Proposed California Investment & Innovation Program (Cal IIP) Regulations (07.05.23)
CALIFORNIA POLLUTION CONTROL FINANCING AUTHORITY
TITLE 4. BUSINESS REGULATIONS
DIVISION 11. CALIFORNIA POLLUTION CONTROL FINANCING AUTHORITY
ARTICLE 13. CALIFORNIA INVESTMENT AND INNOVATION PROGRAM
TEXT OF PROPOSED REGULATIONS
§ 8140. Definitions.
The following definitions shall apply wherever the terms are used throughout this Article.
(a) “CDFI” means community development financial institution, as defined in Health and Safety Code section 44458, subdivision (d).
(b) “Eligible Activities” means activities that serve the purposes of Health and Safety Code section 44558.3, subdivision (b).
(c) “Grant” means an award of funds made by the Authority to the Grantee to support the Project, as authorized by Health and Safety Code section 44558.1 and this Article.
(d) “Grant Agreement” means the written agreement between the Authority and a Grantee, setting forth the terms and conditions of the use of the Grant.
(e) “Grantee” means an Applicant whose Grant has been approved and has executed a Grant Agreement.
(f) “Project” means the activities and deliverables to be accomplished through Grant funding.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Sections 44558 and 44558.1, Health & Safety Code.
§ 8141. Eligibility Requirements.
Grants shall only be awarded to Applicants that meet the eligibility requirements in Health and Safety Code section 44558, subdivision (f).
Applicants that are a party to an existing or prior Grant Agreement may only apply in a future funding round if at least 50% of the previously awarded Grant funds have been spent on the Project.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Sections 44558 and 44558.2, Health & Safety Code.
§ 8142. Approved Grant Uses.
Grants shall be awarded for Eligible Activities.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Section 44558.3, Health & Safety Code.
§ 8143. Application Requirements.
Applications are due no later than November 1 of each calendar year. An Application shall include the following:
(a) Applicant Information.
(1) The legal name of the CDFI applying for a grant, address of the principal office, phone number, website, Employer Identification Number (EIN) or Taxpayer Identification Number (TIN);
(2) Financial institution type (e.g., bank or thrift-state chartered, loan fund, credit union, bank holding, bank or thrift, venture capitalist), date of incorporation, financial activities start date, and total asset size;
(3) Name of authorized representative(s), title and e-mail address for authorized representative(s), name, phone number, and e-mail address for primary point of contact;
(4) Applicant’s geographic markets and target areas;
(5) The grant amount sought, not to exceed the applicable maximum eligible amount in section 8143;
(6) Applicant’s fiscal year;
(7) A narrative of previous Grants awarded by the Authority, if applicable, and how previously awarded Grant funds were spent; and
(8) Indicate if Applicant is a small and emerging CDFI.
(b) Project Information.
(1) Detailed narrative, including discussion of Applicant’s mission, markets served, competition, targeted regions and clients, organization infrastructure and resources to support ongoing activities, management team, and strategic plans;
(2) Explanation of how the Grant will support the Applicant’s mission;
(3) Description of the proposed Eligible Activities that will be performed with the Grant;
(4) Identification of any proposed new target markets and target populations that will be served by the Grant;
(5) Identification of any proposed new financial activities and services that will be undertaken with the Grant; and
(6) Description of the level of distress of the impacted community or new market that is being served. Include indicators to help quantify the level of distress that underserved communities are experiencing, such as geography, unemployment rate, poverty rate, industries impacted, number of businesses licenses issued, and fiscal stress.
(c) Attachments.
(1) Attachment A: Current federal certification as described in Health and Safety Code section 44558, subdivision (f)(1);
(2) Attachment B: Financial statements for the past three years; and
(3) Attachment C: Loan Portfolio.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Section 44558.2, Health & Safety Code.
§ 8144. Grant Awards.
(a) Grants are awarded once per calendar year, provided funding is available. Grants will be awarded to all eligible Applicants that submit a timely and complete application, for the full or partial amount requested.
(b) Authority shall set aside 20 percent of any amount made available in a Program funding round for small and emerging CDFIs, as defined in Health and Safety Code section 44558, subdivision (l). This funding will be divided equally among all eligible Applicants that are small and emerging CDFIs.
(c) The size of grant awards shall be based on the total amount of loans closed by the Applicant in the most recently completed fiscal year. Funding shall be awarded based on the following tier system:
(1) Tier 1: Grantee will receive up to $100,000.
(2) Tier 2: Applicants with a minimum of 10 loans in the most recently completed fiscal year or $10 million in investments will receive an additional $100,000. The maximum grant award for a Tier 2 Grantee is $200,000.
The final funding amounts per tier are subject to change depending on the funding available and the total number of eligible Applicants.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Sections 44558.2, Health & Safety Code.
§ 8145. Authority Approval.
(a) The Executive Director will determine which Projects to recommend to the Authority for Grant funding pursuant to section 8144. The Authority’s selections are final and not subject to administrative appeal.
(b) The Authority shall notify each Applicant whether or not its Application has been approved for funding.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Sections 44558.2, Health & Safety Code.
§ 8146. Grant Agreements.
The terms and conditions of a Grant shall be set forth in a Grant Agreement entered into by the Authority and the Grantee. A Grantee has the sole responsibility for the fiscal management of Grant funds, recordkeeping, reporting, performance of the Project, and all other aspects of compliance with this Article and the Grant Agreement. The Grant Agreement shall include the following:
(a) Grant amount.
(b) Grantee contact information.
(c) Grant duration.
(d) Description of the Project funded by the Grant award.
(e) Agreement that, during the duration of the Grant, the Grant shall only be used to support the Project;
(f) Agreement to comply with the Program statutes and regulations;
(g) Agreement that Grantee is ineligible for future Grants if they violate any Program statute or regulation, or fail to comply with the Grant Agreement;
(h) Agreement that the Grantee will defend, indemnify and hold harmless the Authority and the State, and all officers, trustees, agents and employees of the same, from and against any and all claims, losses, costs, damages, or liabilities of any kind or nature, whether direct or indirect, arising from or relating to the Grant, the Project, or this Program;
(i) Agreement to comply with laws outlawing discrimination including, but not limited to those prohibiting discrimination because of sex, race, color, ancestry, religion, creed, national origin, physical disability (including HIV and AIDS), mental disability, medical condition (cancer or genetic characteristics), sexual orientation, political affiliation, position in a labor dispute, age, marital status, and denial of statutorily-required employment-related leave;
(j) Agreement that continued compliance with Program requirements is the Grantee's responsibility;
(k) Any other provision agreed to by the parties.
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Sections 44558.3, Health & Safety Code.
§ 8147. Annual Reporting.
No later than 180 days after the Grantee’s fiscal year ends, a Grantee shall provide an annual status report to the Authority that includes:
(a) A description of the activities completed with Grant funds during the reporting period;
(b) The amount of Grant funds spent throughout the reporting period;
(c) An annual financial statement; and
(d) Information provided by businesses to the Grantee pursuant to Health and Safety Code section 445585.5, subdivision (a)(5).
Note: Authority cited: Sections 44520 and 44558.4, Health & Safety Code. Reference: Section 44558.5, Health & Safety Code.
§ 8148. Record Retention
Grantees shall retain all Program and financial data necessary to substantiate the purposes for which the Grant funds were spent for a period of three years after the end of the Grant term. Grantees shall provide supporting documentation (e.g. progress reports, project work plan, Program budget, receipts, etc.) upon request to the Authority.