Bill Text: CA SB193 | 2021-2022 | Regular Session | Enrolled

California Senate Bill 193 (Prior Session Legislation)

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: Economic development: grant programs and other financial assistance.

Spectrum: Committee Bill

Status: (Passed) 2022-06-30 - Chaptered by Secretary of State. Chapter 68, Statutes of 2022. [SB193 Detail]

Download: California-2021-SB193-Enrolled.html

Enrolled June 29, 2022

Passed IN Senate June 29, 2022

Passed IN Assembly June 29, 2022

Amended IN Assembly June 26, 2022

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill

No. 193

Introduced by Committee on Budget and Fiscal Review

January 08, 2021

An act to amend Sections 6254.26, 7928.710, 12096.6.1, 12099.1, 12099.2, 12099.3, 12099.4, 12099.5, 12099.6, 12099.7, 12100.60, 12100.62, 12100.63, 12100.82, 12100.83, 12100.83.5, 12100.83.6, 12100.91, 12100.95, and 63089.5 of, to add Section 12099.7.5 to, to add Article 12 (commencing with Section 63089.99) to Chapter 6 of Division 1 of Title 6.7 of, to add and repeal Article 11 (commencing with Section 12100.120) of Chapter 1.6 of Part 2 of Division 3 of Title 2 of, Article 12 (commencing with Section 12100.130) of Chapter 1.6 of Part 2 of Division 3 of Title 2 of, and Article 13 (commencing with Section 12100.140) of Chapter 1.6 of Part 2 of Division 3 of Title 2 of, to add Chapter 7.3 (commencing with Section 11788) to Part 1 of Division 3 of Title 2 of, and to repeal Section 12100.69 of, the Government Code, and to amend Section 44526 of, and to add Article 7 (commencing with Section 44558) to Chapter 1 of Division 27 of, the Health and Safety Code, relating to economic development, and making an appropriation therefor, to take effect immediately, bill related to the budget.

LEGISLATIVE COUNSEL'S DIGEST

SB 193, Committee on Budget and Fiscal Review. Economic development: grant programs and other financial assistance.

(1) The Bergeson-Peace Infrastructure and Economic Development Bank Act (Bank Act) establishes the California Infrastructure and Economic Development Bank (I-Bank) in the Governor’s Office of Business and Economic Development (GO-Biz) under the direction of an executive director appointed by the Governor, subject to confirmation by the Senate, and governed by a board of directors composed of specified persons. The Bank Act, among other things, authorizes the I-Bank to make loans, issue bonds, and provide financial assistance for various types of projects that qualify as economic development or public development facilities. Existing law, the Small Business Financial Assistance Act of 2013 (Small Business Act), establishes the Small Business Expansion Fund, a continuously appropriated fund.

This bill would establish a venture capital program within the I-Bank under the Small Business Act to, among other things and to the extent permissible, acquire contract rights, or make loans with respect to investment funds, investment fund management companies, special purpose investment vehicles, trusts, nonprofit entities, small businesses, and other private business entities. The bill would require the Governor to appoint a deputy director for the program. The bill would authorize the fund to be used to make loans, guarantees, and other financial products that may be provided under the program. By expanding the activities of the bank that are funded by continuous appropriation from the expansion fund, the bill would make an appropriation.

The California Public Records Act requires state and local agencies to make their records available for public inspection, unless an exemption from disclosure applies.

This bill would exempt specified records regarding alternative investments in which the venture capital program invests from the disclosure requirements of the California Public Records Act.

Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

This bill would make legislative findings to that effect.

(2) Existing law establishes the California Office of the Small Business Advocate (CalOSBA) within GO-Biz to serve as the principal advocate on behalf of small businesses, including to represent the views and interests of small businesses, among other duties. Existing law establishes various grant programs within CalOSBA.

This bill would establish, upon appropriation by the Legislature, the California Regional Initiative for Social Enterprises Program within CalOSBA to provide financial and technical assistance to employment social enterprises for purposes of accelerating economic mobility and inclusion for individuals that experience employment barriers. The bill would set forth requirements for the grant and designation of fiscal agents to administer the program, among other things.

Existing law establishes the California Small Business COVID-19 Relief Grant Program to assist qualified small businesses affected by COVID-19. Existing law defines the operative terms of that grant program, including the definition of a “qualified small business.” Existing law continuously appropriates a specified sum from the General Fund for purposes of that grant program.

This bill would redefine certain definitions of that program, including expanding the definition of “qualified small business” to include divisions or departments of tribal governments, cities, and counties, fiscally sponsored organizations, and organizations with an annual gross revenue of up to $5,000,000, and would additionally define new terms. By expanding the definition of what entity may be considered a “qualified small business” to include a greater pool of applicants, this bill would create an appropriation. The bill would additionally require any qualified small business, as defined, to provide an affidavit from the board or authorizing official, as specified. By requiring an affidavit, which is signed under penalty of perjury, the bill would expand the scope of the crime of perjury, thereby imposing a state-mandated local program.

Existing law establishes the California Nonprofit Performing Arts Grant Program within CalOSBA for the purpose of providing grants to eligible nonprofit performing arts organizations, as defined, to encourage workforce development. Existing law authorizes, subject to appropriation by the Legislature, $49,500,000 of program funds to be allocated in one or more rounds to eligible nonprofit performing arts organizations. Existing law repeals the program on December 31, 2022.

This bill would instead repeal the California Nonprofit Performing Arts Grant Program on June 30, 2023.

Existing law establishes, until December 31, 2022, the California Microbusiness COVID-19 Relief Grant Program within CalOSBA to assist qualified microbusinesses, as defined and certified under penalty of perjury, that have been significantly impacted by the COVID-19 pandemic, as provided. Existing law requires CalOSBA to administer a Request for Proposal (RFP) in no more than 2 rounds for a specified period of time per round for eligible grantmaking entities, defined as a county or consortium of nonprofit, community-based organizations, as specified, and, subject to appropriation by the Legislature, requires a grantmaking entity that receives an allocation to administer a county program to, among other things, award individual grants to qualified microbusinesses.

This bill would instead repeal the California Microbusiness Business COVID-19 Relief Grant Program on June 30, 2023, and make conforming changes. By expanding a program that requires qualified microbusinesses to make specified certifications under penalty of perjury, the bill would expand a crime and impose a state-mandated local program.

(3) Existing law, until December 31, 2022, creates the California Venues Grant Program within CalOSBA to provide grants to eligible independent live events, as defined, that have been affected by COVID-19 in order to support their continued operation. Existing law requires, subject to appropriation by the Legislature, $150,000,000 to be allocated in one or more rounds to eligible independent live events.

Existing law requires, for the purposes of program eligibility, that eligible independent live events be entities that satisfy certain criteria, including, but not limited to, being a specified type of business entity, such as a sole proprietorship or a limited liability company and being a specified type of business, classified under the North American Industry Classification System, such as sports teams and clubs, drinking places serving alcoholic beverages, or full-service restaurants. Existing law specifies that an eligible independent live event does not include, among other things, entities that demonstrate a percentage gross earned revenue decline in California of less than 70%, based on a reporting period comparing specified quarters of 2020 to 2019.

This bill would add specified performing arts and recreation businesses to the list of types of businesses, classified under the North American Industry Classification System, eligible for the program. The bill would also add various classifications under the National Taxonomy of Exempt Entities related to art, culture, and education to the list of types of businesses eligible for the program. This bill would specify that an eligible independent live event does not include entities that demonstrate a percentage gross earned revenue decline in California of less than 30%, based on a reporting period comparing specified quarters of 2020 to 2019.

Existing law also defines “eligible venue” for the purposes of the program as a venue with a defined performance and audience space and specified equipment and staff.

This bill would require an eligible venue to also be one of the 3 highest revenue grossing entities, locations, or franchises associated with the applicant.

Existing law authorizes applicants to self-identify race, gender, and ethnicity and requires the office to, within 7 business days of the close of each application period, post the aggregate data, as available, and, within 15 business days of the close of each application period, post data by county and legislative district, as available. Existing law requires the office to post all information on its internet website and provide an electronic copy of the information to the relevant fiscal and policy committees of the Legislature.

This bill would instead require the office to post the aggregate data, as available, and data by county and legislative district, as available, within 30 business days of the close of each application period.

(4) Existing law, the California Small Business Development Technical Assistance Expansion Act of 2018, administered by CalOSBA, establishes the California Small Business Development Technical Assistance Expansion Program to, among other things, provide grants to expand the capacity of small business development technical assistance centers in the state administered by and primarily funded by federal agencies, and authorizes the office to include other nonprofit small business technical assistance centers. The act requires an applicant for a grant to meet specified criteria, including, among others, that the applicant has demonstrated the ability to fully draw down substantially all federal funds available to it. Existing law repeals the act on January 1, 2024.

This bill would rename the act to the California Small Business Development Technical Assistance Act of 2022, and would make conforming changes for that purpose. The bill would require the office to provide grants to nonprofit small business technical assistance centers that are not administered by or primarily funded by federal agencies. The bill would additionally require the applicant to demonstrate the ability to fully draw down substantially all private funds available to it. The bill would remove the January 1, 2024, repeal date, thereby extending operation of the act indefinitely. The bill would also make various technical changes to the act.

(5) Existing law creates GO-Biz to serve the Governor as the lead entity for economic strategy and the marketing of California on issues relating to business development, private sector investment, and economic growth and to administer various programs related to these issues.

This bill would create the Local Government Budget Sustainability Fund to provide, upon appropriation, grant funding for project support for county governments with a goal of providing opportunities for revenue stability. The bill would require GO-Biz to develop criteria for the selection of grant recipients and would impose various requirements on applicants, including limiting applicants to county governments in high-unemployment and high-poverty areas, as specified, and requiring grant recipients to meet with GO-Biz at least bimonthly to evaluate project progress. The bill would specify the criteria for evaluation and prioritization of grants and would specify eligible activities for grant funds. The bill would repeal these provisions on June 30, 2028.

This bill would require GO-Biz to establish the California Containerized Ports Interoperability Grant Program, upon appropriation, to provide grant funding to specified ports in California for the purpose of improving interoperability among containerized ports in California and would establish criteria for determining grant awards. The bill would require GO-Biz to submit specified reports on the grant program to the Legislature. The bill would repeal its provisions on January 1, 2026.

This bill would, until June 30, 2026, establish the Local Government Immigrant Integration Initiative and would, upon appropriation, require GO-Biz to administer competitive grants to local governments to develop or expand local immigrant integration initiatives according to specified grant criteria, and prioritization of equitable distribution of funds across local government jurisdictions. The bill would specify that grants may be used for, among other things, funding immigrant integration focused positions and services. The bill would require grantees to collaborate with one another and would prohibit local governments from using the funding award to replace existing funding or required services. The bill would specify that information that may be collected from individuals participating in the new services and would not constitute a public record subject to disclosure, as specified.

This bill would make legislative findings to that effect.

The bill would require, upon appropriation, GO-Biz to administer competitive grants to eligible service providers, as specified, to develop export training programs and curriculum aimed at underserved business owners, including immigrant entrepreneurs, and small business operators.

The bill would require GO-Biz to complete an annual report, as described, and would specify that persons who are not lawfully present in the United States may participate in and benefit from services provided by these grant programs.

(6) Existing law, until January 1, 2030, and upon appropriation, establishes the California Competes Grant Program to award grants to applicants that meet specified criteria relating to the creation of jobs or investments in the state. The program requires GO-Biz to enter into a written agreement with the grantee, and to consider specified factors when determining whether to enter into the agreement. Existing law specifies various limitations on the allocation of grants under the program, including prohibiting GO-Biz from allocating more than 30% of the aggregate amount of grants appropriated in any fiscal year to one grantee.

This bill would additionally authorize GO-Biz to consider, when determining whether to enter into a written agreement with a grantee, for the 2023–24 fiscal year, and each fiscal year thereafter, the grantee’s willingness to relocate jobs into California from a state that enacted specified laws and the grantee’s commitment to treating their workforce fairly and creating quality, full-time, wage and salary jobs in the state. The bill would authorize GO-Biz to allocate more than 30% of the aggregate amount of grants appropriated in any fiscal year to one grantee if the grant will be used as a state match for the purposes of a business applying for or obtaining specified federal incentives.

(7) Existing law, the California Inclusive Innovation Hub Program, within the office, among other things, requires the office to designate Inclusive Innovation Hubs (iHub2s) within the state to stimulate partnerships, economic development, and job creation by leveraging assets to provide an innovation platform for startup businesses, economic development organizations, business groups, and venture capitalists, as provided. The office is required to oversee, coordinate, and provide assistance to each iHub2. Existing law also requires the office to request proposals for the program from applicants, as defined, that include specified information.

Existing law establishes the Community Economic Resilience Fund Program (CERF) within the Workforce Services Branch of the Employment Development Department, requires CERF to establish and support high road transition collaboratives, as specified, and requires planning grants to support at least one collaborative per region, as specified.

This bill would revise and recast the California Inclusive Innovation Hub Program by, among other things, renaming the program as the “Accelerate California Inclusive Innovation Hub Program,” and renaming an Inclusive Innovation Hub as an “Accelerate California: Inclusive Innovation Hub.” The bill would require previously designated iHUB2s to be newly awarded under the Accelerate California: Inclusive Innovation Hub Program and would modify the requirements for the program. The bill would also make conforming changes in this regard.

This bill would establish the Accelerate California Entrepreneurship Fund, to be administered by the office upon appropriation by the Legislature, to provide acceleration grants to small businesses and entrepreneurs that participate in the Accelerate California: Inclusive Innovation Hubs, as provided.

(8) Existing law, the California Pollution Control Financing Authority Act, establishes the California Pollution Control Financing Authority, with specified powers and duties, and authorizes the authority to approve financing for projects or pollution control facilities to prevent or reduce environmental pollution.

Existing federal law establishes the Capital Magnet Fund and makes moneys in that fund available to the United States Secretary of the Treasury to carry out a competitive grant program to attract private capital for, and increase investment in, certain affordable housing and economic development projects by providing grants, as provided, to Treasury-certified community development financial institutions or nonprofit organizations that meet specified criteria.

Existing federal law, the federal Community Development Financial Institutions Program, provides financial and technical assistance to specified recipients to enhance their ability to provide specified financial products, financial services, and development services to and in their target markets in order to promote economic revitalization and community development through investment in and assistance to community development financial institutions, as defined and specified.

This bill would establish the California Investment and Innovation Program, administered by the California Pollution Control Financing Authority (authority), for the purpose of providing grants to enhance the capacity of community development financial institutions to provide technical assistance and capital access to economically disadvantaged communities in the state. The bill would establish the California Investment and Innovation Fund and would continuously appropriate moneys in the fund to the authority to carry out program, among other things. By establishing a continuously appropriated fund, this bill would make an appropriation. The bill would require the authority to award a grant to an eligible applicant, defined as a community development financial institution that meets specified criteria under the program, as provided. The bill would specify authorized uses of grant funds, including increasing working capital for the purpose of funding services and operations that contribute to the overall community development mission of the eligible applicant, as specified. By establishing a continuously appropriated fund, the bill would make an appropriation.

(9) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

(10) This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill.

Vote: MAJORITY Appropriation: YES Fiscal Committee: YES Local Program: YES

The people of the State of California do enact as follows:

SECTION 1.

The Legislature finds and declares as follows:

(a) Community development financial institutions (CDFIs) are a critical partner of the state in addressing short-term and long-term needs of low- and moderate-income communities in the areas of affordable housing, health care, small business lending, economic development, and more.

(b) As mission-driven lenders, grantors, and providers of technical assistance, CDFIs have proven time and again that they can play a valuable role in helping to deploy and leverage public investment quickly and efficiently.

(c) It is the intent of the Legislature in creating the California Investment and Innovation Program to establish a program that creates an ongoing partnership with CDFIs to assist the state in efficiently deploying resources to communities in need and establishing an equitable economic recovery that benefits low-income communities and communities of color that have been disproportionately impacted by the economic fallout of the COVID-19 pandemic and by historical and ongoing disinvestment.

(d) In addition to providing an economic jumpstart for those communities through immediate investment, it is the intent of the Legislature that the program created by this act will serve as a potential repository for current and future emergency or stimulus funding streams that would otherwise require the state to start up new programs, thereby slowing the delivery of these funds to those most in need. The program will be a permanent resource for community investment.

SEC. 2.

Section 6254.26 of the Government Code is amended to read:

6254.26.

(a) Notwithstanding any provision of this chapter or other law, the following records regarding alternative investments in which public investment funds invest shall not be subject to disclosure pursuant to this chapter, unless the information has already been publicly released by the keeper of the information:

(1) Due diligence materials that are proprietary to the public investment fund or the alternative investment vehicle.

(2) Quarterly and annual financial statements of alternative investment vehicles.

(3) Meeting materials of alternative investment vehicles.

(4) Records containing information regarding the portfolio positions in which alternative investment funds invest.

(5) Capital call and distribution notices.

(6) Alternative investment agreements and all related documents.

(b) Notwithstanding subdivision (a), the following information contained in records described in subdivision (a) regarding alternative investments in which public investment funds invest shall be subject to disclosure pursuant to this chapter and shall not be considered a trade secret exempt from disclosure:

(1) The name, address, and vintage year of each alternative investment vehicle.

(2) The dollar amount of the commitment made to each alternative investment vehicle by the public investment fund since inception.

(3) The dollar amount of cash contributions made by the public investment fund to each alternative investment vehicle since inception.

(4) The dollar amount, on a fiscal yearend basis, of cash distributions received by the public investment fund from each alternative investment vehicle.

(5) The dollar amount, on a fiscal yearend basis, of cash distributions received by the public investment fund plus remaining value of partnership assets attributable to the public investment fund’s investment in each alternative investment vehicle.

(6) The net internal rate of return of each alternative investment vehicle since inception.

(7) The investment multiple of each alternative investment vehicle since inception.

(8) The dollar amount of the total management fees and costs paid on an annual fiscal yearend basis, by the public investment fund to each alternative investment vehicle.

(9) The dollar amount of cash profit received by public investment funds from each alternative investment vehicle on a fiscal year-end basis.

(1) “Alternative investment” means an investment in a private equity fund, venture fund, hedge fund, or absolute return fund.

(2) “Alternative investment vehicle” means the limited partnership, limited liability company, or similar legal structure through which the public investment fund invests in portfolio companies.

(3) “Portfolio positions” means individual portfolio investments made by the alternative investment vehicles.

(4) “Public investment fund” means any public pension or retirement system, any public endowment or foundation, or a public bank, as defined in Section 57600, or the venture capital program pursuant to Article 12 (commencing with Section 63089.99) of Chapter 6 of Division 1 of Title 6.7 of the Government Code.

SEC. 3.

Section 7928.710 of the Government Code is amended to read:

7928.710.

(a) For purposes of this section, the following definitions apply:

(1) “Alternative investment” means an investment in a private equity fund, venture fund, hedge fund, or absolute return fund.

(2) “Alternative investment vehicle” means the limited partnership, limited liability company, or similar legal structure through which the public investment fund invests in portfolio companies.

(3) “Portfolio positions” means individual portfolio investments made by the alternative investment vehicles.

(b) Notwithstanding any provision of this division or other law, the following records regarding alternative investments in which public investment funds invest are not subject to disclosure pursuant to this division, unless the information has already been publicly released by the keeper of the information:

(1) Due diligence materials that are proprietary to the public investment fund or the alternative investment vehicle.

(2) Quarterly and annual financial statements of alternative investment vehicles.

(3) Meeting materials of alternative investment vehicles.

(4) Records containing information regarding the portfolio positions in which alternative investment funds invest.

(5) Capital call and distribution notices.

(6) Alternative investment agreements and all related documents.

(c) Notwithstanding subdivision (b), the following information contained in records described in subdivision (b) regarding alternative investments in which public investment funds invest is subject to disclosure pursuant to this division and shall not be considered a trade secret exempt from disclosure:

(1) The name, address, and vintage year of each alternative investment vehicle.

(2) The dollar amount of the commitment made to each alternative investment vehicle by the public investment fund since inception.

(3) The dollar amount of cash contributions made by the public investment fund to each alternative investment vehicle since inception.

(4) The dollar amount, on a fiscal year-end basis, of cash distributions received by the public investment fund from each alternative investment vehicle.

(5) The dollar amount, on a fiscal year-end basis, of cash distributions received by the public investment fund plus remaining value of partnership assets attributable to the public investment fund’s investment in each alternative investment vehicle.

(6) The net internal rate of return of each alternative investment vehicle since inception.

(7) The investment multiple of each alternative investment vehicle since inception.

(8) The dollar amount of the total management fees and costs paid on an annual fiscal year-end basis, by the public investment fund to each alternative investment vehicle.

(9) The dollar amount of cash profit received by public investment funds from each alternative investment vehicle on a fiscal year-end basis.

SEC. 4.

Chapter 7.3 (commencing with Section 11788) is added to Part 1 of Division 3 of Title 2 of the Government Code, to read:

CHAPTER 7.3. California Regional Initiative for Social Enterprises Program

11788.

For purposes of this chapter, all of the following terms shall have the following meanings:

(a) “Employment social enterprise” has the same meaning as in Section 14005 of the Unemployment Insurance Code.

(b) “Program” means the California Regional Initiative for Social Enterprise Program created pursuant to, and administered in accordance with, this chapter.

(c) “CalOSBA” or “office” means the California Office of Small Business Advocate within the Governor’s Office of Business and Economic Development.

(d) “Director” means the Director of the California Office of the Small Business Advocate.

(e) “Fiscal agent” means an organization with a mission that includes grantmaking to support economic empowerment of employment social enterprises and that is capable of online and mobile application development, customer support, document validation, impact analysis, grant agreements, and awards disbursement, as well as marketing, engagement, and strategic partnerships with a network of employment social enterprises for implementation.

11788.1

(a) (1) Upon appropriation by the Legislature, CalOSBA shall establish the California Regional Initiative for Social Enterprises Program pursuant to this chapter.

(2) In order to accelerate economic mobility and inclusion for individuals that experience employment barriers, the purpose of the program shall be to provide financial assistance and technical assistance to employment social enterprises.

(b) (1) The office shall administer the program to support employment social enterprises in the state through grants disbursed by one or more fiscal agents through June 30, 2024.

(2) The office shall designate at least one fiscal agent to administer the program in accordance with Sections 11788.2 and 11788.3.

(3) In implementing the program, the office or fiscal agents shall consult with local, regional, federal, and other state public and private entities that share a similar mission to support the needs of employment social enterprises in the state.

11788.1.5.

(a) (1) A fiscal agent shall award one-time grants to employment social enterprises through a competitive grant process developed by the office or the fiscal agents.

(2) Grants awarded pursuant to this subdivision shall be of sufficient size and scope to enable the employment social enterprise to build their capacity to generate revenue and provide jobs, training, and support to employees, develop data and learning systems, or replicate or expand within their community or to other California communities. However, each grant shall not exceed five hundred thousand dollars ($500,000).

(3) Employment social enterprises that satisfy the following shall be given preference in the competitive grant process:

(A) Are located in regions of the state with characteristics like those of the Inland Empire and the Central Valley.

(B) Are led by people with lived experience, including, but not limited to, having been incarcerated, homeless, or engaged in substance misuse.

(b) (1) Each grant shall be accompanied by technical assistance provided by a fiscal agent. The value of technical assistance provided to each grantee shall be up to 30 percent of the grant amount awarded to the grantee. The technical assistance provided shall be in addition to the grant amount awarded in subdivision (a).

(2) Technical assistance shall be provided for the duration of the grant period for purposes of growing employment social enterprises and underserved small business groups that are facing capital and opportunity gaps. The technical assistance offered by a fiscal agent to an employment social enterprise shall consist of evaluating the readiness of an employment social enterprise for sustainable growth across five areas: business model, program model, fundraising, operations, and human capital.

(c) The fiscal agent is authorized to use only up to 10 percent of moneys received under this chapter for costs incurred for program administration.

11788.2.

A fiscal agent shall be eligible to be designated by the office if the office determines that the fiscal agent meets all of the following criteria:

(a) The fiscal agent is able to connect state and local agencies, including, but not limited to, agencies in the workforce, social and health services, homelessness, and justice systems to better serve high-barrier populations and ensure greater system collaboration.

(b) The fiscal agent provides information describing the transparent, competitive process by which it will select employment social enterprises to receive the one-time grants. The process shall require employment social enterprises to have a demonstrated track record of achieving specific outcomes related to economic inclusion, stability, and mobility that meets the following criteria:

(1) A clear and strong business model that demonstrates revenue growth and potential for further growth and scale.

(2) A comprehensive and data-driven program model that supports a quality employment social enterprise job that prioritizes long-term outcomes for its employees and demonstrates strong results.

(3) Strong leadership that presents a vision for the employment social enterprise that encompasses realistic growth, expansion, and deepening impact and demonstrates commitment to racial equality in the employment social enterprise.

(4) It is in a stable financial position, and possesses the capacity to work with a small business technical assistance center and to implement recommendations that are offered by a small business technical assistance center.

11788.3.

The office shall evaluate eligible fiscal agents, as described in Section 11788.2, based upon the following factors:

(a) The proposed use of the requested funding, including the specificity, measurability, and ability of the fiscal agent to document and achieve the goals and objectives identified in its application.

(b) The proposed management strategy of the fiscal agent to achieve the goals and objectives identified in its application.

(c) The fiscal agent’s ability to complement and leverage the work of other local, state, federal, and nonprofit or private business technical assistance resource providers.

(d) The fiscal agent’s historical performance with private funding sources and the strength of its fiscal controls.

11788.4.

(a) Upon approval of a grant award pursuant to this article, the office shall issue a notice to the fiscal agent that includes all of the following:

(1) The amount of the award.

(2) A requirement that the fiscal agent periodically provide a performance report that includes all of the following information:

(A) The number of employment social enterprises consulted and trained.

(B) The amount of funds awarded to employment social enterprises.

(C) The size of employment social enterprises assisted based upon the number of employees at the time that those businesses were assisted, as reported by those assisted businesses, categorized based upon the size of the assisted business, as determined by the office.

(D) The city and county in which any assisted employment social enterprises are located.

(E) A narrative description of the system collaboration with state and local government agencies that the small business technical assistance center has developed to better serve people breaking through barriers to employment.

(F) Industry sectors of the employment social enterprises assisted, as reported by those businesses.

(G) A narrative description of how the funds awarded were used to expand services to employment social enterprises and to help employment social enterprises to expand, facilitate investment, and create jobs in California, including in rural communities, low-income communities, and disaster-impacted areas included in a state or federal emergency declaration or proclamation.

(H) The demographics of employment social enterprise leaders supported, including their race.

(I) The number of jobs created.

(J) The number of individuals employed and the demographics of social enterprise employees, including race and gender.

(3) A requirement that the fiscal agents periodically provide a financial report that includes all of the following information:

(A) The name of any business consultant employed.

(B) The hourly rates of any business consultant employed.

(D) The cost of administration and marketing.

(E) The duration of the assistance provided by the fiscal agents.

(F) The start date of the assistance provided by the fiscal agents.

(b) Each fiscal agent shall accept the performance and financial reporting requirements in this section as a condition of being designated as a fiscal agent.

(c) No more than 60 days following the completion of an agreement term pursuant to this chapter, a fiscal agent shall provide a final written performance and financial report to the office consistent with the requirements of this section.

SEC. 5.

Section 12096.6.1 of the Government Code is amended to read:

12096.6.1.

(a) Upon appropriation by the Legislature, GO-Biz shall establish the California Competes Grant Program pursuant to this article.

(b) Upon appropriation by the Legislature, GO-Biz is authorized to provide grants pursuant to this article. GO-Biz shall provide grants only to an applicant that meets at least one of the following criteria:

(1) The applicant will create at least 500 new, full-time jobs in this state, determined on the basis of an annual full-time equivalent, as defined in Section 8000 of Title 10 of the California Code of Regulations, as that section read on January 1, 2021.

(2) The applicant will make a significant infrastructure investment, defined as a project requiring construction or renovation expenditures of at least ten million dollars ($10,000,000) over no more than five years, in this state.

(3) The applicant will create jobs or make the investments in a high-poverty area or high-unemployment area, as those terms are defined in Section 8000 of Title 10 of the California Code of Regulations, as that section read on January 1, 2021, in this state.

(c) The committee shall approve or reject grants pursuant to subdivision (b) of Section 18410.2 of the Revenue and Taxation Code.

(d) (1) The amount of a grant shall be set forth in a written agreement between GO-Biz and the qualified grantee, and shall be based on the factors as described in subparagraphs (A) to (L), inclusive, of paragraph (2) of subdivision (a) of Sections 17059.2 and 23689 of the Revenue and Taxation Code, and considerations described in paragraph (2).

(2) When determining whether to enter into a written agreement with a qualified grantee pursuant to this section, GO-Biz shall consider the extent to which the grant will influence the qualified grantee’s ability, willingness, or both, to create jobs in this state that might not otherwise be created in the state by the qualified grantee or any other California business. GO-Biz may also consider other factors, including, but not limited to, all of the following:

(A) The financial solvency of the qualified grantee and the qualified grantee’s ability to finance its proposed expansion.

(B) The qualified grantee’s current and prior compliance with federal and state laws.

(D) The reasonableness of the fee arrangement between the qualified grantee and any third party providing any services related to the grant allowed pursuant to this section.

(E) Any other factors GO-Biz deems necessary to ensure that the administration of the California Competes Grant Program allowed pursuant to this article is a model of accountability and transparency and that the effective use of the limited amount of grant funds is maximized.

(F) For determinations made under this paragraph during the 2023–24 fiscal year, and each fiscal year thereafter, the grantee’s willingness to relocate jobs into California from a state that has enacted a law that does any of the following:

(i) Voids or repeals, or has the effect of voiding or repealing, existing state protections against discrimination on the basis of sexual orientation, gender identity, or gender expression.

(ii) Authorizes or requires discrimination against same-sex couples or their families, or discrimination on the basis of sexual orientation, gender identity, or gender expression.

(iii) Creates an exemption to antidiscrimination laws in order to permit discrimination against same-sex couples or their families, or permits discrimination on the basis of sexual orientation, gender identity, or gender expression.

(iv) Denies or interferes with, or 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.

(G) For determinations made under this paragraph during the 2023–24 fiscal year, and each fiscal year thereafter, the grantee’s commitment to treating their workforce fairly and creating quality, full-time, wage and salary jobs in the state. Evidence to demonstrate the grantee’s commitment may include, but not be, limited to, the following:

(i) Training, career ladder, apprenticeship, or pre-apprenticeship programs for nonsupervisorial employees.

(ii) Joint labor-management letter of support.

(iii) A high percentage of full-time wage and salary employees compared to part-time, temporary, and independent contractors.

(iv) Little to no history of a bad safety record, or resolved or pending litigation, violations, citations, fines, or penalties relating to any state or federal environmental and labor laws within the last 10 years.

(H) (i) No more than 30 percent of the aggregate amount of grants appropriated in any fiscal year shall be allocated to any one grantee.

(ii) For fiscal years beginning on or after the 2023–24 fiscal year, clause (i) shall not apply if the grant will be used as a state match for a business applying for or obtaining federal incentives to conduct semiconductor research and development or manufacturing.

(e) A qualified grantee shall receive a grant pursuant to this article only if the qualified grantee has not received a tax credit, pursuant to Sections 17059.2 or 23689 of the Revenue and Taxation Code, for the same jobs or investment on which the grant is sought.

(f) The written agreement described in subdivision (d) shall include both of the following:

(1) Provisions indicating whether the grant is to be allocated in full upon approval, or in increments based on mutually agreed-upon milestones, when satisfactorily met by the qualified grantee.

(2) Provisions that allow the committee to recapture the grant, in whole or in part, if the qualified grantee fails to fulfill the terms and conditions of the written agreement.

(g) (1) Implementation of subparagraphs (F) and (G) of paragraph (2) of subdivision (d) of this section for the 2022–23 fiscal year is deemed an emergency and necessary for the immediate preservation of the public peace, health, and safety, or general welfare and, therefore, the Governor’s Office of Business and Economic Development is hereby authorized to adopt emergency regulations to implement subparagraphs (F) and (G) of paragraph (2) of subdivision (d) of this section during the 2022–23 fiscal year in accordance with the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(2) Nothing in this subdivision shall be construed to require the Governor’s Office of Business and Economic Development to approve emergency regulations adopted pursuant to this subdivision.

SEC. 6.

Section 12099.1 of the Government Code is amended to read:

12099.1.

(a) The Accelerate California: Inclusive Innovation Hub Program is hereby created within the office, within the California Office of the Small Business Advocate.

(b) The office shall designate Accelerate California: Inclusive Innovation Hub within the state to accelerate the startup and growth of technology and science-based firms in key industry areas with a focus on diverse founders, including women and people of color, and on underserved geographies and regions. Accelerate California shall offer diverse entrepreneurs the opportunity to develop and grow their innovative ideas by bridging the connection to local networks and communities and increasing access to critical advising and training services.

(c) The office shall oversee, coordinate, and provide assistance to each Accelerate California: Inclusive Innovation Hub.

SEC. 7.

Section 12099.2 of the Government Code is amended to read:

12099.2.

For purposes of this article, the following terms shall be defined as follows:

(a) “Accelerate California: Inclusive Innovation Hub” is a network of interrelated firms, local governments, economic development organizations, educational entities, and industry professionals that collectively drive economic growth within a defined geographic area and for defined underserved business owners and underserved markets that are selected by the office and is responsible for all of the following:

(1) Carrying out the state’s objectives of the Accelerate California: Inclusive Innovation Hub Program.

(2) Serving as the primary agent responsible for coordinating services and resources and maintaining the Accelerate California: Inclusive Innovation Hub agreement with the office.

(3) Serving as the primary liaison to the state and the office.

(b) “Accelerate California Entrepreneurship Fund” means the program administered by the office to award acceleration grants to entrepreneurs and small businesses participating in the Accelerate California: Inclusive Innovation Hubs.

(c) “Applicant” means one or more entities that submit an application to the office. Eligible applicants shall be one or more of the following:

(1) A fully accredited institution of higher education.

(2) A private nonprofit corporation engaged in economic development activities.

(3) A county or municipality in this state that has a preexisting economic development department or program or both.

(4) A public economic development institution such as a workforce investment board or an economic development corporation.

(5) A Community Economic Resilience Fund regional stakeholder.

(d) “Community Economic Resilience Fund Region” means a region established pursuant to Section 14531 of the Unemployment Insurance Code.

(e) “GO-Biz” means the Governor’s Office of Business and Economic Development.

(f) “Office” means the California Office of the Small Business Advocate within GO-Biz.

(g) “Underserved” means, with respect to geographic areas and business owners, currently or have historically experienced relatively limited access to resources, such as early-state investment capital, technical assistance, mentorship, financial services, community engagement, and investment.

(1) Underserved geographic areas shall include low-wealth or rural regions, or regions designated or otherwise termed as disadvantaged by a federal entity.

(2) Underserved business owners shall include entrepreneurs and the owners of startup businesses that are women, minority, formerly incarcerated, disabled, or veterans. For purposes of this paragraph, “startup” means a company in the first stages of operations, such as prerevenue and proof of concept. “Startups” may be founded by one or more entrepreneurs who want to develop a product or service for which they believe there is demand. “Startups” generally start with high costs and limited revenue and typically look for capital from a variety of sources, such as angel or venture capitalists.

SEC. 8.

Section 12099.3 of the Government Code is amended to read:

12099.3.

(a) The office shall issue a request for proposals for the Accelerate California: Inclusive Innovation Hub Program.

(b) An applicant’s proposal shall include, but shall not be limited to, all of the following information:

(1) A statement of purpose.

(2) A signed statement of cooperation and a description of the roles and relationships of each entity involved in the Accelerate California: Inclusive Innovation Hub.

(3) A designated Accelerate California: Inclusive Innovation Hub director who will be responsible for statewide program oversight and coordination of statewide activities, convening of statewide partners, and engagement of regional Accelerate California: Inclusive Innovation Hub designees.

(4) Identification of one Accelerate California: Inclusive Innovation Hub per Community Economic Resilience Fund region, where applicable.

(5) A clearly stated regional Accelerate California Hub designee to coordinate Accelerate California: Inclusive Innovation Hub activities within its respective service area.

(6) A clearly identified location with an explanation as to how the location is central to the potential client base.

(7) Clearly identified benchmarks or milestones with approximate dates as to when they will be achieved.

(8) A complete budget including a description of secured funds with proof, pending funds, and potential future funding sources.

(9) A list and brief description of local and regional incentives and support programming that aligns with the objectives of the Accelerate California: Inclusive Innovation Hub program and the applicant’s proposal and focus area.

(10) A clearly articulated commercial market focus and plan.

(11) A clearly articulated Accelerate California: Inclusive Innovation Hub management structure and plan that may include a description of the capabilities, qualifications, and experience of the proposed management team, team leaders, or key personnel who are critical to achieving the proposed objectives.

(12) A list of Accelerate California: Inclusive Innovation Hub assets and resources.

(13) A clearly articulated focus area of the Accelerate California: Inclusive Innovation Hub including underserved geographic areas, industry sectors, and business owners, or other targeted areas for development and growth that will be served by grant funds.

(14) A list of specific resources available to support and guide startup companies in Accelerate California: Inclusive Innovation Hub industry sectors.

(15) A clearly articulated list of goals to be achieved with the certification of the Accelerate California: Inclusive Innovation Hub.

(16) Expectations for job development and business creation, growth, and expansion.

(17) Defined performance standards agreed upon by the partners involved in the development of the application for an Accelerate California: Inclusive Innovation Hub. This shall include how the hub will identify and support the selected underserved geographic areas and underserved business owners.

(18) Evaluation procedures that will be used to measure the level of achievement for each stated goal.

(19) A plan for sustainability that includes an extension of the program beyond the initial four years.

(20) Organizational experience including capabilities, related experience, facilities, techniques, unusual resources, or unique combinations of these that are integral factors for achieving the proposed objectives.

(21) Demonstrated experience in developing innovation programming, such as technology transfer and commercialization programs in partnership with industry, university, or federal partners.

(22) Demonstrated experience with intellectual property management and licensing.

(23) Evidence of community engagement and established partnerships in the proposed region.

(24) A clearly articulated plan to outreach to the designated underserved geographic regions and underserved business owners.

(25) A list of small business technical assistance grantees, as described in Article 7 (commencing with Section 12100.60) who serve the designated regions.

(26) A detailed program design and implementation plan describing how the hub will develop and implement the program, including specifics on attracting entrepreneurs and small business to the program, any application and selection processes, and program components.

(c) The office may waive any of the requirements listed in subdivision (b) for purposes of waiving requirements that disadvantage a rural community that applies and does not have all of the required components.

(d) The office may designate an Accelerate California: Inclusive Innovation Hub for a term of not more than four years. An Accelerate California: Inclusive Innovation Hub may reapply for a designation without limitation on the number of times.

(e) (1) The Accelerate California: Inclusive Innovation Hub designation shall not be official until a grant agreement is entered into by the applicant and the office. The grant agreement shall include the goals and performance standards identified in the application and other related requirements as determined by the office.

(2) For an iHub previously designated by GO-Biz or an iHub2 previously designated by the office to be designated as an Accelerate California: Inclusive Innovation Hub by the office, the designation is required to be newly awarded under the Accelerate California: Inclusive Innovation Hub Program.

(f) One Accelerate California: Inclusive Innovation Hub may be awarded per applicable Community Economic Resilience Fund region.

(g) The office shall set guidelines for approval, designation, operation, reporting, redesignation, and dedesignation of Accelerate California: Inclusive Innovation Hubs. The guidelines shall include all of the following:

(1) A protest and appeal process relative to the designation of a hub.

(2) A dispute resolution process

(3) All relevant information for applying for a grant.

(h) (1) An Accelerate California: Inclusive Innovation Hub shall quarterly and annually report to the office on its progress in meeting the goals and performance standards as described in the Accelerate California: Inclusive Innovation Hub application and implementing grant agreement with the office.

(2) The office shall annually prepare a report that summarizes the information collected from paragraph (1). This reporting requirement may be met by providing the same information in the annual report of the office. This report shall include for each Accelerate California: Inclusive Innovation Hub the following information:

(A) A description of the service area or areas as articulated in the application and implementing grant agreement, including how its services were made and equitably available to underserved geographic areas and underserved business owners.

(B) The goals and performance standards identified in the application and implementing grant agreement.

(C) Descriptive information about the educational, research, governmental, business, nonprofit, philanthropic, financial, or investor entities involved in the Accelerate California: Inclusive Innovation Hub.

(D) A financial statement showing total revenues, including the sources of revenue, expenditures, and assets. The financial statements should be presented in a consistent manner across the Accelerate California: Inclusive Innovation Hubs.

(E) The number of participating entrepreneurs and startup businesses and the change in the number and composition of participating startup businesses.

(F) Descriptive information about the participating startup businesses that may include, but are not limited to, geographic location, industry sectors, business legal structure, owners’ demographics, financing acquired, equity capital raised during the year, revenues, profits, and number of employees.

(G) A description of the progress in meeting the goals and performance standards identified in the application and implementing grant agreement.

(H) A description of the services provided by the office throughout the year to support the Accelerate California: Inclusive Innovation Hubs.

(3) The office shall post the report described in paragraph (2) on its internet website and provide notice to the Governor, the relevant policy committees of the Legislature, and the Legislative Analyst’s Office that the information is available on the internet website.

(i) The office shall evaluate, on or before January 1, 2026, the effectiveness of the Accelerate California: Inclusive Innovation Hub program to submit a written report to the Director of Finance, the relevant policy committees of the Legislature, and the Joint Legislative Budget Committee. This report shall do all of the following:

(1) Evaluate the extent to which each Accelerate California: Inclusive Innovation Hub achieved the goals and performance standards identified in their applications and implementing grant agreements.

(2) Evaluate the level of accessibility and availability of services to underserved geographic areas, industry sectors, and underserved business owners.

(3) Evaluate the sustainability of each Accelerate California: Inclusive Innovation Hub.

(4) Identify specific actions that could be taken to improve program outcomes in future years.

SEC. 9.

Section 12099.4 of the Government Code is amended to read:

12099.4.

A designated Accelerate California: Inclusive Innovation Hub shall include at least one major university or research center or institute, one economic development organization, and consist of at least four of the following, in any combination:

(a) A business support organization including a workforce development or training organization, incubator or business accelerator, business technical assistance providers, chamber of commerce, and networking organization that supports innovation.

(b) An angel or venture capital network.

(c) A business foundation, innovation foundation, science foundation, laboratory research institution, federal laboratory, university laboratory, or research and development facility.

(d) A municipal economic development division or department.

(e) A federal government partner such as a national laboratory.

SEC. 10.

Section 12099.5 of the Government Code is amended to read:

12099.5.

Before an official designation as an Accelerate California: Inclusive Innovation Hub the applicant shall self-certify both of the following:

(a) That the Accelerate California: Inclusive Innovation Hub will comply with the state’s nondiscrimination policy.

(b) That the Accelerate California: Inclusive Innovation Hub and its principals are current in payment of all state and local taxes owed unless they have entered into an agreement that was deemed satisfactory by the respective taxing authority and are in full compliance with the agreement.

SEC. 11.

Section 12099.6 of the Government Code is amended to read:

12099.6.

(a) An Accelerate California: Inclusive Innovation Hub may do all of, but shall not be limited to, the following:

(1) Provide free or low-cost advisory services and technical assistance to entrepreneurs and startups. An Accelerate California: Inclusive Innovation Hub shall make every effort to ensure services are accessible and equally available to underserved geographic areas and underserved business owners.

(2) Facilitate community programming and engagement with local partners, including, but not limited to, state universities and research institutes, state community colleges, local governments, state and federal service providers, private industry, workforce investment boards and agencies, small business and microenterprise development organizations, economic development organizations, and chambers of commerce.

(3) Facilitate partnerships between innovative startup businesses, research institutions, and venture capitalists or financial institutions.

(b) The Accelerate California: Inclusive Innovation Hub shall, to the extent feasible, work in close collaboration with the activities of the office as its primary statewide partner.

SEC. 12.

Section 12099.7 of the Government Code is amended to read:

12099.7.

The Inclusive Innovation Accelerator Account is hereby created within the California Economic Development Fund in the State Treasury. Subject to the approval of the Department of Finance, all moneys collected and received by the office or the Governor’s Office of Business and Economic Development on the office’s behalf for California Inclusive Innovation Initiatives from gifts, bequests, or donations shall be deposited in the Inclusive Innovation Accelerator Account. Notwithstanding Section 13340, the moneys in the account are continuously appropriated to the office to be used for Accelerate California: Inclusive Innovation Initiatives pursuant to the terms of the gift, bequest, or donation.

SEC. 13.

Section 12099.7.5 is added to the Government Code, to read:

12099.7.5.

(a) Upon appropriation by the Legislature, the office shall administer the Accelerate California Entrepreneurship Fund to provide acceleration grants to small businesses and entrepreneurs that participate in the Accelerate California: Inclusive Innovation Hubs. The purpose of the acceleration grants is to spur high-growth industries and startups and build a pipeline of scalable firms and well-paid jobs, and increase access to private investment for diverse founders as well as those in geographically isolated and underserved regions. The office shall develop guidance for priority areas of funding and process for the funding and selection of grantees. Funding disbursements shall begin in the second year of the program after a hub has achieved satisfactory reporting for the first year of performance.

(b) (1) To receive an acceleration grant, small businesses and entrepreneurs shall satisfy all of the following:

(A) Be located in the geographic region of the Accelerate California: Inclusive Innovation Hub.

(B) Have an existing relationship with the Accelerate California: Inclusive Innovation Hub and have been incubated or accelerated at the hub.

(C) Complete a grant application with a letter of support included in the application from its regional Accelerate California: Innovation Hub and provide the Accelerate California: Inclusive Innovation Hub with a description of its innovation model and provide an equity and sustainability statement.

(D) Have not received a previous grant from the Accelerate California Entrepreneurship Fund.

(2) Applications shall be evaluated based on breadth and quality of service and demonstrated ability to reach target populations.

(c) Applications from underserved business groups, including women, minority, and veteran-owned businesses, and businesses in low-wealth, rural, or disaster-impacted communities included in a state or federal emergency declaration or proclamation, shall be given preference if the applicants are eligible and have met program requirements to receive a grant.

SEC. 14.

Section 12100.60 of the Government Code is amended to read:

12100.60.

This article shall be known and may be cited as the California Small Business Development Technical Assistance Act of 2022.

SEC. 15.

Section 12100.62 of the Government Code is amended to read:

12100.62.

Unless the context otherwise requires, the following definitions in this section shall govern the construction of this article:

(a) “California Office of the Small Business Advocate,” “CalOSBA,” or “office,” means the office created pursuant to Section 12098.

(b) “California Small Business Development Center Program” is comprised of the five regional networks of small business development centers operating in the state pursuant to a cooperative agreement between the fiscal agent and the federal Small Business Administration.

(c) “Committed nonstate local cash match” means funding awarded by a nonstate local source to a small business technical assistance center through a letter of intent, notice of award, or cash deposit.

(d) “Director” means the individual designated as “director” pursuant to Section 12098.1.

(e) “Federal small business technical assistance center” means an organization that contracts with a federal funding partner to operate a small business development center, a women’s business center, a veterans business outreach center, a manufacturing extension partnership center, a minority business development center, a procurement technical assistance center, or a federally funded similar program within this state to support small businesses.

(f) “Federal funding partner” means the federal Small Business Administration, federal Department of Commerce, federal Department of Defense, or any other federal agency with the authority to administer a small business technical assistance program in this state.

(g) “Fiscal agent” means the entity with which a funding partner contracts to administer small business technical assistance programs within a state or district. The fiscal agent shall be directly accountable to the funding partner for all aspects of the specified small business technical assistance program, including staffing, programming, outreach, securing any required matching funds to draw down federal funds or private funding sources, and reporting performance outcomes to operate the program in the fiscal agent’s area of responsibility.

(h) “GO-Biz”” means the Governor’s Office of Business and Economic Development.

(i) “Local cash match” means nonfederal funds that are spent on eligible program costs.

(j) “Manufacturing extension partnership center” means a California contractor recognized by the federal National Institute of Standards and Technology pursuant to the Omnibus Trade and Competitiveness Act of 1988 (Public Law 100-418), at which small manufacturers can obtain information and assistance on new technology acceleration, supply chain management, lean processing, export development, sustainable manufacturing practices, and other issues related to innovation.

(k) “Minority business development agency center” means an entity or physical location, recognized by the federal Department of Commerce, from which a minority-owned small business may receive consulting and technical services to expand to new markets, both foreign and domestic.

(l) “Minority business development agency export center” means an entity or physical location, recognized by the federal Department of Commerce, from which a minority-owned small business may receive consulting and technical services to increase access to capital, contracts, and foreign markets.

(m) “Private funding source” means any entity that makes grants, and includes corporate or private philanthropy or similarly established nongovernmental entities.

(n) “Procurement act” means Chapter 142 (commencing with Section 2411) of Part IV of Subtitle A of Title 10 of the United States Code, which governs the Procurement Technical Assistance Cooperative Agreement program, administered by the federal Department of Defense.

(o) “Procurement technical assistance center” means an entity or physical location, recognized by the federal Department of Defense, from which a small business owner may receive free training on a variety of topics, including starting, operating, and expanding a small business.

(p) “Program” means the California Small Business Development Technical Assistance Program created pursuant to Section 12100.63 and administered in accordance with this article.

(q) “Small business act” means the Small Business Development Center Act of 1980 (Public Law 96-302), and any amendments to that act, which authorizes the Small Business Development Center Program, administered by the federal Small Business Administration.

(r) “Small business development center” means to an entity or physical location, recognized by the federal Small Business Administration, from which a small business owner or an aspiring entrepreneur may receive free one-on-one consulting and low at-cost training on a variety of topics, including starting, operating, and expanding a small business.

(s) “Small business technical assistance center” includes a federal small business technical assistance center or any established nonprofit community-based organization, exempt from federal income taxation pursuant to Section 501(c)(3) of the Internal Revenue Code, the mission of which includes economic empowerment of underserved microbusinesses or small businesses and entrepreneurs and that operates entrepreneurial or small business development programs which provide free or low-cost services to California’s underserved businesses and entrepreneurs to enable their launch and sustained growth.

(t) “Small Business Advocate” is the individual designated pursuant to Section 12098.1.

(u) “Veteran’s business act” means Section 657b of Title 15 of the United States Code, which establishes the Office of Veterans Business Development and governs veteran business outreach centers, administered by the federal Small Business Administration.

(v) “Veterans business center” means an entity or physical location, recognized by the federal Small Business Administration, from which a small business veteran owner or an aspiring veteran entrepreneur can receive free one-on-one consulting and low at-cost training on a variety of topics including starting, operating, and expanding a small business.

(w) “Women’s business act” means the Women’s Business Ownership Act of 1988 (Public Law 100-533), and any amendments to that act, administered by the federal Small Business Administration.

(x) “Women’s business center” means an entity or physical location, recognized by the federal Small Business Administration, from which a small business owner or an aspiring entrepreneur can receive free one-on-one consulting and low at-cost training on a variety of topics including starting, operating, and expanding a small business.

SEC. 16.

Section 12100.63 of the Government Code is amended to read:

12100.63.

(a) The California Small Business Technical Assistance Program is hereby created within the California Office of the Small Business Advocate.

(b) The program shall be under the direct authority of the Small Business Advocate.

(c) The purpose of the program is to assist small businesses through free or low-cost one-on-one consulting and low-cost training by entering into grant agreements with one or more small business technical assistance centers.

(d) In implementing the program, the office shall consult with local, regional, federal, and other state public and private entities that share a similar mission to support the needs of small businesses in California.

(e) An applicant pursuant to this article shall be a small business technical assistance center, including a regional or statewide network, operating as a group or as an individual center.

(1) A small business technical assistance center operating as a group consisting of centers organized under a coordinating administrative or fiscal entity shall apply by submitting a single consolidated application to the office.

(2) A small business technical assistance center operating as an individual center shall apply by submitting a single application for that center to the office.

(f) The office shall administer the program to provide grants to expand the capacity of small business development technical assistance centers in California, administered by and primarily funded by federal agencies, but shall also include other nonprofit small business technical assistance centers, that provide one-on-one confidential consulting and training to small businesses and entrepreneurs in this state. An applicant shall be eligible to participate in the program if the office determines that the applicant meets all of the following criteria:

(1) At the time of applying for funds, the applicant has an active contract with a federal funding partner to administer a program in this state, or has received a letter of intent from a federal funding partner to administer a federal small business technical assistance center program in this state within the next fiscal year. Alternatively, if the applicant is not a federally contracted small business technical assistance center, the applicant shall document a private funding source with similar intent and meet the criteria defined in subdivision (s) of Section 12100.62.

(2) (A) The applicant provided a plan of action and commitment to fully draw down all of the federal funds available using local cash match and state funds not described in Section 12100.65 during the duration of the award period. Alternatively, if the applicant is not a federally contracted small business technical assistance center, the applicant shall present a plan of action for drawing down any match required by those private funding sources using local cash match outside of state funds not described in Section 12100.65 during the award period. The office may request that the applicant provide details relating to the source and amount of these nonstate local match funds.

(B) If the applicant is a new small business technical assistance center, the applicant has demonstrated the ability to fully draw down substantially all federal or private funds available to it.

(3) The requested funding amount does not exceed the total federal award specified in the contract with the federal funding partner contract, or the private funding sources specified, but in any event is no less than twenty five thousand dollars ($25,000).

(4) The applicant seeks funding for one or more years, but no more than five years in duration.

(5) The grant agreements authorized by this article are not subject to the model contract provisions developed pursuant to Chapter 14.27 (commencing with Section 67325) of Part 40 of Division 5 of Title 3 of the Education Code.

(6) The applicant has a fiscal agent that is able to receive nonfederal funds.

(g) The office shall issue a request for proposal for grants under the program, which may contain the following information:

(1) The eligibility requirements described in subdivision (e).

(2) The available funding range.

(3) Funding instruments.

(4) The local cash match requirement described in subdivision (f).

(5) Operational capacity.

(6) The duration of the program.

(7) The start date of the program.

(8) Narrative requirements.

(9) Reporting requirements.

(10) Required attachments.

(11) Submission requirements.

(12) Application evaluation criteria.

(13) An announcement of an awards timeline.

(h) (1) The office shall evaluate applications received based on the following factors:

(A) The proposed use of the requested funding, including the specificity, measurability, and ability of the applicant to document and achieve the goals and objectives identified in its application.

(B) The proposed management strategy of the applicant to achieve its goals and objectives identified in its application.

(C) The applicant’s ability to complement and leverage the work of other local, state, federal, nonprofit, or private business technical assistance resource providers.

(D) The applicant’s historical performance with federal funding partner contracts or private funding sources and the strength of its fiscal controls.

(2) The office shall prioritize funding for applications that best meet the factors listed in paragraph (1) and give preference to applications that propose new or enhanced services to underserved business groups, including women, minority, and veteran-owned businesses, and businesses in low-wealth, rural, and disaster-impacted communities included in a state or federal emergency declaration or proclamation.

(i) State funds provided pursuant to the program shall be used to expand consulting and training services through existing and new centers, including satellite offices. State funds provided pursuant to the program shall not supplant nonstate local cash match dollars included in a federal small business technical assistance center’s plan described in subparagraph (A) of paragraph (2) of subdivision (f) or in any nonfederal small business technical assistance center’s plan.

(j) Subject to appropriation of necessary funds by the Legislature, a supplemental grant program designated as the California Dream Fund Program shall be established by the office to provide microgrants as described in this subdivision. The microgrants shall be disbursed through California Small Business Technical Assistance Program grantees. California Small Business Technical Assistance Program applicants, as prescribed by the office, may also request state funds designated as the California Dream Fund Program moneys to provide microgrants up to ten thousand dollars ($10,000) to seed entrepreneurship and small business creation in underserved small business groups that are facing capital and opportunity gaps. These microgrants shall be made available to startup clients participating in intensive startup training and consulting with the center networks.

(k) For purposes of implementing the California Dream Fund Program, a person or entity shall not seek information that is unnecessary to determine eligibility, including whether the individual is undocumented. Information that may be collected from individuals participating in the California Dream Fund Program shall not constitute a record subject to disclosure under Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1.

SEC. 17.

Section 12100.69 of the Government Code is repealed.

SEC. 18.

Section 12100.82 of the Government Code is amended to read:

12100.82.

Unless the context requires otherwise, the following definitions in this section shall govern the construction of this article:

(a) “Applicant” means any California taxpayer, including, but not limited to, an individual, corporation, nonprofit organization, cooperative, or partnership, who submits an application for the program.

(b) “California Small Business COVID-19 Relief Grant Program” or “program” means the grant program established in Section 12100.83.

(c) “CalOSBA” or “office” means the California Office of the Small Business Advocate within the Governor’s Office of Business and Economic Development.

(d) “Director” means the Director of the Office of Small Business Advocate.

(e) “Fiscal agent” means a California-based Community Development Financial Institution (CDFI) capable of online and mobile application development, customer support, document validation, impact analysis, grant agreements, and awards disbursement, as well as marketing, engagement, and strategic partnerships with a network of CDFIs and nonprofits for implementation.

(f) “Fiscal sponsorship” means an existing nonprofit offering to provide its tax exemption and associated benefits to another group, such as a charitable project.

(g) (1) “Qualified small business” means a business or nonprofit that meets all of the following criteria, as confirmed by the office or fiscal agent through review of revenue declines, other relief funds received, credit history, tax returns, and bank account validation:

(A) Is one of the following:

(i) A sole proprietor, independent contractor, 1099 employee, C-corporation, S-corporation, cooperative, limited liability company, partnership, or limited partnership, with an annual gross revenue of less than five million dollars ($5,000,000), but greater than one thousand dollars ($1,000), in the 2019 taxable year.

(ii) A registered 501(c)(3), 501(c)(6), or 501(c)(19) nonprofit entity that had an annual gross revenue of less than five million dollars ($5,000,000), but greater than one thousand dollars ($1,000), in the 2019 taxable year.

(iii) A division or department of a larger organization or entity, such as a tribal government, city, county, or city and county.

(iv) An organization that is fiscally sponsored by a nonprofit corporation.

(B) Began operating in the state prior to June 1, 2019.

(D) Has been impacted by COVID-19 and the related health and safety restrictions, such as business interruptions or business closures incurred as a result of the COVID-19 pandemic.

(E) Provides organizing documents, such as a 2019 tax return or Form 990, an affidavit from the board or authorizing official from the governing authority, detailing the governance structure; or a copy of an official filing with the Secretary of State or with the local municipality, as applicable, including, but not limited to, Articles of Incorporation, Certificate of Organization, Fictitious Name of Registration, or Government-Issued Business License.

(F) Provides an acceptable form of government-issued photo identification, where applicable.

(2) Notwithstanding paragraph (1), “qualified small business” shall not include any of the following:

(A) Businesses without a physical presence in the state and not headquartered in the state.

(B) Businesses primarily engaged in political or lobbying activities, regardless of whether the entity is registered as a 501(c)(3), 501(c)(6), or 501(c)(19).

(D) Financial institutions or businesses primarily engaged in the business of lending, such as banks, finance companies, and factoring companies.

(E) Businesses engaged in any activity that is unlawful under federal, state, or local law.

(F) Businesses that restrict patronage for any reason other than capacity.

(G) Speculative businesses.

(H) Businesses with any owner of greater than 10 percent of the equity interest in it who meets one or more of the following criteria:

(i) The owner has, within the prior three years, been convicted of or had a civil judgment rendered against the owner, or has had commenced any form of parole or probation, including probation before judgment, for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a federal, state, or local public transaction or contract under a public transaction, violation of federal or state antitrust or procurement statutes or commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements, or receiving stolen property.

(ii) The owner is presently indicted for or otherwise criminally or civilly charged by a federal, state, or local government entity, with commission of any of the offenses enumerated in clause (i).

(I) Affiliated companies, as defined in Section 121.103 of Title 13 of the Code of Federal Regulations.

(J) Other businesses determined by the office, consistent with the limitations and exclusions set in Rounds 1 and 2 of the COVID-19 Relief Grant Program.

(h) “Rounds 1 and 2 of the COVID-19 Relief Grant Program” means the first two rounds of grant allocations awarded, prior to the enactment of this article, through the COVID-19 Relief Grant that is administered by CalOSBA and that is funded by Executive Order No. E 20/21-182.

SEC. 19.

Section 12100.83 of the Government Code is amended to read:

12100.83.

(a) The California Small Business COVID-19 Relief Grant Program is hereby created within CalOSBA.

(b) The program shall be under the direct authority of the director.

(c) The purpose of the program is to provide grants to qualified small businesses affected by COVID-19 in order to support their continued operation.

(d) The office or its fiscal agent shall consult with local, regional, state, and federal public and private entities, as applicable, that share a similar mission to support the needs of small businesses and nonprofits in California.

(e) The office may contract with a fiscal agent, or amend an existing contract with a fiscal agent to meet the requirements of this article, to carry out the programs, at a rate of no more than 5 percent of administrative and programs funds appropriated by the Legislature for the purposes of this article.

(f) The office shall allocate grants to qualified small businesses that meet the requirements of this article.

(g) (1) The office shall conduct marketing and outreach for equitable awareness and the distribution of grants that includes all of the following:

(A) Engaging multiple partners, including, but not limited to, business and nonprofit associations, chambers of commerce, economic development corporations, and other nonprofit mission-based organizations, and organizations with nonprofit expertise.

(B) Providing access to technical assistance services covering all counties in the state and in multiple languages to reach non-English-speaking individuals in all counties in the state.

(C) Building awareness throughout the state, including in underserved and underbanked communities, by collaborating with multiple community groups to distribute program information, applicant access through multiple branded partner portals, and advertising and social media outreach through owned, paid, and earned media channels.

(2) For the qualified small business program, outreach in advance of open application rounds shall be conducted for a minimum of three weeks prior to opening each application round. Following each round, the fiscal agent shall assess service gaps and address outreach deficiencies as necessary to improve program equity.

(3) The fiscal agent shall provide information on how to connect to additional support resources to each applicant whether or not the applicant is selected as a grant recipient.

(h) Grants shall be prioritized, to the extent permissible under state and federal equal protection laws, in accordance with the following criteria:

(1) Geographic distribution based on COVID-19 health and safety restrictions following California’s Blueprint for a Safer Economy and county status and the Regional Stay Home Order.

(2) Industry sectors most impacted by the pandemic, including, but not limited to, those identified as in the North American Industry Classification System codes beginning with:

(A) 61 – Educational Services.

(B) 71 – Arts, Entertainment, and Recreation.

(D) 315 – Apparel Manufacturing.

(E) 448 – Clothing and Clothing Accessory Stores.

(F) 451 – Sporting Goods, Hobby, Musical Instrument, and Book Stores.

(G) 485 – Transit and Ground Passenger Transportation.

(H) 487 – Scenic and Sightseeing Transportation.

(I) 512 – Motion Picture and Sound Recording Industries.

(J) 812 – Personal and Laundry Services.

(K) 5111 – Newspaper, Periodical, Book, and Directory Publishers.

(3) Nonprofit mission services most impacted by the pandemic, including, but not limited to, emergency food provisions, emergency housing stability, childcare, and workforce development.

(4) Underserved small business groups that have faced historic barriers to access to capital and networks, and are defined as businesses majority owned and operated on a daily basis by women, minorities or persons of color, and veterans, or businesses in rural and low-wealth communities.

(5) Disadvantaged communities tracked by socioeconomic indicators that may include, but are not limited to, low to moderate income, poverty rates, unemployment, educational attainment, and other disadvantaging factors that limit access to capital and other resources.

(i) (1) Grants to qualified small businesses shall be awarded in a minimum of three rounds, which includes a closed round, in the following amounts:

(A) Five thousand dollars ($5,000) for applicants with an annual gross revenue of one thousand dollars ($1,000) to one hundred thousand dollars ($100,000) in the 2019 taxable year.

(B) Fifteen thousand dollars ($15,000) for applicants with an annual gross revenue greater than one hundred thousand dollars ($100,000), and up to one million dollars ($1,000,000), in the 2019 taxable year.

(C) Twenty five thousand dollars ($25,000) for applicants with an annual gross revenue greater than one million dollars ($1,000,000), and up to five million dollars ($5,000,000), in the 2019 taxable year.

(2) The office, or its fiscal agent, may conduct, pursuant to the existing eligibility, criteria, or other requirements from Rounds 1 and 2 of the COVID-19 Relief Grant Program, a closed round for existing applicants from those two rounds in order to award up to 25 percent of any newly allocated funds while initial outreach for future open rounds is conducted.

(3) Rounds 1 and 2 of the COVID-19 Relief Grant Program shall not be considered a round for purposes of meeting the minimum round requirements described in paragraph (1).

(j) (1) All remaining funds from the original allocation of fifty million dollars ($50,000,000) of program funds for eligible nonprofit cultural institutions, including those associated with educational institutions, shall be allocated in one or more rounds to eligible nonprofit cultural institutions.

(2) Required verifying documentation: Form 990 verification, signed affidavit from governing body, or fiscal sponsor agreement to validate entities.

(3) For purposes of this subdivision, “eligible nonprofit cultural institution” means a nonprofit entity that is organized primarily for the purpose of producing, promoting, or presenting the arts, history, heritage, or humanities to the public; or, organized for identifying, documenting, interpreting, and preserving cultural resources and that satisfies the criteria for a qualified small business applicant pursuant to subdivision (g) of Section 12100.82.

(4) (A) The office shall not regrant funding to repeat eligible nonprofit cultural institution awardees unless the program is under subscribed and all entities seeking a first-time grant have been awarded.

(B) Pursuant to subparagraph (A), the office shall:

(D) 711130 - Musical Groups and Artists.

(E) 711190 - Other Performing Arts Companies.

(F) 711310 - Promoters of Performing Arts, Sports, and Similar Events with Facilities.

(G) 711320 - Promoters of Performing Arts, Sports, and Similar Events without Facilities.

(H) 711410 - Agents and Managers for Artists, Athletes, Entertainers, and Other Public Figures.

(I) 711510 - Independent Artists, Writers, and Performers.

(J) 712110 - Museums.

(K) 712120 - Historical Sites.

(L) 712130 - Zoos and Botanical Gardens.

(M) 712190 - Nature Parks & Other Similar Institutions.</p>

(i) Prioritize grants to repeat eligible nonprofit cultural institution awardees based on documented percentage revenue declines that are based on a reporting period comparing 2020 versus 2019.

(ii) Prioritize organizations with the largest operating losses relative to their budget and past performance.

(5) Eligible nonprofit cultural institutions include theater companies, dance companies, musical groups, symphony and opera companies, performing arts companies, arts & education organizations, art and history museums, historical sites, historical societies, zoos, aquariums, science centers, children’s museums, botanical gardens, nature parks, and cultural centers.

(6) The office shall give the first priority of grant awards to nonprofit cultural institutions that did not previously receive a grant from the California Small Business COVID-19 Relief Grant Program.

(7) Grants shall be awarded to an eligible nonprofit cultural institution under this subdivision even if the eligible nonprofit cultural institution has otherwise been awarded a grant under subdivision (i).

(8) Grants under this subdivision shall be awarded in the following amounts:

(A) Five thousand dollars ($5,000) for applicants with an annual gross revenue of one thousand dollars ($1,000) to one hundred thousand dollars ($100,000) in the 2019 taxable year.

(C) Twenty-five thousand dollars ($25,000) for applicants with an annual gross revenue greater than one million dollars ($1,000,000) in the 2019 taxable year.

(k) Grant moneys awarded under this section shall only be used for costs resulting from the COVID-19 pandemic and related health and safety restrictions, or business interruptions or closures incurred as a result of the COVID-19 pandemic, including the following:

(1) Employee expenses, including payroll costs, health care benefits, paid sick, medical, or family leave, and insurance premiums.

(2) Working capital and overhead, including rent, utilities, mortgage principal, and interest payments, but excluding mortgage prepayments, and debt obligations, including principal and interest, incurred before March 1, 2020.

(3) Costs associated with reopening business operations after being fully or partially closed due to state-mandated COVID-19 health and safety restrictions and business closures.

(4) Costs associated with complying with COVID-19 federal, state, or local guidelines for reopening with required safety protocols, including, but not limited to, equipment, plexiglass barriers, outdoor dining, PPE supplies, testing, and employee training expenses.

(5) Any other COVID-19-related expenses not already covered through grants, forgivable loans, or other relief through federal, state, or county or city programs.

(6) Any other COVID-19-related costs that are not human resource expenses for the state share of Medicaid, employee bonuses, severance pay, taxes, legal settlements, personal expenses, or other expenses unrelated to COVID-19 impacts, repairs from damages already covered by insurance, or reimbursement to donors for donated items or services.

(l) (1) Applicants may self-identify race, gender, and ethnicity. Within seven business days of the close of each application period, the office shall post the aggregate data, as available. Within 15 business days of the close of each application period, the office shall post data by legislative district, as available. Within 45 business days, the office shall post the actual awarded information, as available. All information shall be posted on the Governor’s Office of Business and Economic Development (GO-Biz) internet website and GO-Biz shall provide an electronic copy of the information to the relevant fiscal and policy committees of the Legislature.

(2) The office shall report to the Legislature the number of grants and dollar amounts awarded for each of the following categories:

(A) Race and ethnicity.

(B) Women-owned.

(D) Located in a disadvantaged community pursuant to paragraph (5) of subdivision (h).

(E) Located in a rural area.

(F) County.

(G) State Senate district.

(H) State Assembly district.

(I) Nonprofits, including by geography.

(J) Cultural institutions, including by geography.

(K) Nonprofit cultural institutions, including by geography.

(m) The fiscal agent shall issue Forms 1099 and otherwise adhere to tax reporting guidelines regardless of whether the grants are excluded from gross income for purposes of the Personal Income Tax Law (Part 10 (commencing with Section 17001)) or the Corporation Tax Law (Part 11 (commencing with Section 23001) of Division 2 of the Revenue and Taxation Code).

SEC. 20.

Section 12100.83.5 of the Government Code is amended to read:

12100.83.5.

(a) The California Venues Grant Program is hereby created within CalOSBA.

(b) The program shall be under the direct authority of the director.

(c) The purpose of the program is to provide grants to eligible independent live events that have been affected by COVID-19 in order to support their continued operation.

(d) The office may contract with a fiscal agent, or amend an existing contract with a fiscal agent to meet the requirements of this section, to carry out the program, at a rate of no more than 5 percent of administrative and programs funds appropriated by the Legislature for the purposes of this section.

(e) Subject to appropriation by the Legislature, the office shall allocate grants to eligible independent live events that meet the requirements of this section.

(f) (1) Subject to appropriation by the Legislature, one hundred fifty million dollars ($150,000,000) shall be allocated in one or more rounds to eligible independent live events.

(2) For purposes of this section, “eligible venue” means a venue with the following characteristics:

(A) A defined performance and audience space.

(B) Mixing equipment, a public address system, and a lighting rig.

(i) A sound engineer.

(ii) A booker.

(iii) A promoter.

(iv) A stage manager.

(v) Security personnel.

(vi) A box office manager.

(D) Is one of the three highest revenue grossing entities, locations, or franchises associated with the applicant.

(E) For a venue owned or operated by a nonprofit entity that produces free events, the events are produced and managed primarily by paid employees, not by volunteers.

(3) For purposes of this section, “eligible independent live event” means an entity that satisfies all of the following:

(A) Is a sole proprietor, C-corporation, S-corporation, cooperative, limited liability company, partnership, limited partnership, or a registered 501(c)(3) nonprofit entity that satisfies the criteria defined in subparagraphs (B) through (G) inclusive of paragraph (1) of subdivision (f) of Section 12100.82.

(B) Is in any of the following North American Industry Classification System (NAICS) codes, clauses (i) to (xiv), inclusive, or National Taxonomy of Exempt Entities (NTEE) codes, clauses (xv) to (xxxi), inclusive:

(i) 512131 - Motion Picture Theaters (except Drive-Ins).

(ii) (I) 512132 - Drive-In Motion Picture Theaters.

(II) An entity that qualifies under this clause shall be an authentic drive-in motion picture theater. For purposes of this clause, “authentic drive-in motion picture theater” means a permanently constructed commercial motion picture drive-in theater of which the main purpose of the property is the outdoor exhibition of motion pictures for patrons in vehicles using professional Digital Cinema Initiatives (DCI) compliant digital projectors or 35mm or 70mm film.

(iii) 7111 – Performing Arts Companies.

(iv) 711110 - Theater Companies and Dinner Theaters.

(v) 711120 – Dance Companies.

(vi) 711130 – Musical Groups and Artists.

(vii) 711211 – Sports Teams and Clubs.

(viii) 7113 - Promoters of Performing Arts, Sports, and Similar Events.

(ix) 711310 - Promoters of Performing Arts, Sports, and Similar Events with Facilities.

(x) 711320 - Promoters of Performing Arts, Sports, and Similar Events without Facilities.

(xi) 7139 – Other Amusement and Recreation Industries.

(xii) 713990 – All Other Amusement and Recreation.

(xiii) 722410 – Drinking Places (Alcoholic Beverages).

(xiv) 722511 – Full-Service Restaurants.

(xv) A20 – Arts, Cultural Organizations - Multipurpose.

(xvi) A23 – Cultural, Ethnic Awareness.

(xvii) A25 – Arts Education.

(xviii) A50 – Museums.

(xix) A54 – History Museums.

(xx) A56 – Natural History, Natural Science Museums.

(xxi) A60 – Performing Arts Organizations.

(xxii) A61 – Performing Arts Centers.

(xxiii) A62 – Dance.

(xxiv) A63 – Ballet.

(xxv) A65 – Theater.

(xxvi) A68 – Music.

(xxvii) A69 – Symphony Orchestras.

(xxviii) A6A – Opera.

(xxix) A6B – Singing, Choral.

(xxx) A6C – Music Groups, Bands, Ensembles.

(xxxi) A90 – Arts Service Organizations and Activities.

(i) An individual or entity that meets both of the following criteria:

(I) As a principal business activity, organizes, promotes, produces, manages, or hosts live concerts, comedy shows, theatrical productions, or other events by performing artists at an eligible venue where both of the following take place:

(ia) A cover charge through ticketing or front door entrance fee is applied.

(ib) Performers are paid.

(II) At least 70 percent of the earned revenue of the individual or entity is generated through cover charges or ticket sales, production fees or production reimbursements, or the sale of event beverages, food, or merchandise.

(ii) An individual or entity that, as a principal business activity, makes tickets to events available for purchase by the public an average of not less than 30 days before the date of the event, which shall meet both of the following:

(I) The requirements of subclause (I) of clause (i).

(II) Performers are paid in an amount that is based on a percentage of sales, a guarantee in writing or standard contract, or another mutually beneficial formal agreement.

(iii) An individual or entity that meets both of the following criteria:

(I) As a principal business activity, organizes, promotes, produces, manages, or hosts live sporting events at an eligible venue where both of the following take place:

(ia) A cover charge through ticketing or front door entrance fee is applied.

(ib) Performers are paid.

(III) The individual or entity is not a major league or professional sports team or club, and is not owned by a major league or professional sports team or club.

(4) Notwithstanding paragraph (3), “eligible independent live event” shall not include entities that satisfy any of the following:

(A) Is a publicly traded corporation, or is majority owned and controlled by a publicly traded corporation.

(B) Owns or operates entities in more than five states or in another country, or is owned by an entity that owns or operates entities in more than five states or in another country.

(D) Demonstrates a percentage gross earned revenue decline in California of less than 30 percent, based on a reporting period comparing Q2, Q3, and Q4 of 2020, compared to Q2, Q3, and Q4 of 2019.

(E) Is an excluded entity as defined in paragraph (2) of subdivision (f) of Section 12100.82.

(5) Grants to eligible independent live events shall be prioritized on documented percentage gross earned revenue declines based on a reporting period comparing California gross earned revenues in Q2, Q3, and Q4 of 2020 and California gross earned revenues in Q2, Q3, and Q4 of 2019.

(6) Grants awarded under this subdivision shall be in an amount equal to the lesser of two hundred fifty thousand dollars ($250,000) or 20 percent of the applicant’s gross earned revenue in California for the 2019 taxable year.

(7) Eligible independent live event applicants shall complete a new and separate application for the grants allocated under this section even if they already have submitted an application for the California Small Business COVID-19 Relief Grant Program established in Section 12100.83.

(8) If an eligible independent live event has been awarded a grant under the California Small Business COVID-19 Relief Grant Program established in Section 12100.83, the amount of that grant shall be subtracted from the grant amount awarded under this section. If the grant amount awarded under Section 12100.83 is greater than the amount awarded under this section, the eligible independent live event shall not receive a grant under this subdivision and no amount shall be subtracted.

(9) No more than twenty five million ($25,000,000) in grants may be allocated to eligible independent live events that qualify under clause (iii) of subparagraph (C) of paragraph (3), unless all other eligible independent live events have received funding.

(g) Grant moneys awarded under this section shall only be used for costs resulting from the COVID-19 pandemic and related health and safety restrictions, or business interruptions or closures incurred as a result of the COVID-19 pandemic, including the following:

(1) Employee expenses, including payroll costs, health care benefits, paid sick, medical, or family leave, and insurance premiums.

(3) Costs associated with reopening business operations after being fully or partially closed due to state-mandated COVID-19 health and safety restrictions and business closures.

(4) Costs associated with complying with COVID-19 federal, state, or local guidelines for reopening with required safety protocols, including, but not limited to, equipment, plexiglass barriers, outdoor dining, personal protective equipment (PPE) supplies, testing, and employee training expenses.

(5) Any other COVID-19-related expenses not already covered through grants, forgivable loans, or other relief through federal, state, county, or city programs.

(h) Applicants may self-identify race, gender, and ethnicity. Within 30 business days of the close of each application period, the office shall post the aggregate data, as available, and data by county and legislative district, as available. Within 45 business days, the office shall post the actual awarded information, as available. All information shall be posted on the Office of Small Business Advocate (CalOSBA) internet website and CalOSBA shall provide an electronic copy of the information to the relevant fiscal and policy committees of the Legislature.

(i) The fiscal agent shall issue Forms 1099 and otherwise adhere to tax reporting guidelines regardless of whether the grants are excluded from gross income for purposes of the Personal Income Tax Law (Part 10 (commencing with Section 17001) of Division 2 of the Revenue and Taxation Code) or the Corporation Tax Law (Part 11 (commencing with Section 23001) of Division 2 of the Revenue and Taxation Code).

(j) This section shall remain in effect only until December 31, 2022, and as of that date is repealed.

SEC. 21.

Section 12100.83.6 of the Government Code is amended to read:

12100.83.6.

(a) The California Nonprofit Performing Arts Grant Program is hereby created within CalOSBA.

(b) The program shall be under the direct authority of the director.

(c) The purpose of the program is to provide grants to eligible nonprofit performing arts organizations to encourage workforce development.

(d) The office may contract with a fiscal agent, or amend an existing contract with a fiscal agent to meet the requirements of this section, to carry out the program, at a rate of no more than 5 percent of administrative and program funds appropriated by the Legislature for the purposes of this section.

(e) Subject to appropriation by the Legislature, the office shall allocate grants to eligible nonprofit performing arts organizations that meet the requirements of this section.

(f) (1) Subject to appropriation by the Legislature, forty-nine million five hundred thousand dollars ($49,500,000) of program funds shall be allocated in one or more rounds to eligible nonprofit performing arts organizations.

(2) For purposes of this subdivision, an “eligible nonprofit performing arts organization” means a registered 501(c)(3) nonprofit entity that satisfies the criteria for a qualified small business pursuant to subdivision (f) of Section 12100.82, with no more than two million dollars ($2,000,000) in annual gross revenue, and that is in one of the following North American Industry Classification System codes:

(A) 711110 - Theater Companies and Dinner Theaters.

(B) 711120 - Dance Companies.

(D) 711190 - Other Performing Arts Companies.

(3) Grants under this subdivision shall be awarded on a first-come, first-served basis in the following amounts:

(A) Twenty-five thousand dollars ($25,000) for applicants with annual gross revenue greater than one thousand dollars ($1,000) to one hundred thousand dollars ($100,000) in the 2019 taxable year.

(B) Fifty thousand dollars ($50,000) for applicants with annual gross revenue greater than one hundred thousand dollars ($100,000), and up to one million dollars ($1,000,000) in the 2019 taxable year.

(C) Seventy-five thousand dollars ($75,000) for applicants with annual gross revenue greater than one million dollars ($1,000,000), and up to two million dollars ($2,000,000) in the 2019 taxable year.

(4) A registered 501(c)(3) nonprofit entity, without regard to its annual gross revenue, may be eligible for funds if it serves as a fiscal sponsor for entities that are qualified small businesses pursuant to subdivision (f) of Section 12100.82, with no more than two million dollars ($2,000,000) in annual gross revenue, and that is in one of the following North American Industry Classification System codes:

(A) 711110 - Theater Companies and Dinner Theaters.

(B) 711120 - Dance Companies.

(D) 711190 - Other Performing Arts Companies.

(g) Grant moneys awarded under this section shall only be used for the following:

(1) Employee expenses, including payroll costs, health care benefits, paid sick, medical, or family leave, and insurance premiums.

(2) Contributions or payments to a centralized payroll service.

(3) Recruitment, training, development, and other human resources related expenses.

(4) Other operating expenses or equipment for employees.

(h) (1) Applicants may self-identify race, gender, and ethnicity. Within seven business days of the close of each application period, the office shall post the aggregate data, as available. Within 15 business days of the close of each application period, the office shall post data by legislative district, as available. Within 45 business days, the office shall post the actual awarded information, as available. All information shall be posted on the internet website of the Office of Small Business Advocate (CalOSBA) and CalOSBA shall provide an electronic copy of the information to the relevant fiscal and policy committees of the Legislature.

(2) The office shall report to the Legislature the number of grants and dollar amounts awarded for each of the following categories:

(A) Race and ethnicity.

(B) Women-owned.

(D) Located in or serve a disadvantaged community as described in paragraph (5) of subdivision (h) of Section 12100.83.

(E) Located in a rural area.

(F) County.

(G) State Senate district.

(H) State Assembly district.

(I) Geography.

(i) The fiscal agent shall issue Form 1099 and otherwise adhere to tax reporting guidelines regardless of whether the grants are excluded from gross income for purposes of the Personal Income Tax Law (Part 10 (commencing with Section 17001) of Division 2 of the Revenue and Taxation Code) or the Corporation Tax Law (Part 11 (commencing with Section 23001) of Division 2 of the Revenue and Taxation Code).

(j) This section shall remain in effect only until June 30, 2023, and as of that date is repealed.

SEC. 22.

Section 12100.91 of the Government Code is amended to read:

12100.91.

Subject to appropriation by the Legislature, the following shall apply:

(a) The office may use up to 0.5 percent of funds for administrative expenses. A grantmaking entity may use up to 20 percent of its allocation for administrative expenses (including fiscal agent fee), marketing, and outreach to qualified microbusiness owners in underserved business groups, including businesses owned by women, minorities, veterans, individuals without documentation, individuals with limited English proficiency, and business owners located in low-wealth and rural communities.

(b) Any unused money by the grantmaking entity, less that 20 percent administrative expenses, outreach and marketing funds, must be transferred back to the office by June 29, 2023.

SEC. 23.

Section 12100.95 of the Government Code is amended to read:

12100.95.

This article shall remain in effect only until June 30, 2023, and as of that date is repealed.

SEC. 24.

Article 11 (commencing with Section 12100.120) is added to Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code, to read:

Article 11. Local Government Budget Sustainability Fund

12100.120.

This article shall be known and may be cited as the Local Government Budget Sustainability Fund.

12100.121.

All efforts funded under this article are intended to support and be aligned with other initiatives in the State of California to support economic and workforce diversification, including, but not limited to, the Community Economic Resilience Fund. This article is intended to focus on providing project support for county governments in areas of the state facing high unemployment and high poverty that demonstrate a commitment to advancing a more climate-resilient local economy and pursuing economic diversification initiatives and projects that will provide opportunities for revenue stability. Funds provided under this article are intended to enable county governments to pursue a range of projects that have the potential to diversify their industry presence and create high road jobs, while creating additional potential sources of county revenues over time.

12100.122.

(a) The Local Government Budget Sustainability Fund is hereby created within the Governor’s Office of Business and Economic Development. Upon appropriation, moneys in the fund shall be available for purposes of this article.

(b) The purpose of the program is to provide grants on a competitive basis to local entities that meet the requirements of the article and, when possible, prioritizing those that have the ability to leverage projects that are affiliated with a federal, state, or local program. The success of each grant shall be evaluated on a project-specific basis.

(d) The Governor’s Office of Business and Economic Development shall develop, in consultation with other state agencies and departments, criteria for the selection of grant recipients, which shall include, but not be limited to, all of the following:

(1) Applicants shall be limited to county governments in high-unemployment and high-poverty areas. For purposes of this grant program, high-unemployment and high-poverty areas are defined as geographic areas with a poverty rate or geographic rate that is 150 percent of the California statewide poverty rate, per the most recently updated data available from the United States Census Bureau’s American Community Survey 5-Year Estimates on or after January 1, 2022. Counties within geographic areas that fall under the high-unemployment and high-poverty designation as of July 1, 2022 are eligible for the duration of the program. Counties within geographic areas that fall under either the high-unemployment or high-poverty designations as of July 1, 2022, shall be eligible for the program if moneys are available following rounds designated for applicants that are county governments in high-unemployment and high-poverty areas.

(2) Applicants shall be participants in their region’s respective Community Economic Resilience Fund planning table.

(3) Applicants shall explain current challenges to local revenue sustainability for the next six years, and specifically challenges that pose a risk to the ability of applicants to continue existing government services.

(4) Applicants shall explain how funding secured from this program will be used for specific staffing needs to facilitate project identification, execution, construction, and implementation.

(5) Applicants shall explain how funding secured from this program will be used to support its ability to pursue projects that would advance one of the following five categories:

(A) Process improvement projects, which are defined as permit streamlining, inspections and siting review streamlining, business and community resource toolkits, or technological improvement and modernization, among others.

(B) Economic diversification and stability projects, such as those included in existing Comprehensive Economic Development Strategies, other regional economic development strategies, projects identified and prioritized by the regional high road transition collaboratives, which are defined as construction and nonconstruction opportunities aimed at new and emerging industry clusters that leverage workforce transition and skills generation, additional General Fund revenue sources, or construction and nonconstruction efforts to create new climate related accelerators or incubators and investment centers. Nonconstruction includes research, planning, strategic development and other predevelopment related expenses. Construction includes materials, labor, acquisition and final construction and other related activities.

(C) Workforce development projects, which are defined as construction and nonconstruction opportunities for new and existing workforce programs that will provide training, upskilling, or reskilling and can provide additional support services for participants specifically tied to economic diversification and stability opportunities.

(D) Existing process improvement, economic diversification and stability, and workforce development projects, as described in subparagraphs (A) to (C), inclusive, which have defined awards from federal agencies and include local jurisdiction matching funds requirements. Projects with a clear nexus to projects described in subparagraphs (A) to (C), inclusive, shall be considered.

(E) (i) Project identification and planning resources.

(ii) “Project identification and planning resources” means moneys intended to build staff specifically designed for staffing increases for the recognized economic development departments within the eligible counties to perform the actions required by this article, including for purposes of identifying, defining, applying for grants for, developing a Comprehensive Economic Development Strategy, as described in Section 303.7 of Title 13 of the Code of Federal Regulations, and developing projects described in subparagraphs (A) to (C), inclusive.

(iii) Funding provided pursuant to this subparagraph shall not exceed three million dollars ($3,000,000) in total to all applicants over the duration of the program.

(iv) A request made pursuant to this subparagraph shall include information on the applicable job requirements and skills needed to identify, propose, define, apply for grants for, and develop projects associated with subparagraphs (A) to (C), inclusive.

(6) If an applicant applies to receive funding pursuant to subparagraph (A), (B), or (C) of paragraph (5), the applicant shall provide details pertaining to projects that would be supported with these funds, including, but not limited to, budget, staffing, contracting, materials, equipment, and other expenses.

(7) Applicants shall include information pertaining to how projects are attributive to climate-resilience.

(8) Applicants shall agree to initiation meetings with office staff for resource identification, project scoping, industry engagement, regulatory agency engagement, other planning, and alignment with administration priorities.

(9) (A) Applicants shall be encouraged to utilize funds as match funding to other established state, federal, philanthropic, or other grant opportunities. Projects including a federal, local, or philanthropic match shall be prioritized by the Governor’s Office of Business and Economic Development.

(B) Applicants shall engage with the Governor’s Office of Business and Economic Development during development, and prior to, submission of an application that includes a local match. For projects where the local match funding requirements exceed the funding capacity of the program, the excess requirements shall be funded by the local jurisdiction providing the associated local match.

(C) Applicants shall provide detailed information, if they have match funding, on the matching funds available, in-kind matching funds budget details, grant application and submission details, grant award notices, and any other information that indicates the applicant’s receipt of match funding.

(10) Applicants shall provide a detailed assessment of the staffing requirements related to project applicants, including, but not limited to, duties and responsibilities, salary and benefits, working titles, reporting structure, and duration.

(11) Applicants shall include countywide government employment data as a part of an application.

(e) Grant recipients shall meet with the office periodically, at least bimonthly, to ensure projects are meeting specified benchmarks associated with climate resilience, business services process improvement, economic diversification, and long-term economic stability. If key indicators of progress are not being met, the office may take actions to terminate the grant agreement and have unspent dollars allocated to the project returned. The office may require reimbursement for allocated dollars that have been spent if it determines dollars have been spent improperly or in a manner that is outside the scope of the agreement.

(f) The office shall report to the Legislature each calendar year the number of grants and dollar amounts by local entity. The report shall be submitted in compliance with Section 9795.

12100.123.

The office shall evaluate and prioritize grants, to the extent permissible under state and federal equal protection laws, in accordance with the following criteria:

(a) Assessment of proposal details submitted, including, but not limited to, budget information, staffing requirements, positions, project goals, timeliness, and, if applicable, industry partners, workforce and labor partners, trade associations, and local businesses.

(b) Assessment of coalition-building capacity, as evidenced by letters of support that speak to the potential community benefit of projects from labor, business, community, city government, and other stakeholders, including, but not limited to, economic development, philanthropy, education, and workforce partners.

(c) Other qualitative and quantitative measures determined by the specific project or grant application utilizing these funds for required match funding.

12100.124.

Eligible activities for grant funds shall include, but are not limited to, all of the following:

(a) Staffing requirements, position classifications, and wages. Salary increases outside the scope of bargaining agreements are explicitly prohibited from utilizing these funds.

(b) Project costs including, but not limited to, budget, staffing, contracting, consulting, materials, equipment, and other expenses.

(c) Match funding for other federal, state, philanthropic, or other grant opportunities with a required match. Programs without a match requirement that have specific scoring improvement through match funding shall be prioritized.

12100.125.

This article shall remain in effect until June 30, 2028, and as of that date is repealed.

SEC. 25.

Article 12 (commencing with Section 12100.130) is added to Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code, to read:

Article 12. California Containerized Ports Interoperability Grant Program

12100.130.

For purposes of this article, the following terms have the following meanings:

(a) “Applicant” means any port in California with container terminals that specialize in handling goods transported in intermodal shipping containers and provides details on demonstrated data system needs plans for using grant funds to support cloud-based data system development.

(b) “Interoperability” means the ability for a port’s computerized and cloud-based data systems to securely share information and expedite information exchange across port users and relevant transportation service providers, including other port or public sector-based, computerized, and cloud-based cargo data systems as needed, in support of operational improvement, efficiency, and emissions reduction.

12100.131.

(a) Upon appropriation by the Legislature, GO-Biz shall establish the California Containerized Ports Interoperability Grant Program pursuant to this article.

(b) Upon appropriation by the Legislature, GO-Biz is authorized to provide grants pursuant to this article. GO-Biz shall award grants and determine grant amounts based on the following criteria:

(1) (A) The applicant agrees to reach a memorandum of understanding (MOU) with all other grantees on or before May 1, 2023, that defines how they will work to help achieve real-time interoperability among the containerized ports in California. GO-Biz shall withhold the disbursement of one-half of each successful applicant’s grant funding until after an MOU is reached. No later than 30 days after an MOU has been reached, GO-Biz shall report to the chairpersons of the committees in each house of the Legislature that consider appropriations and the Chairperson of the Joint Legislative Budget Committee that a port data interoperability agreement has been reached.

(B) Notwithstanding any other law, if an individual applicant does not reach a Memorandum of Understanding with all other grantees by May 1, 2023, the applicant shall return the funds to GO-Biz and GO-Biz shall revert the funds to the General Fund.

(2) Grant funding allocations to each applicant shall be considered based on demonstrated data system needs and key performance metrics, including, but not limited to, historical container volumes.

(3) Grant funding shall not be used by a grantee to support a system that would, in any way, track or monitor labor, including, but not limited to, productivity metrics, or a system that would infringe on a collective bargaining agreement or workers’ right to collectively bargain.

(c) Grant funding shall only be used to support operations of computerized and cloud-based data systems that are necessary to achieve interoperability.

(d) (1) On or before January 1, 2024, GO-Biz shall report to the Legislature, pursuant to Section 9795, information on awarded grants, a project description of each grant award, available information on data system enhancements or other project outcomes, and the implementation status of the MOU.

(2) On or before January 1, 2026, GO-Biz shall provide a final report to the Legislature, pursuant to Section 9795, describing the final results of the program.

(e) This article shall remain in effect only until January 1, 2026, and as of that date is repealed.

SEC. 26.

Article 13 (commencing with Section 12100.140) is added to Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code, to read:

Article 13. Local Government Immigrant Integration Initiative

12100.140.

The Local Government Immigrant Integration Initiative is hereby created within GO-Biz.

12100.141.

(a) Upon appropriation by the Legislature, GO-Biz shall administer competitive grants to local governments to develop or expand local immigrant integration initiatives.

(b) Applications shall include the following grant criteria:

(1) A description of the proposed activities and how they will advance immigrant integration through locally administered public programs that advance quality of life (health, social services, housing, civic participation services), and economic mobility (education, workforce development, and entrepreneurship services).

(2) An analysis of the demographics and related needs of the immigrant community in the jurisdiction and alignment with proposed activities.

(3) A description of a public and accessible community input process implemented prior to submission of the proposal to solicit recommendations from immigrant residents, community organizations and service providers that represent or serve the diverse demographics in the jurisdiction, the recommendations provided, and how proposed activities incorporate those recommendations where appropriate.

(4) Plans to ensure continuity of funding for proposed activities after the one-time grant is awarded for sustainability, including through public-private partnerships, or other means.

(5) A description of how the impact, challenges and reach of proposed activities will be objectively measured and reported to GO-Biz not to include personally identifiable information or information that is unnecessary to determine program eligibility, including immigration or citizenship status.

(1) Creating multilingual local government immigrant resources or positions to support community engagement and community navigation, or other local government efforts to improve immigrant access and use of quality of life services.

(2) Funding immigrant integration focused positions and services, such as financial assistance, training or financial literacy programs, referral services for immigrant workers or entrepreneurs, or other local government efforts to improve immigrant access and use of economic mobility and opportunity services.

(3) Creating navigation assistance to specific language needs, working with community-based organizations, nonprofits, counties, and city governments, or a combination of those entities, social service agencies to develop reciprocal referral systems, or other local government efforts to improve access and use of some or all of the above services to support an emerging newcomer population, including immigrant youth, refugees, asylum seekers, or other newly arrived immigrant residents.

(d) Grantees shall collaborate with one another, including through convenings organized by GO-Biz, to share and scale best practices.

(e) Local governments applying for grant funding shall not use the funding award to replace existing funding or required services.

(f) In addition to the grant criteria described in subdivision (b), GO-Biz shall prioritize equitable distribution of funds, where possible, across local government jurisdictions, with consideration to estimates of where immigrants reside and supporting underserved regions. GO-Biz shall consult with relevant state agencies and departments with expertise in public health, housing and social services, workforce development, immigration legal services, and entrepreneurial support services. This includes, but is not limited to, the State Department of Social Services, Department of Housing and Community Development, the State Department of Public Health, and the Labor and Workforce Development Agency.

(g) GO-Biz shall include in an annual report to each house of the Legislature, in accordance with Section 9795, information on awarded grants, project descriptions for each grant award, and information on program outcomes.

(h) Persons who are not lawfully present in the United States may participate in and benefit from local government services provided by this grant program, consistent with Section 1621(d) of Title 8 of the United States Code. For purposes of implementing this grant program, no entity or person shall seek or disclose information that is unnecessary to determine eligibility for program services, including immigration or citizenship status.

(i) Information that may be collected from individuals participating in new services provided under this funding shall not constitute a record subject to disclosure under Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1 of the Government Code.

(j) This section shall be operative only until January 1, 2023, and as of that date, is repealed.

12100.141.

(a) Upon appropriation by the Legislature, GO-Biz shall administer competitive grants to local governments to develop or expand local immigrant integration initiatives.

(b) Applications shall include the following grant criteria:

(2) An analysis of the demographics and related needs of the immigrant community in the jurisdiction and alignment with proposed activities.

(4) Plans to ensure continuity of funding for proposed activities after the one-time grant is awarded for sustainability, including through public-private partnerships, or other means.

(5) A description of how the impact, challenges, and reach of proposed activities will be objectively measured and reported to GO-Biz not to include personally identifiable information or information that is unnecessary to determine program eligibility, including immigration or citizenship status.

(d) Grantees shall collaborate with one another, including through convenings organized by GO-Biz, to share and scale best practices.

(e) Local governments applying for grant funding shall not use the funding award to replace existing funding or required services.

(i) Information that may be collected from individuals participating in new services provided under this funding shall not constitute a record subject to disclosure under Division 10 (commencing with Section 7920.000) of Title 1.

(j) This section shall become operative January 1, 2023.

12100.142.

(a) Upon appropriation by the Legislature, GO-Biz shall administer competitive grants to service providers to develop export training programs and curriculum aimed at underserved business owners, including immigrant entrepreneurs and small business operators.

(b) Eligible service providers may include, but are not limited to, nonprofit community organizations, economic development agencies, and educational institutions with demonstrated success reaching the target populations, including in languages other than English. Export training and curriculum of applicants shall include all of the following:

(1) Planned outreach to and engagement with underserved businesses, immigrant entrepreneurs, and small business operators including in languages other than English.

(2) A description of how curriculum and instruction would consider the needs of underserved businesses, immigrant entrepreneurs and small business operators, including in languages other than English.

(3) As a component of the training programs, recruitment of business professionals to mentor underserved businesses, immigrant entrepreneurs, and small business operators as part of programming including in languages other than English.

(4) A process by which voluntary, de-identified, aggregate data regarding the demographics of the training participants is reported to GO-Biz.

(5) An agreement that service providers will collaborate with one another, including through convenings organized by GO-Biz, to share and scale best practices.

(c) GO-Biz shall include in an annual report to each house of the Legislature, in accordance with Section 9795, information on awarded grants, a project description for each grant award, the findings of any research conducted during the grant program, and available information on training and program outcomes.

(d) Persons who are not lawfully present in the United States may participate in and benefit from services provided by this initiative, and this section is therefore enacted pursuant to Section 1621(d) of Title 8 of the United States Code. For purposes of implementing this initiative, no entity or person shall seek information that is unnecessary to determine eligibility, including immigration or citizenship status.

12100.143.

This article shall remain in effect only until June 30, 2026, and as of that date is repealed.

SEC. 27.

Section 63089.5 of the Government Code is amended to read:

63089.5.

(a) There is hereby continued in existence in the State Treasury the California Small Business Expansion Fund. All or a portion of the funds in the expansion fund may be paid out, with the approval of the Department of Finance, to a financial institution or financial company that will establish a trust fund and act as trustee of the funds.

(b) The expansion fund and the trust fund shall be used for the following purposes:

(1) To pay defaulted loan guarantee or surety bond losses, or other financial product defaults or losses.

(2) To fund direct loans and other debt instruments.

(3) To pay administrative costs of corporations.

(4) To pay state support and administrative costs.

(5) To pay those costs necessary to protect a real property interest in a financial product default.

(c) The expansion fund and trust fund are created solely for the purpose of receiving state, federal, or local government moneys, and other public or private moneys to make loans, guarantees, and other financial products that the California Small Business Finance Center or a financial development corporation is authorized to provide or that may be provided pursuant to Article 12 (commencing with Section 63089.99). The program manager shall provide written notice to the Joint Legislative Budget Committee and to the Chief Clerk of the Assembly and the Secretary of the Senate who shall provide a copy of the notice to the relevant policy committees within 10 days of any nonstate funds being deposited in the expansion fund. The notice shall include the source, purpose, timeliness, and other relevant information as determined by the bank board.

(d) (1) One or more accounts in the expansion fund and the trust fund may be created by the program manager for corporations participating in one or more programs authorized under this chapter and Section 8684.2. Each account is a legally separate account, and shall not be used to satisfy loan guarantees or other financial product obligations of another corporation except when the expansion fund or trust fund is shared by multiple corporations.

(2) The program manager may create one or more holding accounts in the expansion fund or the trust fund, or in both, to accommodate the temporary or permanent transfers of funds pursuant to Section 63089.3.

(e) The amount of guarantee liability outstanding at any one time shall not exceed 10 times the amount of funds on deposit in the expansion fund plus any receivables due from funds loaned from the expansion fund to another fund in state government as directed by the Department of Finance pursuant to a statute enacted by the Legislature, including each of the trust fund accounts within the trust fund.

SEC. 28.

Article 12 (commencing with Section 63089.99) is added to Chapter 6 of Division 1 of Title 6.7 of the Government Code, to read:

Article 12. Venture Capital Program

63089.99.

(a) A venture capital program is hereby established within the bank.

(b) The Governor shall appoint a deputy director who shall have direct authority over the venture capital program and serve at the pleasure of the Governor. Notwithstanding any law in this chapter, the deputy director shall act under the guidance and authority of the executive director.

(c) The venture capital program shall operate pursuant to directives and requirements developed and approved by the bank board.

(d) Pursuant to the venture capital program and to the extent permissible, the bank may do both of the following:

(1) Acquire contract rights, or enter into contracts involving loans or bonds (including without limitation, loans and bonds with shared appreciation rights or contingent interest payments) with respect to investment funds, investment fund management companies, special purpose investment vehicles, trusts, nonprofit entities, small businesses, and other private business entities.

(2) Reinvest the proceeds received by the bank from any loans or contract rights, as described in paragraph (1).

(e) Any loans or contract rights made by the bank pursuant to this section shall be exempt from the usury provisions of Section 1 of Article XV of the California Constitution. This subdivision creates and authorizes exempt classes of transactions and persons pursuant to Section 1 of Article XV of the California Constitution.

(f) An action to determine the validity of any resolution, agreement, or other method of financing authorized or undertaken pursuant to this section may be brought pursuant to Chapter 9 (commencing with Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.

SEC. 29.

Section 44526 of the Health and Safety Code is amended to read:

44526.

The authority is authorized to do any of the following:

(a) To determine the location and character of any project to be financed under the provisions of this division, to lend financial assistance to any participating party, to construct, reconstruct, renovate, replace, lease, as lessor or lessee, and regulate the same, and to enter into contracts for the sale of any pollution control facilities, including installment sales or sales under conditional sales contracts, and to make loans to participating parties to lend financial assistance in the acquisition, construction, or installation of a project.

(b) To issue bonds, notes, bond anticipation notes, and other obligations of the authority for any of its corporate purposes, and to fund or refund the same, all as provided in this division.

(c) To fix fees and charges for pollution control facilities, or for the loan of moneys to finance pollution control facilities, and to revise from time to time those fees and charges, and to collect rates, rents, fees, loan repayments, and charges for the use of and for any facilities or services furnished, or to be furnished, by a project or any part thereof and to contract with any person, partnership, association, corporation, or public agency with respect thereto, and to fix the terms and conditions upon which any pollution control facilities may be sold or disposed of, whether upon installment sales contracts or otherwise.

(d) To employ and fix the compensation of bond counsel, financial consultants, and advisers as may be necessary in its judgment in connection with the issuance and sale of any bonds, notes, bond anticipation notes, or other obligations of the authority; to contract for engineering, architectural, accounting, or other services of appropriate agencies as may be necessary in the judgment of the authority for the successful development of any project; and to pay the reasonable costs of consulting engineers, architects, accountants, and construction experts employed by any participating party if, in the judgment of the authority, those services are necessary to the successful development of any project, and those services are not obtainable from any public agency.

(e) To receive and accept loans, contributions, or grants, of money, property, labor, or other things of value, for, or in aid of, the authority in carrying out the purposes of this division, from any source, including, but not limited to, the federal government, the state, or any agency of the state, any local government or agency thereof, or any nonprofit or for-profit private entity or individual.

(f) To apply for, and accept, subventions, grants, loans, advances, and contributions from any source, of money, property, labor, or other things of value. The sources may include, but are not limited to, bond proceeds, dedicated taxes, state appropriations, federal appropriations, federal grant and loan funds, public and private sector retirement system funds, and proceeds of loans from the Pooled Money Investment Account.

(g) To provide grants and loans to any city or county deemed eligible by the authority. The grants and loans shall be used to assist California neighborhoods suffering from high poverty or unemployment levels, or from low-income levels, to assist cities and counties in developing and implementing growth policies and programs that reduce pollution hazards and the degradation of the environment, or to promote infill development to revitalize these communities. The grants and loans may be used to employ the technical expertise necessary to identify, assess, and complete applications for state, federal, and private economic assistance programs that develop and implement sustainable development and sound environmental policies and programs. Priority shall be given to applicants lacking the resources to identify, assess, and complete applications to economic assistance, and for those lacking the resources to develop and implement sustainable growth and other sound environmental policies and programs. The authority shall fund these grants and loans from any funds available to the authority or set aside for the authority’s administrative expenses. The authority may not award more than seven million five hundred thousand dollars ($7,500,000) in grants and loans pursuant to this subdivision. This subdivision shall remain operative only until January 1, 2012.

(h) (1) To provide a loan directly, or indirectly through one or more public or private sector intermediaries, to any city, county, school district, redevelopment agency, financial institution, as defined in subdivision (d) of Section 44559.1, for-profit or not-for-profit organization, or participating party, as defined in Section 44506, to assist in financing, among other things, the costs of performing or obtaining brownfield site assessments, remedial action plans and reports, technical assistance, the cleanup, remediation, or development of brownfield sites, or any other similar or related costs, subject to all applicable federal, state, and local laws, procedures, and regulations.

(2) The authority shall establish standards and criteria to ensure that a recipient of direct or indirect financing for cleanup or remediation pursuant to this subdivision has the necessary financial resources and expertise to successfully and appropriately complete the cleanup or remediation of the property.

(3) The authority may pay all, or a portion, of the associated program development and implementation costs of any public or private sector intermediaries through which a loan is made. A loan authorized by this subdivision is subject to both of the following:

(A) A loan may be used in connection with a brownfield site prior to a determination of whether the site has a reasonable potential for economically beneficial reuse.

(B) A loan may be made upon the terms determined by the authority and may provide for any rate of interest or no interest.

(4) The authority shall fund a loan made pursuant to this subdivision from any funds available to it, from any funds set aside for the authority’s administrative expenses, or from any small business assistance fund established for these purposes pursuant to Section 44548.

(5) The authority may waive repayment of all, or a portion, of any loan made pursuant to this subdivision upon conditions to be determined by the authority, and the amount so waived shall be deemed a grant to the recipient.

(i) To provide grants to enhance the capacity of community development financial institutions, as defined in Section 44558, to provide technical assistance and capital access to economically disadvantaged communities in this state, pursuant to Article 7.

(j) To do all things generally necessary or convenient to carry out the purposes of this division.

SEC. 30.

Article 7 (commencing with Section 44558) is added to Chapter 1 of Division 27 of the Health and Safety Code, to read:

Article 7. California Investment and Innovation Program

44558.

For purposes of this article:

(a) “Administration expenses” means the reasonable and necessary expenses incurred by the authority in the administration of this article, including, without limitation, the fees and costs of attorneys, consultants, and other individuals.

(b) “Applicant” means an eligible applicant that applies to the authority for a grant pursuant to this article.

(d) “Community development financial institution” means any community development financial institution certified by the federal Community Development Financial Institutions Fund under Part 1805 (commencing with Section 1805.100) of Chapter XVIII of Title 12 of the Code of Federal Regulations.

(e) “Disadvantaged community” means a census tract in which the median household income is less than 80 percent of the statewide or county annual median household income level, whichever is less.

(f) “Eligible applicant” means a community development financial institution for which all of the following applies:

(1) The applicant shall have a current certification pursuant to Section 1805 of Title 12 of the Code of Federal Regulations.

(2) The applicant shall have a minimum net worth of twenty-five thousand dollars ($25,000) as indicated on its financial statements prepared in accordance with generally accepted accounting principles.

(3) The applicant shall have made a minimum of five loans in the 12 months prior to submitting its application.

(4) Either of the following applies:

(A) The community development financial institution has a principal office in California, the officers of which are domiciled in California.

(B) The community development financial institution has a record of lending in this state, based on either of the following:

(i) At least 25 percent of the community development financial institution’s loan portfolio, at the time of the application, provides financial assistance to persons or projects located in this state.

(ii) The community development financial institution has provided financing assistance in this state totaling at least ten million dollars ($10,000,000) in the three years prior to its application.

(g) “Executive director” means the Executive Director of the California Pollution Control Financing Authority.

(h) “Fund” means the California Investment and Innovation Fund created in subdivision (b) of Section 44558.1.

(i) “Low-income communities” has the same meaning as defined in Section 39713 of the Health and Safety Code.

(j) “Lower income household” has the same meaning as defined in Section 50079.5 of the Health and Safety Code.

(k) “Program” means the California Investment and Innovation Program established in subdivision (a) of Section 44558.1.

(l) “Small and emerging community development financial institution” means a community development financial institution that has less than ten million dollars ($10,000,000) in assets.

44558.1.

(a) (1) The authority shall establish the California Investment and Innovation Program for the purpose of providing grants to enhance the capacity of community development financial institutions to provide technical assistance and capital access to economically disadvantaged communities in this state.

(2) The authority shall adopt guidelines for the implementation of this program consistent with this article.

(b) The California Investment and Innovation Fund is created in the State Treasury. The authority shall allocate moneys in the fund to eligible recipients in accordance with this article. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the authority to carry out the purposes of this article. All moneys accruing to the authority pursuant to this article from any source shall be deposited into the fund.

(c) The California Investment and Innovation Fund may receive funds from any source, including, but not limited to, the federal government, philanthropic entities, financial institutions, and state funds appropriated for this purpose.

(d) The authority may access moneys in the fund for administrative costs as necessary to implement the program, subject to conditions, if any, stipulated in the appropriation of the funds.

(e) Notwithstanding any other law, the authority may direct the Treasurer to invest moneys in the fund that are not required for its current needs in the eligible securities specified in Section 16430 of the Government Code as the authority shall designate. The authority may direct the Treasurer to deposit moneys in interest-bearing accounts in state or national banks or other financial institutions having principal offices located in the state. The authority may alternatively require the transfer of moneys in the fund to the Surplus Money Investment Fund for investment pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code. All interest or other increment resulting from an investment or deposit shall be deposited into the fund, notwithstanding Section 16305.7 of the Government Code. Moneys in the fund shall not be subject to transfer to any other fund pursuant to any provision of Part 2 (commencing with Section 16300) of Division 4 of Title 2 of the Government Code, except the Surplus Money Investment Fund.

44558.2.

(a) When funding is available, the authority shall make the funding available to eligible applicants selected by the authority to participate in the program. Unless otherwise prohibited by law, the authority shall use the available funding to do all of the following:

(1) Develop an application process for awarding grants to eligible applicants pursuant to the program and require each eligible applicant to submit an application in the form and manner prescribed by the authority.

(2) Set aside at least 20 percent of any amount made available in a program funding round for eligible applicants that are small and emerging community development financial institutions.

(3) Ensure that eligible recipients receiving grants pursuant to the program serve geographically diverse areas, both urban and rural, across this state.

(b) (1) When funding is available, the authority shall make grants available in one or more rounds of funding availability, not to exceed fifteen million dollars ($15,000,000) in total grants in any calendar year.

(2) Awards shall be announced by February 1 of each year. The first round of funding shall be awarded by February 1, 2024.

(3) Funds shall be available for use by the grantee for a period of two years, as specified in the grant agreement entered into pursuant to Section 44558.3. Grant funds shall be used as prescribed by the article and the grant agreement for a period of two years. Upon the expiration of that two-year period and that grant agreement, there shall be no limitation on the use of the grant funds.

(4) Any income generated from the grant award during the term of grant agreement entered into pursuant to Section 44558.3 shall be reinvested by the grantee into activities allowable under the grant agreement.

(c) As part of the application process described in subdivision (a), the authority shall determine the amount that any eligible applicant who submits a timely and complete application may receive per calendar year, subject to the following conditions:

(1) All eligible applicants that submit a timely and complete application shall receive a grant. In each round of funding the authority shall, in announcing the availability of funding, establish a minimum and maximum grant amount.

(2) For the purpose of determining the amount of individual grants, the authority shall develop criteria to adjust the size of awards based on the total amount of loans closed by the applicant in the most recently completed fiscal year.

(3) After receiving a grant in one year, an eligible applicant may apply in a future funding round if the eligible applicant has made reasonable progress in deploying the previously awarded grant funding.

44558.3.

(a) Prior to receiving any grant funds under this program, an applicant selected by the authority to participate in the program shall enter into a grant agreement with the authority that requires the applicant to do all of the following:

(1) Achieve specific goals related to capacity building described in subdivision (b).

(2) Provide information requested by the authority to support administration of the program.

(3) Comply with terms and conditions imposed by the authority.

(b) Unless otherwise prohibited by law, an eligible applicant that receives grant funds under the program may use those funds for either or both of the following purposes:

(1) (A) To increase total net assets for the purpose of increasing the eligible applicant’s capacity to attract additional financing that the applicant uses to fund loans, loss reserves, or other means of finance for any of the following:

(i) Commercial facilities that promote revitalization, community stability, or job creation or retention.

(ii) Businesses that provide jobs for low-income persons, are owned by low-income persons, or increase the availability of products and services to low-income persons.

(iii) Facilities providing health care, childcare, educational, cultural, or social services.

(iv) The provision of checking, savings accounts, check cashing, money orders, certified checks, automated teller machines, deposit taking, safe deposit box services, and other similar services.

(v) Development, preservation, or renovation of affordable housing.

(vi) Credit building consumer loans with charges that do not exceed the amounts allowed by Sections 22304.5 and Section 22370 of the Financial Code.

(B) For purposes of this section, “total net assets” means the amount of total assets minus total liabilities, as disclosed in an audited financial statement prepared according to generally accepted accounting principles.

(2) To increase working capital for the purpose of funding services and operations that contribute to the overall community development mission of the eligible applicant, including technical assistance, technology, training, and other activities that benefit low-income neighborhoods, undercapitalized business owners, and other socially and economically disadvantaged individuals.

(c) If a grantee is licensed pursuant to any division of the Financial Code and the grantee loses its license, the grant shall be forfeited and returned, in total, to the authority.

44558.4.

(a) Notwithstanding any other law, including subdivision (a) of Section 44520, the authority may adopt, amend, or repeal rules and regulations for the administration of the program pursuant to this article without complying with the procedural requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, except as described in subdivision (b).

(b) The authority shall provide a notice of proposed action as described in Section 11346.5 of the Government Code. The notice of proposed action shall be provided to the public at least 21 days before the close of the public comment period, and the authority shall schedule at least one public hearing as described in Section 11346.8 of the Government Code before the close of the public comment period. The committee shall maintain a rulemaking file as described in Section 11347.3 of the Government Code. The final version of the regulations shall be accompanied by a final statement of reasons as described in subdivision (a) of Section 11346.9 of the Government Code.

44558.5.

(a) The authority shall adopt guidelines for annual reporting by grantees that do all of the following:

(1) Provide a description of the grantee’s overall activities during the report period, including how the grant specifically contributed to these activities.

(2) Require a grantee to provide an annual financial statement and meet record retention and audit requirements for the duration of the grant to ensure compliance with the limitations and requirements of this article.

(3) Align the time period covered by the annual report required by this subdivision with the reporting period covered by the federal CDFI Program administered by the United States Department of the Treasury.

(4) For the purpose of tracking the impact of individual grant awards, establish that the performance period shall start no earlier than the date the grant award agreement entered into pursuant to Section 44558.3 is signed and the funding is under the control of the grantee.

(5) Unless otherwise prohibited by law, as a condition of receiving the grant, all grantees shall request businesses directly served by the grantee with grant funds to self-identify their gender, race, and ethnicity. Grantees shall annually report to the authority the information provided to them by the businesses.

(b) By March 1, 2024, and annually thereafter, the authority shall post a report on the authority’s internet website that describes the results of the program, including, but not limited to, the total number of grants awarded, the amount of previously awarded grants that have been reported as spent by the grantees, an aggregation of any data provided by grantees, and a descriptive summary of the information provided by grantees pursuant to subdivision (a) in the most recent reporting period. The authority shall also include in the report any recommendations for improving the effectiveness, transparency, and accountability of public funds deployed to community development financial entities to serve the unmet needs of, and build inclusive economic prosperity in, California’s lower income neighborhoods and undercapitalized small businesses.

SEC. 31.

The Legislature finds and declares that Sections 2 and 3 of this act, which amend Sections 6254.26 and 7928.710 of, and Section 26 which adds Article 13 (commencing with Section 12100.140) to Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code, impose a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interests:

In the case of Sections 2 and 3 which amend Sections 6254.26 and 7928.710 of the Government Code, this bill balances the interests of the venture capital program in keeping certain investment information confidential with the interest of the public in accessing information concerning the conduct of the people’s business.

In the case of Section 26 which adds Article 13 (commencing with Section 12100.140) to Chapter 1.6 of Part 2 of Division 3 of Title 2 of the Government Code, the Legislature finds that this limitation to the public’s right of access is necessary to protect the privacy interests of program participants and to ensure full participation in the grant program.

SEC. 32.

No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SEC. 33.

This act is a bill providing for appropriations related to the Budget Bill within the meaning of subdivision (e) of Section 12 of Article IV of the California Constitution, has been identified as related to the budget in the Budget Bill, and shall take effect immediately.

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Bill Text: CA SB193 | 2021-2022 | Regular Session | Enrolled

California Senate Bill 193 (Prior Session Legislation)

LEGISLATIVE COUNSEL'S DIGEST

Digest Key

Bill Text

The people of the State of California do enact as follows:

SECTION 1.

SEC. 2.

6254.26.

SEC. 3.

7928.710.

SEC. 4.

CHAPTER 7.3. California Regional Initiative for Social Enterprises Program

11788.

11788.1

11788.1.5.

11788.2.

11788.3.

11788.4.

SEC. 5.

12096.6.1.

SEC. 6.

12099.1.

SEC. 7.

12099.2.

SEC. 8.

12099.3.

SEC. 9.

12099.4.

SEC. 10.

12099.5.

SEC. 11.

12099.6.

SEC. 12.

12099.7.

SEC. 13.

12099.7.5.

SEC. 14.

12100.60.

SEC. 15.

12100.62.

SEC. 16.

12100.63.

SEC. 17.

SEC. 18.

12100.82.

SEC. 19.

12100.83.

SEC. 20.

12100.83.5.

SEC. 21.

12100.83.6.

SEC. 22.

12100.91.

SEC. 23.

12100.95.

SEC. 24.

Article 11. Local Government Budget Sustainability Fund

12100.120.

12100.121.

12100.122.

12100.123.

12100.124.

12100.125.

SEC. 25.

Article 12. California Containerized Ports Interoperability Grant Program

12100.130.

12100.131.

SEC. 26.

Article 13. Local Government Immigrant Integration Initiative

12100.140.

12100.141.

12100.141.

12100.142.

12100.143.

SEC. 27.

63089.5.

SEC. 28.

Article 12. Venture Capital Program