California Senate Bill SB594 Amended / Bill

 BILL NUMBER: SB 594AMENDED BILL TEXT AMENDED IN SENATE MAY 24, 2013 AMENDED IN SENATE APRIL 18, 2013 INTRODUCED BY Senator Steinberg FEBRUARY 22, 2013 An act to add Part 38 (commencing with Section 64200) to Division 4 of Title 2 of the Education Code, and to add Sections 17057.6 and 23610.6 to the Revenue and Taxation Code, relating to education. LEGISLATIVE COUNSEL'S DIGEST SB 594, as amended, Steinberg. California Career Pathways Investment. The Personal Income Tax Law and The Corporation Tax Law authorize various credits against the taxes imposed by those laws. This bill, in accordance with legislative findings contained in this bill and for calendar years beginning on or after January 1, 2014, would, for a business entity, as described, that provides career technical education, authorize a credit against those taxes, subject to specified limitations, in an amount equal to that allocated by the California Career Pathways State Investment Committee, a committee established by this bill. This bill would  require each school district   establish in each local educational agency  and community  college  district  to create  a Career Pathways Investment Trust Fund, the  funds   moneys  in which would be used for  the  purposes of financing program and administrative costs relating to the operation of career pathways programs, as provided. This bill would impose specified duties on school districts with regard to career pathways programs. Existing law authorizes the governing board of a community college district to establish contract education programs within or outside the state by agreement with any public or private agency, corporation, association, or any other person or body, to provide specific educational programs or training to meet the specific needs of these bodies. Existing law authorizes the governing board of any school district to initiate and carry on any program or activity, or  may   to  otherwise act in any manner that is not in conflict with or inconsistent with, or preempted by, any law and that is not in conflict with the purposes for which school districts are established. This bill would, among other things, authorize the California Career Pathways State Investment Committee and a  business entity   school district or districts, or a community college district or districts,  to enter into  Workforce Development Bonds, as defined, in accordance with applicable laws,   a pay-for-performance contract for a career pathways pay-for-performance pilot project  to fund career pathways programs operated by the  business entity and a  school district, community college district, or a consortium of school districts and community college  districts. The bill would authorize a local educational agency or community college district to issue lease revenue bonds, as specified, or enter into loan or lease agreements, to finance the operation of career pathways programs   districts, and under which a business entity partner may be compens   ated for its costs  . The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement shall be made pursuant to these statutory provisions for costs mandated by the state pursuant to this act, but would recognize that local agencies and school districts may pursue any available remedies to seek reimbursement for these costs. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. It is the intent of the Legislature to appropriate two hundred fifty million dollars ($250,000,000) from the General Fund in the 2013-14 fiscal year to the Career Pathways State Revolving Fund. The source of funds for that appropriation may include state apportionments for purposes of Section 8 of Article XVI of the California Constitution and offsetting budget savings derived from reforms to the Enterprise Zone Act (Chapter 12.8 (commencing with Section 7070) of Division 7 of Title 1 of the Government Code) and the New Jobs Tax Credit. SEC. 2. Part 38 (commencing with Section 64200) is added to Division 4 of Title 2 of the Education Code, to read: PART 38. Career Pathways Investment Credit and Trust Fund 64200. (a) The Legislature finds and declares the following: (1) After five years of deep recession and high rates of unemployment, the California economy has begun to recover. (2) One of the most important actions California can take to hasten that recovery is to invest in the development of a skilled workforce to perform well-paying jobs in growing and emerging sectors of its regional economies. (3) The fastest-growing occupations are expected to be those that require scientific, technical, engineering, or mathematics (STEM) skills, such as jobs in biotechnology, digital media arts, agricultural technology, green technology, or computer-related and health-related fields. (4) California's systems of public education, which includes primary and secondary schools, technical training, apprenticeship, two-year and four-year colleges, and graduate schools, play a critical role in workforce preparation, one that could be significantly strengthened by a tighter focus on education and training that delivers the skills and capacities most called for in high-opportunity sectors. (5) This kind of workforce preparation is best accomplished in concert with regional business and industry, so that students receive the most current and relevant education that prepares them to compete for good jobs in their communities after graduation from high school or postsecondary education and training. (6) Work-based educational and training opportunities enhance the employment prospects of low- and moderate-income individuals and contribute to the stability and economic development of their communities. (b) It is the intent of the Legislature that federal bank regulators, specifically, the Federal Reserve bank, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision, give credit to federally insured banks and thrifts on their compliance  exams   examinations  under the federal Community Reinvestment Act of 1977 (Public Law 95-128) for grants, investments, and loans to educational institutions, nonprofit organizations, and businesses in support of career pathways programs. (c) It is the intent of the Legislature to establish state fiscal incentives, such as  Workforce Development Bonds, grants, loans,   pay-for-performance contracts, grants,  and tax credits, that encourage California businesses and industry to enter into partnerships with schools and community colleges that strengthen the nature and quality of education provided by those institutions. These partnerships will connect high school pupils and teachers, and college students and faculty, to real-world experience that provides sustained exposure to applied academics, skill development, work-related experience, and potential future employment. This experience will keep students on track to graduation, further education, and productive careers. (d) The dissolution of redevelopment agencies will increase property tax revenues to K-14 school districts and community college districts, including the one-time distribution of redevelopment agency cash assets expected to occur in the 2012-13 and 2013-14 fiscal years. It is the intent of the Legislature that school districts and community college districts capitalize the Career Pathways  Investment  Trust Funds established pursuant to this act for purposes of  funding grants and loans to businesses and offsetting administrative costs of the program   financing program and administrative costs relating to the operation of career pathways programs  . 64201. For  the  purposes of this part: (a) "Applicant" means a business entity that enters into a contract or memorandum of understanding with a local educational agency, community college, or workforce investment board to provide career technical education that connects pupils to real-world experience and provides sustained exposure to applied academics, skill development, work-related education, and potential future employment, and that applies to the committee for  state financial assistance, including Workforce Development Bonds and  the career pathways investment credit.  (b) "Authentic application" means an activity in the context of a middle, high school, or community college course that requires pupils to work actively with academic and technical concepts, facts, and skills in a realistic, work-like setting that emulates the problems encountered by professionals and the practices they use to address them. These applications typically require pupils to examine a task from a variety of perspectives, to draw upon multiple resources, to collaborate with others, and to accomplish tasks and projects by working in teams rather than individually.   (c)   (b)  "Budget" means an estimate of all qualified expenditures to be paid or incurred in providing the career pathways program over the period for which the applicant is applying for the career pathways investment credit.  (c) "Career Pathways Investment Trust Fund" means a fund established in each local educational agency and community college district for the purpose of financing program and administrative costs relating to the operation of career pathways programs.   (d) "Career pathways pay-for-performance pilot project" means a career pathways program approved for funding by the committee under a pay-for-performance contract between the committee and the school district or districts or community college district or districts. The pay-for-performance contract shall specify the accountability and performance measurements that determine the extent to which a business entity partnering with the school districts or districts or community college district or districts may be compensated for its costs. The amount of compensation shall vary in accordance with demonstrated performance. Performance measures shall include all of the following:   (1) Demonstrated improvement in academic performance.   (2) Demonstrated improvement in postsecondary enrollment.   (3) Decreased dropout rates.   (4) Demonstrated improvement in transitions to appropriate employment, apprenticeships, or any other job training school, if applicable.   (5) Measurements of pupil, parent, and employer satisfaction.   (d)   (e)  "Career pathways programs" means programs that support the following: (1) Integrated academic and technical learning that prepares pupils for both postsecondary education and careers in high-growth or high-need sectors of the economy. These programs include core academic courses emphasizing authentic applications, sequences or clusters of three or more courses that align with the Office of the Chancellor of the California Community Colleges-approved or state board-approved career technical education standards and frameworks that also integrate key academic concepts and skills, work-based learning opportunities, and additional services like counseling or supplementary instruction in reading, writing, and mathematics. These programs may be delivered through high schools, regional occupational centers or programs, California Partnership Academies or other career academies, alternative education programs, including continuation schools and programs administered by county offices of education, adult education programs, or community colleges. (2) Curriculum and professional development. (3) Middle school and early high school career exploration activities. (4) Externship and fellowship opportunities that expose middle school and high school teachers and community college faculty to the skills and competencies that pupils need for successful employment in high-growth sectors of the California economy. (5) Active engagement by business and industry in pathway design and implementation, work-based learning, assessment of student work, and other aspects of effective preparation for success in further postsecondary education and careers. (6) Workplace learning and educational opportunities that prepare pupils for careers in high-skilled, high-growth, and emerging employment sectors, including, but not limited to, biotechnology research and development, engineering and construction, advanced manufacturing, health sciences and nursing, environmental sciences, and agricultural technology. (7) Programs that provide employment services and support to individuals with exceptional needs, including autistic individuals.  (e) "Career Pathways Investment Trust Fund" means a fund established in each local educational agency or community college district for the purpose of financing program and administrative costs relating to the operation of career pathways programs.  (f) "Career Pathways State Revolving Fund" means a fund established in the State Treasury for the purpose of providing state financial assistance to local educational agencies, community college districts, and business entities that have entered into agreements to implement and operate career pathways programs. State financial assistance may include  grants, loans, and the repayment of Workforce Development Bonds   grants and pay-for-performance contracts  . (g) "Committee" means the California Career Pathways State Investment Committee. (h) "Qualified expenditures" includes the following:  (1) The costs of work-based learning specialists that convene, connect, measure, and broker partnerships between local educational agencies and business entities, including the costs of all of the following activities:   (A) Matching pupils with work-based learning opportunities, including school year or summer internships and paid employment within a career pathway.   (B) Using schoolsite mentors as liaisons between local educational agencies, business entities, parents, and community partners.   (C) Providing technical assistance to help local educational entities and business entities design comprehensive career pathways programs.   (D) Providing technical assistance to help teachers integrate school-based and work-based learning with academic and career technical subject matters.   (E) Brokering the involvement of business entities in school-based and work-based activities.   (F) Assisting pupils in finding appropriate work, continuing pupils' education or training, and linking pupils to other community services.   (G) Evaluating outcomes to assess career pathways program success, particularly in regard to pupil subgroups.   (H) Linking existing youth development activities with employer and industry strategies to upgrade worker skills.   (1)   (2)  Paid jobs or internships for high school pupils or community college students that are related to course work in a career  pathway   pathways  program.  (2)   (3)  Support and supervision for unpaid internships or other work-based learning opportunities that give pupils the opportunity to connect what they are learning in high school or community college to its application in the real world.  (3)   (4)  Teacher or faculty externships.  (4)   (5)  Contributions to programs administered by postsecondary institutions that provide support to middle school, high school, or community college career pathways programs. This support may include, but shall not be limited to, teacher training, curriculum development, and other forms of technical assistance.  (5)   (6)  Equipment and instructional materials, including equipment and software to support technology-based instruction that provides one or more of the following: (A) Accelerated learning opportunities. (B) Identification of skill and knowledge gaps. (C) Targeted remediation to prepare pupils for college and careers.  (6)   (7) Employees to provide instruction, in partnership with credentialed teachers employed by the school district or faculty employed by the community college, at the schoolsite or community college campus.  (7)   (8)  Contributions to support staff who link career  pathway   pathways  programs with regional business entities and assist in the development of the memoranda of understanding provided in subdivision (h) of Section 64204. The staff may be employed by local  education   educational  agencies, community colleges, or regional intermediary organizations.  (i) "Workforce Development Bond" means a contract between the California Career Pathways State Investment Committee and an applicant who agrees to provide capital to fund a career pathways program jointly operated by the applicant and a school district or community college district, or a consortium of school districts and community college districts. The contract shall specify that the California Career Pathways State Investment Committee shall repay the bond if performance targets established for the career pathways program are met. Financial returns to the applicant may vary pursuant to the measured level of performance. Proceeds from the sale of the bonds shall be disbursed by the committee to the Career Pathways Investment Trust Fund for the local educational agency or community college district, and may be used for career pathways program operations, development of rigorous and career-relevant curriculum by the applicant and the school district, community college district, or consortium of school districts and community college districts, paid internships, post-high-school financial aid for college, licensing and credentialing programs, and wage subsidies for full-time employment for pupils who successfully complete a career pathways program.   64202. (a) A local educational agency or community college district may issue lease revenue bonds secured by the lease of any property of the local educational agency or community college district pursuant to subdivision (b), or enter into loan or lease agreements not subject to Section 18 of Article XVI of the California Constitution with the committee or private entities, to finance the operation of career pathways programs. (b) For purposes of the lease revenue bonds authorized in subdivision (a), and notwithstanding any other law, a local educational agency or community college district may lease any property of the local educational agency or community college district. The local educational agency or community college district may enter into any other agreements or execute any other documents necessary or desirable to carry out the purposes of this subdivision. (c) A local educational agency or community college district may enter into contracts or agreements with banks, insurers, or other financial institutions or parties that it determines are necessary or desirable to improve the security and marketability of, or to manage interest rates or other risks associated with, the lease revenue bonds issued pursuant to this section.  64203. (a) A Career Pathways Investment Trust Fund is hereby established in each local educational agency  or   and  community college district for the purpose of financing program and administrative costs relating to the operation of career pathways programs. The trust fund may accept revenues from any source, including one-time property tax revenues resulting from the dissolution of the assets of the former redevelopment agencies,  proceeds from the sale of Workforce Development Bonds,  other tax revenues, grants,  loans,  and contributions or employment training funds made available through the employment training panel or workforce investment boards. The trust fund shall be administered by each local educational agency or community college district. (b) Moneys in a Career Pathways Investment Trust Fund  shall   may  be used for any of the following purposes:  (1) Qualified expenditures.   (2) Administrative costs.   (3) Grants, loans, and program costs associated with career pathways programs.   (1) Career pathways program operations.   (2) Development of rigorous and career-relevant curriculum by the applicant and the school district, community college district, or consortium of school districts and community college districts.   (3) Paid internships.   (4) Post-high-school financial aid for college, licensing, and credentialing programs.   (5) Wage subsidies for full-time employment for pupils who successfully complete a career pathways program.  64204. (a) The California Career Pathways State Investment Committee is hereby established in state government. (b) The committee shall be composed of the following members: (1) The Chancellor of the California Community Colleges, or his or her designee, who will serve as the chairperson of the committee. (2) The Superintendent or his or her designee. (3) The Chair of the California Workforce Investment Board, or his or her designee. (4) One appointee of the Senate Committee on Rules, who shall represent the business community and will serve a four-year term. (5) One appointee of the Speaker of the Assembly, who will serve a four-year term. (c) The committee is granted the sole authority to allocate to local educational agencies, community college districts, and applicants moneys appropriated to the Career Pathways State Revolving Fund for state financial assistance, including  grants, loans,   grants  and the  repayment  payment  of  Workforce Development Bonds issued   pay-for-performance contracts entered into  by the committee  as part of a career pathways pay-for-performance pilot project  . The committee is also granted the sole authority to allocate to applicants the Career Pathways Investment Credits authorized pursuant to Section 64206. (d) The committee shall establish criteria and guidelines for evaluating applications for state financial assistance, including requirements for commitments of financial or other resources by applicants or a local educational agency, community college district, or workforce investment board. The committee shall give priority in allocating state financial assistance to the following:  (1) Proposals that would fund a work-based learning specialist to convene, connect, measure, and broker efforts to establish or enhance a locally defined career pathways program that provides connections between local educational agencies and business entities.   (1)   (2)  Local educational agencies and community college districts that have an unemployment rate higher than the statewide average unemployment rate for the most recent calendar year, as determined by the Employment Development Department, or a high school graduation rate lower than the statewide high school graduation rate for the most recent calendar year, as determined by the committee using the California Longitudinal Pupil Achievement Data System.  (2)   (3)  Local educational agencies and community college districts that include in their application a significant amount of private funding support from their business partners.  (3)   (4)  Local educational agencies and community college districts that include in their application articulated pathways connecting high school and postsecondary certificate and degree programs in their region.  (4)   (5)  Local educational agencies and community college districts that are not seeking state financial assistance for existing activities. However, priority in allocating state financial assistance shall be given to applicants that seek to expand or augment existing investments in career pathways programs.  (e) The committee may allocate the proceeds from the sale of Workforce Development Bonds to applicants that have entered into memoranda of understanding with a local educational agency or community college district to fund career pathways programs.   (f)   (e)  The committee shall develop performance criteria for determining the financial returns to private entities  investing in Workforce Development Bonds   participating in a career pathways pay-for-performance pilot   project. The performance-based compensation to be paid to private entities by educational agency participants for each pay-for-performance contract shall be specified in the contract  . The performance criteria shall include, but are not limited to, high school pupil and community college student achievement and opportunity in the following areas: (1) High school graduation. (2) Completion of postsecondary programs that culminate in a certificate or degree. (3) Attainment of industry-recognized credentials that are valued in high-growth, high-need, or emerging economic sectors. (4) Provision of internships to high school pupils and community college students. (5) Provision of paid summer jobs for high school pupils and community college students. (6) Provision of externships for high school teachers and community college faculty. (7) Provision of scholarships or other financial assistance for students pursuing postsecondary education or training in a relevant career pathway. (8) Offer of paid employment or apprenticeship to high school pupils or community college students who are participants or graduates of a career pathways program.  (f) The committee may spend up to ten million dollars ($10,000,000) of the amount appropriated to the California Career Pathways State Revolving Fund for the career pathways pay-for-performance pilot project.  (g) The committee may prepare forms, establish procedures, set priorities, assess, and perform other administrative functions as necessary. (h) The Superintendent, the Chancellor of the Community Colleges, and the California Workforce Investment Board shall enter into a memorandum of understanding to allocate staff resources to the committee. The costs to these entities shall be offset by fees charged to applicants for Career Pathways Tax Credits. 64205. (a) There is hereby created in the State Treasury the California Career Pathways State Revolving Fund for the purpose of providing financial assistance to local educational agencies, community college districts, and business entities that have entered into agreements to implement and operate career pathways programs. Within the fund there shall also be established a Career Pathways Financing Account, a Career Pathways Grant Account,  a Career Pathways Loan Account,  and additional accounts and subaccounts that the committee may establish from time to time. (b) Moneys in the Career Pathways Financing Account shall be used to  repay Workforce Development Bonds issued by the committee,   pay pay-for-performance contracts entered into by the committee as part of a career pathways pay-for-performance pilot project,  or other  bonds or  financing agreements entered into by the committee. (c) Moneys in the Career Pathways Grant Account shall be used to award grants from the committee to local educational agencies and community college districts.  (d) Moneys in the Career Pathways Loan Account shall be used to make loans from the committee to local educational agencies and community college districts.   (e)   (d)  Notwithstanding Section 13340 of the Government Code, all moneys in the Career Pathways State Revolving Fund shall be continuously appropriated without regard to fiscal year for the support of the committee and for expenditure for the purposes stated in this part.  (f)   (e)  All expenses incurred in carrying out the purposes of this part shall be payable solely from funds provided pursuant to this part, and no liability or obligation shall be imposed upon the state and none shall be incurred by the committee beyond the extent to which money shall have been provided pursuant to this part. 64206. For calendar years beginning on or after January 1, 2014, the committee shall allocate the  Career Pathways Investment Credit   career pathways investment credit  in an amount authorized in the Budget Act for that calendar year. For purposes of this section, the committee shall do all of the following: (a) Allocate the career pathways investment credit for up to five calendar years for each application the committee approves, as long as the amount allocated does not exceed the amount authorized in the Budget Act. (b) (1) Give priority in allocating tax credits to the following: (A) Applicants that have entered into a contract or memorandum of understanding with local educational agencies, community colleges, or workforce investment boards  , as specified in subdivision (a) of Section 64201,  in communities that have an unemployment rate higher than the statewide unemployment rate, as determined by the United States Census, and a high school graduation rate lower than the statewide high school graduation rate, as determined by the committee using the California Longitudinal Pupil Achievement Data System. (B) Applicants that have entered into a contract or memorandum of understanding with local educational agencies, community colleges, or workforce investment boards with  proportions of private funding support that exceed the one-to-one match requirement described in paragraph (1) of subdivision (e)  an applicant financial commitment that exceeds the commitment of public funds  . (C) Applicants that have entered into a contract or memorandum of understanding with local educational agencies or community colleges that offer articulated pathways connecting high school and postsecondary certificate and degree programs in their region. (D) Applicants that are not seeking tax credits for existing activities. However, priority shall be given to applicants that seek to expand or augment existing investments in career  pathway   pathways  programs. (2) To the maximum extent practicable, subject to paragraph (1), give priority in allocating career pathways investment credits to applicants that seek to expand or augment existing investments in career  pathway   pathways  programs. (3) The committee shall not give priority to any applicant by virtue of the date of submission of its application, except to allocate credits where two or more applicants have the same rating. (c) An applicant shall enter into an enforceable contract or memorandum of understanding with the committee to comply with the requirements of this part, Sections 17057.6 and 23610.6 of the Revenue and Taxation Code, any applicable state laws, and any additional requirements the department deems necessary or appropriate to serve the purposes of this part. The contract or memorandum of understanding shall also provide for legal action to obtain specific performance or monetary damages for breach of contract and shall require regular programmatic audits. (d) Adopt  criteria  rules  that  awards   award  credits to applicants that demonstrate that either the applicant or the local educational agency, community college, or workforce investment board  meets   with which it has entered into a memorandum of understanding pursuant to this part performed well in regard to  the following criteria: (1) The effectiveness of the career  pathway   pathways  program toward preparing students for productive, high-wage employment in growing or high-need sectors of the California economy. Effectiveness criteria shall include: (A) Pathway completion rates. (B) High school graduation rates or community college completion rates, as appropriate. (C) Percentages of students attaining an industry certification. (D) Percentages of students transitioning successfully to postsecondary education or apprenticeship. (E) Employment and earnings after high school. (2) The level of the applicant's investment in, oversight of, and ability to leverage and sustain current career pathways programs and current career technical education programs. (e) Develop and provide forms for  the  purposes of informing potential applicants of the purposes of this part. (f) The amount of the credit reserved for a calendar year shall not exceed 50 percent of the qualified expenditures estimated by the applicant for the calendar year. (g) The committee shall report to the Franchise Tax Board, once each year, the identity of the qualified taxpayers for whom the career pathways  investment  credits are allocated each year. (h) The committee may, in its discretion, consult with the Treasurer and the California Tax Credit Allocation Committee regarding the allocation of tax credits. If a request for consultation is made, the Treasurer and the California Tax Credit Allocation Committee shall aid the committee. (i) Establish audit requirements. The committee may share information established during an audit with the Franchise Tax Board. (j) It is the intent of the Legislature, subsequent to the enactment of the act adding this section, to reduce the statutory cap on the authorization for the new jobs tax credit enacted by Chapter 17 of the Statutes of 2009, Third Extraordinary Session, from four hundred million dollars ($400,000,000) to three hundred million dollars ($300,000,000) and to authorize one hundred million dollars ($100,000,000) for the Career Pathways Investment Credit, effective January 1, 2014. SEC. 3. Section 17057.6 is added to the Revenue and Taxation Code, to read: 17057.6. (a) For each taxable year beginning on or after January 1, 2014, there shall be allowed to a qualified taxpayer as a credit against the "net tax," as defined in Section 17039, an amount equal to that allocated to a qualified taxpayer by the California Career Pathways Investment Committee pursuant to Section 64206 of the Education Code. (b) For purposes of this section a "qualified taxpayer" means an applicant, as defined in Section 64201 of the Education Code, who is either the sole owner if an individual, partners if the taxpayer is a partnership, or shareholders if the taxpayer is an "S" corporation, and who was awarded an allocation of the career pathways investment credit by the California Career Pathways Investment Committee. (c) In the case where the credit allowed under this section exceeds the "net tax," the excess credit may be carried over to reduce the "net tax" in the following taxable year, and succeeding taxable years, if necessary, until the credit has been exhausted. (d) If a qualified taxpayer fails to comply with the requirements of this section or with Part 38 (commencing with Section 64200) of Division 4 of Title 2 of the Education Code, the credit shall be disallowed and assessed and collected under Section 19051 until the requirements are satisfied. SEC. 4. Section 23610.6 is added to the Revenue and Taxation Code, to read: 23610.6. (a) For each taxable year beginning on or after January 1, 2014, there shall be allowed to a qualified taxpayer as a credit against the "tax," as defined in Section 23036, an amount equal to that allocated to a qualified taxpayer by the California Career Pathways Investment Committee pursuant to Section 64206 of the Education Code. (b) For purposes of this section a "qualified taxpayer" means an applicant, as defined in Section 64201 of the Education Code, that is subject to the taxes imposed by this part. (c) In the case where the credit allowed under this section exceeds the "tax," the excess credit may be carried over to reduce the "tax" in the following taxable year, and succeeding taxable years, if necessary, until the credit has been exhausted. (d) If a qualified taxpayer fails to comply with the requirements of this section or with Part 38 (commencing with Section 64200) of Division 4 of Title 2 of the Education Code, the credit shall be disallowed and assessed and collected under Section 19051 until the requirements are satisfied. SEC. 5. No reimbursement shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code for costs mandated by the state pursuant to this act. It is recognized, however, that a local agency or school district may pursue any remedies to obtain reimbursement available to it under Part 7 (commencing with Section 17500) and any other provisions of law.