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Despite Bipartisan Support, Still Birth Tax Credit Bill Fails to Advance

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May 31, 2018

A recent pro-life legislative proposal, which even managed to garner significant support from Democratic legislators, was held in fiscal committee and will not advance any further this year.

Assembly Bill 2259, authored by Assemblymember Jim Patterson (R-Fresno) sought to establish a $2,000 tax credit for still birth-related medical and burial or cremation costs paid or incurred during the taxable year.

According to the author, “AB 2259 will provide much-needed financial relief to families who have experienced a tragic loss through still birth.  In addition to the emotional toll, there are considerable financial hardships resulting from a still birth, including medical bills, funeral arrangements, and even grief counseling.  This also doesn’t factor the cost of a crib, diapers, clothing, and other items the families may have already purchased in excitement and anticipation of the birth of their child…While this bill can’t take away from the loss they’ve experienced, it can provide incredible relief to families in need.”

Approximately 2,400 still births occur in California every year.  Commencing in 2008, California began to issue “Certificates of Still Birth” to parents upon request, in addition to a fetal death certificate.  While these certificates have no real legal effect, they serve as a symbolic document that can offer some solace and comfort to parents who experience the loss of a pregnancy.  Parents may request such a certificate for a $24 fee, and a certificate may be requested at any time, regardless of when the fetal death certificate was issued.  Thus, a new certificate may be issued for a still birth occurring decades ago so long as a fetal death certificate exists.

As the committee analysis of AB 2259 noted, in addition to the expenses parents incur in anticipation of a newborn, parents incur further expenses stemming from a still birth.  California law requires the burial or cremation of a fetus beyond 20 weeks, resulting in burial or cremation expenses.  Medical insurance does not cover certain medical costs, such as autopsy results and genetic testing for a stillborn baby.  Other expenses parents may incur include grief counseling and lost wages.

Therefore, AB 2259 sought to establish a $2,000 tax credit, including an automatic “sunset” after five years (meaning the bill would have automatically expired unless subsequent legislation extended the tax credit).  Currently, four states offer still birth-related tax credits or dependent expenses: Arizona, Minnesota, Missouri and North Dakota.  Tax credits in these states range from $1,200 to $2,300.  Three other states are currently considering still birth tax credits similar to that proposed in AB 2259.

Perhaps surprisingly, the bill received unanimous bipartisan support in policy committee, the Assembly Committee on Revenue and Taxation, passing by an 8-0 vote, with six Democrats voting to support the measure.  It’s a refreshing change to see bipartisan support for a pro-life measure that acknowledges that life begins in the womb.  There was no opposition to the measure.

Unfortunately, the bill failed to advance beyond the Assembly Appropriations Committee, the fiscal committee charged with analyzing the financial impact proposed legislation will have on the state.  The committee estimated that the bill would have cost the state’s General Fund $2.3 million in lost revenue in fiscal year 2018-19, and slightly less in future years.  It’s worth noting that, despite the fact that AB 2259 would have cost the state $2.3 million, the Legislative Analyst Office (LAO) recently projected that California will end the 2018-19 fiscal year with nearly $21 billion in total reserves. 

Bills that cost the state more than $150,000 are placed on the committee’s “suspense file.”  On May 25, the committee announced which bills were allowed to advance and which bills were “held under submission” (effectively held in committee).  

Unfortunately, while AB 2259 was held under submission and will not advance any further this year, this proposal should continue to be explored especially given its bipartisan support.