An act to amend Section 6018.10 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy.
Summary
SB 87 extends an existing sales and use tax law provision that treats all-volunteer fire departments as consumers, rather than retailers, for tangible personal property they sell when the proceeds are used solely for the department’s purposes. In practical terms, this means qualifying volunteer fire departments can continue to sell items such as food and clothing without collecting sales tax on those sales, so long as the fundraising proceeds are dedicated to the department’s mission. The bill extends the current sunset date from January 1, 2026, to January 1, 2031.
The bill also adds the findings and reporting requirements associated with a tax expenditure under state law. It states the purpose of the exemption is to keep fundraiser proceeds with volunteer fire departments and help them obtain needed equipment and services, especially during fire season. The California Department of Tax and Fee Administration must annually estimate the revenue loss and report that information to the Legislature beginning in 2026. The bill takes effect immediately as a tax levy and includes a provision stating that the state will not reimburse local agencies for any sales and use tax revenue losses resulting from the measure.
Impact
SB 87 amends Revenue and Taxation Code Section 6018.10 and extends a targeted sales and use tax exemption for all-volunteer fire departments for five additional years. It preserves the existing rule that qualifying volunteer fire departments are treated as consumers, not retailers, for sales of tangible personal property, including hot prepared food and clothing, when profits are used exclusively for department purposes, while keeping the $100,000 gross receipts limitation for inapplicability. Because sales and use tax changes are incorporated into local tax laws, the measure also affects local Bradley-Burns sales taxes and related local transactions and use taxes. The bill expressly bars state reimbursement to local agencies for any resulting revenue losses.
Sentiment
The bill appears to have been broadly supported and noncontroversial. The recorded votes were unanimous or near-unanimous at each stage, including committee actions, floor passage, and concurrence, with no recorded opposition in the provided history. The measure was also chaptered into law, indicating it advanced smoothly through the legislative process. The overall sentiment reflected in the vote history is favorable toward supporting volunteer fire departments and preserving their fundraising capacity.
Contention
The main policy issue is the fiscal effect of extending a tax expenditure, including reduced sales and use tax revenue for the state and local governments. The bill addresses that concern by requiring annual revenue-loss estimates and by stating that no state reimbursement will be provided to local agencies for lost revenue. Another potential point of distinction is eligibility: the exemption applies only to organizations meeting the bill’s definition of an all-volunteer fire department and excludes departments with gross receipts of $100,000 or more in each of the two preceding calendar years. No substantive opposition or competing viewpoints are reflected in the provided transcripts or vote summaries.