State Recap: CA Stimulus Plan; NV Senator Co-Hosts Job Fair

Planning budget

The California Credit Union League has notified credit unions of the next step in California’s “Golden State Stimulus Payments” plan. Some important provisions have been secured within committee in the current Assembly Bill 88 (the legislative package carried over from Senate Bill 88 in February).

California will soon begin to provide stimulus payments to individuals and families as part of this recently approved stimulus relief. SB 88 establishes one-time stimulus payments of $600 or $1,200 to qualified recipients who:

  • Have filed 2020 tax returns.
  • Are California Earned Income Tax Credit (EITC) recipients; OR Individual Tax Identification Number (ITIN) filers earning $75,000 or less.
  • Have lived in California for more than half of the 2020 tax year.
  • Are California residents on the date payment is issued.
  • Are not eligible to be claimed as a dependent.

Assembly Bill 88 (signed into law on March 17) also provides technical amendments to SB 88. Specifically, AB 88 automatically exempts GSSPs from certain garnishment orders and would require a credit union to employ a certain procedure to identify a deposit that is exempt pursuant to that provision.
 
Identification of GSSPs
A notice from the California Franchise Tax Board (FTB) gives details/instructions for automated clearing house (ACH) company entry descriptions for these payments. Credit unions should immediately prepare to begin receiving these GSSPs and make any processing or system preparations necessary. The FTB will supply payment files to interested financial institutions (with a sample of the warrant identification information), including routing number and additional features. Stimulus-payment warrants will include a notation of “GOLDEN STATE STIMULUS” printed under the identification number. To obtain the range of valid warrant numbers, issue dates, and a sample of the warrant identification information, email FTBGSSTIMULUS@ftb.ca.gov.
 
The FTB will likely send an email to financial institutions requesting the referenced information four to five days prior to the mailing of paper warrants for that particular distribution phase. Also, here is the FTB’s estimated distribution dates and expected payment volume for each distribution.
 
Collections (Offsets, Withholding Orders, Wage Garnishments, Levies)
Credit unions receiving funds directly from California’s GSSPs must exempt these payments from any garnishment order, with the exception of orders in connection with child support, spousal support, family support, or a criminal restitution payable to victims.
 
A credit union must identify an exempt deposit using a “lookback period” during an “account review,” which the credit union must perform at least once. Under the law:

  • An “account review” means: the “process of examining deposits in an account to determine if a benefit agency has deposited a benefit payment into the account during the lookback period.”
  • A “lookback period” means: a “two-month period that begins on the date preceding the date of the account review and ends on the corresponding date of the month two months earlier or on the last date of the month two months earlier if the corresponding date does not exist.”

A credit union that attempts to comply with these provisions in good faith will not be subject to liability.
 
Credit unions should consult with their legal counsel if they have any questions or concerns about a specific garnishment order under these direct stimulus relief payments.

Job Fair Helps Nevadans Get Back to Work
Last week, Sen. Catherine Cortez Masto (D-NV) co-hosted Nevada’s Virtual Job Fair to help get local workers back to work. The senator hosted the event with Rep. Susie Lee (D-NV), Washoe County Commissioner Alexis Hill, Clark County Commissioner Justin Jones, and leaders from local employment training and workforce connection departments and organizations.
 
The recently passed American Rescue Plan Act includes numerous provisions Senator Cortez Masto advocated for to help employers looking to hire new workers. These include an extension and expansion of the Employee Retention Tax Credit, an extension and expansion of additional tax credits to provide emergency paid sick and family leave to employees impacted by COVID-19, and $10 billion to reauthorize the State Small Business Credit Initiative.

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