BILL ANALYSIS Ó
AB 416
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Date of Hearing: May 1, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
AB 416 (Gordon) - As Amended: April 4, 2013
Policy Committee: Natural
ResourcesVote:6-2
Local Government 7-2
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill requires the Air Resources Board (ARB) to establish
the Local Emission Reduction Program (LERP) to provide grants
and other financial assistance to eligible local government
recipients for the purpose of developing and implementing local
greenhouse gas emissions (GHG) reduction projects.
Specifically, this bill:
1)Provides that, upon appropriation by the Legislature, money
shall be available from the GF for this program.
2)Requires ARB, in coordination with other state entities, as
appropriate, to establish and administer the LERP to provide
local assistance grants and other financial assistance to
eligible recipients for the purposes of developing and
implementing GHG emissions reduction projects in the state.
3)Defines eligible recipients for purposes of the bill to mean
"a city, county, city and county, charter city, charter
county, metropolitan planning organization, regional climate
authority, special district, joint powers authority, air
pollution control or air quality management district, regional
collaborative, or nonprofit organization working in
coordination with a local government."
4)Requires ARB to develop standards and guidelines for the
distribution of funds to reduce GHG emissions and to maximize
the ability to achieve one or more of the following:
a) Decrease air or water pollution.
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b) Reduce the consumption of natural resources or energy.
c) Provide opportunities to achieve greenhouse gas
emissions reductions in ways that increase localized energy
resources.
d) Promote public-private partnerships to implement energy
efficiency and clean energy projects with financing
incentives for residential and commercial facilities.
e) Increase the reliability of local water supplies.
f) Increase solid waste diversion from landfills.
g) Increase electric vehicle infrastructure.
h) Achieve greenhouse gas emissions reductions in ways that
reduce vehicle miles traveled.
i) Prevent conversion of agricultural, forest, and open
space lands to uses that result in higher greenhouse gas
emissions.
5)Requires ARB and the Strategic Growth Council (SGC), in
evaluating potential projects to be funded, to give priority
to projects that demonstrate one or more of the following
characteristics:
a) Regional implementation.
b) The ability to leverage additional public and private
funding.
c) The potential for co-benefits or multi-benefits.
d) The potential for the project or program to be
replicated.
e) Consideration of geographic and socioeconomic issues.
6)States the intent of the Legislature that moneys appropriated
pursuant to the bill's provisions must be in a manner
consistent with the requirements of the Greenhouse Gas
Reduction Fund Investment Plan and Communities Revitalization
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Act.
7)Makes the development of standards and guidelines by ARB and
the provision of financial assistance to eligible recipients
contingent upon appropriation by the Legislature.
FISCAL EFFECT
The costs to administer this program will depend upon its scope
and the extent to which local governments adopt local GHG
emission reduction plans. This bill does not appropriate funding
and local rates of participation are unknown. The cost
estimates below are intended to illustrate costs that typically
could be expected to result from any program similar to the
Local Emission Reduction Program. Actual program costs may vary
considerably.
1)Annual costs to ARB as follows: $450,000 in 2012-13 to
develop standards and guidelines and $150,000 thereafter to
revise them; $580,000 to certify locally adopted GHG emission
reduction plans; $150,000 to oversee program expenditures; and
$100,000 to provide general administrative support.
2)Costs to the Strategic Growth Council in the tens of thousands
of dollars annually to assist in the awarding of local grants.
3)Cost pressure of an unknown amount, potentially in the
millions of dollars annually, to fund the Local Emission
Reduction Program.
COMMENTS
1)Purpose. According to the author, local governments are
uniquely positioned to implement the greatest
emissions-reducing projects and as a result, should be at the
center of an investment strategy aimed to achieve California's
climate goals. Without a local program, local-scale and
regional-scale emission reduction initiatives are not likely
to be undertaken.
If funded, AB 416 provides direct investments in California to
advance clean and efficient energy, expand low-carbon and
public transportation, protect natural resources, promote
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sustainable infrastructure development, increase the
reliability of local water supplies, improve infrastructure,
reduce local costs, create jobs, and achieve many other local
priorities.
2)Background. The California Global Warming Solutions Act of
2006 (AB 32), ARB to adopt a statewide GHG emissions limit
equivalent to 1990 levels by 2020 and adopt regulations,
including market-based compliance mechanisms, to achieve
maximum technologically feasible and cost-effective GHG
emission reductions.
All moneys collected by ARB from the auction or sale of
allowances pursuant to a market-based compliance mechanism
(i.e., the cap-and-trade program adopted by ARB under AB 32)
are deposited into the GHG Reduction Fund available for
appropriation by the Legislature. The local and regional
agencies defined in this bill are eligible for funding under
this program.
3) Prior Legislation. This bill is similar to AB 2404
(Fuentes) which was held on this committee's Suspense File.
However, AB 2404 did not rely upon GF revenues but instead
relied upon the appropriation of cap and trade revenues.
Analysis Prepared by : Jennifer Galehouse / APPR. / (916)
319-2081