(a) (1) There is hereby established within the Workforce Services Branch of the Employment Development Department, the Community Economic Resilience Fund Program, to build an equitable and sustainable economic recovery from the impacts of COVID-19 on California’s industries, workers, and communities, and to provide for the durability of that recovery by fostering long-term economic resilience in the overall transition to a carbon-neutral economy.

(2) The branch shall administer the Community Economic Resilience Fund Program. The program shall be governed by the provisions of this chapter.

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(b) (1) The program shall be administered by the Labor and Workforce Development Agency, the Office of Planning and Research, and the Governor’s Office of Business and Economic Development. These three agencies shall be referred to as the Inter-Agency Leadership Team and shall jointly be responsible for planning, oversight, and decision-making, including, but not limited to all of the following:

(A) Identifying the geographic boundaries of regions in a way that prioritizes economic recovery and transition strategies and is consistent with other state definition of regional economic and labor markets.

(B) Creating program guidelines and evaluation metrics.

(C) Designing a competitive grant structure for CERF investments.

(D) Developing technical assistance and evaluation infrastructure.

(E) Tracking and reporting progress and deliverables.

(2) Program implementation shall be undertaken by the Workforce Services Branch of the Employment Development Department under the direction of the Inter-Agency Leadership Team. It is the intent of the Legislature that CERF be designed to build a more robust, sustainable, and equitable recovery across all sectors of California’s economy and to provide for the durability of that recovery by fostering long-term economic resilience in the overall transition to a carbon-neutral economy.

(3) The Inter-Agency Leadership Team, as established in paragraph (1), shall develop policies for grant funds distributed in this chapter that may fund regional programs and economic development strategies that directly complement state and federal infrastructure, climate, business, and workforce investments in multiple sectors, including housing, transportation, advanced energy, broadband, and natural resources, and connect, in each of those sectors, to any existing or emerging high road training partnerships. Policies and guidelines developed under this provision shall be made publicly available on the Labor and Workforce Development Agency’s internet website.

(4) (A) The Inter-Agency Leadership Team shall consist of the senior cabinet-level appointees, or their designees, representing the Labor and Workforce Development Agency, the Office of Planning and Research, and the Governor’s Office of Business and Economic Development, with policy guidance from subject matter experts within those state entities.

(B) The Inter-Agency Leadership Team shall be supported administratively by the Office of Planning and Research. Administrative support shall include support for convenings, meetings, agendas, gathering, analyzing and communicating stakeholder input, and summarizing guidelines for solicitations and providing this policy guidance to the Workforce Services Branch. The Labor and Workforce Development Agency, the Office of Planning and Research, and the Governor’s Office of Business and Economic Development shall sign memoranda of understanding or inter-agency agreements for purposes of confirming each of their roles and responsibilities in the Interagency Leadership Team.

(c) (1) The program shall provide financial support to establish and support high road transition collaboratives in designing region- and industry-specific economic recovery and transition strategies. The program shall include a focus on macroeconomic impacts, such as the global COVID-19 pandemic, the global transition to carbon neutrality, or the western region of the United States’ acute vulnerability to climate change impacts.

(2) The program, through these collaboratives, shall support transparent and inclusive processes for shared problem solving to advance long-term prosperity and equity.

(3) The collaboratives shall work directly with the community capacity-building programs initially established by Chapter 377 of the Statutes of 2018, pursuant to Part 3.6 (commencing with Section 71130) of Division 34 of the Public Resources Code, to support active and equitable community engagement and other similar state-sponsored local and regional economic, workforce, and community development programs and initiatives. The collaboratives shall also seek out and invite into the engagement process local and regional planning efforts whose mission is aligned with the purposes of this chapter.

(4) The representation on the collaboratives shall reflect the people and economy of the region and include balanced representation from labor, business, community, government, and other stakeholders, including, but not limited to, economic development, philanthropy, education, and workforce partners to be designated in the program guidelines.

(d) Planning grants shall be awarded on a competitive basis to establish and support at least one High Road Transition Collaborative per region in areas that have had disproportionate impacts due to COVID-19. The Inter-Agency Leadership Team shall establish evaluation criteria consistent with the state planning priorities established pursuant to § 65041.1 of the Government Code. The Inter-Agency Leadership Team shall establish additional criteria and detailed metrics in the program guidelines, consistent with the goals of the program outlined in subdivisions (b) and (c), including the following core activities:

(1) Select a skilled and impartial convener to build a collaborative, as described in paragraph (4) of subdivision (i), and facilitate and collaborate with each designated partner entity to develop the economic recovery and transition plans, to solicit, consider, and respond to comments from collaborative members, and to provide equitable public participation and input.

(2) Develop one or more regional and subregional economic recovery and transition plans addressing essential elements of a high road strategy, including economic diversification, industry planning, workforce development, career pathways for individuals with formal education totaling less than a two-year degree that lead to high road jobs, and the identification and integration of current or supplemental safety net programs. This plan shall include industry cluster and labor market analysis, with actionable research and consultation from the University of California or other expert institutions, and focus on economic recovery, growth, and resilience across multiple sectors. The plans shall prioritize the creation of high-quality jobs and equitable access to them, and emphasize where possible the development of sustainable and resilient industries, such as renewable energy, energy efficiency, carbon removal, and zero-emission vehicles, advanced manufacturing, agriculture and forestry, and climate restoration and resilience.

(3) Disseminate these transition plans to all interested parties. The plan or plans provided by each high road transition collaborative shall be made publicly available on the Labor and Workforce Development Agency’s internet website.

(e) (1) Implementation grants shall be awarded on a rolling and competitive basis. This grant program shall be structured to provide a small initial tranche of funding for economic diversification pilots with demonstrable high road elements in those regions already engaged in economic recovery and transition planning. The majority of funds shall be used to provide, through June 30, 2025, economic development grants on a rolling basis, informed by the work of high road transition collaboratives.

(2) The grant recipients shall demonstrate a plan to fully spend or obligate by December 31, 2025, all funds received pursuant to this subdivision, and shall pay all obligations by December 31, 2026.

(3) The implementation grants shall also meet all of the following requirements:

(A) Support work identified as a priority in the economic recovery and transition plan with the high road intent of this program.

(B) Demonstrate support of the regional intermediary and alignment with the economic recovery and transition plan.

(C) Support labor standards where applicable, such as prevailing wage, project labor agreements, or community workforce agreements.

(D) Address geographic equity, accounting for differences in urban, suburban, rural, and tribal communities, and emphasize investment in underserved jurisdictions.

(E) Organize strategies by industry or geography, or both, within and across regions, with the potential to focus on regionwide strategies or on one or more specific priority projects within a region.

(F) Include a range of activities related to economic diversification, including, but not limited to, creating innovation hubs for key growth industries, expanding incubator or accelerator programs that provide technical assistance for small business owners to connect to larger industry clusters, and other projects and activities that advance a high road economy.

(G) Coordinate with, advance, and complement, without supplanting, state and federal infrastructure investments.

(H) Align with regional workforce needs by linking directly to high road training partnerships or high road construction careers training programs wherever such partnerships exist or emerge in the region.

(f) The Labor and Workforce Development Agency, working with the Office of Planning and Research, and the Governor’s Office of Business and Economic Development, shall manage the design and operation of all program solicitation and award processes, including the administration of and accountability for both the planning and implementation grants. The Workforce Services Branch shall manage funds and contracts under direction of the Inter-Agency Leadership Team. This includes, but is not limited to, all of the following:

(1) Solicitation, management and execution of all grants and contracts, based on guidelines developed by the Inter-Agency Leadership Team.

(2) Oversight and monitoring for fiscal integrity.

(3) Quarterly reporting to the Inter-Agency Leadership Team.

(4) Beginning December 31, 2022, annual reporting to the Joint Legislative Budget Committee and the applicable Senate and Assembly budget subcommittees. The report shall include a detailed summary of grants awarded, fiscal compliance, and progress on individual program objectives and related high road metrics, including equity, inclusivity, job quality, and sustainability, as designated in program guidelines and determined by inter-agency program staff.

(5) Commencing June 30, 2023, supplemental annual reporting to the Legislature, in accordance with § 9795 of the Government Code, that includes a concise written discussion, based on the experience and expertise of the Inter-Agency Leadership Team and program staff, describing key findings on regional trends in sustainable economic recovery, and common challenges in the development and implementation of high road transition strategies.

(6) Procurement of a comprehensive third-party evaluation to be completed, with guidance and oversight from the Inter-Agency Leadership Team, no less than six months after all available outcome data is available.

(g) All CERF grantees shall fulfill the outcome and reporting requirements required by this chapter as established by the Inter-Agency Leadership Team and fiscal oversight by the Employment Development Department. In addition to and in alignment with paragraphs (4) and (5) of subdivision (f), these reporting requirements shall include:

(1) A detailed analysis of grantee challenges and achievements, whether relating to convening an inclusive regional planning process, developing a comprehensive high road recovery plan, or implementing a strategy to promote long-term economic resilience within the region and to create high road jobs, while transitioning to a carbon-neutral economy. This shall include measurable progress toward target outcomes, including job creation, increase in number of jobs per region, average increases in hourly wages of entered employed individuals placed in jobs, job retention, number of individuals impacted through services, such as training, supportive services, or job placement, as enumerated in CERF guidelines and individual contracts in accord with each of the above jurisdictions.

(2) A more general discussion of the challenges and opportunities of designing and implementing a high road transition vision in a particular place or industry. At a minimum, grantees shall report the number and types of stakeholders directly involved in CERF planning or project development, the nature and extent of their participation, and related efforts to build capacity among community, labor, local government, or other key stakeholder groups.

(h) A portion of grant funding may be reserved for making planning and implementation grants to Native American tribes under criteria and conditions determined by the Inter-Agency Leadership Team and consistent with the purposes of the program. Tribes are intended to have maximum flexibility in the use of the funds and to use the funds to support tribe-led economic development projects. Applying for grant funds that are awarded pursuant to this subdivision does not preclude a tribal government or group of tribal governments from applying for other implementation grants awarded pursuant to this section.

(i) For the purposes of this chapter, the following definitions apply:

(1) “CERF” shall mean the Community Economic Resilience Fund Program.

(2) “High road” has the same meaning as used in subdivision (r) of Section 14005.

(3) “High road construction careers” has the same meaning as used in subdivision (t) of Section 14005.

(4) “High road transition collaboratives” or “collaboratives” are broad-based regional groups convened by a skilled and impartial intermediary to plan for economic recovery and transition to a sustainable and equitable economic future. These collaboratives shall prioritize equity, sustainability, and job quality, and advance a shared prosperity where workers and communities across California’s diverse regions share equally in the benefits of a carbon-neutral future. Minimum membership and representation shall be as described in subdivision (c).

(5) “High road training partnerships” has the same meaning as used in subdivision (s) in Section 14005.

(j) Until July 1, 2025, the administering agency may authorize advance payments on a grant awarded under this section in accordance with § 11019.1 of the Government Code.

(k) All criteria, guidelines, and policies developed for the administration of the program shall be exempt from the rulemaking provisions of the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(l) This chapter shall become operative when an appropriation is made by the Legislature for the purposes of carrying out the provisions of this chapter. The branch shall post notice of the appropriation on the home page of its internet website and send notice of the appropriation to the Legislative Counsel.

(Amended by Stats. 2023, Ch. 39, Sec. 31. (AB 130) Effective July 10, 2023. Conditionally operative as prescribed by its own provisions. See conditional termination clause in Section 14007.)