Existing law establishes the State Energy Resources Conservation and Development Commission within the Natural Resources Agency and requires the commission to establish and convene the Blue Ribbon Commission on Lithium Extraction in California, with specified members. Existing law requires the Blue Ribbon Commission to review, investigate, and analyze certain issues and potential incentives regarding lithium extraction and use in California, including, among others, the importance of, and opportunities for, the application of local, state, and federal incentives and investments to facilitate lithium extraction from geothermal brines and the use of enhanced infrastructure financing districts or community revitalization investment authorities, as defined.

This bill would declare the intent of the Legislature to subsequently amend this measure to include provisions that would establish the Southeast California Desert Valleys Economic Zone to include Imperial Valley, Eastern Coachella Valley, and Palo Verde Valley. The bill would further express the intent of the Legislature that this regional economic zone be recognized by federal, state, and local governments, and be eligible to compete for funding and investments.

Date of Hearing: May 10, 2023

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Chris Holden, Chair

ABPCA Bill Id:AB 1562

Author:(Garcia) – As Amended Ver:March 23, 2023

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill requires, subject to appropriation, the Governor’s Office of Business and Economic Development (GO-Biz) to provide technical assistance to local and regional entities on how to establish and maintain regional economic hubs through the designation as an “economic development zone.”

Further, the bill requires, by January 15, 2024, the director of GO-Biz to designate an economic development liaison to assist entities in the Eastern Coachella Valley and the Imperial Valley to establish an economic development zone.

FISCAL EFFECT:

Ongoing General Fund costs to GO-Biz, likely in the mid hundreds of thousands of dollars annually, for staff to provide technical assistance to local and regional entities and to designate an economic liaison specific to the Eastern Coachella Valley and the Imperial Valley.

COMMENTS:

1. Purpose. Based on literature from supporters of this bill, the intention of the bill is that GO-Biz will assist the Eastern Coachella Valley and the Imperial Valley to develop an economic zone for lithium extraction from geothermal brines. According to proponents, this designation will help the region compete for federal, state, and local funding.
2. Background. Current law allows GO-Biz to develop and disseminate content to inform the public about geographically targeted economic development programs. These programs include federal Promise Zones and federal Opportunity Zones. Current law requires GO-Biz to convene, at least annually, representatives from programs and agencies to discuss how California can “leverage” Promise Zones and Opportunity Zones to meet state and local needs.

Analysis Prepared by: Natasha Collins / APPR. / (916) 319-2081

Date of Hearing: April 25, 2023

ASSEMBLY COMMITTEE ON JOBS, ECONOMIC DEVELOPMENT, AND THE ECONOMY

Carlos Villapudua, Chair

ABPCA Bill Id:AB 1562 (

Author:Garcia) – As Amended Ver:March 23, 2023

SUBJECT: Governor’s Office of Business and Economic Development: Southeast California Desert Valleys Economic Zone

SUMMARY: This bill would advance incentives and investments from lithium extraction. The bill would help these areas compete for federal, state, and local funding and investments. By creating an economic zone around “Lithium Valley”, there is a great opportunity to encourage economic development for California’s most underserved areas and people.

Specifically, this bill:

1. This bill would require the office, subject to available funding, to provide technical assistance to local and regional entities and collaboration on how to establish and maintain regional economic hubs through the designation of place-based economic development zones.
2. The bill would require the director of the office, by January 15, 2024, to designate an economic development liaison to assist entities in the Eastern Coachella Valley and the Imperial Valley to establish a Southeast California Desert Valleys Economic Zone. The bill would also make clarifying changes.

EXISTING LAW:

1. Existing law authorizes the Governor’s Office of Business and Economic Development (office) to develop content on its internet website or through other mediums to be used for public dissemination, through outreach activities, in order to provide information and resources to inform the general public about place-based and other geographically targeted economic development programs, including California Promise Zones and California Opportunity Zones.
2. Existing law requires the office to convene, at least annually, representatives from various programs and agencies across the state and from various federal programs and agencies for the purpose of discussing how California can leverage Promise Zones and Opportunity Zones to meet state and local community and economic development needs.

FISCAL EFFECT: This bill is expected to have an anticipated cost.

COMMENTS: AB 1562 would establish the Southeastern California Desert Valleys Economic Zone to include areas around the Salton Sea Geothermal Resource area. This bill is key in advancing incentives and investments from lithium extraction. Furthermore, this will help these areas compete for federal, state, and local funding and investments. The creation of an economic zone around “Lithium Valley” provides a substantial opportunity to encourage economic development for California’s most underserved areas and peoples.

Lithium Valley is a proposed initiative to develop a regional hub for lithium-ion battery manufacturing and supply chain in California. The initiative is inspired by Silicon Valley, the world-renowned technology hub that emerged in California's Bay Area in the 1960s and has since grown to become a global center for innovation and entrepreneurship.

The vision for Lithium Valley is to create a similar ecosystem for the lithium-ion battery industry, bringing together research and development, manufacturing, supply chain, and entrepreneurship to drive the growth of the industry and support the transition to clean energy. The initiative aims to leverage California's existing strengths in technology, innovation, and entrepreneurship, as well as the state's abundant natural resources and skilled workforce.

California is already home to several companies that are key players in the lithium-ion battery industry. The Lithium Valley initiative seeks to build on this existing foundation and create a more robust and integrated ecosystem for the industry.

The initiative is still in the planning stages, and there are many questions to be answered about how it will be implemented. However, it has already generated significant interest and support from both public and private sectors. In 2020, California Governor Gavin Newsom announced plans to establish a new state commission to study the potential for Lithium Valley and make recommendations for its development.

The development of Lithium Valley is seen as an important step towards the creation of a more sustainable and resilient energy system, as well as a significant economic opportunity for the state of California, the country and the Southeast California Desert Valley the as a whole.

The Southeast California Desert Valley also known as the Coachella Valley is a region located in the eastern part of Riverside County. According to data from the United States Census Bureau, the poverty rate in the Coachella Valley was 17.5% in 2019.

This rate is higher than the national average poverty rate of 10.5% and the California state poverty rate of 12.8%. The poverty rate in the Coachella Valley is also higher than the poverty rates for both Riverside County and the nearby city of Palm Springs, which were 13.6% and 14.7%, respectively, in 2019.

High poverty rates have significant impacts on the health, education, and economic opportunities of individuals and families. Efforts to reduce poverty in the Coachella Valley include the Lithium Valley Initiative.

REGISTERED SUPPORT / OPPOSITION:

Support

Alianza Coachella Valley
City of Brawley
Clean Power Campaign
Comite Civico Del Valle
County of Riverside Supervisor V. Manuel Perez
Los Amigos De LA Comunidad, INC.
State Building and Construction Trades Council of Ca
The Leap Institute
Universidad Popular

Opposition

None on file

Analysis Prepared by: Carla Castilla / J., E.D., & E. / (916) 319-2090