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

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.