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    © 2025 Veeto.
    SB-86
    Energy & Environment

    California Alternative Energy and Advanced Transportation Financing Authority Act: sales and use tax exclusion.

    Engrossed
    CA
    ∙
    2025-2026 Regular Session
    1
    0
    Track
    Track

    Key Takeaways

    • Extends the sales tax exclusion program for clean energy and manufacturing projects through January 1, 2031.
    • Adds nuclear fusion power facilities to projects eligible for tax benefits.
    • Maintains annual funding cap at $100 million for qualifying projects.
    • Requires economic and environmental impact reports to the Legislature by January 2027.

    Summary

    Senator McNerney's proposal to extend California's alternative energy and advanced manufacturing tax incentives through 2031 expands eligibility to include nuclear fusion technology while maintaining the program's focus on environmental protection and economic development. The legislation continues sales and use tax exclusions for projects that promote California-based manufacturing, create jobs, and reduce environmental impacts.

    The bill maintains the annual cap of $100 million in tax exclusions for qualifying projects, with a temporary increase to $115 million through 2024 that includes $15 million specifically for lithium-related manufacturing. Out-of-state and international companies remain eligible for these incentives when establishing manufacturing facilities in California.

    Under the extended program, the California Alternative Energy and Advanced Transportation Financing Authority must evaluate projects based on their manufacturing investment, job creation potential, and environmental benefits. The authority will study the program's economic and environmental outcomes, with findings due to the Legislature by January 2027.

    The legislation preserves existing oversight mechanisms, including public hearings for project approvals and coordination between the authority and the State Air Resources Board to verify compliance with environmental requirements. As a tax levy, the provisions would take effect immediately upon enactment.

    Key Dates

    Next Step
    Referred to the Assembly Standing Committee on Appropriations
    Next Step
    Assembly Committee
    Referred to the Assembly Standing Committee on Appropriations
    Hearing has not been scheduled yet
    Assembly Revenue And Taxation Hearing
    Assembly Committee
    Assembly Revenue And Taxation Hearing
    Do pass as amended and be re-referred to the Committee on [Appropriations]
    Assembly Transportation Hearing
    Assembly Committee
    Assembly Transportation Hearing
    Do pass and be re-referred to the Committee on [Revenue and Taxation]
    Vote on Senate Floor
    Senate Floor
    Vote on Senate Floor
    Special Consent SB86 McNerney et al
    Senate Appropriations Hearing
    Senate Committee
    Senate Appropriations Hearing
    Do pass as amended
    Senate Appropriations Hearing
    Senate Committee
    Senate Appropriations Hearing
    Placed on suspense file
    Senate Revenue and Taxation Hearing
    Senate Committee
    Senate Revenue and Taxation Hearing
    Do pass, but first be re-referred to the Committee on [Appropriations]
    Introduced
    Senate Floor
    Introduced
    Introduced. Read first time. To Com. on RLS. for assignment. To print.

    Contacts

    Profile
    Anna CaballeroD
    Senator
    Bill Author
    Not Contacted
    Not Contacted
    Profile
    Tim GraysonD
    Senator
    Bill Author
    Not Contacted
    Not Contacted
    Profile
    Joaquin ArambulaD
    Assemblymember
    Committee Member
    Not Contacted
    Not Contacted
    Profile
    Buffy WicksD
    Assemblymember
    Committee Member
    Not Contacted
    Not Contacted
    Profile
    Laurie DaviesR
    Assemblymember
    Bill Author
    Not Contacted
    Not Contacted
    0 of 21 row(s) selected.
    Page 1 of 5
    Select All Legislators
    Profile
    Anna CaballeroD
    Senator
    Bill Author
    Profile
    Tim GraysonD
    Senator
    Bill Author
    Profile
    Joaquin ArambulaD
    Assemblymember
    Committee Member
    Profile
    Buffy WicksD
    Assemblymember
    Committee Member
    Profile
    Laurie DaviesR
    Assemblymember
    Bill Author
    Profile
    Lisa CalderonD
    Assemblymember
    Committee Member
    Profile
    Mike FongD
    Assemblymember
    Committee Member
    Profile
    Diane DixonR
    Assemblymember
    Committee Member
    Profile
    Gregg HartD
    Assemblymember
    Committee Member
    Profile
    Corey JacksonD
    Assemblymember
    Bill Author
    Profile
    Blanca PachecoD
    Assemblymember
    Committee Member
    Profile
    Gail PellerinD
    Assemblymember
    Committee Member
    Profile
    Kate SanchezR
    Assemblymember
    Committee Member
    Profile
    Tri TaR
    Assemblymember
    Committee Member
    Profile
    Angelique AshbyD
    Senator
    Bill Author
    Profile
    Jessica CalozaD
    Assemblymember
    Committee Member
    Profile
    Mark GonzalezD
    Assemblymember
    Committee Member
    Profile
    Heather HadwickR
    Assemblymember
    Committee Member
    Profile
    Jose SolacheD
    Assemblymember
    Committee Member
    Profile
    Jerry McNerneyD
    Senator
    Bill Author
    Profile
    Sade ElhawaryD
    Assemblymember
    Committee Member

    Similar Past Legislation

    Bill NumberTitleIntroduced DateStatusLink to Bill
    AB-2400
    California Alternative Energy and Advanced Transportation Financing Authority Act.
    February 2024
    Failed
    View Bill
    California Alternative Energy and Advanced Transportation Financing Authority: sales and use taxes: exclusions.
    January 2019
    Passed
    View Bill
    Alternative energy financing.
    February 2018
    Failed
    View Bill
    Sales and use taxes: exclusion: alternative energy financing.
    February 2016
    Failed
    View Bill
    Showing 4 of 4 items
    Page 1 of 1

    Get Involved

    Act Now!

    Email the authors or create an email template to send to all relevant legislators.

    Introduced By

    Jerry McNerney
    Jerry McNerneyD
    California State Senator
    Co-Authors
    Anna Caballero
    Anna CaballeroD
    California State Senator
    Angelique Ashby
    Angelique AshbyD
    California State Senator
    Laurie Davies
    Laurie DaviesR
    California State Assembly Member
    Tim Grayson
    Tim GraysonD
    California State Senator
    Corey Jackson
    Corey JacksonD
    California State Assembly Member
    40% progression
    Bill has passed all readings in its first house and is ready to move to the other house (6/4/2025)

    Latest Voting History

    View History
    July 14, 2025
    PASS
    Assembly Committee
    Assembly Revenue And Taxation Hearing
    AyesNoesNVRTotalResult
    7007PASS

    Key Takeaways

    • Extends the sales tax exclusion program for clean energy and manufacturing projects through January 1, 2031.
    • Adds nuclear fusion power facilities to projects eligible for tax benefits.
    • Maintains annual funding cap at $100 million for qualifying projects.
    • Requires economic and environmental impact reports to the Legislature by January 2027.

    Get Involved

    Act Now!

    Email the authors or create an email template to send to all relevant legislators.

    Introduced By

    Jerry McNerney
    Jerry McNerneyD
    California State Senator
    Co-Authors
    Anna Caballero
    Anna CaballeroD
    California State Senator
    Angelique Ashby
    Angelique AshbyD
    California State Senator
    Laurie Davies
    Laurie DaviesR
    California State Assembly Member
    Tim Grayson
    Tim GraysonD
    California State Senator
    Corey Jackson
    Corey JacksonD
    California State Assembly Member

    Summary

    Senator McNerney's proposal to extend California's alternative energy and advanced manufacturing tax incentives through 2031 expands eligibility to include nuclear fusion technology while maintaining the program's focus on environmental protection and economic development. The legislation continues sales and use tax exclusions for projects that promote California-based manufacturing, create jobs, and reduce environmental impacts.

    The bill maintains the annual cap of $100 million in tax exclusions for qualifying projects, with a temporary increase to $115 million through 2024 that includes $15 million specifically for lithium-related manufacturing. Out-of-state and international companies remain eligible for these incentives when establishing manufacturing facilities in California.

    Under the extended program, the California Alternative Energy and Advanced Transportation Financing Authority must evaluate projects based on their manufacturing investment, job creation potential, and environmental benefits. The authority will study the program's economic and environmental outcomes, with findings due to the Legislature by January 2027.

    The legislation preserves existing oversight mechanisms, including public hearings for project approvals and coordination between the authority and the State Air Resources Board to verify compliance with environmental requirements. As a tax levy, the provisions would take effect immediately upon enactment.

    40% progression
    Bill has passed all readings in its first house and is ready to move to the other house (6/4/2025)

    Key Dates

    Next Step
    Referred to the Assembly Standing Committee on Appropriations
    Next Step
    Assembly Committee
    Referred to the Assembly Standing Committee on Appropriations
    Hearing has not been scheduled yet
    Assembly Revenue And Taxation Hearing
    Assembly Committee
    Assembly Revenue And Taxation Hearing
    Do pass as amended and be re-referred to the Committee on [Appropriations]
    Assembly Transportation Hearing
    Assembly Committee
    Assembly Transportation Hearing
    Do pass and be re-referred to the Committee on [Revenue and Taxation]
    Vote on Senate Floor
    Senate Floor
    Vote on Senate Floor
    Special Consent SB86 McNerney et al
    Senate Appropriations Hearing
    Senate Committee
    Senate Appropriations Hearing
    Do pass as amended
    Senate Appropriations Hearing
    Senate Committee
    Senate Appropriations Hearing
    Placed on suspense file
    Senate Revenue and Taxation Hearing
    Senate Committee
    Senate Revenue and Taxation Hearing
    Do pass, but first be re-referred to the Committee on [Appropriations]
    Introduced
    Senate Floor
    Introduced
    Introduced. Read first time. To Com. on RLS. for assignment. To print.

    Latest Voting History

    View History
    July 14, 2025
    PASS
    Assembly Committee
    Assembly Revenue And Taxation Hearing
    AyesNoesNVRTotalResult
    7007PASS

    Contacts

    Profile
    Anna CaballeroD
    Senator
    Bill Author
    Not Contacted
    Not Contacted
    Profile
    Tim GraysonD
    Senator
    Bill Author
    Not Contacted
    Not Contacted
    Profile
    Joaquin ArambulaD
    Assemblymember
    Committee Member
    Not Contacted
    Not Contacted
    Profile
    Buffy WicksD
    Assemblymember
    Committee Member
    Not Contacted
    Not Contacted
    Profile
    Laurie DaviesR
    Assemblymember
    Bill Author
    Not Contacted
    Not Contacted
    0 of 21 row(s) selected.
    Page 1 of 5
    Select All Legislators
    Profile
    Anna CaballeroD
    Senator
    Bill Author
    Profile
    Tim GraysonD
    Senator
    Bill Author
    Profile
    Joaquin ArambulaD
    Assemblymember
    Committee Member
    Profile
    Buffy WicksD
    Assemblymember
    Committee Member
    Profile
    Laurie DaviesR
    Assemblymember
    Bill Author
    Profile
    Lisa CalderonD
    Assemblymember
    Committee Member
    Profile
    Mike FongD
    Assemblymember
    Committee Member
    Profile
    Diane DixonR
    Assemblymember
    Committee Member
    Profile
    Gregg HartD
    Assemblymember
    Committee Member
    Profile
    Corey JacksonD
    Assemblymember
    Bill Author
    Profile
    Blanca PachecoD
    Assemblymember
    Committee Member
    Profile
    Gail PellerinD
    Assemblymember
    Committee Member
    Profile
    Kate SanchezR
    Assemblymember
    Committee Member
    Profile
    Tri TaR
    Assemblymember
    Committee Member
    Profile
    Angelique AshbyD
    Senator
    Bill Author
    Profile
    Jessica CalozaD
    Assemblymember
    Committee Member
    Profile
    Mark GonzalezD
    Assemblymember
    Committee Member
    Profile
    Heather HadwickR
    Assemblymember
    Committee Member
    Profile
    Jose SolacheD
    Assemblymember
    Committee Member
    Profile
    Jerry McNerneyD
    Senator
    Bill Author
    Profile
    Sade ElhawaryD
    Assemblymember
    Committee Member

    Similar Past Legislation

    Bill NumberTitleIntroduced DateStatusLink to Bill
    AB-2400
    California Alternative Energy and Advanced Transportation Financing Authority Act.
    February 2024
    Failed
    View Bill
    California Alternative Energy and Advanced Transportation Financing Authority: sales and use taxes: exclusions.
    January 2019
    Passed
    View Bill
    Alternative energy financing.
    February 2018
    Failed
    View Bill
    Sales and use taxes: exclusion: alternative energy financing.
    February 2016
    Failed
    View Bill
    Showing 4 of 4 items
    Page 1 of 1