California Incentives and Workforce Development Guide

CA Incentives | Finance, Loans, IRB, Workforce Development
A comprehensive list of California financial aid, loans, grants, abatements, workforce development, exemptions, funds & capital investment opportunities.

California Incentives and Workforce Development Guide


California Incentives and Workforce Development Guide

For a list of California economic development agencies that can help with the site selection process, visit our Online Site Seekers’ Guide.



Alternative and Renewable Fuel and Vehicle Technology Program: Demonstrating California’s leadership in the national push to reduce dependency on petroleum and greenhouse gas emissions while improving energy security, the Alternative and Renewable Fuel and Vehicle Technology Program (also known as “AB 118”) provides financial incentives (as much as $100 million annually through competitive grants, loans, loan guarantees, revolving loans and other appropriate measures or means) for businesses, vehicle and technology manufacturers, workforce training partners, fleet owners, consumers and academic institutions to develop and deploy alternative and renewable fuels as well as advanced transportation technologies that help the state meet its policy objectives on climate change.

Brownfields Revolving Loan Fund Program: Provides low-interest rate loans between $200,000 and $900,000 for financing cleanup activities of sites by eligible public or private property owners including government agencies, private property owners as well as non-profit organizations. Up to $200,000 in sub-grants can also be awarded to government agencies and non- profit organizations.

California Capital Access Program: The CalCAP encourages participating banks and lending institutions to provide loans to small businesses that fall outside of conventional underwriting standards. Small business owners that have difficulty in obtaining conventional financing may qualify for a CalCAP loan through any CalCAP lender.

California Capital Access with Collateral Support (CalCAP – CS): CalCAP CS pledges cash to cover the collateral shortfall of loans of $100,000 or more. CalCAP CS provides up to 40% of the loan value, with the possibility of an additional 10% for businesses located in a Severely Affected Community. Small business lenders loaning to businesses classified as a small business under U.S. Small Business Administration guidelines and that have fewer than 500 FTEs. The borrower’s primary business and at least 51% of its employees or business income, sales or payroll must be in California. The business activity resulting from the bank’s loan must be created and retained in California.

Electric Program Investment Charge (EPIC) Program: The EPIC (previously called the Public Interest Energy Research program), is the state’s premier energy research, development and deployment program for the advancement of science and technology in the fields of energy efficiency, renewable energy, advanced electricity technologies, energy- related environmental protection, transmission and distribution as well as transportation technologies. Over the last 10 years EPIC has invested over $700 million to assist utilities and energy companies in the development and deployment of technologies that provide environmental and economic benefits to California’s energy ratepayers.

Energy Innovations Small Grant (EISG) Program: The EISG Program provides up to $95,000 for hardware projects and $50,000 for modeling projects to small businesses, non-profits, individuals and academic institutions to conduct research that establishes the feasibility of new, innovative energy concepts. Research projects must target one of the specified R&D areas, address a California energy problem and provide a potential benefit to California electric and natural gas ratepayers. To encourage participation in the program the application and award process has been simplified and assistance is available in gaining access to technical experts.

Industrial Development Bond (IDB): IDB financing is a competitive financing option available for the acquisition of manufacturing facilities and equipment providing a financing option for manufacturers to access private capital markets at tax-exempt rates. The benefits of IDB financing include interest rates generally 20-30% lower than conventional financing.

Pollution Control Tax-Exempt Bond Financing Program: Private activity tax-exempt bond financing to California businesses for the acquisition, construction or installation of qualified pollution control, waste disposal, waste recovery facilities and the acquisition and installation of new equipment.

Small Business Loan Guarantee (SBLGP): The California SBLGP assists businesses with the creation and retention of jobs while encouraging investment into low- to moderate-income communities. The SBLGP enables small businesses to not only obtain a loan it could not otherwise obtain but more importantly helps to establish a favorable credit history with a lender so the business may obtain loans in the future on its own without the assistance of the program.



California Competes Tax Credit: The California Competes Tax Credit is an income tax credit available to businesses that want to come to California or stay and grow in California. Unlike the Enterprise Zone program this program is Statewide. Thus, there are no geographic restrictions. Tax credit agreements will be negotiated by GO-Biz and approved by the “California Competes Tax Credit Committee.”

California Film & Television Tax Credit Program: The California Film Commission offers a tax credit incentive program to qualified motion pictures. $100 million has been allocated annually beginning in fiscal year 2009-2010 through 2016-2017. The Program allows a 20% tax credit for qualified production related expenses to a taxpayer against State income taxes.

California Research & Development Tax Credit: Corporate income tax credits available to companies that have incurred qualified research expenses in California. A taxpayer qualifies for the credit if it paid or incurred qualified research expenses while conducting qualified research in California. The taxpayer may receive up to 15% of the excess of current year research expenditures over a computed base amount.

(Full) Sales and Use Tax Exclusion – Advanced Manufacturing & Transportation and Alternative Energy: A sales tax exclusion from both state and local sales tax collection on equipment purchases for qualifying businesses that conduct qualifying activities. Sales tax rates vary by jurisdiction (typically 7% to 9.25%).

New Employment Hiring Tax Credit (NEC): The New Employment Credit (NEC) is available for each taxable year beginning on or after January 1, 2014, and before January 1, 2021, to a qualified taxpayer that hires a qualified full-time employee on or after January 1, 2014, and pays or incurs qualified wages attributable to work performed by the qualified full-time employee in a designated census tract or economic development area, and that receives a tentative credit reservation for that qualified full-time employee.

Research & Development Tax Credit: The California R&D tax credit program reduces income or franchise tax. You may qualify for the credit if you paid or incurred qualified research expenses while conducting qualified research activity in California. You may receive 15% of the excess of current year research expenditures over a computed base amount (minimum of 50% of current year research expenses) or a 24% credit for basic research payments to third party organizations. You may claim the credit on the return for the taxable year you incurred the qualified expenses. Qualified research expenses include wages, supplies and contract research costs. To qualify, the research must be conducted within California and include basic or applied research of scientific inquiry, original investigation for the advancement of scientific or engineering knowledge or improved function of a business component. California has several exceptions to the federal law that can affect your computations for the credit.

Sales and Use Tax Exemption for Agriculture: This program, which is administered by the Board of Equalization, provides a partial sales tax exemption available under section 6356.5 for the sale, storage, use or other consumption of farm equipment, machinery and their parts to qualified persons for use in qualifying activities. The partial exemption may also apply to leases. The partial exemption applies only to the state sales and use tax rate portion. The exemption does not apply to any local, city, county or district taxes. Sales and purchases of farm equipment, machinery and parts will continue to be subject to the remaining portion of the sales and use tax rate consisting of the local, city, county and any applicable district taxes.

Sales and Use Tax Exemption for Manufacturing: This program, which is administered by the Board of Equalization, provides a sales tax exemption of 4.1875% for basic manufacturing equipment. In addition, equipment for food processing manufacturing and research and development, biotechnology manufacturing and research and development and manufacturing research and development are eligible for the exemption. Tenant improvements for manufacturing or research and development may also be eligible.



Employment Training Panel: Provides funding to employers to assist in upgrading the skills of their workers through training that leads to good paying, long-term jobs. It is a cash reimbursement for training cost incurred by employers set by a pre-determined two-year performance based contract. Contracts vary based on number of employees enrolled, hours of training, training material and employee wages.

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