Bill to Restore Tax Credit Funding Goes to Governor

Share

JobCreatorA California Chamber of Commerce-supported job creator bill to restore full funding to the California Competes Tax Credit program awaits action by the Governor after passing the Legislature in the closing hours of the session.

AB 1560 (Quirk-Silva; D-Fullerton) ensures California remains a competitive environment for employer investment.

Bipartisan Support

An urgency measure, AB 1560 passed the Senate and Assembly with overwhelming bipartisan support.

Last year, Governor Edmund G. Brown Jr. signed legislation that created a new tax credit program administered by the Governor’s Office of Business and Economic Development (GO-Biz). This program enables GO-Biz to negotiate agreements and provide economic incentives to employers in exchange for investment and employment expansion in California.

Employers must apply for this program and, before awarding any incentives, GO-Biz evaluates each application based on a number of factors, including the number of jobs created, the amount of wages and benefits provided to employees, the duration of the investment, and the overall size of the investment in the state.

In addition 25% of the funds awarded must be provided to small business.

Successful Program

The program proved to be very successful in its first year—the fund was oversubscribed by $470 million. The awards that were approved by GO-Biz are projected to create nearly 6,000 jobs and generate more than $2 billion in investments.

Unfortunately, recently enacted legislation reduces the amount of funding in future years, weakening a valuable economic tool that has contributed to a more competitive environment in the state.

AB 1560 authorizes the Department of Finance to restore funding to the program and, in doing so, sends a strong message to employers that California favors economic policies that make the state more investment-friendly.

The CalChamber will be asking the Governor to sign AB 1560.

Staff Contact: Jeremy Merz

Costly Anti-Business Bills Pass Legislature to Governor
President of Mexico, Governor Brown Continue Momentum of Trade Mission
Share
Jeremy Merz
About Jeremy Merz
Jeremy Merz specialized in workers’ compensation, taxation, privacy, transportation and infrastructure issues while a CalChamber policy advocate from December 2011 through December 2016. He now is vice president, state affairs – western region at the American Insurance Association. Merz came to the CalChamber from Downey Brand, LLP, where he represented private defendants in state and federal courts on business litigation, employment law and workers’ compensation litigation. He earned a B.A. in economics from the University of California at Davis and a J.D. with distinction from the McGeorge School of Law, University of the Pacific, where he served on the editorial board of the McGeorge Law Review.