(a)

1. (1) Funds made available pursuant to an appropriation from the Greenhouse Gas Reduction Fund to reduce mobile and stationary sources of criteria air pollutants or toxic air contaminants consistent with the community emissions reduction programs developed pursuant to Section 44391.2 shall be available to districts, as distributed by the state board, and shall be used for projects that complement and further the rules and regulatory requirements that the state board or districts have established or are in the process of developing to reduce or mitigate emissions from mobile or stationary sources in affected communities pursuant to Section 44391.2. The funds shall be allocated for projects that are intended to benefit communities that the state board has selected or is considering for selection in future years pursuant to Section 44391.2.
2. (2) Funds shall be allocated to projects consistent with priorities identified by the affected community in a transparent meaningful public process.
3. (3) Funds shall only be allocated to projects that will provide emission reductions that are in excess of those otherwise required by law or regulation.

(b) Projects eligible for funding include the following:

1. (1) Projects that provide financial assistance for the purchase of cleaner technologies with a priority on zero-emission equipment either through the Community Air Protection Funds Moyer Guidelines Supplement or in accordance with the state board’s guidelines for the Highway Safety, Traffic Reduction, Air Quality, and Port Security Bond Act of 2006 (Chapter 12.49 (commencing with Section 8879.20) of Division 1 of Title 2 of the Government Code) relative to funding amount and truck evaluation.
2. (2) Zero-emission charging infrastructure projects with a priority toward infrastructure that supports medium- and heavy-duty vehicles.

3. (3)

   1. (A) Projects that provide financial assistance to owners of stationary sources that are not subject to the requirements adopted by the state board pursuant to subdivision (c) of Section 38562 for replacement of equipment with technologies that will result in direct emission reductions of toxic air contaminants and criteria air pollution, including zero-emission technologies.
   2. (B) The state board may contract with the State Treasurer to expend funds for purposes of this paragraph through programs implemented by the State Treasurer or the Capital Programs and Climate Financing Authority.

(d)

1. (1) Notwithstanding Section 10231.5 of the Government Code, by March 1 of each year, the state board shall report to the Legislature on the use, in the prior fiscal year, of funds that are subject to this section. The report shall include all of the following:

   1. (A) A list of projects funded.
   2. (B) An identification of the communities designed to be benefited by the projects.
   3. (C) The anticipated reduction in the emissions of criteria pollutants, toxic air contaminants, and greenhouse gases resulting from the projects.
   4. (D) How the projects further the relevant community emissions reduction program.
2. (2) The report required by paragraph (1) may be submitted as a part of the annual report required pursuant to Section 39720.