., paid by the taxpayer in the taxable year. The taxpayer may not place a condition on the school meal debt donation, request the donation be used to repay the debt of a specific pupil, or receive anything of value in exchange for the donation. No subtraction is allowed under this subdivision unless the taxpayer receives certification from the governing body, on a form provided by the department, that the governing body will use the donation solely for the purpose of repaying school meal debt, as defined in s. 71.21 (4m) (a) 2., and the taxpayer includes the form with the income tax return for the year to which the claim relates.

AB84-ASA1,8 Section 8. 71.36 (1m) (d) of the statutes is created to read:

AB84-ASA1,10,11 71.36 (1m) (d) A tax-option corporation may deduct from its net income an amount, not to exceed $25,000, equal to the school meal debt donation, as defined in s. 71.21 (4m) (a) 3., paid by the taxpayer in the taxable year. The taxpayer may not place a condition on the school meal debt donation, request the donation be used to repay the debt of a specific pupil, or receive anything of value in exchange for the donation. No subtraction is allowed under this paragraph unless the taxpayer receives certification from the governing body, on a form provided by the department, that the governing body will use the donation solely for the purpose of repaying school meal debt, as defined in s. 71.21 (4m) (a) 2., and the taxpayer includes the form with the income tax return for the year to which the claim relates.

AB84-ASA1,9 Section 9 . 71.365 (4m) (d) 1m. of the statutes is created to read:

AB84-ASA1,10,14 71.365 (4m) (d) 1m. A tax-option corporation may deduct from its net income the amount under s. 71.36 (1m) (d).

AB84-ASA1,10 Section 10 . 71.45 (2) (a) 21. of the statutes is created to read:

AB84-ASA1,10,25 71.45 (2) (a) 21. By subtracting an amount, not to exceed $25,000, equal to the school meal debt donation, as defined in s. 71.21 (4m) (a) 3., paid by the taxpayer in the taxable year. The taxpayer may not place a condition on the school meal debt donation, request the donation be used to repay the debt of a specific pupil, or receive anything of value in exchange for the donation. No subtraction is allowed under this subdivision unless the taxpayer receives certification from the governing body, on a form provided by the department, that the governing body will use the donation solely for the purpose of repaying school meal debt, as defined in s. 71.21 (4m) (a) 2., and the taxpayer includes the form with the income tax return for the year to which the claim relates.

AB84-ASA1,11 Section 11. 115.3415 of the statutes is created to read:

AB84-ASA1,11,3 115.3415 School lunch and breakfast programs; requirements. (1) In this section:

AB84-ASA1,11,7 (a) “Governing body” means the school board of a school district, governing body of a private school, operator of a charter school under s. 118.40 (2r) or (2x), governing body of a tribal school, director of the program under s. 115.52, or director of the center under s. 115.525.

AB84-ASA1,11,10 (b) “Quality meal” means a school lunch or breakfast that satisfies the requirements for the governing body of a school to receive reimbursement under s. 115.34 (2) or 115.341 (1).

AB84-ASA1,11,11 (c) “School” means any of the following:

AB84-ASA1,11,14 1. A public school, including a charter school under s. 118.40 (2r) or (2x), private school, or tribal school that receives a payment under s. 115.34 (2) for a school lunch served to a pupil at the school.

AB84-ASA1,11,16 2. The program under s. 115.52, provided the program receives a payment under s. 115.34 (2) for a school lunch served to a pupil in the program.