Airports: financial assistance.

The allocation percentage for public and private use airports based on fuel flowage statistics increased from 70% to 75%, while the percentage for qualifying general aviation airports decreased from 20% to 15%. The 1% aviation education and 9% nonhub/small hub grant program allocations are unchanged.

Administrative costs (up to $1,000,000 in the first year and $600,000 in subsequent years) were moved from being carved out of the 70% airport allocation into a new subdivision (c) of Section 21689. The division now deducts its administrative costs from the total account balance before applying the percentage allocations, meaning all percentage shares are calculated on a net figure.

The $500,000 annual grant for rural, nonhub commercial airports with fewer than 300,000 enplanements (inoperative after January 1, 2032) was expanded to also include general aviation airports as eligible recipients.

New definition of 'fuel flowage statistics' added in Section 7102.3(c), defined as the total gallons of jet fuel sold or consumed annually at an airport. A new definition of 'general aviation airport' was added in Section 21689(d), referencing Section 47102 of Title 49 of the United States Code.

The definition of 'jet fuel' was changed from 'Jet A aviation fuel or sustainable aviation fuel' to 'aircraft jet fuel, as defined in Section 7387,' which is a broader statutory reference that may encompass additional fuel types.

The Controller's transfer deadline was simplified from 'on July or before September 1 of each year' to 'on or before September 1 of each year,' removing the earlier July reference.

The reporting requirement language was simplified from 'airports that sell or consume jet fuel where jet fuel is sold or consumed' to 'airports where jet fuel is sold or consumed,' and the general aviation airport allocation now references 'a process established by the division' rather than a fixed process in Section 21682, giving the division more flexibility in how funds are distributed.

Eliminated the provision requiring 50 percent of jet fuel tax revenue to be retained by the airport where the fuel is sold. Previously, airports kept half for local operations and capital improvements; now all revenue flows into the state Aeronautics Account for centralized allocation.

Removed the 40 percent allocation to commercial airports broken down by hub category (30 percent large hub, 20 percent medium hub, 20 percent small hub, 30 percent nonhub).

Removed the 15 percent allocation for grants to nonhub commercial airports with fewer than 300,000 enplanements to attract and expand air service.

Removed the 15 percent allocation for other state aviation programs and aviation-related purposes.

Reduced the aviation education grant allocation from 5 percent to 1 percent of available funds.

Added a new 9 percent allocation to existing grant programs that serve nonhub and small hub airports.

Removed an entire section of legislative findings and intent specifically focused on the City of Bakersfield and County of Kern, including population data, job creation goals, and regional economic development language. Replaced with general statewide findings about California's airport network.

Extended the annual transfer deadline from July 1 to 'July or before September 1' of each year, giving the Controller additional time to process the transfer from the Retail Sales Tax Fund to the Aeronautics Account.

Changed the definition of 'jet fuel' from 'Jet A aviation fuel or sustainable aviation fuel' to 'aircraft jet fuel, as defined in Section 7387,' adopting a cross-reference to an existing statutory definition rather than listing specific fuel types.

Clarified the fuel flowage reporting requirement: airports must now report where 'jet fuel is sold or consumed' rather than simply that they 'sell or consume jet fuel,' which may affect which entities have reporting obligations.

The sales and use tax rate on jet fuel is reduced from 4.1875% to 3.9375%, a 0.25 percentage point decrease that reduces total revenue available for airport funding.

A new allocation mechanism directs 70% of transferred revenues to be divided among public and private use airports based on their reported fuel flowage statistics from the previous calendar year, replacing the prior system of fixed percentage categories for different airport types.

The overall allocation structure is restructured. The new top-level split is: 70% by fuel flowage, 20% for qualifying general aviation airports, 1% for aviation education grants (reduced from 5%), and 9% for existing grant programs serving nonhub and small hub airports (new category). The prior categories of 40% for commercial airports by hub size, 15% for nonhub airport service grants, and 15% for other state aviation programs are eliminated as separate line items.

From the 70% fuel-flowage allocation, $500,000 annually is set aside for grants to rural, nonhub commercial airports with fewer than 300,000 enplanements to attract, establish, and expand air service. This provision becomes inoperative on January 1, 2032.

The covered fuel is narrowed from 'aviation fuel' (defined as jet fuel and aviation gasoline) to simply 'jet fuel,' now defined as Jet A aviation fuel or sustainable aviation fuel. Aviation gasoline is no longer covered, but sustainable aviation fuel is explicitly included.

All public and private use airports that sell or consume jet fuel must report their fuel flowage statistics to the Division of Aeronautics by March 31 each year. The division then determines each airport's revenue allocation based on those reports.

The aviation education grant category is narrowed from 5% to 1% and its scope is refined to focus on improving the 'aviation workforce,' with explicit mention of traffic control training and education added alongside flight training scholarships.

The bill is now flagged as containing a state-mandated local program (changed from 'no' to 'yes') due to the new reporting requirements imposed on county-owned and city-owned airports, triggering potential state reimbursement obligations under the Government Code.

New procedural requirements are added: the Controller must make the fund transfer on July 1 of each year; allocations must comply with federal law (49 U.S.C. Sections 47107 and 47133); and amounts are determined based on reports from the California Department of Tax and Fee Administration.

A new Section 1 adds broad legislative findings about California's integrated airport network, the economic importance of regional airports, and the need for strategic investment in airport infrastructure and air service development across urban and rural communities.

Entire Section 21241.5 requiring Caltrans to develop a plan to increase flight availability at Meadows Field Airport in Kern County was deleted, along with the special statute finding and state-mandated local program reimbursement provisions.

The tax transfer provision was narrowed from all 'aviation fuel' (jet fuel and aviation gasoline) to 'jet fuel' only, excluding avgas from the new allocation scheme.

The bill no longer imposes a state-mandated local program, as the requirement for Kern County to participate in developing the Meadows Field plan was removed.

A new 50/50 split was created: 50% of jet fuel tax revenue is retained by the airport where the fuel is sold for local operations, capital improvements, maintenance, and aviation-related infrastructure needs; the remaining 50% goes to the Aeronautics Account.

The state sales and use tax rate on aviation fuel was reduced from 4.1875 percent to 3.9375 percent.

Allocation percentages within the Aeronautics Account were rebalanced: general aviation airports increased from 12% to 20%, commercial airports increased from 30% to 40% (with large hub rising to 30%, small hub to 20%, nonhub dropping to 30%), nonhub air service grants cut from 40% to 15%, aviation education raised from 3% to 5%, and other state aviation programs raised from 10% to 15%.

New Section 7102.3 of the Revenue and Taxation Code transfers state sales and use tax revenue at the rate of 4.1875 percent on aviation fuel (jet fuel and aviation gasoline) into the Aeronautics Account in the State Transportation Fund.

New Section 21689 of the Public Utilities Code establishes a fixed allocation formula for Aeronautics Account funds: 12 percent to general aviation airports, 30 percent split among commercial airports (20 percent large hub, 20 percent medium hub, 14 percent small hub, 46 percent nonhub), 40 percent for grants to nonhub commercial airports with fewer than 300,000 annual enplanements to attract and expand air service, 3 percent for aviation education grants, 10 percent for other state aviation programs, and up to 5 percent for administrative costs.

The bill's appropriation status changed from 'no' to 'yes,' meaning it now makes an appropriation by increasing funding sources for and expanding purposes of the continuously appropriated Aeronautics Account.

Grants under the 40 percent nonhub commercial airport allocation carry a priority for airports located in cities with a population greater than 400,000, which directly targets Bakersfield and Meadows Field Airport.

The vote requirement changed from a simple majority to a two-thirds majority, making passage more difficult.

The state-mandated local program designation changed from 'yes' to 'no,' removing the mandate classification that would have triggered reimbursement obligations under the Government Code.