BILL ANALYSIS Ó
AB 2343
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Date of Hearing: April 18, 2016
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Das Williams, Chair
AB 2343
(Cristina Garcia) - As Amended April 11, 2016
SUBJECT: Greenhouse Gas Reduction Fund: study
SUMMARY: Requires the Department of Finance (DOF) to include in
its annual report to committees of the Legislature information
relating to the economic impacts of Greenhouse Gas Reduction
Fund (GGRF) expenditures.
EXISTING LAW:
1)Requires the Air Resources Board (ARB), pursuant to California
Global Warming Solutions Act of 2006 [AB 32 (Nunez), Chapter
488, Statutes of 2006], to adopt a statewide greenhouse gas
(GHG) emissions limit equivalent to 1990 levels by 2020 and
adopt regulations to achieve maximum technologically feasible
and cost-effective GHG emission reductions. AB 32 authorizes
ARB to permit the use of market-based compliance mechanisms to
comply with GHG reduction regulations, once specified
conditions are met.
2)Establishes the GGRF and requires all moneys, except for fines
and penalties, 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)
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to be deposited in the GGRF and available for appropriation by
the Legislature.
3)Establishes the GGRF Investment Plan and Communities
Revitalization Act (Act) to set procedures for the investment
of GHG allowance auction revenues. Authorizes a range of GHG
reduction investments and establishes policy objectives.
4)Specifies that moneys appropriated from the GGRF through
investments may include funding to reduce GHG emissions
through:
a) Energy efficiency, clean and renewable energy
generation, distributed renewable energy generation,
transmission and storage, and other related actions;
b) The development of state-of-the-art systems to move
goods and freight, advanced technology vehicles and vehicle
infrastructure, advanced biofuels, and low-carbon and
efficient public transportation;
c) Strategic planning and development of sustainable
infrastructure projects;
d) Investments in programs implemented by local and
regional agencies, local and regional collaboratives, and
nonprofit organizations coordinating with local
governments; and,
e) Funding research, development, and deployment of
innovative technologies, measures, and practices related to
programs and projects funded pursuant to the Act.
5)Requires the investment plan to allocate (1) a minimum of 25%
of the available moneys in the GGRF to projects that provide
benefits to identified disadvantaged communities, and (2) a
minimum of 10% of the available moneys in the GGRF to projects
located within identified disadvantaged communities.
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6)Requires each state agency to annually prepare and submit to
the Secretary of the California Environmental Protection
Agency (CalEPA) a report that includes:
a) A list of those measures that have been adopted and
implemented by the state agency to meet GHG emission
reduction targets and a status report of the actual GHG
emissions reduced as a result of the measures;
b) A timetable for adoption of any additional measures
needed to meet GHG emissions reduction targets;
c) An estimate of the department's own GHG emissions and an
explanation of any increase or decrease compared to the
previous year's emissions.
7)Requires CalEPA, on or before January 1 of each year, to
compile and organize the information submitted by state
agencies into a clear, standardized format and provide the
information on its website as a "state agency GHG emission
reduction report card."
8)Beginning March 1, 2014, and annually thereafter, requires DOF
to report to the appropriate committees of the Legislature the
status of projects funded by the GGRF and their outcomes.
Requires that the report include a description of how the
administering agencies have fulfilled the funding requirements
for disadvantaged communities.
THIS BILL requires DOF to include in its annual report to
committees of the Legislature a comparison of all of the
following:
1)The levels of investment funded across the state;
2)The GHG emissions reductions resulting from the investments;
and,
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3)The economic benefits associated with the investments,
including, but not limited to, the jobs created and salaries
and wages associated with those jobs.
FISCAL EFFECT: Unknown
COMMENTS:
1)Existing GGRF funding and programs. The 2014-15 Budget Act
allocated GGRF revenues for the 2014-15 fiscal year and
established a long-term plan for the allocation of GGRF
revenues beginning in fiscal year 2015-16. Thirty-five
percent of GGRF is continuously appropriated for investments
in transit, affordable housing, and sustainable communities.
Twenty-five percent is continuously appropriated to continue
the construction of the high-speed rail project. The
remaining 40% is subject to annual appropriation by the
Legislature for investments in programs that include
low-carbon transportation, energy efficiency and renewable
energy, and natural resources and waste diversion. An
expenditure plan for the 40% was not included in the 2015-16
Budget Act, with the exception of $227 million appropriated to
continue funding for specified existing programs. The
remaining 2015-16 revenues, along with 2016-17 revenues, are
available for appropriation this year.
The 2016 Annual Report of Cap and Trade Auction Proceeds
includes an analysis of funds spent within and benefiting
disadvantaged communities, excluding high speed rail spending.
According to the report, 39% of expenditures were for
projects located within disadvantaged communities and 51% of
the overall funding benefited disadvantaged communities.
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Listed below are the major GGRF program areas, administering
agency, and funding to date:
a) Transportation and Sustainable Communities
i) High Speed Rail, High Speed Rail Authority
(Authority), $850 million
ii) Transit and Intercity Rail Capital Program,
Transportation Agency, $265 million
iii) Low Carbon Transit Operations Program, Department of
Transportation (Caltrans), $145 million
iv) Affordable Housing and Sustainable Communities
Program, Strategic Growth Council (SGC), $610 million
v) Low Carbon Transportation, ARB, $325 million
b) Clean Energy and Energy Efficiency
i) Low-Income Weatherization Program, Community
Services and Development (CSD), $154 million
ii) Energy Efficiency in Public Buildings, California
Energy Commission (CEC), $20 million
iii) Climate Smart Agriculture, Department of Food and
Agriculture (CDFA), $75 million
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iv) Water-Energy Efficiency, Department of Water
Resources (DWR), $70 million
c) Natural Resources and Waste Diversion
i) Wetlands and Watershed Restoration, Department of
Fish and Wildlife (DFW), $27 million
ii) Urban Forestry, Forest Health Restoration, and
Reforestation, Department of Forestry and Fire Protection
(CAL FIRE), $42 million
iii) Waste Diversion, Department of Resources Recycling
and Recovery (CalRecycle), $31 million
The Governor's 2016-17 Budget proposes just under $3.1 billion
in expenditures:
a) Continuous Appropriations
i) High Speed Rail, Authority, $500 million
ii) Low Carbon Transit Operations, State Transit
Assistance, $100 million
iii) Transit and Intercity Rail Capital Program,
Transportation Agency, $200 million
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iv) Affordable Housing and Sustainable Communities
Program, SGC, $400 million
b) Fifty Percent Reduction in Petroleum Use
i) Transit and Intercity Rail Capital Program,
Transportation Agency, $400 million
ii) Low Carbon Road Program, Caltrans, $100 million
iii) Low Carbon Transportation and Fuels, ARB, $500
million
iv) Biofuel Facility Investments, CEC, $25 million
c) Local Climate Action
i) Transformative Climate Communities, SGC, $100
million
d) Short-Lived Climate Pollutants
i) Black Carbon Woodsmoke and Refrigerants, ARB, $60
million
ii) Waste Diversion, CalRecycle, $100 million
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iii) Climate Smart Agriculture - Healthy Soils and Dairy
Digesters, CDFA, $55 million
e) Safeguarding California/Water Action Plan
i) Water and Energy Efficiency, CDFA and DWR, $30
million
ii) Drought Executive Order, CEC, $60 million
iii) Wetlands and Watershed Restoration/CalEcoRestore,
DFW, $60 million
f) Safeguarding California/Carbon Sequestration
i) Healthy Forests and Urban Forestry, CAL FIRE, $180
million
ii) Urban Greening, Natural Resources Agency, $20
million
g) Energy Efficiency/Renewable Energy
i) Energy Efficiency for Public Buildings, Department
of General Services, $30 million
ii) California Lending for Energy and Environmental
Needs Center, I Bank, $20 million
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iii) Energy Corps, Conservation Corps, $15 million
iv) Energy Efficiency Upgrades/Weatherization, CSD, $75
million
v) Renewable Energy and Energy Efficiency Projects,
University of California, California State University,
$60 million
1)GGRF reporting. ARB and DOF are required to submit various
reports to the Legislature relating to the states's
cap-and-trade program and GGRF expenditures. The primary
report is ARB's Scoping Plan, which lays out ARB's plan to
reduce greenhouse gas GHG emissions to 1990 levels by 2020.
The Scoping Plan was first adopted in 2008 and must be updated
every five years. ARB is also tasked with developing a
short-lived climate pollution reduction strategy. ARB also
prepares an annual report of climate investments using
cap-and-trade funds. DOF is required to develop a three-year
investment plan for cap-and-trade funding. DOF is required to
annually report to the Legislature on the status of projects
funded by the GGRF and their outcomes. The Act requires that,
where applicable and to the extent feasible, GGRF allocations
be used for co-benefits, including: economic, environmental,
and public health benefits; job creation; complement efforts
to improve air quality; direct investments toward
disadvantaged communities; provide opportunities for
businesses, public agencies, nonprofits, and other community
institutions to participate in and benefit from GHG emissions
reductions efforts; and, lessen impacts of climate change on
the state's communities, economy, and environment. However,
there is no clear reporting mechanism to inform the
Legislature and the public about the economic and job benefits
have resulted from programs funded by the GGRF. This bill
would require DOF to include information about the economic
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benefits associated with GGRF programs in its existing report
to the Legislature.
2)Author's statement:
AB 2343 seeks to augment the current annual report to the
Legislature on the status and outcomes of projects funded
from the GGRF. This bill requests that additional
information be provided so that legislators can easily
compare levels of investment across the state and compare
economic benefits associated with those investments,
including jobs created and the salaries and wages
associated with those jobs.
REGISTERED SUPPORT / OPPOSITION:
Support
None on file
Opposition
None on file
Analysis Prepared by:Elizabeth MacMillan / NAT. RES. / (916)
AB 2343
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