View frequently asked questions (FAQ) for California Pollution Control Financing Authority (CPCFA).

General Questions

What is the California Pollution Control Financing Authority (CPCFA)?

CPCFA is a state agency within the California State Treasurer's Office that provides private activity tax-exempt bond financing to California businesses for the acquisition, construction, or installation of qualified pollution control, waste disposal, waste recovery facilities, and the acquisition and installation of new equipment. Financing is performed in conjunction with allocation from the California Debt Limit Allocation Committee (CDLAC). The allocation is required by federal tax law for private activity tax-exempt bonds to be issued.

Who is eligible for Tax-Exempt Financing through CPCFA?

CPCFA provides financing to California businesses, irrespective of company size, for the acquisition, construction or installation of qualified pollution control, waste disposal, and resource recovery facilities.

Why would a company want to apply for private activity tax-exempt bond financing instead of more traditional bank financing?

Tax-exempt bond financing provides qualified borrowers with lower interest costs than are available through conventional financing mechanisms.

What is the process to receive private-activity tax-exempt bond financing?
  • Potential Borrowers submit an application, which is reviewed for tax-exempt bond financing eligibility. CPCFA works directly with the applicants in this process and throughout the entire process if the project is eligible.
  • Qualified projects receive approval of an Initial Resolution (IR) from the Executive Director of CPCFA. The IR is a preliminary action that, if bonds are issued, allows a borrower to be reimbursed for eligible project expenditures incurred 60 days before resolution and for the period after resolution up to the issuance date. It is not a commitment by CPCFA that bonds will be issued. NOTE: Whether or not a borrower seeks reimbursement for project costs incurred prior to issuance, CDLAC regulations require an approved IR to be submitted with the application for allocation.
  • A Final Resolution (FR) authorizes a bond sale for a project within a certain period (usually 180 days). An FR is approved by CPCFA only after a detailed examination of final project plans (technical and financial) and the applicant has obtained any and all appropriate certificates from affected environmental agencies and submitted all such certificates to the Authority (if appropriate, a statement must be submitted stating why any approval or certificate has not been obtained or is unnecessary).
  • In addition to FR approval, potential borrowers via CPCFA request "allocation" from the California Debt Limit Allocation Committee . The allocation is required by federal tax law before private activity tax-exempt bonds can be issued. Once approved, the CDLAC allocation remains valid for 90 days, and that can be extended by the Executive Director of CDLAC for an additional 90 days.
  • Once projects receive allocation and FR approval, the Office of the State Treasurer schedules the bonds for sale. CPCFA utilizes a Bond Trustee to distribute the bond proceeds to the borrower and, on behalf of bondholders, to collect and disburse bond payments.
Are there any restrictions on what can be funded?
  • 95% of proceeds must be used for the defined project
  • 2% of bond proceeds can be used for costs of issuance
  • 25% of bond proceeds can be used for land costs in certain cases
  • A public hearing (TEFRA) must be held before the bonds are issued
  • To acquire an existing building, a minimum of 15% of the bond proceeds must be used to renovate the building
  • The average life of the bond issue cannot exceed 120% of the weighted average of the estimated useful life of the assets being financed
Who makes up the CPCFA Board?
  • State Treasurer, Chair
  • State Controller
  • Director of the Department of Finance
How often does the CPCFA Board meet?

The Board holds monthly meetings. Please see the 2023 Meeting Schedule for dates and times.

Is there a way to receive updated information or monthly agendas?

Click here to sign up for notifications.

How do I appeal the denial of an application?
What is the Small Business Assistance Fund (SBAF)?

CPCFA uses its SBAF to help pay for the costs of issuance of tax-exempt bonds issued on behalf of small businesses. The SBAF may be used to pay for costs such as letter of credit fees, transaction fees and other costs associated with the issuance of bonds. This assistance reduces the net cost of financing to the small business. Please see the SBAF Policy for eligibility details.