California Competes

California Competes Tax Credit

The California Competes Tax Credit is an income tax credit for businesses that are expanding or relocating to California. California Competes is a tax credit program that Gov. Jerry Brown approved in 2013.

It is a successor program to the Enterprise Zone Tax Credit which was phased out in 2014.
The number of credits available will increase over several years:

  • $30 million in 2013-14
  • $150 million in 2014-15; and
  • $200 million each year through 2017-18.

The credit available to any individual business will be based on a set of criteria including the number of jobs created, opportunity for future growth, and much more.

Who Can Claim the California Competes Tax Credit?

In order to qualify for a portion of the allocation, the business must have expansion plans to create jobs in California over the next five years or be at risk to leave California. In 2014, the current allocation of tax credits available to businesses is $30 million.

The tax credit award process is a four-part program with a quantitative analysis phase, a qualitative analysis phase, a negotiation phase, and a committee hearing.

KBKG is prepared to represent and assist businesses that want to apply for the California Competes Tax Credit. Contact us to start your application!


For the fiscal year 2018-19, GO-Biz will accept applications for the California Competes Tax Credit during the following periods:

  • July 30, 2018, through August 20, 2018
  • January 2, 2019, through January 21, 2019
  • March 4, 2019, through March 25, 2019

California Competes Credit Details

Tax Credit Attributes

  • Negotiated incentive
  • 4 Phase application process and contract award
  • Administered by the governor’s office
  • Nonrefundable
  • 6-year carryforward
  • Can be awarded over multiple years

Key Evaluation Factors

  • Number of jobs created or retained
  • Compensation paid to the employee
  • Investment in California
  • Economic Census data in job creation areas
  • Incentives available in California
  • Incentives available from other states
  • Duration of the proposed project
  • Economic impact
  • Industry and related local economic factors
  • Opportunity for future growth
  • Cost-benefit of investment to tax credit


  • No more than 20% to any one business
  • 25% must be allocated to small businesses

Targeted Applicants

  • Business expanding in California
  • Businesses new to California
  • Businesses at risk of leaving California
  • Businesses relocating within California

Application Process

  • Phase 1 Quantitative Analysis
  • Phase 2 Qualitative Analysis
  • Phase 3 Negotiation
  • Phase 4 Committee Review and Award

Application Opportunities

  • Rolling windows throughout the year

Award Amounts Available

  • 6/30/14 – $30,000,000
  • 6/30/15 – $150,000,000
  • 6/30/16 – $180,000,000
  • 6/30/17 – $180,000,000
  • 6/30/18 – $180,000,000

California Competes Credit Process

Phase 1: Quantitative Analysis

Compares your investment in California to the tax credit

  • Prepare an application based on your expansion plans
  • Isolate projects and develop application strategy and timing
  • Perform quantitative analysis and ask ratio modeling for a competitive bid

Phase 2: Qualitative Analysis

Analyzes your expansion plan for key economic criteria

  • Identify key components to be included in the application
  • Highlight economic and targeted job creation data
  • Qualify the expansion investments as a high priority

Phase 3: Negotiation

Prepare a contract identifying the terms of the tax credit

  • Ensure the terms and conditions are conservative and attainable
  • Reduce the risk of recapture or liability in contract terms
  • Capture anticipated costs and reduce any vague or undefined benchmarks

Phase 4: Committee Review and Award

Award or deny decision rendered at this time

  • Coach and plan taxpayer to receive the full award
  • Assist in preparation of necessary forms for tax return
  • The model financial impact of credit and consult with a tax preparer

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