Amended (as amended by Stats. 2022, Ch. 251, Sec. 21) by Stats. 2025, Ch. 211, Sec. 3. (SB 86) Effective October 1, 2025. Repealed as of January 1, 2028, by its own provisions. See later operative version, as amended by Sec. 4 of Stats. 2025, Ch. 211.
(a)The purpose of this section is to promote the creation of California-based manufacturing, high-quality California-based jobs, advanced manufacturing, the reduction of greenhouse gases, or reductions in air and water pollution or energy consumption, and to ensure that California communities and workers benefit from projects receiving financial assistance pursuant to this section. In furtherance of this purpose, the authority may approve a project for financial assistance in the
form of the sales and use tax exclusion established in Section 6010.8 of the Revenue and Taxation Code.
(b)For purposes of this section, the following terms have the following meanings:
(1)“Project” means tangible personal property if at least 50 percent of its use is either to process recycled feedstock that is intended to be reused in the production of another product or using recycled feedstock in the production of another product or soil amendment, or tangible personal property that is used in the state for the design, manufacture, production, or assembly of advanced manufacturing, advanced transportation technologies, or alternative source products, components, or systems, as defined in Section 26003. “Project” does not include tangible personal property that processes
or uses recycled feedstock in a manner that would constitute disposal as defined in subdivision (b) of Section 40192.
(2)“Recycled feedstock” means materials that would otherwise be destined for disposal, having completed their intended end use and product lifecycle.
(3)“Soil amendments” may include “compost,” as defined in Section 14525 of the Food and Agricultural Code, “fertilizing material,” as defined in Section 14533 of the Food and Agricultural Code, “gypsum” or “phosphatic sulfate gypsum,” as those terms are defined in Section 14537 of the Food and Agricultural Code, or a substance distributed for the purpose of promoting plant growth or improving the quality of crops by conditioning soils through physical means.
(c)The authority shall publish notice of the availability of project applications and deadlines for submission of project applications to the authority.
(d)The authority shall evaluate a project application based on all of the following criteria:
(1)The extent to which the project develops manufacturing facilities, or purchases equipment for manufacturing facilities, located in California.
(2)The extent to which the anticipated benefit to the state from the project equals or exceeds the projected benefit to the participating party from the sales and use tax exclusion.
(3)The extent to which the project will create new, or result in the
loss of, permanent, full-time jobs in California, including the average and minimum wage for each classification of full-time employees proposed to be hired or not retained.
(4)To the extent feasible, the extent to which the project, or the product produced by the project, results in a reduction of greenhouse gases, a reduction in air or water pollution, an increase in energy efficiency, or a reduction in energy consumption, beyond what is required by federal or state law or regulation.
(5)The extent of unemployment in the area in which the project is proposed to be located.
(6)Any other factors the authority deems appropriate in accordance with this section.
(e)On or after January 1, 2026, for an applicant that, together with its parent corporation and subsidiaries, employs 500 or more employees, the authority shall not approve a project for financial assistance pursuant to this section unless the applicant certifies, in a manner designated by the authority, that the applicant and its contractors will do all of the following:
(1)Provide comparatively good wage and benefits to the employees of the applicant or its subcontractors, relative to the industrial sector of the applicant or its subcontractors, occupation, and labor market of those employees.
(2)Invest in employee training, growth, and development, such as through comprehensive workforce training programs or apprenticeship programs.
(3)Adopt
mechanisms to include worker voice and agency in the workplace.
(f)At a duly noticed public hearing, the authority shall approve, by resolution, project applications for financial assistance.
(g)Without regard to the actual date of any transaction between a
participating party and the authority, any project approved by the authority by resolution for the sales and use tax exclusion pursuant to Section 6010.8 of the Revenue and Taxation Code before March 24, 2010, shall not be subject to this section.
(h)(1) Except as provided in paragraph (2), the exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred million dollars ($100,000,000) for each calendar year.
(2)For the 2022, 2023, and 2024 calendar years, the exclusions granted pursuant to Section 6010.8 of the Revenue and Taxation Code for projects approved by the authority pursuant to this section shall not exceed one hundred fifteen million dollars ($115,000,000), of which fifteen million dollars ($15,000,000) shall be made available only to projects that manufacture, refine, extract, process, or recover lithium. In evaluating applications for projects that manufacture, refine, extract, process, or recover lithium, the authority, in addition to the criteria in subdivision (d), may consider other factors, including, but not limited to, the grantee’s willingness to relocate projects into California from a state that has enacted a law that does any of the following:
(A)Has the effect of voiding or repealing existing state protections
against discrimination on the basis of sexual orientation, gender identity, or gender expression.
(B)Authorizes or requires discrimination against same-sex couples or their families or on the basis of sexual orientation, gender identity, or gender expression.
(C)Creates an exemption to antidiscrimination laws in order to permit discrimination against same-sex couples or their families or on the basis of sexual orientation, gender identity, or gender expression.
(D)Has the effect of denying or interfering with a woman’s right to choose to bear a child or to choose and obtain an abortion, as provided by Article 2.5 (commencing with Section 123460) of Chapter 2 of Part 2 of Division 106 of the Health and Safety Code.
(i)The authority shall study the efficacy and cost benefit of the sales and use tax exclusion as it relates to advanced manufacturing projects. The study shall include the number of jobs created, the costs of each job, and the annual salary of each job. The study shall also consider a dynamic analysis of the economic output to the state that would occur without the sales and use tax exclusion.
(j)This section shall remain in effect only until January 1, 2028, and as of that date is repealed.