BILL ANALYSIS Ó
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 156 (Perea) - California Global Warming Solutions Act of
2006: disadvantaged communities.
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|Version: August 18, 2015 |Policy Vote: E.Q. 6 - 1 |
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|Urgency: No |Mandate: No |
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|Hearing Date: August 24, 2015 |Consultant: Marie Liu |
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This bill meets the criteria for referral to the Suspense File.
Bill
Summary: AB 156 would establish a technical assistance grant
program to help eligible applicants identify and develop
projects that are eligible to receive funding from the
Greenhouse Gas Reduction Fund (GGRF).
Fiscal
Impact:
Unknown ongoing costs, likely in the mid-hundreds of thousands
to low millions, depending on the size of the grant program,
to the GGRF (special fund) for the ARB to administer the grant
program
Cost pressures of at least $7 million to the GGRF (special
fund) for ARB or a third-party to provide technical
assistance.
Background: The California Global Warming Solutions Act of 2006 (referred
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to as AB 32, HSC §38500 et seq.) requires the California Air
Resources Board (ARB) to determine the 1990 statewide greenhouse
gas (GHG) emissions level, to approve a statewide GHG emissions
limit equivalent to that level that will be achieved by 2020,
and to adopt GHG emissions reductions measures by regulation.
ARB is authorized to include the use of market-based mechanisms
to comply with the regulations. All monies, except for fines and
penalties, collected pursuant to a market-based mechanism are
deposited in the Greenhouse Gas Reduction Fund (GGRF)
(Government Code §16428.8).
Existing law requires that the GGRF only be used to facilitate
the achievement of reductions of GHG emissions consistent with
AB 32 (HSC §39710 et seq.). To this end, the Department of
Finance, in consultation with the ARB and any other relevant
state agencies, is required to develop, as specified, a
three-year investment plan for the moneys deposited in the GGRF.
The investment plan must allocate a minimum of 25% of the funds
to projects that benefit disadvantaged communities and to
allocate 10% of the funds to projects located within
disadvantaged communities. Additionally, the ARB, in
consultation with CalEPA, is required to develop funding
guidelines for administering agencies receiving allocations of
GGRF funds that include a component for how agencies should
maximize benefits to disadvantaged communities.
Proposed Law:
This bill would require the ARB, upon appropriation, to
establish a comprehensive technical assistance grant program for
eligible applicants assisting communities that the state board
determines require technical assistance in accessing programs
that allocate money from the GGRF. Priority would be given to
those communities demonstrating the greatest need for increased
capacity. Eligible applicants include regional agencies and
nonprofit organizations coordinating with local governments.
Grants could be used for the following activities:
Identifying appropriate grant programs,
Developing competitive project proposals,
Coordinating existing local programs that reduce GHG emissions
with new programs that receive GGRF funding,
Conducting community outreach to residents of eligible
communities regarding consumer programs receiving funding from
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GGRF or reducing GHG emissions
ARB would be required to coordinate with the California
Environmental Protection Agency (CalEPA) as well as agencies
that administer GGRF funds in the development of grant program
guidelines.
This bill would require the investment plan to allocate money to
fund this technical assistance program.
This bill would also require the ARB to prepare and post on its
website a report on projects funded to benefit disadvantaged
communities. The report is to include the following information
on the project: a general description, location of
implementation, estimated date of completion, award amount, and
the status of any monies not awarded in accordance with the
investment plan and the reasons for those funds not being
awarded.
Related
Legislation: SB 398 would create a technical assistance and
outreach program, administered by the secretary of the
California Environmental Protection Agency (CalEPA), for small
businesses and small nonprofits who are interested in applying
for grants from programs funded by the Greenhouse Gas Reduction
Fund (GGRF). SB 398 is awaiting hearing in the Assembly
Appropriations Committee.
AB 1179 (Rendon) would require the ARB to prepare and post on
its website a report on the GGRF funded projects, identical to
the requirement in this bill. Assembly Appropriations held AB
1179 was held under suspense and incorporated the language in AB
1179 into AB 156, also adding Assembly Member Rendon as a
principle co-author.
Staff
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Comments: To develop and provide a comprehensive technical
assistance program for disadvantaged communities for all GGRF
programs, ARB estimates that it would need 40 positions at $7.4
million plus 2 additional positions at $280,000 annually for the
first two years. This estimate assumes that ARB would be the
entity providing the technical assistance. This estimate
includes 20 positions to provide guidance and feedback to
communities in developing competitive projects to apply for
GGRF-funded grants and 10 positions to conduct outreach to local
governments, non-profits, and others on consumer programs aimed
at reducing GHG emissions. ARB notes that there are over 2,000
census tracks in the state that meet the definition of "eligible
community" in the bill. Each of these communities could receive
technical assistance for GGRF-funded programs run by 14
administering agencies with 40 sub-programs. Staff notes that
this bill aims to provide assistance in developing grant
proposals. This could require a significant amount of workload
per project. Depending on the depth of assistance given, the 20
positions estimated for this responsibility could be
conservative.
According to the author's staff, the intent of this bill is to
create a grant program that would allocate grants to
third-parties to provide the technical assistance instead of the
ARB providing the technical assistance itself. Staff notes that
both program designs could be allowed under the current language
of the bill. Staff recommends that the bill be amended to
clearly reflect the author's intent. If a third-party is
providing the assistance, the bill should also clarify whether
the third-party can receive a grant to provide technical
assistance to a single project or a single applicant.
Staff believes the costs associated with the grant program are
approximately the same, regardless of who is providing the
technical assistance, just distributed differently. If the
assistance is to be conducted by a third-party, ARB will likely
need approximately 5% of the grant program's appropriation for
administration with the remaining amount being issued through
grants.
Staff notes that there is a very high probability that the grant
program would be oversubscribed. If the program is
oversubscribed, the ARB will be in a position of choosing which
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applicants receive funding, therefore giving those communities
an advantage over other eligible communities who don't receive
assistance. This early advantage could be especially significant
given that the assistance could include project development.
Providing an early advantage would be especially inappropriate
in programs administered by the ARB. Having a third-party
administer the technical assistance creates some distance
between the awarding agency and potential applicants, especially
if the third-party receives a grant to help with multiple
projects and applicants. However there still could be the
perception, if not the reality, that the technical assistance
program would be choosing early winners and losers for the
various GGRF-funded grant programs. Staff believes it is not
likely that enough funding could be provided to this grant
program to avoid oversubscription.
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