BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                            Senator Kevin de León, Chair


          SB 605 (Lara) - California Global Warming Solutions Act of 2006:  
          scoping plan.
          
          Amended: May 8, 2013            Policy Vote: EQ 7-2
          Urgency: No                     Mandate: No
          Hearing Date: May 23, 2013      Consultant: Marie Liu
          
          SUSPENSE FILE. AS PROPOSED TO BE AMENDED.
          
          
          Bill Summary: SB 605 would make various new requirements of the  
          next scoping plan prepared by the Air Resources Board (ARB) and  
          require that the scoping plan be approved by the Joint  
          Legislative Budget Committee.

          Fiscal Impact: 
              Annual limited-term costs of $1.7 million and 11.2 PYs from  
              the Cost of Implementation Account (COI) within the Air  
              Pollution Control Fund (special fund) for FY 2013-14, FY  
              2014-15, and FY 2015-16 for additional information to be  
              incorporated into the 2013 scoping plan.
              Annual ongoing costs of $1.7 million and 11.2 PYs from the  
              COI starting in FY 2013-14 for to incorporate additional  
              information into future scoping plans. 

          Background: The California Global Warming Solutions Act of 2006  
          (AB 32 (Nunez/Pavley) Chapter 488/2006) requires the state's  
          greenhouse gas (GHG) emissions to be reduced to 1990 levels by  
          2020. ARB is required to adopt GHG emissions reduction measures  
          by regulation and may include the use of market-based mechanisms  
          to comply with these regulations. The implementation of AB 32 is  
          guided by a scoping plan prepared and approved by ARB. The first  
          scoping plan was required to be adopted by January 1, 2009 and  
          updated at least once every five years. ARB is required to  
          evaluate the total potential costs and total potential economic  
          and noneconomic benefits of the plan for reducing GHGs to the  
          state's economy and public health.

          The current scoping plan outlines achieving GHG emission  
          reductions through a cap-and-trade program, the low carbon fuel  
          standard, light-duty vehicle GHG standards, energy efficiency  
          actions, the Renewable Portfolio Standard, regional  








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          transportation-related GHG targets, and a variety of other  
          actions and programs.

          Proposed Law: This bill would require the ARB to include in the  
          next scoping update:
               A prioritization and emphasis on measures that result in  
              GHG emissions while creating jobs within the state and  
              reducing co-pollutants.
               A prioritization and emphasis on current regulations and  
              actions and additional measures to achieve the maximum,  
              technologically feasible, and cost-effective reductions in  
              short-lived climate pollutants with high global warming  
              potential.
               Requirement that offsets originate and be achieved within  
              the state to the maximum extent feasible.
               A plan that achieves the GHG emission goal that would be  
              implemented in the event that current measures do not result  
              in the GHG reductions necessary.
               Consideration of the use of special funds that are  
              authorized to be expended for the purposes of GHG reductions  
              for reductions from sources within the state.

          The scoping plan update would be required to be approved by the  
          Joint Legislative Budget Committee in consultation with the  
          appropriate Legislative Committees. 

          If ARB completes an update prior to January 1, 2014, this bill  
          would require the ARB to revise the update to comply with these  
          new requirements.

          Staff Comments: This bill would require ARB to include a  
          substantial amount of new information into future scoping plans.  
          ARB estimates that it would need an additional 11.2 PYs and $1.7  
          million ongoing to meet the additional requirements under this  
          bill. 

          However, given the timing of this bill and the planned 2013  
          scoping plan update, there may be additional costs. The first  
          scoping plan was adopted in 2008 and thus ARB is planning  
          completing its update in 2013. A preliminary draft is scheduled  
          to be released in summer 2013 and the Board anticipates  
          considering adoption of the update in the fall. Even if the ARB  
          began to adjust the scoping plan per this bill after the  
          Governor's signature, should it pass the Legislature, much of  








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          the work to create the update will have already been completed.  
          This bill would explicitly require ARB to revise the update if  
          an update is adopted prior to January 1, 2014. ARB estimates  
          that this would result in the need for 11.2 PYs and $1.7 million  
          for three years.

          Proposed Author Amendments: Remove the requirement for the  
          Legislature to approve the update to the strategic plan and  
          specify that the backup plan for GHG emissions is a backup in  
          the event that any of the GHG measures fail.