BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 197|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
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THIRD READING
Bill No: AB 197
Author: Eduardo Garcia (D), et al.
Amended: 8/19/16 in Senate
Vote: 21
PRIOR VOTES NOT RELEVANT
SENATE ENVIRONMENTAL QUALITY COMMITTEE: 5-2, 6/29/16
AYES: Wieckowski, Hill, Jackson, Leno, Pavley
NOES: Gaines, Bates
SENATE APPROPRIATIONS COMMITTEE: 5-2, 8/11/16
AYES: Lara, Beall, Hill, McGuire, Mendoza
NOES: Bates, Nielsen
SUBJECT: State Air Resources Board: greenhouse gases:
regulations
SOURCE: Asian Pacific Environmental Network
California Environmental Justice Alliance
DIGEST: This bill creates the Joint Legislative Committee on
Climate Policies, requires the Air Resources Board (ARB) to
prioritize direct emissions reductions when adopting rules and
regulations to achieve emissions reductions beyond the statewide
greenhouse gas (GHG) limit, and specifies requirements for
reporting GHG emissions, criteria air pollutants, and toxic air
contaminants, for facilities, sectors, and emissions reduction
measures. This bill also requires that two legislative members
serve as ex-officio, nonvoting members of ARB.
Senate Floor Amendments of 8/19/16 make a number of changes
including 1) adding intent language, 2) modifying provisions
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related to the Joint Legislative Committee, 3) defining social
costs, 4) requiring ARB to consider social cost and prioritize
rules and regulations that achieve direct emissions reductions
and when adopting rules and regulations to obtain emissions
reductions beyond the statewide GHG emissions limit, 5) removing
the requirement to rank emissions reduction measures, and 6)
specifying how ARB is required to report GHG and air pollution
emissions for facilities, sectors, and emissions reduction
measures.
ANALYSIS:
Existing law:
1) Establishes ARB with 14 members, 12 of which are appointed
by the Governor with consent of the Senate, and two members
appointed by the Senate Committee on Rules and the Speaker of
the Assembly, respectively. Of the 12 members appointed by
the Governor, six must have specified qualifications and six
must be board members from air districts, and the two members
of the Legislature are required to be persons who work
directly with pollution-burdened and vulnerable communities.
(Health and Safety Code §39510)
2) Requires, under the California Global Warming Solutions Act
of 2006 (HSC §38500 et seq.), ARB to do the following:
a) Determine the 1990 statewide GHG emissions level and
approve a statewide GHG emissions limit that is equivalent
to that level, to be achieved by 2020, and to adopt GHG
emissions reductions measures by regulation to achieve the
maximum technologically feasible and cost-effective
reductions in GHG emissions in furtherance of achieving
the statewide GHG emissions limit. ARB is authorized to
include the use of market-based mechanisms to comply with
the regulations.
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b) Prepare and approve a scoping plan by January 1, 2009,
for achieving the maximum technologically feasible and
cost-effective GHG emissions reductions from sources or
categories of sources of GHGs by 2020. The plan must be
updated at least once every five years.
c) Adopt regulations to require the reporting and
verification of statewide GHG emissions.
3) Requires ARB to establish a program to inventory sources of
air pollution within air basins and monitor air pollutants in
cooperation with local air districts.
This bill:
1) Establishes the Joint Legislative Committee on Climate
Change Policies, consisting of at least three members of the
Senate and at least three members of the Assembly, to
ascertain facts and make recommendations to the Legislature
concerning the state's climate change programs, policies, and
investments.
2) Requires ARB to post and update at least annually on ARB's
Web site GHG emission and criteria pollutants, and toxic air
pollutants emissions no later than January 1, 2018, for all
facilities subject to GHG emission reporting requirements in
a manner that illustrates emissions levels over time.
3) Requires ARB to post and update at least annually graphs of
GHG emissions, criteria pollutants and toxic air contaminants
throughout the state broken down to a local and subcounty
level for stationary sources, and at least a county level for
mobile sources.
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4) Requires ARB to prepare an informational report that
evaluates emissions trends and influences for those trends
for GHG emissions, criteria pollutants, and toxic air
contaminants from sectors covered by the Scoping Plan, and
authorizes the report to include recommendations for
legislative action and consideration.
5) Requires the chair of ARB to present the informational
report annually to the Joint Committee on Climate Change
Policies.
6) Requires ARB when adopting rules and regulations to achieve
emissions reductions beyond the 2020 statewide GHG emissions
limit, to consider the social cost of GHG emissions, follow
specified requirements, and prioritize rules and regulations
that result in direct emissions reductions at large
stationary sources of GHGs, direct emissions reductions from
mobile sources, and direct emissions reductions from other
sources.
7) Defines "social cost" as an estimate of the economic
damages, including but not limited to changes in agricultural
productivity, public health impacts, climate adaptation
impacts, and changes in energy system costs, per metric ton
of greenhouse gas emissions per year.
8) Requires each Scoping Plan update to identify the range of
GHG emissions reductions, range of air pollution reductions,
and cost-effectiveness, including avoided social costs, for
each emissions reduction measure.
9) Establishes six-year terms for voting members of ARB and
authorizes voting members to serve additional terms.
10)Specifies that a member of ARB whose appointment satisfies
local air district membership requirements for ARB's makeup,
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shall not be a member of ARB effective immediately if they
cease to hold the qualifying membership of a local air
district.
11)Requires that two legislative members serve as ex-officio,
nonvoting members of ARB, with one member appointed by the
Senate Committee on Rules, and the other member appointed by
the Speaker of the Assembly.
12)Makes various findings and declarations, including the need
to protect the state's most disadvantaged communities from
the effects of climate change, and for ARB's GHG reduction
actions to be performed in a transparent and accountable
manner.
13)Provides that the provisions of this bill are only operative
if SB 32 (Pavley) is enacted and becomes law on or before
January 1, 2017.
Background
1)Air Resources Board. ARB was created in 1967 through the
Mulford-Carrell Act, which combined two Department of Health
bureaus, the Bureau of Air Sanitation and the Motor Vehicle
Pollution Control Board.
Six of the board members must have certain qualifications
(e.g., automotive engineering; chemistry, meteorology, or
related field; surgeon or an authority on health effects).
The other six members must be board members from the
following entities: South Coast Air Quality Management
District (AQMD), Bay Area AQMD, San Joaquin Valley AQMD, San
Diego APCD, one of six Sacramento region air districts, and a
board member from any other district. These board members
must reflect the "qualitative requirements" of the other six
members to the extent practicable.
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AB 1288 (Atkins, Chapter 586, Statutes of 2015) added two
additional members to the board, which increased the
membership from 12 to 14, appointed by the Senate Committee on
Rules and the Speaker of the Assembly, and requires those
members be persons who work directly with pollution-burdened
and vulnerable communities.
2)The Global Warming Solutions Act of 2006. In 2006, the Global
Warming Solutions Act of 2006, AB 32 (Núñez and Pavley,
Chapter 488, Statutes of 2006) established a statewide GHG
emissions limit by 2020. AB 32 defines GHGs as carbon
dioxide (CO2), methane, nitrous oxide, hydrofluorocarbons,
perfluorocarbons, and sulfur hexafluoride and requires ARB to
determine the 1990 statewide GHG emissions level and approve
a statewide GHG emissions limit that is equivalent to that
level, to be achieved by 2020.
AB 32 requires ARB, among other things, to inventory GHG
emissions in California; implement regulations that achieve
the maximum technologically feasible and cost-effective
reduction of GHG emissions and impose fees for administrative
implementation costs; adopt discrete early action measures;
prepare and approve a scoping plan; convene an Environmental
Justice Advisory Committee; and appoint an economic advisory
committee to obtain recommendations for GHG reduction
measures.
The statute also specifies that ARB may include market-based
compliance mechanisms in the AB 32 regulations after
considering the potential for direct, indirect, and
cumulative emission impacts from these mechanisms, including
localized impacts in communities that are already adversely
impacted by air pollution, and must design any market-based
compliance mechanisms to prevent any increase in the
emissions of toxic air contaminants or criteria air
pollutants.
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3)AB 32 Scoping Plan. Pursuant to AB 32, ARB approved the first
Scoping Plan in 2008. The Scoping Plan outlined a suite of
measures aimed at achieving 1990-level emissions, a reduction
of 80 million metric tons of CO2 (MMT CO2e).
The 2008 Scoping Plan recommended that reducing GHG emissions
from the wide variety of sources that make up the state's
emissions profile could best be accomplished through a
cap-and-trade program along with a mix of other strategies
including:
A low carbon fuel standard (LCFS);
Light-duty vehicle GHG standards;
Expanding and strengthening existing energy efficiency
programs, and building and appliance standards;
Achieving a 33% Renewable Portfolio Standard;
Regional transportation-related GHG targets; and
Creating targeted fees on water use and high global
warming potential pollutants.
The basic design of the program, as recommended by the
original Scoping Plan, is that the combination of direct
regulatory measures and cap-and-trade is intended to achieve
the emission reduction target by 2020. Specifically, the
Scoping Plan lays out a strategy where the overall limit on
GHG emissions from most of the California economy is "capped"
through a cap-and-trade program, and direct regulations
within both capped and uncapped sectors would achieve
additional emissions reductions.
Pursuant to authority under AB 32, ARB adopted a LCFS in
2009, and a cap-and-trade program, approved on December 13,
2011.
Scoping Plan update. ARB approved an update to the Scoping
Plan on May 22, 2014. The update asserts that California is
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on track to meet the near-term 2020 greenhouse gas limit and
is well positioned to maintain and continue reductions beyond
2020 as required by AB 32.
Comments
Purpose of Bill. According to the author, "In order for
California to remain an economic and environmental leader the
state will need to also be a leader on issues related to equity.
Placing the health and economic impacts of climate policy on
vulnerable populations second will stunt the state's prosperity.
A great degree of transparency and investment in California's
environmentally and socioeconomically disadvantaged populations
has the potential to yield significant climate, economic, public
health and quality of life benefits while knocking down barriers
to opportunity."
Related/Prior Legislation
SB 32 (Pavley, 2016) requires ARB to approve a statewide GHG
emissions limit of 40% below the 1990 GHG emissions level to be
achieved by 2030 and specifies the bill only becomes operative
if AB 197 is enacted and becomes effective on or before January
1, 2017.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee:
One-time costs of $100,000 (various special funds) to the ARB
for construction to enlarge the hearing room dais and to
provide the equipment needed to accommodate two additional
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board members.
$233,000 annually (Cost of Implementation Fund) to the ARB for
staffing needs to support new board members and develop
ranking criteria.
SUPPORT: (Unable to verify at time of writing)
Asian Pacific Environmental Network (co-source)
California Environmental Justice Alliance (co-source)
Clean Power Campaign
The Nature Conservancy
OPPOSITION: (Unable to verify at time of writing)
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Agricultural Council of California
Association of California Egg Farmers
Building Owners & Managers Association of California
California Association of Wheat Growers
California Bean Shippers Association
California Building Industry Association
California Business Properties Assoc.
California Chamber of Commerce
California Farm Bureau Federation
California Grain and Feed Association
California Independent Oil Marketers Association
California Independent Petroleum Association
California League of Food Processors
California Manufacturers and Technology Association
California Pear Growers Association
California Railroad Industry
California Seed Association
California Taxpayers Association
Family Business Association
International Council of Shopping Centers
NAIOP of California, Commercial Real Estate Development
Association
National Federation of Independent Business, California
Western States Petroleum Association
ARGUMENTS IN SUPPORT: The Nature Conservancy argues this bill
would work alongside SB 32 to ensure that the state continues to
develop and implement the most effective climate policies in
order to prevent climate change problems from worsening. Clean
Power Campaign states that AB 197 will strengthen the role of
the Legislature in advising ARB and climate change policies and
will direct ARB to prioritize measures that result in direct GHG
emissions reductions from large sources across sectors.
ARGUMENTS IN OPPOSITION: Opponents argue that while AB 197 does
not mandate a specific regulatory mechanism, it directs ARB to
prioritize command-and-control regulations over a market-based
compliance mechanism, which would undermine flexibility required
for manufacturers to meet reduction obligations in the most
cost-effective manner. Opponents state that the creation of a
Joint Legislative Committee on Climate Change Policies and
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adding two non-voting legislators to the board does not justify
the empowerment of ARB with a post-2020 goal that does not
include further limits on their authority.
Prepared by:Rebecca Newhouse / E.Q. / (916) 651-4108
8/22/16 12:07:12
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