20250AB__026594ENR INTRODUCED 2025-01-17 AMENDED_ASSEMBLY 2025-04-21 AMENDED_ASSEMBLY 2025-05-23 AMENDED_SENATE 2025-06-26 AMENDED_SENATE 2025-08-29 PASSED_ASSEMBLY 2025-09-12 PASSED_SENATE 2025-09-11 ENROLLED 2025-09-16 2025 AB ENR Introduced by Assembly Member Caloza (Principal coauthor: Assembly Member Solache) (Coauthors: Assembly Members Bonta, Fong, Garcia, Gipson, Harabedian, Pacheco, and Schiavo) (Coauthor: Senator Cortese) LEAD_AUTHOR ASSEMBLY Caloza PRINCIPAL_COAUTHOR ASSEMBLY Solache COAUTHOR ASSEMBLY Bonta COAUTHOR ASSEMBLY Fong COAUTHOR ASSEMBLY Garcia COAUTHOR ASSEMBLY Gipson COAUTHOR ASSEMBLY Harabedian COAUTHOR ASSEMBLY Pacheco COAUTHOR ASSEMBLY Schiavo COAUTHOR SENATE Cortese

An act to add and repeal

Article 8 (commencing with

Section 12100.80) of

Chapter 1.6 of Part of Division of Title of the Government Code, relating to economic recovery. economic recovery Small Business Recovery Fund Act. Existing law establishes the Office of Small Business Advocate (OSBA) within the Governor’s Office of Business and Economic Development, also known as GO-Biz, to advocate for causes of small business and to provide small businesses with the information they need to survive in the marketplace.

This bill, upon appropriation by the Legislature, would require OSBA to allocate 90% of the moneys appropriated to the Small Business Recovery Fund, which would be created within the State Treasury, for purposes of a small business recovery grant program to provide competitive grants to small businesses, as defined, that are directly impacted by a state of emergency proclaimed by the Governor or other specified emergencies. The bill would require the funds to be used for, among other things, to support recovery and rebuilding efforts, and would require a grantee to match the amount of the grant awarded.

The bill would require OSBA to award grants in amounts that range from $2,500 to $100,000, inclusive. This bill would require OSBA to allocate 5% of the moneys appropriated to the fund to the Small Business Technical Assistance Program administered by GO-Biz, for grants to small business technical assistance centers that provide direct service to disaster-affected areas, and 5% to the Capital Infusion Program administered by GO-Biz, to support increased demand for capital-related technical assistance in disaster areas.

This bill would require the Director of the Office of Small Business Advocate to prepare and submit a report to the Legislature on the results of grant funds awarded for each state of emergency proclaimed by the Governor, as provided. This bill would repeal the Small Business Recovery Fund Act on January 1, 2032. MAJORITY NO YES NO NO NO NO NO NO NO NO The people of the State of California do enact as follows:

SECTION

Article 8 (commencing with

Section 12100.80) is added to

Chapter 1.6 of Part of Division of Title of the Government Code , to read: 8. Small Business Recovery Fund Act 12100.80. This

article shall be known, and may be cited, as the Small Business Recovery Fund Act. 12100.81. The Legislature finds and declares all of the following: (

a) Severe weather-related and natural disaster events have caused significant economic and operational disruptions to small businesses across California. (

b) Recovery, rebuilding, and investments in resilient infrastructure are essential to ensuring businesses remain viable and contribute to California’s economic stability. (

c) Establishing a recovery fund will provide essential support to impacted entities and promote long-term resilience against future disasters. 12100.83. (

a) Upon appropriation by the Legislature for purposes of this article, the Office of Small Business Advocate shall allocate percent of the moneys appropriated to the Small Business Recovery Fund, which shall be created within the State Treasury, for purposes of a small business recovery grant program to provide competitive grants to small businesses that are directly impacted by a state of emergency proclaimed by the Governor, a local emergency proclaimed by the governing body of a city, county, or city and county, or other state of emergency, including, but not limited to, earthquakes, natural or man-made disasters specific to that jurisdiction, conditions of extreme peril to persons or property, or a state of war emergency. (

b) The grant program shall prioritize funding for eligible small businesses affected by the natural disasters referenced in the Governor’s Proclamation of a State of Emergency, issued January 7, 2025, and by any subsequent disasters covered by a proclamation of a state of emergency issued by the Governor while the fund is in existence. 12100.84. (

a) Funds awarded pursuant to the small business recovery grant program shall be used for the following purposes:

(1) To support recovery and rebuilding efforts for grantees.

(2) To promote investment in more resilient infrastructure, including, but not limited to, all of the following: (

A) Infrastructure upgrades and improvements. (

B) Relocation of electrical or business equipment. (

C) Business relocation to more secure locations within the state. (

D) Investment in additional insurance coverage.

(3) To ensure that grantees can reopen and remain viable. (

b) Grant funds may be used retroactively for work already performed in response to the proclaimed disaster, provided sufficient documentation is submitted to the Office of Small Business Advocate. 12100.85. (

a) Except as provided in subdivision (b), and in accordance with

Section 12100.86, a small business, as defined in

Section 14837, may apply for funds under the small business recovery grant program. (

b) Notwithstanding subdivision (a), funds shall not be awarded to any of the following:

(1) Foundations and charitable trusts.

(2) Gambling establishments.

(3) Adult entertainment establishments.

(4) Hospitals or nursing facilities.

(5) Rental property businesses. 12100.86. An applicant for the small business recovery grant program shall meet the following qualifications: (

a) The applicant shall be current with all state payroll taxes, sales taxes, and income taxes, as applicable. (

b) The applicant was not the subject of an order for relief in bankruptcy as of the date of the declared disaster. (

c) The applicant has not permanently ceased operations. (

d) The applicant is not barred from receiving federal or state funds. 12100.87. (

a) The Office of Small Business Advocate shall award grants pursuant to the small business recovery grant program through a competitive process.

(1) The rating criteria for the grant application may include, but is not limited to, all of the following: (

A) The viability of the applicant’s recovery plan. (

B) The applicant’s ability to match grant funds. (

C) The efficacy and long-term impact of the applicant’s proposed recovery efforts.

(2) Preference in awarding grants shall be given to applicants who receive technical assistance through the Small Business Technical Assistance Program administered by the Office of Small Business Advocate. (

b) The office shall award grants in amounts that range from two thousand five hundred dollars ($2,500) to one hundred thousand dollars ($100,000), inclusive. (

c) A grantee shall match on a dollar-for-dollar basis, the amount of the funds awarded pursuant to the small business recovery grant program. The applicant may use funds received from insurance claims, small business association recovery loans, or in-kind contributions to satisfy the match requirement. 12100.88. (

a) The Office of Small Business Advocate shall allocate percent of the funds appropriated to the Small Business Recovery Fund for both of the following purposes:

(1) Five percent shall be allocated to the Small Business Technical Assistance Program for grants to small business technical assistance centers that provide direct service to disaster-affected areas.

(2) Five percent shall be allocated to the Capital Infusion Program, administered by the Governor’s Office of Business and Economic Development, to support increased demand for capital-related technical assistance in disaster areas. (

b) It is the intent of the Legislature that funds allocated pursuant to this

section be prioritized to provide outreach and assistance to small businesses owned by ethnic minorities, women, and other disenfranchised segments of the population. 12100.89. (

a) It is the intent of the Legislature to evaluate the effectiveness of the Small Business Recovery Fund periodically and appropriate additional funds as necessary to address ongoing and future disaster recovery needs. (

b) The Director of the Office of Small Business Advocate shall prepare a report on the results of grant funds awarded pursuant to this

article for each state of emergency proclaimed by the Governor. The director shall submit a report to the Legislature on or before days after a state of emergency is proclaimed by the Governor. The report shall be submitted in compliance with

Section 9795. 12100.90. This

article shall remain in effect only until January 1, 2032, and as of that date is repealed.