Section 25625.2.
Cal. Public Resources Code - PRC § 25625.2.
in effect(a)
The commission shall establish and administer the Climate Innovation Program to provide financial incentives to California-headquartered companies for developing and commercializing technologies that provide technological advancements that either help California meet its greenhouse gas reduction targets and achieve its climate goals on an accelerated timeline and at a lower cost, or enable the state to be more resilient to the impacts of climate change such as drought and wildfire.
(b)
In administering the Climate Innovation Program, the commission shall do all of the following:
(1)
Award funds to California-headquartered companies.
(2)
(A)
Award funds to research teams consisting of California-headquartered companies working jointly with California public university students, faculty, or researchers at a University of California or a California State University facility, including innovation hubs, Innovation and Entrepreneurship Centers, or California Institutes for Sciences and Innovation, as provided through a memorandum of understanding or contract between the California-headquartered company and these public entities.
(B)
Notwithstanding subdivision (a), eligible applicants may include corporations or other business entities that enter into written agreements with the commission that the company will relocate its headquarters to California and comply with the requirements of this chapter if granted an incentive, 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 permit 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.
(3)
Conduct a stakeholder-driven process to identify and prioritize investments in technological advancements for the Climate Innovation Program that:
(A)
Provide the greatest potential benefits to the state’s climate goals, including, but not limited to, zero-emission transportation, lithium processing, manufacturing, and recovery, regenerative agriculture, and drought and wildfire prevention.
(B)
Are not sufficiently addressed by other funding programs.
(C)
May leverage and attract significant federal funding to California.
(4)
Negotiate with an eligible
applicant the terms and conditions of proposed written agreements that provide the financial incentives allowed pursuant to this chapter. The written agreement may include such terms and conditions as required by the commission, including, but not limited to, requiring repayment of some or all of the financial incentive over a period of time determined in the written agreement.
(5)
Provide the negotiated written agreement to the commission for its approval at a duly noticed public meeting held in accordance with the Bagley-Keene Open Meeting Act (Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of Division 3 of Title 2 of the Government Code), including the proposed terms and conditions from paragraph (4).
(6)
Post on its internet website all of the following information:
(A)
The name of each
applicant granted a financial incentive under this chapter.
(B)
The estimated amount of the investment by each applicant.
(C)
The estimated number of jobs created or retained.
(D)
The amount of the financial incentive granted to the funding recipient.
(E)
The amount of the financial incentive recaptured from the funding recipient, if applicable.
(7)
(A)
Include a term requiring the recipient, if there is a liquidity event, to repay the full amount of the financial incentive plus an additional percentage. The additional percentage shall be set at 20 percent. The commission and recipient may enter into a repayment plan for the recipient to make the repayment over time
instead of the recipient making a one-time payment. The percentage may be increased to the extent the recipient fails to meet the performance metrics it agrees upon with the commission.
(B)
Each financial incentive shall include performance metrics, including jobs created and environmental benefits, and may include other metrics, including, but not limited to, follow-on investment, patents filed, and estimated benefits to California based on a reasonable estimate of market adoption.
(C)
The commission shall exempt from the repayment term in subparagraph (A) a “producer,” as defined in Section 47002 of the Revenue and Taxation Code, that pays a lithium extraction excise tax pursuant to Section 47010 of the Revenue and Taxation Code.
(D)
The commission may exempt projects from the repayment term in subparagraph (A) if
it is prohibited by a recipient’s existing or announced federal award.
(8)
(A)
Establish a process for selecting and overseeing projects funded through the Climate Innovation Program to ensure financial incentives are used to advance technologies that help meet the state’s climate goals.
(B)
The process described in subparagraph (A) shall include developing criteria for awarding financial incentives and providing oversight over funded projects.
(9)
Require each recipient to report on the number of jobs created and the project’s measurable environmental benefits. The commission may require each recipient to report on other specific, measurable performance metrics, including, but not limited to, follow-on investment, patents filed, and estimated benefits to California based on a reasonable
estimate of market adoption, as determined by the commission.
(10)
Maintain an online database that includes, but is not limited to, a brief description of each project for which funding was awarded, including the name of the recipient, the amount of the award, and the outcomes of the funded project.
(11)
(A)
Solicit applicants and award financial incentives using a competitive award process. The commission may noncompetitively award follow-on financial incentives to awardees of a prior competitive award process.
(B)
The commission may use the competitive award process of another organization to award funds or provide follow-on funding for a company previously selected through a competitive process for the purpose of attracting significant federal or private funding for the projects or for the
purpose of accelerating the delivery of program benefits.
(C)
Notwithstanding any other law, in its discretion, advance up to 25 percent of the financial incentive awarded pursuant to this chapter, in a manner consistent with Section 11019 of the Government Code.
(12)
(A)
Without limiting any other rights and remedies available to the commission, the commission may include the following repayment term:
“Without limiting any of its other remedies, the commission may, for recipient’s noncompliance of any financial incentive requirement, withhold future payments, demand and be entitled to repayment of past reimbursements, or suspend or terminate this financial incentive. The tasks in the scope of work are not severable, and completion of all of them is material to this financial
incentive. Another material aspect of this financial incentive is that the recipient shall be a California-headquartered company for the entire term of the financial incentive and an additional 10 years. Thus, the commission, without limiting its other remedies, is entitled to repayment of all funds paid to recipient if the recipient does not timely complete all tasks in the scope of work or is not a California-headquartered company at any time during the financial incentive period and an additional 10 years.”
(B)
If both the repayment term described in subparagraph (A) and the repayment term in paragraph (4) apply, the repayment term of paragraph (4) has priority, but the repayment term of subparagraph (A) also applies.
(C)
The commission may exempt projects from the repayment term described in subparagraph (A) if it is prohibited by a
recipient’s existing or announced federal award.
(13)
Include a term requiring all funds awarded in the financial incentive to be spent on projects located in California.
References
referencesCal. Health and Safety Code - HSC § 123460.
referencesCal. Government Code - GOV § 11120.
referencesCal. Revenue and Taxation Code - RTC § 47002.
referencesCal. Revenue and Taxation Code - RTC § 47010.
referencesCal. Government Code - GOV § 11019.
Source: CA Legislative Counsel Bulk DataURL: https://downloads.leginfo.legislature.ca.gov/pubinfo_2025.zipFetched: 6/27/2026