Bill Text: CA AB2389 | 2013-2014 | Regular Session | Chaptered


Bill Title: Local government: capital investment incentive programs: corporation tax credits: qualified wages: new advanced strategic aircraft program.

Spectrum: Bipartisan Bill

Status: (Passed) 2014-07-10 - Chaptered by Secretary of State - Chapter 116, Statutes of 2014. [AB2389 Detail]

Download: California-2013-AB2389-Chaptered.html
BILL NUMBER: AB 2389	CHAPTERED
	BILL TEXT

	CHAPTER  116
	FILED WITH SECRETARY OF STATE  JULY 10, 2014
	APPROVED BY GOVERNOR  JULY 10, 2014
	PASSED THE SENATE  JULY 3, 2014
	PASSED THE ASSEMBLY  JULY 3, 2014
	AMENDED IN SENATE  JULY 2, 2014
	AMENDED IN ASSEMBLY  JUNE 25, 2014

INTRODUCED BY   Assembly Member Fox
   (Principal coauthors: Assembly Members Campos, Muratsuchi,
Quirk-Silva, and Salas)
   (Principal coauthor: Senator Knight)
   (Coauthors: Assembly Members Achadjian, Alejo, Atkins, Bloom,
Bocanegra, Bradford, Ian Calderon, Chau, Conway, Cooley, Dababneh,
Dickinson, Gorell, Gray, Hall, Harkey, Linder, Maienschein, Medina,
Nazarian, Olsen, Pan, Perea, John A. Pérez, V. Manuel Pérez, and
Wilk)
   (Coauthors: Senators Anderson, Berryhill, Cannella, Correa,
Fuller, Gaines, Huff, Lara, Morrell, Nielsen, Padilla, Roth, Vidak,
Walters, and Wyland)

                        FEBRUARY 21, 2014

   An act to amend Section 51298.5 of, and to amend, repeal, and add
Section 51298 of, the Government Code, and to amend Sections 17059.2
and 23689 of, and to add Section 23636 to, the Revenue and Taxation
Code, relating to economic development, and declaring the urgency
thereof, to take effect immediately.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2389, Fox. Local government: capital investment incentive
programs: corporation tax credits: qualified wages: new advanced
strategic aircraft program.
   Existing law authorizes a county, city and county, or city to
establish a capital investment incentive program, pursuant to which
the county, city and county, or city is authorized to pay a capital
investment incentive amount, as defined, that does not exceed the
amount of property tax derived from that portion of the assessed
value of a qualified manufacturing facility that exceeds
$150,000,000, to a proponent of a qualified manufacturing facility. A
"qualified manufacturing facility" is defined to include a facility
operated by a business described in specified provisions of the
Standard Industrial Classification Manual. Existing law requires the
Business, Transportation and Housing Agency, or its successor, to
certify qualified manufacturing facilities for purposes of these
provisions and to carry out various oversight duties. Existing law
repeals these provisions on January 1, 2017.
   This bill would, until July 1, 2015, reduce the assessed value
threshold for calculating the capital investment incentive amount
from $150,000,000 to $25,000,000 and would define "qualified
manufacturing facility" to include, among others, facilities operated
by certain businesses described in specified provisions of the North
American Industry Classification System Manual. The bill would
transfer the duties of the Business, Transportation and Housing
Agency to the Governor's Office of Business and Economic Development
(GO-Biz). The bill would, on July 1, 2015, restore the existing
provisions relating to the capital investment threshold amount and
the definition of "qualified manufacturing facility," but would
maintain the transfer of duties to Go-Biz. The bill would instead
repeal these provisions on January 1, 2018. The bill would also
replace obsolete references in those restored provisions to the
Standard Industrial Classification Manual with corresponding
references to the North American Industry Classification System
Manual.
   The Corporation Tax Law allows various credits against the taxes
imposed by that law.
   This bill would, for taxable years beginning on or after January
1, 2015, and before January 1, 2030, allow, with regard to the
manufacture of a new advanced strategic aircraft for the United
States Air Force, a credit against the taxes imposed under that law
for 171/2% of qualified wages, as defined, paid or incurred by the
qualified taxpayer, as defined, to qualified full-time employees,
award the credit on a first-come-first-served basis, and provide that
the credit have a phased aggregate cap ranging from $25,000,000 to
$31,000,000 per calendar year, as specified.
   Existing law also allows a credit against the taxes imposed under
both laws for each taxable year beginning on or after January 1,
2014, and before January 1, 2025, in an amount as provided in a
written agreement between the Governor's Office of Business and
Economic Development and the taxpayer, agreed upon by the California
Competes Tax Credit Committee, and based on specified factors,
including the number of jobs the taxpayer will create or retain in
the state and the amount of investment in the state by the taxpayer.
Existing law limits the aggregate amount of credits allocated to
taxpayers to a specified sum per fiscal year.
   This bill would reduce this aggregate amount of credits that may
be allocated to taxpayers per fiscal year by the phased aggregate
amount allowed to taxpayers pursuant to the credit proposed by this
bill with regard to the manufacture of a new advanced strategic
aircraft, as described above.
   This bill would declare that it is to take effect immediately as
an urgency statute.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 51298 of the Government Code is amended to
read:
   51298.  It is the intent of the Legislature in enacting this
chapter to provide local governments with opportunities to attract
large manufacturing facilities to invest in their communities and to
encourage industries, such as high technology, aerospace, automotive,
biotechnology, software, environmental sources, and others, to
locate and invest in those facilities in California.
   (a) Commencing in the 1998-99 fiscal year, the governing body of a
county, city and county, or city, may, by means of an ordinance or
resolution approved by a majority of its entire membership, elect to
establish a capital investment incentive program. In any county, city
and county, or city in which the governing body has so elected, the
county, city and county, or city shall, upon the approval by a
majority of the entire membership of its governing body of a written
request therefor, pay a capital investment incentive amount to the
proponent of a qualified manufacturing facility for up to 15
consecutive fiscal years. A request for the payment of capital
investment incentive amounts shall be filed by a proponent in writing
with the governing body of an electing county, city and county, or
city in the time and manner specified in procedures adopted by that
governing body. In the case in which the governing body of an
electing county, city and county, or city approves a request for the
payment of capital investment incentive amounts, both of the
following conditions shall apply:
   (1) The consecutive fiscal years during which a capital investment
incentive amount is to be paid shall commence with the first fiscal
year commencing after the date upon which the qualified manufacturing
facility is certified for occupancy or, if no certification is
issued, the first fiscal year commencing after the date upon which
the qualified manufacturing facility commences operation.
   (2) In accordance with paragraph (4) of subdivision (d), the
annual payment to a proponent of each capital investment incentive
amount shall be contingent upon the proponent's payment of a
community services fee.
   (b) For purposes of this section:
   (1) "Qualified manufacturing facility" means a proposed
manufacturing facility that meets all of the following criteria:
   (A) The proponent's initial investment in that facility, in real
and personal property, necessary for the full and normal operation of
that facility, made pursuant to the capital investment incentive
program, that comprises any portion of that facility or has its situs
at that facility, exceeds one hundred fifty million dollars
($150,000,000). Compliance with this subparagraph shall be certified
by the Governor's Office of Business and Economic Development upon
the director's approval of a proponent's application for
certification of a qualified manufacturing facility. An application
for certification shall be submitted by a proponent to the Governor's
Office of Business and Economic Development in writing in the time
and manner as specified by the director.
   (B) The facility is to be located within the jurisdiction of the
electing county, city and county, or city to which the request is
made for payment of capital investment incentive amounts.
   (C) The facility is operated by any of the following:
   (i) A business described within Code 3359 or 3364 of the 2012
North American Industry Classification System (NAICS) Manual
published by the United States Office of Management and Budget.
   (ii) A business engaged in the recovery of minerals from
geothermal resources, including the proportional amount of a
geothermal electric generating plant that is integral to the recovery
process by providing electricity for it.
   (iii) A business engaged in the manufacturing of parts or
components related to the production of electricity using solar,
wind, biomass, hydropower, or geothermal resources on or after July
1, 2010.
   (D) The proponent is currently engaged in any of the following:
   (i) Commercial production.
    (ii) The perfection of the manufacturing process.
    (iii) The perfection of a product intended to be manufactured.
   (2) "Proponent" means a party or parties that meet all of the
following criteria:
   (A) The party is named in the application to the county, city and
county, or city within which the qualified manufacturing facility
would be located for a permit to construct a qualified manufacturing
facility.
   (B) The party will be the fee owner of the qualified manufacturing
facility upon the completion of that facility. Notwithstanding the
previous sentence, the party may enter into a sale-leaseback
transaction and nevertheless be considered the proponent.
   (C) If a proponent that is receiving capital investment incentive
amounts subsequently leases the subject qualified manufacturing
facility to another party, the lease may provide for the payment to
that lessee of any portion of a capital investment incentive amount.
Any lessee receiving any portion of a capital investment incentive
amount shall also be considered a proponent for the purposes of
subdivision (d).
   (3) "Capital investment incentive amount" means, with respect to a
qualified manufacturing facility for a relevant fiscal year, an
amount up to or equal to the amount of ad valorem property tax
revenue derived by the participating local agency from the taxation
of that portion of the total assessed value of that real and personal
property described in subparagraph (A) of paragraph (1) that is in
excess of twenty-five million dollars ($25,000,000).
   (4) "Manufacturing" means the activity of converting or
conditioning property by changing the form, composition, quality, or
character of the property for ultimate sale at retail or use in the
manufacturing of a product to be ultimately sold at retail.
Manufacturing includes any improvements to tangible personal property
that result in a greater service life or greater functionality than
that of the original property.
   (c) A city or special district may, upon the approval by a
majority of the entire membership of its governing body, pay to the
county, city and county, or city an amount equal to the amount of ad
valorem property tax revenue allocated to that city or special
district, but not the actual allocation, derived from the taxation of
that portion of the total assessed value of that real and personal
property described in subparagraph (A) of paragraph (1) of
subdivision (b) that is in excess of twenty-five million dollars
($25,000,000).
   (d) A proponent whose request for the payment of capital
investment incentive amounts is approved by an electing county, city
and county, or city shall enter into a community services agreement
with that county, city and county, or city that includes, but is not
limited to, all of the following provisions:
   (1) A provision requiring that a community services fee be
remitted by the proponent to the county, city and county, or city, in
each fiscal year, in an amount that is equal to 25 percent of the
capital investment incentive amount calculated for that proponent for
that fiscal year, except that in no fiscal year shall the amount of
the community services fee exceed two million dollars ($2,000,000).
   (2) A provision specifying the dates in each relevant fiscal year
upon which payment of the community services fee is due and
delinquent, and the rate of interest to be charged to a proponent for
any delinquent portion of the community services fee amount.
   (3) A provision specifying the procedures and rules for the
determination of underpayments or overpayments of a community
services fee, for the appeal of determinations of any underpayment,
and for the refunding or crediting of any overpayment.
   (4) A provision specifying that a proponent is ineligible to
receive a capital investment incentive amount if that proponent is
currently delinquent in the payment of any portion of a community
services fee amount, if the qualified manufacturing facility is
constructed in a manner materially different from the facility as
described in building permit application materials, or if the
facility is no longer operated as a qualified manufacturing facility
meeting the requirements of paragraph (1) of subdivision (b). If a
proponent becomes ineligible to receive a capital investment
incentive amount as a result of an agreement provision included
pursuant to this subparagraph, the running of the number of
consecutive fiscal years specified in an agreement made pursuant to
subdivision (a) is not tolled during the period in which the
proponent is ineligible.
   (5) A provision that sets forth a job creation plan with respect
to the relevant qualified manufacturing facility. The plan shall
specify the number of jobs to be created by that facility, and the
types of jobs and compensation ranges to be created thereby. The plan
shall also specify that for the entire term of the community
services agreement, both of the following shall apply:
   (A) All of the employees working at the qualified manufacturing
facility shall be covered by an employer-sponsored health benefits
plan, with the exception of any employee who was offered but declined
coverage due to other available group coverage.
   (B) The average weekly wage, exclusive of overtime, paid to all of
the employees working at the qualified manufacturing facility, who
are not management or supervisory employees, shall be not less than
the state average weekly wage.
   For the purpose of this subdivision, "state average weekly wage"
means the average weekly wage paid by employers to employees covered
by unemployment insurance, as reported to the Employment Development
Department for the four calendar quarters ending June 30 of the
preceding calendar year.
   (6) (A) In the case in which the proponent fails to operate the
qualified manufacturing facility as required by the community
services agreement, a provision that requires the recapture of any
portion of any capital investment incentive amounts previously paid
to the proponent equal to the lesser of the following:
   (i) All of the capital investment incentive amounts paid to the
proponent, less all of the community services fees received from the
proponent, and less any capital investment incentive amounts
previously recaptured.
   (ii) The last capital investment incentive amount paid to the
proponent, less the last community services fee received from the
proponent, multiplied by 40 percent of the number of years remaining
in the community services agreement, but not to exceed 10 years, and
less any capital investment incentive amounts previously recaptured.
   (B) If the proponent fails to operate the qualified manufacturing
facility as required by the community services agreement, the county,
city and county, or city may, upon a finding that good cause exists,
waive any portion of the recapture of any capital investment
incentive amount due under this subdivision. For the purpose of this
subdivision, good cause includes, but is not limited to, the
following:
   (i) The proponent has sold or leased the property to a person who
has entered into an agreement with the county, city and county, or
city to assume all of the responsibilities of the proponent under the
community services agreement.
   (ii) The qualified manufacturing facility has been rendered
inoperable and beyond repair as a result of an act of God, civil
disorder, failure of power, riots, insurrections, war, acts of
terrorism, or any other causes, whether the kind herein enumerated or
otherwise, not within the control of the qualified manufacturing
facility claiming good cause, which restrict or interfere with a
qualified manufacturing facility's ability to timely perform, and
which by the exercise of reasonable due diligence, such party is or
would have been unable to prevent or overcome.
   (C) For purposes of this subdivision, failure to operate a
qualified manufacturing facility as required by the community
services agreement includes, but is not limited to, failure to
establish the number of jobs specified in the jobs creation plan
created pursuant to paragraph (5).
   (e) (1) Each county, city and county, or city that elects to
establish a capital investment incentive program shall notify the
Governor's Office of Business and Economic Development of its
election to do so no later than June 30th of the fiscal year in which
the election was made.
   (2) In addition to the information required to be reported
pursuant to paragraph (1), each county, city and county, or city that
has elected to establish a capital investment incentive program
shall notify the Governor's Office of Business and Economic
Development each fiscal year no later than June 30th of the amount of
any capital investment incentive payments made and the proponent of
the qualified manufacturing facility to whom the payments were made
during that fiscal year.
   (3) The Governor's Office of Business and Economic Development
shall compile the information submitted by each county, city and
county, and city pursuant to paragraphs (1) and (2) and submit a
report to the Legislature containing this information no later than
October 1, every two years commencing October 1, 2000.
   (f) This section shall become inoperative on July 1, 2015.
   (g) A capital investment incentive program established pursuant to
this section before the effective date of the act adding this
subdivision may remain in effect for the full term of that program.
   (h) This section is repealed on January 1, 2016.
  SEC. 2.  Section 51298 is added to the Government Code, to read:
   51298.  It is the intent of the Legislature in enacting this
chapter to provide local governments with opportunities to attract
large manufacturing facilities to invest in their communities and to
encourage industries, such as high technology, aerospace, automotive,
biotechnology, software, environmental sources, and others, to
locate and invest in those facilities in California.
   (a) Commencing in the 1998-99 fiscal year, the governing body of a
county, city and county, or city, may, by means of an ordinance or
resolution approved by a majority of its entire membership, elect to
establish a capital investment incentive program. In any county, city
and county, or city in which the governing body has so elected, the
county, city and county, or city shall, upon the approval by a
majority of the entire membership of its governing body of a written
request therefor, pay a capital investment incentive amount to the
proponent of a qualified manufacturing facility for up to 15
consecutive fiscal years. A request for the payment of capital
investment incentive amounts shall be filed by a proponent in writing
with the governing body of an electing county, city and county, or
city in the time and manner specified in procedures adopted by that
governing body. In the case in which the governing body of an
electing county, city and county, or city approves a request for the
payment of capital investment incentive amounts, both of the
following conditions shall apply:
   (1) The consecutive fiscal years during which a capital investment
incentive amount is to be paid shall commence with the first fiscal
year commencing after the date upon which the qualified manufacturing
facility is certified for occupancy or, if no certification is
issued, the first fiscal year commencing after the date upon which
the qualified manufacturing facility commences operation.
   (2) In accordance with paragraph (4) of subdivision (d), the
annual payment to a proponent of each capital investment incentive
amount shall be contingent upon the proponent's payment of a
community services fee.
   (b) For purposes of this section:
   (1) "Qualified manufacturing facility" means a proposed
manufacturing facility that meets all of the following criteria:
   (A) The proponent's initial investment in that facility, in real
and personal property, necessary for the full and normal operation of
that facility, made pursuant to the capital investment incentive
program, that comprises any portion of that facility or has its situs
at that facility, exceeds one hundred fifty million dollars
($150,000,000). Compliance with this subparagraph shall be certified
by the Governor's Office of Business and Economic Development upon
the director's approval of a proponent's application for
certification of a qualified manufacturing facility. An application
for certification shall be submitted by a proponent to the Governor's
Office of Business and Economic Development in writing in the time
and manner as specified by the director.
   (B) The facility is to be located within the jurisdiction of the
electing county, city and county, or city to which the request is
made for payment of capital investment incentive amounts.
   (C) The facility is operated by any of the following:
   (i) A business described in Codes 3321 to 3399, inclusive, or
Codes 541711 or 541712 of the 2012 North American Industry
Classification System (NAICS) Manual published by the United States
Office of Management and Budget.
   (ii) A business engaged in the recovery of minerals from
geothermal resources, including the proportional amount of a
geothermal electric generating plant that is integral to the recovery
process by providing electricity for it.
   (iii) A business engaged in the manufacturing of parts or
components related to the production of electricity using solar,
wind, biomass, hydropower, or geothermal resources on or after July
1, 2010.
   (D) The proponent is currently engaged in any of the following:
   (i) Commercial production.
   (ii) The perfection of the manufacturing process.
   (iii) The perfection of a product intended to be manufactured.
   (2) "Proponent" means a party or parties that meet all of the
following criteria:
   (A) The party is named in the application to the county, city and
county, or city within which the qualified manufacturing facility
would be located for a permit to construct a qualified manufacturing
facility.
   (B) The party will be the fee owner of the qualified manufacturing
facility upon the completion of that facility. Notwithstanding the
previous sentence, the party may enter into a sale-leaseback
transaction and nevertheless be considered the proponent.
   (C) If a proponent that is receiving capital investment incentive
amounts subsequently leases the subject qualified manufacturing
facility to another party, the lease may provide for the payment to
that lessee of any portion of a capital investment incentive amount.
Any lessee receiving any portion of a capital investment incentive
amount shall also be considered a proponent for the purposes of
subdivision (d).
   (3) "Capital investment incentive amount" means, with respect to a
qualified manufacturing facility for a relevant fiscal year, an
amount up to or equal to the amount of ad valorem property tax
revenue derived by the participating local agency from the taxation
of that portion of the total assessed value of that real and personal
property described in subparagraph (A) of paragraph (1) that is in
excess of one hundred fifty million dollars ($150,000,000).
   (4) "Manufacturing" means the activity of converting or
conditioning property by changing the form, composition, quality, or
character of the property for ultimate sale at retail or use in the
manufacturing of a product to be ultimately sold at retail.
Manufacturing includes any improvements to tangible personal property
that result in a greater service life or greater functionality than
that of the original property.
   (c) A city or special district may, upon the approval by a
majority of the entire membership of its governing body, pay to the
county, city and county, or city an amount equal to the amount of ad
valorem property tax revenue allocated to that city or special
district, but not the actual allocation, derived from the taxation of
that portion of the total assessed value of that real and personal
property described in subparagraph (A) of paragraph (1) of
subdivision (b) that is in excess of one hundred fifty million
dollars ($150,000,000).
   (d) A proponent whose request for the payment of capital
investment incentive amounts is approved by an electing county, city
and county, or city shall enter into a community services agreement
with that county, city and county, or city that includes, but is not
limited to, all of the following provisions:
   (1) A provision requiring that a community services fee be
remitted by the proponent to the county, city and county, or city, in
each fiscal year, in an amount that is equal to 25 percent of the
capital investment incentive amount calculated for that proponent for
that fiscal year, except that in no fiscal year shall the amount of
the community services fee exceed two million dollars ($2,000,000).
   (2) A provision specifying the dates in each relevant fiscal year
upon which payment of the community services fee is due and
delinquent, and the rate of interest to be charged to a proponent for
any delinquent portion of the community services fee amount.
   (3) A provision specifying the procedures and rules for the
determination of underpayments or overpayments of a community
services fee, for the appeal of determinations of any underpayment,
and for the refunding or crediting of any overpayment.
   (4) A provision specifying that a proponent is ineligible to
receive a capital investment incentive amount if that proponent is
currently delinquent in the payment of any portion of a community
services fee amount, if the qualified manufacturing facility is
constructed in a manner materially different from the facility as
described in building permit application materials, or if the
facility is no longer operated as a qualified manufacturing facility
meeting the requirements of paragraph (1) of subdivision (b). If a
proponent becomes ineligible to receive a capital investment
incentive amount as a result of an agreement provision included
pursuant to this subparagraph, the running of the number of
consecutive fiscal years specified in an agreement made pursuant to
subdivision (a) is not tolled during the period in which the
proponent is ineligible.
   (5) A provision that sets forth a job creation plan with respect
to the relevant qualified manufacturing facility. The plan shall
specify the number of jobs to be created by that facility, and the
types of jobs and compensation ranges to be created thereby. The plan
shall also specify that for the entire term of the community
services agreement, both of the following shall apply:
   (A) All of the employees working at the qualified manufacturing
facility shall be covered by an employer-sponsored health benefits
plan, with the exception of any employee who was offered but declined
coverage due to other available group coverage.
   (B) The average weekly wage, exclusive of overtime, paid to all of
the employees working at the qualified manufacturing facility, who
are not management or supervisory employees, shall be not less than
the state average weekly wage. For the purpose of this subdivision,
"state average weekly wage" means the average weekly wage paid by
employers to employees covered by unemployment insurance, as reported
to the Employment Development Department for the four calendar
quarters ending June 30 of the preceding calendar year.
   (6) (A) In the case in which the proponent fails to operate the
qualified manufacturing facility as required by the community
services agreement, a provision that requires the recapture of any
portion of any capital investment incentive amounts previously paid
to the proponent equal to the lesser of the following:
   (i) All of the capital investment incentive amounts paid to the
proponent, less all of the community services fees received from the
proponent, and less any capital investment incentive amounts
previously recaptured.
   (ii) The last capital investment incentive amount paid to the
proponent, less the last community services fee received from the
proponent, multiplied by 40 percent of the number of years remaining
in the community services agreement, but not to exceed 10 years, and
less any capital investment incentive amounts previously recaptured.
   (B) If the proponent fails to operate the qualified manufacturing
facility as required by the community services agreement, the county,
city and county, or city may, upon a finding that good cause exists,
waive any portion of the recapture of any capital investment
incentive amount due under this subdivision. For the purpose of this
subdivision, good cause includes, but is not limited to, the
following:
   (i) The proponent has sold or leased the property to a person who
has entered into an agreement with the county, city and county, or
city to assume all of the responsibilities of the proponent under the
community services agreement.
   (ii) The qualified manufacturing facility has been rendered
inoperable and beyond repair as a result of an act of God, civil
disorder, failure of power, riots, insurrections, war, acts of
terrorism, or any other causes, whether the kind herein enumerated or
otherwise, not within the control of the qualified manufacturing
facility claiming good cause, which restrict or interfere with a
qualified manufacturing facility's ability to timely perform, and
which by the exercise of reasonable due diligence, such party is or
would have been unable to prevent or overcome.
   (C) For purposes of this subdivision, failure to operate a
qualified manufacturing facility as required by the community
services agreement includes, but is not limited to, failure to
establish the number of jobs specified in the jobs creation plan
created pursuant to paragraph (5).
   (e) (1) Each county, city and county, or city that elects to
establish a capital investment incentive program shall notify the
Governor's Office of Business and Economic Development of its
election to do so no later than June 30th of the fiscal year in which
the election was made.
   (2) In addition to the information required to be reported
pursuant to paragraph (1), each county, city and county, or city that
has elected to establish a capital investment incentive program
shall notify the Governor's Office of Business and Economic
Development each fiscal year no later than June 30th of the amount of
any capital investment incentive payments made and the proponent of
the qualified manufacturing facility to whom the payments were made
during that fiscal year.
   (3) The Governor's Office of Business and Economic Development
shall compile the information submitted by each county, city and
county, and city pursuant to paragraphs (1) and (2) and submit a
report to the Legislature containing this information
                          no later than October 1, every two years
commencing October 1, 2016.
   (f) This section shall become operative on July 1, 2015.
  SEC. 3.  Section 51298.5 of the Government Code is amended to read:

   51298.5.  (a) This chapter shall remain in effect only until
January 1, 2018.
   (b) A capital investment incentive program established pursuant to
this chapter before January 1, 2018, may remain in effect for the
full term of that program, regardless of the repeal of this chapter.
  SEC. 4.  Section 17059.2 of the Revenue and Taxation Code is
amended to read:
   17059.2.  (a) (1) For each taxable year beginning on and after
January 1, 2014, and before January 1, 2025, there shall be allowed
as a credit against the "net tax," as defined in Section 17039, an
amount as determined by the committee pursuant to paragraph (2) and
approved pursuant to Section 18410.2.
   (2) The credit under this section shall be allocated by GO-Biz
with respect to the 2013-14 fiscal year through and including the
2017-18 fiscal year. The amount of credit allocated to a taxpayer
with respect to a fiscal year pursuant to this section shall be as
set forth in a written agreement between GO-Biz and the taxpayer and
shall be based on the following factors:
   (A) The number of jobs the taxpayer will create or retain in this
state.
   (B) The compensation paid or proposed to be paid by the taxpayer
to its employees, including wages and fringe benefits.
   (C) The amount of investment in this state by the taxpayer.
   (D) The extent of unemployment or poverty in the area according to
the United States Census in which the taxpayer's project or business
is proposed or located.
   (E) The incentives available to the taxpayer in this state,
including incentives from the state, local government, and other
entities.
   (F) The incentives available to the taxpayer in other states.
   (G) The duration of the proposed project and the duration the
taxpayer commits to remain in this state.
   (H) The overall economic impact in this state of the taxpayer's
project or business.
   (I) The strategic importance of the taxpayer's project or business
to the state, region, or locality.
   (J) The opportunity for future growth and expansion in this state
by the taxpayer's business.
   (K) The extent to which the anticipated benefit to the state
exceeds the projected benefit to the taxpayer from the tax credit.
   (3) The written agreement entered into pursuant to paragraph (2)
shall include:
   (A) Terms and conditions that include the taxable year or years
for which the credit allocated shall be allowed, a minimum
compensation level, and a minimum job retention period.
   (B) Provisions indicating whether the credit is to be allocated in
full upon approval or in increments based on mutually agreed upon
milestones when satisfactorily met by the taxpayer.
   (C) Provisions that allow the committee to recapture the credit,
in whole or in part, if the taxpayer fails to fulfill the terms and
conditions of the written agreement.
   (b) For purposes of this section:
   (1) "Committee" means the California Competes Tax Credit Committee
established pursuant to Section 18410.2.
   (2) "GO-Biz" means the Governor's Office of Business and Economic
Development.
   (c) For purposes of this section, GO-Biz shall do the following:
   (1) Give priority to a taxpayer whose project or business is
located or proposed to be located in an area of high unemployment or
poverty.
   (2) Negotiate with a taxpayer the terms and conditions of proposed
written agreements that provide the credit allowed pursuant to this
section to a taxpayer.
   (3) Provide the negotiated written agreement to the committee for
its approval pursuant to Section 18410.2.
   (4) Inform the Franchise Tax Board of the terms and conditions of
the written agreement upon approval of the written agreement by the
committee.
   (5) Inform the Franchise Tax Board of any recapture, in whole or
in part, of a previously allocated credit upon approval of the
recapture by the committee.
   (6) Post on its Internet Web site all of the following:
   (A) The name of each taxpayer allocated a credit pursuant to this
section.
   (B) The estimated amount of the investment by each taxpayer.
   (C) The estimated number of jobs created or retained.
   (D) The amount of the credit allocated to the taxpayer.
   (E) The amount of the credit recaptured from the taxpayer, if
applicable.
   (d) For purposes of this section, the Franchise Tax Board shall do
all of the following:
   (1) (A) Except as provided in subparagraph (B), review the books
and records of all taxpayers allocated a credit pursuant to this
section to ensure compliance with the terms and conditions of the
written agreement between the taxpayer and GO-Biz.
   (B) In the case of a taxpayer that is a "small business," as
defined in Section 17053.73, review the books and records of the
taxpayer allocated a credit pursuant to this section to ensure
compliance with the terms and conditions of the written agreement
between the taxpayer and GO-Biz when, in the sole discretion of the
Franchise Tax Board, a review of those books and records is
appropriate or necessary in the best interests of the state.
   (2) Notwithstanding Section 19542:
   (A) Notify GO-Biz of a possible breach of the written agreement by
a taxpayer and provide detailed information regarding the basis for
that determination.
   (B) Provide information to GO-Biz with respect to whether a
taxpayer is a "small business," as defined in Section 17053.73.
   (e) In the case where the credit allowed under this section
exceeds the "net tax," as defined in Section 17039, for a taxable
year, the excess credit may be carried over to reduce the "net tax"
in the following taxable year, and succeeding five taxable years, if
necessary, until the credit has been exhausted.
   (f) Any recapture, in whole or in part, of a credit approved by
the committee pursuant to Section 18410.2 shall be treated as a
mathematical error appearing on the return. Any amount of tax
resulting from that recapture shall be assessed by the Franchise Tax
Board in the same manner as provided by Section 19051. The amount of
tax resulting from the recapture shall be added to the tax otherwise
due by the taxpayer for the taxable year in which the committee's
recapture determination occurred.
   (g) (1) The aggregate amount of credit that may be allocated in
any fiscal year pursuant to this section and Section 23689 shall be
an amount equal to the sum of subparagraphs (A), (B), and (C), less
the amount specified in subparagraphs (D) and (E):
   (A) Thirty million dollars ($30,000,000) for the 2013-14 fiscal
year, one hundred fifty million dollars ($150,000,000) for the
2014-15 fiscal year, and two hundred million dollars ($200,000,000)
for each fiscal year from 2015-16 to 2017-18, inclusive.
   (B) The unallocated credit amount, if any, from the preceding
fiscal year.
   (C) The amount of any previously allocated credits that have been
recaptured.
   (D) The amount estimated by the Director of Finance, in
consultation with the Franchise Tax Board and the State Board of
Equalization, to be necessary to limit the aggregation of the
estimated amount of exemptions claimed pursuant to Section 6377.1 and
of the amounts estimated to be claimed pursuant to this section and
Sections 17053.73, 23626, and 23689 to no more than seven hundred
fifty million dollars ($750,000,000) for either the current fiscal
year or the next fiscal year.
   (i) The Director of Finance shall notify the Chairperson of the
Joint Legislative Budget Committee of the estimated annual allocation
authorized by this paragraph. Any allocation pursuant to these
provisions shall be made no sooner than 30 days after written
notification has been provided to the Chairperson of the Joint
Legislative Budget Committee and the chairpersons of the committees
of each house of the Legislature that consider appropriation, or not
sooner than whatever lesser time the Chairperson of the Joint
Legislative Budget Committee, or his or her designee, may determine.
   (ii) In no event shall the amount estimated in this subparagraph
be less than zero dollars ($0).
   (E) (i) For the 2015-16 fiscal year and each fiscal year
thereafter, the aggregate amount of credit that may be allocated
pursuant to this section and Section 23689 shall be reduced by the
amount of credit allowed to all qualified taxpayers pursuant to
subparagraph (A) or subparagraph (B) of paragraph (1) of subdivision
(c) of Section 23636.
   (ii) If the amount available per fiscal year pursuant to this
section and Section 23689 is less than the aggregate amount of credit
allowed to qualified taxpayers pursuant to subparagraph (A) or
subparagraph (B) of paragraph (1) of subdivision (c) of Section
23636, the aggregate amount allowed pursuant to Section 23636 shall
not be reduced and, in addition to the reduction required by clause
(i), the aggregate amount of credit that may be allocated pursuant to
this section and Section 23689 for the next fiscal year shall be
reduced by the amount of that deficit.
   (iii) It is the intent of the Legislature that the reductions
specified in this subparagraph of the aggregate amount of credit that
may be allocated pursuant to this section and Section 23689 shall
continue if the repeal dates of the credits allowed by this section
and Section 23689 are removed or extended.
   (2) Each fiscal year, 25 percent of the aggregate amount of the
credit that may be allocated pursuant to this section and Section
23689 shall be reserved for small business, as defined in Section
17053.73 or 23626.
   (3) Each fiscal year, no more than 20 percent of the aggregate
amount of the credit that may be allocated pursuant to this section
shall be allocated to any one taxpayer.
   (h) GO-Biz may prescribe rules and regulations as necessary to
carry out the purposes of this section. Any rule or regulation
prescribed pursuant to this section may be by adoption of an
emergency regulation in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
   (i) A written agreement between GO-Biz and a taxpayer with respect
to the credit authorized by this section shall comply with existing
law on the date the agreement is executed.
   (j) (1) Upon the effective date of this section, the Department of
Finance shall estimate the total dollar amount of credits that will
be claimed under this section with respect to each fiscal year from
the 2013-14 fiscal year to the 2024-25 fiscal year, inclusive.
   (2) The Franchise Tax Board shall annually provide to the Joint
Legislative Budget Committee, by no later than March 1, a report of
the total dollar amount of the credits claimed under this section
with respect to the relevant fiscal year. The report shall compare
the total dollar amount of credits claimed under this section with
respect to that fiscal year with the department's estimate with
respect to that same fiscal year. If the total dollar amount of
credits claimed for the fiscal year is less than the estimate for
that fiscal year, the report shall identify options for increasing
annual claims of the credit so as to meet estimated amounts.
   (k) This section is repealed on December 1, 2025.
  SEC. 5.  Section 23636 is added to the Revenue and Taxation Code,
to read:
   23636.  (a) For each taxable year beginning on or after January 1,
2015, and before January 1, 2030, a qualified taxpayer shall be
allowed a credit against the "tax," as defined in Section 23036, in
an amount equal to 171/2 percent of qualified wages paid or incurred
by the qualified taxpayer during the taxable year to qualified
full-time employees multiplied by the annual full-time equivalent
ratio.
   (b) For purposes of this section:
   (1) "Annual full-time equivalent" means either of the following:
   (A) In the case of a qualified full-time employee paid hourly
qualified wages, "annual full-time equivalent" means the total number
of hours worked for the qualified taxpayer by the qualified
full-time employee, not to exceed 2,000 hours per employee, divided
by 2,000.
   (B) In the case of a salaried qualified full-time employee,
"annual full-time equivalent" means the total number of weeks worked
for the qualified taxpayer by the qualified employee divided by 52.
   (2) "Annual full-time equivalent ratio" means a ratio, the
numerator of which is 1,100 and the denominator of which is the
number of a qualified taxpayer's qualified full-time employees
computed on an annual full-time equivalent basis for the taxable
year. The annual full-time equivalent ratio may not be greater than
one.
   (3) "Qualified full-time employee" means an individual that is
employed in this state by the qualified taxpayer and satisfies both
of the following:
   (A) The individual's services for the qualified taxpayer are at
least 80 percent directly related to the qualified taxpayer's
subcontract to design, test, manufacture property, or otherwise
support production of property for ultimate use in or as a component
of a new advanced strategic aircraft for the United States Air Force.

   (B) The individual is paid compensation from the qualified
taxpayer that satisfies either of the following conditions:
   (i) Is qualified wages paid by the qualified taxpayer for services
not less than an average of 35 hours per week.
   (ii) Is a salary paid by the qualified taxpayer as compensation
during the taxable year for full-time employment, within the meaning
of Section 515 of the Labor Code.
   (4) "Qualified taxpayer" means any taxpayer that is a major
first-tier subcontractor awarded a subcontract to manufacture
property for ultimate use in or as a component of a new advanced
strategic aircraft for the United States Air Force. For purposes of
this paragraph, the term "major first-tier subcontractor" means a
subcontractor that was awarded a subcontract in an amount of at least
35 percent of the amount of the initial prime contract awarded for
the manufacturing of a new advanced strategic aircraft for the United
States Air Force.
   (5) "Qualified wages" means wages paid or incurred by the
qualified taxpayer during the taxable year with respect to qualified
full-time employees that are direct labor costs, within the meaning
of Section 263A of the Internal Revenue Code, relating to
capitalization and inclusion in inventory costs of certain expenses,
allocable to property manufactured in this state by the qualified
taxpayer for ultimate use in or as a component of a new advanced
strategic aircraft for the United States Air Force.
   (6) "New advanced strategic aircraft for the United States Air
Force" means a new advanced strategic aircraft developed and produced
for the United States Air Force under the New Advanced Strategic
Aircraft Program.
   (7) "New Advanced Strategic Aircraft Program" means the project
designed to design, test, manufacture, or otherwise support
production of a new advanced strategic aircraft for the United States
Air Force under a contract that is expected to be awarded in the
first or second calendar quarter of 2015.
   (c) (1) The total aggregate amount of the credit that may be
allowed to all qualified taxpayers pursuant to this section shall be
as follows:
   (A) In years one through five of the credit, the total aggregate
amount of the credit that may be allowed to all qualified taxpayers
pursuant to this section shall not exceed twenty- five million
dollars ($25,000,000) per calendar year.
   (B) In years 6 through 10 of the credit, the total aggregate
amount of the credit that may be allowed to all qualified taxpayers
pursuant to this section shall not exceed twenty-eight million
dollars ($28,000,000) per calendar year.
   (C) In years 11 through 15 of the credit, the total aggregate
amount of the credit that may be allowed to all qualified taxpayers
pursuant to this section shall not exceed thirty-one million dollars
($31,000,000) per calendar year.
   (2) The Franchise Tax Board shall allocate the credit to the
taxpayers on a first-come-first-served basis.
   (3) The credit allowed under this section must be claimed on a
timely filed original return.
   (d) In the case where the credit allowed by this section exceeds
the "tax," the excess may be carried over to reduce the "tax" in the
following year, and the seven succeeding years if necessary, until
the credit is exhausted.
   (e) A credit shall not be allowed unless the credit was reflected
within the bid upon which the qualified taxpayer's subcontract to
manufacture property for ultimate use in or as a component of a New
Advanced Strategic Aircraft Program is based by reducing the amount
of the bid by a good faith estimate of the amount of the credit
allowable under this section.
   (f) All references to the credit and ultimate cost reductions
incorporated into any successful bid that was awarded a subcontract
and for which a qualified taxpayer is making a claim shall be made
available to the Franchise Tax Board upon request.
   (g) If the qualified taxpayer is allowed a credit pursuant to this
section for qualified wages paid or incurred, only one credit shall
be allowed to the taxpayer under this part with respect to any wage
consisting in whole or in part of those qualified wages.
   (h) (1) The Franchise Tax Board may prescribe regulations
necessary or appropriate to carry out the purposes of this section.
   (2) The Franchise Tax Board may also prescribe rules, guidelines,
or procedures necessary or appropriate to carry out the purposes of
this section. Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code shall not apply to
any rule, guideline, or procedure prescribed by the Franchise Tax
Board pursuant to this section.
   (i) This section shall remain in effect only until December 1,
2030, and as of that date is repealed.
  SEC. 6.  Section 23689 of the Revenue and Taxation Code is amended
to read:
   23689.  (a) (1) For each taxable year beginning on and after
January 1, 2014, and before January 1, 2025, there shall be allowed
as a credit against the "tax," as defined in Section 23036, an amount
as determined by the committee pursuant to paragraph (2) and
approved pursuant to Section 18410.2.
   (2) The credit under this section shall be allocated by GO-Biz
with respect to the 2013-14 fiscal year through and including the
2017-18 fiscal year. The amount of credit allocated to a taxpayer
with respect to a fiscal year pursuant to this section shall be as
set forth in a written agreement between GO-Biz and the taxpayer and
shall be based on the following factors:
   (A) The number of jobs the taxpayer will create or retain in this
state.
   (B) The compensation paid or proposed to be paid by the taxpayer
to its employees, including wages and fringe benefits.
   (C) The amount of investment in this state by the taxpayer.
   (D) The extent of unemployment or poverty in the area according to
the United States Census in which the taxpayer's project or business
is proposed or located.
   (E) The incentives available to the taxpayer in the state,
including incentives from the state, local government and other
entities.
   (F) The incentives available to the taxpayer in other states.
   (G) The duration of the proposed project and the duration the
taxpayer commits to remain in this state.
   (H) The overall economic impact in this state of the taxpayer's
project or business.
   (I) The strategic importance of the taxpayer's project or business
to the state, region, or locality.
   (J) The opportunity for future growth and expansion in this state
by the taxpayer's business.
   (K) The extent to which the anticipated benefit to the state
exceeds the projected benefit to the taxpayer from the tax credit.
   (3) The written agreement entered into pursuant to paragraph (2)
shall include:
   (A) Terms and conditions that include the taxable year or years
for which the credit allocated shall be allowed, a minimum
compensation level, and a minimum job retention period.
   (B) Provisions indicating whether the credit is to be allocated in
full upon approval or in increments based on mutually agreed upon
milestones when satisfactorily met by the taxpayer.
   (C) Provisions that allow the committee to recapture the credit,
in whole or in part, if the taxpayer fails to fulfill the terms and
conditions of the written agreement.
   (b) For purposes of this section:
   (1) "Committee" means the California Competes Tax Credit Committee
established pursuant to Section 18410.2.
   (2) "GO-Biz" means the Governor's Office of Business and Economic
Development.
   (c) For purposes of this section, GO-Biz shall do the following:
   (1) Give priority to a taxpayer whose project or business is
located or proposed to be located in an area of high unemployment or
poverty.
   (2) Negotiate with a taxpayer the terms and conditions of proposed
written agreements that provide the credit allowed pursuant to this
section to a taxpayer.
   (3) Provide the negotiated written agreement to the committee for
its approval pursuant to Section 18410.2.
   (4) Inform the Franchise Tax Board of the terms and conditions of
the written agreement upon approval of the written agreement by the
committee.
   (5) Inform the Franchise Tax Board of any recapture, in whole or
in part, of a previously allocated credit upon approval of the
recapture by the committee.
   (6) Post on its Internet Web site all of the following:
   (A) The name of each taxpayer allocated a credit pursuant to this
section.
   (B) The estimated amount of the investment by each taxpayer.
   (C) The estimated number of jobs created or retained.
   (D) The amount of the credit allocated to the taxpayer.
   (E) The amount of the credit recaptured from the taxpayer, if
applicable.
   (d) For purposes of this section, the Franchise Tax Board shall do
all of the following:
   (1) (A) Except as provided in subparagraph (B), review the books
and records of all taxpayers allocated a credit pursuant to this
section to ensure compliance with the terms and conditions of the
written agreement between the taxpayer and GO-Biz.
   (B) In the case of a taxpayer that is a "small business," as
defined in Section 23626, review the books and records of the
taxpayer allocated a credit pursuant to this section to ensure
compliance with the terms and conditions of the written agreement
between the taxpayers and GO-Biz when, in the sole discretion of the
Franchise Tax Board, a review of those books and records is
appropriate or necessary in the best interests of the state.
   (2) Notwithstanding Section 19542:
   (A) Notify GO-Biz of a possible breach of the written agreement by
a taxpayer and provide detailed information regarding the basis for
that determination.
   (B) Provide information to GO-Biz with respect to whether a
taxpayer is a "small business," as defined in Section 23626.
   (e) In the case where the credit allowed under this section
exceeds the "tax," as defined in Section 23036, for a taxable year,
the excess credit may be carried over to reduce the "tax" in the
following taxable year, and succeeding five taxable years, if
necessary, until the credit has been exhausted.
   (f) Any recapture, in whole or in part, of a credit approved by
the committee pursuant to Section 18410.2 shall be treated as a
mathematical error appearing on the return. Any amount of tax
resulting from that recapture shall be assessed by the Franchise Tax
Board in the same manner as provided by Section 19051. The amount of
tax resulting from the recapture shall be added to the tax otherwise
due by the taxpayer for the taxable year in which the committee's
recapture determination occurred.
   (g) (1) The aggregate amount of credit that may be allocated in
any fiscal year pursuant to this section and Section 17059.2 shall be
an amount equal to the sum of subparagraphs (A), (B), and (C), less
the amount specified in subparagraphs (D) and (E):
   (A) Thirty million dollars ($30,000,000) for the 2013-14 fiscal
year, one hundred fifty million dollars ($150,000,000) for the
2014-15 fiscal year, and two hundred million dollars ($200,000,000)
for each fiscal year from 2015-16 to 2017-18, inclusive.
   (B) The unallocated credit amount, if any, from the preceding
fiscal year.
   (C) The amount of any previously allocated credits that have been
recaptured.
   (D) The amount estimated by the Director of Finance, in
consultation with the Franchise Tax Board and the State Board of
Equalization, to be necessary to limit the aggregation of the
estimated amount of exemptions claimed pursuant to Section 6377.1 and
of the amounts estimated to be claimed pursuant to this section and
Sections 17053.73, 17059.2, and 23626 to no more than seven hundred
fifty million dollars ($750,000,000) for either the current fiscal
year or the next fiscal year.
   (i) The Director of Finance shall notify the Chairperson of the
Joint Legislative Budget Committee of the estimated annual allocation
authorized by this paragraph. Any allocation pursuant to these
provisions shall be made no sooner than 30 days after written
notification has been provided to the Chairperson of the Joint
Legislative Budget Committee and the chairpersons of the committees
of each house of the Legislature that consider appropriation, or not
sooner than whatever lesser time the Chairperson of the Joint
Legislative Budget Committee, or his or her designee, may determine.
   (ii) In no event shall the amount estimated in this subparagraph
be less than zero dollars ($0).
   (E) (i) For the 2015-16 fiscal year and each fiscal year
thereafter, the aggregate amount of credit that may be allocated
pursuant to this section and Section 17059.2 shall be reduced by the
amount of credit allowed to all qualified taxpayers pursuant to
subparagraph (A) or subparagraph (B) of paragraph (1) of subdivision
(c) of Section 23636.
   (ii) If the amount available per fiscal year pursuant to this
section and Section 17059.2 is less than the aggregate amount allowed
to qualified taxpayers pursuant to subparagraph (A) or subparagraph
(B) of paragraph (1) of subdivision (c) of Section 23636, the
aggregate amount allowed pursuant to Section 23636 shall not be
reduced and, in addition to the reduction required by clause (i), the
aggregate amount available pursuant to this section and Section
17059.2 for the next fiscal year shall be reduced by the amount of
that deficit.
   (iii) It is the intent of the Legislature that the reductions
specified in this subparagraph of the aggregate amount of credit that
may be allocated pursuant to this section and Section 17059.2 shall
continue if the repeal dates of the credits allowed by this section
and Section                                           17059.2 are
removed or extended.
   (2) Each fiscal year, 25 percent of the aggregate amount of the
credit that may be allocated pursuant to this section and Section
17059.2 shall be reserved for "small business," as defined in Section
17053.73 or 23626.
   (3) Each fiscal year, no more than 20 percent of the aggregate
amount of the credit that shall be allocated pursuant to this section
may be allocated to any one taxpayer.
   (h) GO-Biz may prescribe rules and regulations as necessary to
carry out the purposes of this section. Any rule or regulation
prescribed pursuant to this section may be by adoption of an
emergency regulation in accordance with Chapter 3.5 (commencing with
Section 11340) of Part 1 of Division 3 of Title 2 of the Government
Code.
   (i) (1) A written agreement between GO-Biz and a taxpayer with
respect to the credit authorized by this section shall not restrict,
broaden, or otherwise alter the ability of the taxpayer to assign
that credit or any portion thereof in accordance with Section 23663.
   (2) A written agreement between GO-Biz and a taxpayer with respect
to the credit authorized by this section must comply with existing
law on the date the agreement is executed.
   (j) (1) Upon the effective date of this section, the Department of
Finance shall estimate the total dollar amount of credits that will
be claimed under this section with respect to each fiscal year from
the 2013-14 fiscal year to the 2024-25 fiscal year, inclusive.
   (2) The Franchise Tax Board shall annually provide to the Joint
Legislative Budget Committee, by no later than March 1, a report of
the total dollar amount of the credits claimed under this section
with respect to the relevant fiscal year. The report shall compare
the total dollar amount of credits claimed under this section with
respect to that fiscal year with the department's estimate with
respect to that same fiscal year. If the total dollar amount of
credits claimed for the fiscal year is less than the estimate for
that fiscal year, the report shall identify options for increasing
annual claims of the credit so as to meet estimated amounts.
   (k) This section is repealed on December 1, 2025.
  SEC. 7.   This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:
   In order to promote economic development in California related to
the manufacture of property to be used for new advanced strategic
aircraft for the United States Air Force and to authorize a local
government to pay a related capital investment amount pursuant to a
reduced threshold amount as soon as possible, it is necessary that
this act take effect immediately.
                   
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