There are 27 Titles that comprise the California Code of Regulations, which contain all of the adopted regulations in the State of California. In Title 10, “Investment,” Division 13, there are regulations for the “Governor’s Office of Business and Economic Development.” Division 13 has four chapters. The following is an overview of these regulations.
Article 1 deals with the California Competes Tax Credit and contains five sections.
§ 8000. Definitions. The following terms are defined in this section: “Aggregate employee compensation”; “Aggregate investment”; “Agreement” or “California competes tax credit agreement”; “Allocation”; “Allocation period”; “Annual full-time equivalent”; “Applicant”; “Application”; “Application form”; “Application period”; “Base year”; “Benefits”; “California competes tax credit” or “credit”; “California competes tax credit committee” or “committee”; “Current assets”; “Current liabilities”; “Current taxable year”; “Director”; “Directly related”; “Economic impact”; “Fringe benefits”; “Full-time employee”; “GO-Biz”; “High poverty area”; “High unemployment area”; “Investment”; “Material litigation”; “Personal property”; “Project”; “Project financing”; “Real property”; “Strategic importance”; “Wage or Wages”; “Website”; and, “Working capital.”
§ 8010. Tax Credit. The applicant is required to set forth its requested California competes tax credit amount in the application form. The minimum amount of a request is $20,000 and the maximum amount is subject to the limit set forth in the Revenue and Taxation Code.
§ 8020. Announcement of Application Deadlines and Committee Meetings. The director is required to announce the application period or periods for the California competes tax credit prior to each new fiscal year on the website. The announcement is required to state specified information.
§ 8030. Application Process for Tax Credit Allocation. In the event the director announces at the beginning of a fiscal year that applications must be submitted online, applicants are required to create a login and password as designated on the website. The application must contain extensive information described
§ 8040. Notice to and Duties of the Franchise Tax Board. Upon approval by the committee, GO-Biz is required to provide the negotiated agreements to the Franchise Tax Board in the form and manner agreed to by the FTB and GO-Biz. The FTB has access to the application and any and all documentation provided by the applicant or prepared or relied on by GO-Biz or the committee in the decision to approve the agreement and allocate a credit.
Article 2 deals with the Made in California Program and contains six sections.
§ 8100. Definitions. This section contains definitions for the following terms: “Applicant”; “Application”; “Application form”; “CA Made label”; “Certification” or “certified”; “Certification form”; “Certification term”; “Direct labor cost”; “Direct material cost”; “Familiar”; “Fee”; “GO-Biz”; “Indirect labor cost”; “Indirect material cost”; “License”; “Licensee”; “Licensing agreement”; “Product”; “Program”; “Research and development”; “Salary”; “Supply chain”; “Third-party certifier”; “Website”; and, “Wholesale value.”
§ 8110. Application Process for CA Made Label. Applications are required to be accepted by GO-Biz on a rolling basis. GO-Biz must review, finalize, and execute licensing agreements at the beginning of each quarter.
§ 8120. Certification Process for CA Made Label. Applicants are required to provide the CA Made certification form to a third-party certifier.
§ 8130. Application Review, Rejection, Approval, and Renewal Processes. Upon receipt of an application, GO-Biz is required to review the application for completeness and notify applicant of any deficiencies if appropriate.
§ 8140. CA Made Licensing Agreement and CA Made Label Usage. The website and the licensing agreement must identify the CA Made label that will be provided to licensees by GO-Biz. The CA Made label may be used by licensees for certified products pursuant to the rights and limitations as described in the licensing agreement.
§ 8150. Fee Imposition, Structure, and Management. Upon application approval, GO-Biz is required to assess a fee on all licensees.
Article 3 deals with the California EB-5 Foreign Investment Program and contains 4 sections.
§ 8200. Definitions. The following terms are defined in this section: “Applicant”; “Census Bureau’s Participant Statistical Areas Program”; “Census tracts”; “Commercial enterprise”; “Contiguous census tract”; “EB-5 Program”; “GO-Biz TEA Interactive Tool”; “GO-Biz”; “New commercial enterprise”; “Project”; “Qualifying cities, Census Designated Places ( “CDPs”), and Metropolitan Statistical Areas ( “MSAs”)”; “Regional center”; “Request”; “Rural area”; “Supporting letter”; “Special TEA”; “Targeted Employment Area” or “TEA”; “TEA certification”; “TEA certification letter”; and, “USCIS.”
§ 8210. Designation and Certification of Qualified Teas. An individual or entity may establish that the location in which the new commercial enterprise is going to principally do business in, is a TEA, by submitting evidence to USCIS that the metropolitan statistical area, the specific county within a metropolitan statistical area, or the county in which a city or town with a population of 20,000 or more is located, had an average unemployment rate of at least 150% of the federal Bureau of Labor Statistics’ most recently published national average unemployment rate before the date of the application.
§ 8220. Renewal of State Designated Tea Certification. State designated TEA certification letters will not be renewed automatically. An applicant with on-going projects that require a continuing TEA designation and certification must submit a new TEA certification request by using the GO-Biz TEA Interactive Tool and following the process described.
§ 8230. EB-5 Survey. On an annual basis, the GO-Biz International Trade and Investment Program is required to survey the regional centers located in California for statistical and reporting purposes.
Article 4 deals with the California Innovation Hub Program and contains eight sections.
§ 8300. Definitions. The following terms are defined in this section: “Applicant”; “Evaluated Criteria”; “GO-Biz”; “Incubator/business accelerator”; “Innovation Hub Partners or Partnerships”; “iHub Worldwide Innovation Network” or “iWIN”; “Memorandum of understanding” or “MOU”; “Knowledge node”; “Review Committee”; “Request for proposal”; and, “State of the art.”
§ 8310. Application Process for Ihub Designation. At its sole discretion, GO-Biz will release a request for proposal for the iHub Program on its website when there is availability to add a new iHub because of a termination of an IHub, an expiration of an iHub or the availability of a region. The request for proposal must include a schedule with specified information.
§ 8320. Applicant Evaluation. Following the submittal, the application will be reviewed by a Review Committee based on a scoring mechanism described below evaluating each of the “Evaluated Criteria” specifically listed.
§ 8330. Grounds for Rejection. GO-Biz reserves the right to waive any immaterial deviation in a proposal. However, the waiver of an immaterial deviation in a request for proposal in no way excuses the Applicant from full compliance with the request for proposal requirements after the Applicant is awarded iHub designation pursuant to the terms of the MOU. A request for proposal must be rejected for specified reasons.
§ 8340. Requirements of Designated Ihubs. If granted formal designation, the iHub is required to do specified actions.
§ 8350. Ihub Innovation Accelerator Account. In order for GO-Biz to accept any gifts, bequests or donations to be used for California iHub purposes, the donor must clearly identify in writing the use of the funds and set forth any criteria that it requires GO-Biz to review and consider prior to distributing the funds, including, but not limited to, iHub’s compliance with the terms of the MOU.
§ 8360. Reporting Requirements. The iHub coordinator for each designated iHub will submit an annual report to GO-Biz. Reporting requirements will be based upon terms set forth in the MOU, which will include specified information.
§ 8370. Changes or Modifications. If an iHub changes its legal entity formation (e.g., limited liability partnership converted to a corporation) or its legal name, it must notify GO-Biz in writing of this change no later than thirty (30) calendar days after such change takes legal effect. The parties must then enter into a new MOU to reflect such change.
§ 8380. Revocation Process. If GO-Biz determines that a designated iHub is not complying with these regulations or the terms of the MOU, GO-Biz is required to provide written notice identifying the deficiencies and the corrective action required.
- General Guidance in Reading the Public Utilities Code - July 1, 2022
- How Much Time Does the California Governor Have to Act on Bills? - July 1, 2022
- What Will Be on the November 2022 Statewide Ballot? - June 30, 2022