CAL TAX

David R. Doerr, principal contributorRonald W. Roach, editor

Vol. X, No. 21June 2, 1997

BOE TO MAINTAIN FILES ON DELETED ANNOTATIONS

State Board of Equalization staff, as part of the Improving Public Access to Information Project, agreed to maintain an index of deleted annotations of business tax laws, the BOE's chief counsel says. However, staff turned down a request to list publication dates.

In a May 8 response letter to requests from Joseph Micallef of Associated Sales Tax Consultants of Sacramento, BOE Chief Counsel Timothy Boyer noted that annotations "are not regulations and do not have the force or effect of law." He described annotations as "synopses of selected legal opinions," and their purpose is to guide the application of statutes and regulations to specific factual situations.

Thus, according to Mr. Boyer, unlike a document date, a publication date "would serve no useful purpose" and could mistakenly imply that such a date has some meaningful significance. "The fact that a legal opinion was not annotated and included in the Business Taxes Law Guide until some years after the advice was written in no way impacts the taxability of any transaction," he wrote.

The deleted annotation list, which BOE staff agreed to maintain to help both taxpayers and tax administrators, also will not include effective dates, because an annotation, while clarifying taxability in a particular case, "is not the basis upon which the transaction is or is not taxable," Mr. Boyer wrote. "Hence, annotations, unlike statutes or regulations, do not have 'effective dates.'"

Mr. Boyer's letter was in response to Mr. Micallef's April 22 correspondence to BOE Executive Director Les Sorensen. Mr. Micallef contended that lack of a deleted annotation index and publication dates are two defects in the board staff's preparation as work nears completion on the Historic Annotation Project as part of the guidebook on business tax law.

Mr. Micallef successfully sued the BOE over public access to internal memoranda and legal opinions in 1992 and, he said he is keeping a close watch on board activities that have resulted from the litigation, such as the Historic Annotation Project.

Most of the annotations are being prepared from long-standing internal memoranda and legal opinions which are only now being released for public access and review, Mr. Micallef wrote. Although various departments and offices of the board have relied on the underlying documents for years, and in some cases decades, the public, prior to 1993, was precluded access by virtue of the board maintaining such documents in what Mr. Micallef called "secret law."

He said the concern is that dates shown on the newly published annotations are not the dates the annotations were published and made available to the public. Instead, the annotation date shown is the date of the original internal memorandum or legal opinion on which it is based. Giving the impression of long-standing use, he said an annotation published in 1997 from a document which originated in 1960 would show the annotation as 1960 instead of the actual publication date of 1997.