In 2012, the voters of California approved Proposition 39 which established a Clean Energy Fund for the purpose of "funding projects that create jobs in California improving energy efficiency and expanding clean energy generation." In order to raise revenue for the Clean Energy Fund, the proposition requires that most (but not all) multi-state corporations to use the single-sales factor method of apportioning their income. Previously, most California corporate taxpayer apportioned their income based on three factors - property, payroll, and double-weighted sales. See Section 2115: Beware of Double Counting.
So what does this have to do with California Corporations Code Section 2115? As readers should know, Section 2115 imposes many provisions of the California General Corporation Law on foreign corporations to the exclusion of the laws of the jurisdictions in which they are incorporated. A foreign corporation becomes subject to Section 2115 if it meets two tests. One of these tests is met if the average of the property, payroll and sales factors is more than 50% during the last fiscal year. Because most corporations applied these three factors to apportion their California income, one could find these factors on Schedule R of their tax returns. As a result of Proposition 39, you will no longer find these three factors on many corporations' Schedule Rs.
Although Proposition 39 was approved a decade ago, a taxpayer recently filed a lawsuit challenging the initiative measure. One Technologies LLC v. Franchise Tax Board, Los Angeles County Superior Court, Case No. 21STCV21844. The basis for the challenge was that the measure violated California's single subject rule. Cal. Const. Art. II, § 8(d) ("An initiative measure embracing more than one subject may not be submitted to the electors or have any effect."). That case is currently on appeal.