BILL ANALYSIS Ó
AB 2722
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Date of Hearing: May 18, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2722 (Burke) - As Amended April 20, 2016
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
The bill creates the Transformative Climate Communities Program
(Program), to be administered by the Strategic Growth Council
(SGC) and funded by AB 32 cap-and-trade revenues. Specifically,
this bill:
1)Allocates up to $250 million from of Greenhouse Gas Revenue
Funds (GGRF), upon appropriation by the Legislature, to SGC to
administer the program.
2)Requires SGC, in coordination with the Assistant Secretary for
Environmental Justice and Tribal Affairs at California
Environmental Protection Agency (CalEPA), to award competitive
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grants to eligible entities, including:
a) Nonprofit organizations;
b) Community-based organizations;
c) Faith-based organizations;
d) Coalitions or associations of nonprofit organizations;
e) Community development finance institutions;
f) Community development corporations; and,
g) Local agencies.
1)Requires grants to be awarded for the development and
implementation of transformative climate community plans that
contribute to greenhouse gas (GHG) emission reductions and
demonstrate potential climate, economic, workforce, health,
and environmental benefits in disadvantaged communities, as
specified. Grants may be awarded over multiple years.
2)Requires SGC and all funded entities to identify additional
public and private funds and coordinate a network of technical
assistance providers, as specified.
FISCAL EFFECT:
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1)Cost pressures of up to $250 million (GGRF) to fund the
Program.
2)Increased costs of $5 million for SGC to develop and implement
the program. This figure is based on the Governor's proposed
budget which provides $100 million for an Administration
proposed Transformative Climate Communities Program (GGRF)
3)Increased costs to the Air Resources Board (ARB) of less than
$150,000 (GGRF) if eligible projects fit within existing GGRF
project categories. If eligible projects are outside current
existing GGRF project categories, ARB estimates increased
initial costs of approximately $670,000 for two years, and
ongoing annual costs of $520,000 (GGRF) to develop
quantification methodologies, disadvantaged community
criteria, reporting criteria, and expenditure records
4)Minor, absorbable costs for CalEPA.
COMMENTS:
1)Purpose. According to the author, this bill establishes a new
program to ensure California is making comprehensive,
cross-cutting, and transformative climate investments to
achieve multiple GHG, public health, and economic benefits in
our state's most vulnerable communities. This bill will help
cities, local jurisdictions, and communities accelerate
sustainability plans to meet the state's climate change goals.
2)Background. The California Global Warming Solutions Act of
2006 (AB 32). AB 32 requires ARB to adopt a statewide GHG
emissions limit equivalent to 1990 levels by 2020 and adopt
regulations, including market-based compliance mechanisms, to
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achieve maximum technologically feasible and cost-effective
GHG emission reductions.
As part of the implementation of AB 32 market-based compliance
measures, ARB adopted a cap-and-trade program that caps the
allowable statewide emissions and provides for the auctioning
of emission credits, the proceeds of which are quarterly
deposited into the GGRF available for appropriation by the
Legislature.
SB 535 (De León), Chapter 830, Statutes of 2012, requires no
less than 10% of cap-and-trade revenues fund projects located
within disadvantaged communities, and that 25% of available
revenues fund projects that benefit those communities.
The 2014-15 Budget Act allocated cap-and-trade revenues for
the 2014-15 fiscal year and established a long-term plan for
the allocation of cap-and-trade revenues beginning in fiscal
year 2015-16.
The Budget continuously appropriates 35% of cap-and-trade
funds for investments in transit, affordable housing, and
sustainable communities. Twenty-five percent of the revenues
are continuously appropriated to continue the construction of
high-speed rail. The remaining 40% are to be appropriated
annually by the Legislature for investments in programs that
include low-carbon transportation, energy efficiency and
renewable energy, and natural resources and waste diversion.
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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, totaling $3.1 billion are available for
appropriation this year.
The 2016-17 proposed budget includes $100 million to create a
new Transformative Climate Communities Program, but did not
include much detail on the specifics of the program. This
bill is intended to expand upon this proposal.
3)Disadvantaged Communities and Environmental Justice. SB 535
(De León), Chapter 830, Statutes of 2012, requires no less
than 10% of cap-and-trade revenues fund projects located
within disadvantaged communities, and that 25% of available
revenues fund projects that benefit those communities.
In October 2014, CalEPA released its list of disadvantaged
communities for the purpose of SB 535. CalEPA relied on
CalEnviroScreen to identify the areas disproportionately
burdened by and vulnerable to multiple sources of pollution.
CalEnviroScreen is a tool that assesses all census tracts in
California to identify the areas disproportionally affected
and vulnerable to multiple sources of pollution.
Areas (census tracts) identified as disadvantaged for SB 535's
purposes by CalEnviroScreen include: the majority of the San
Joaquin Valley; much of Los Angeles and the Inland Empire;
pockets of other communities near ports, freeways, and major
industrial facilities such as refineries and power plants; and
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large swaths of the Coachella Valley, Imperial Valley and
Mojave Desert.
According to the Office of Environmental Health Hazard
Assessment (OEHHA), approximately 8 million Californians (21%)
live in zip codes that are considered "highly impacted" by
environmental, public health, and socioeconomic stressors.
Nearly half of all Californians live within six miles of a
facility that is a significant GHG emitter and they are
disproportionately people of color.
In February of 2014, CalEPA issued an Environmental Justice
Program Update, which included four main areas for future
actions: 1)Increase efforts to eliminate discrimination on
the basis of race, national origin, ethnic group
identification, religion, age, sex, sexual orientation, color,
genetic information, or disability in any program or activity
conducted or funded by the state; 2)Develop guidance to
promote a sound legal framework for CalEPA to advance
environmental justice goals and objectives; 3)Lead an
agency-wide working group dedicated to increase compliance
with environmental laws in communities with relatively higher
environmental burdens; and, 4)Add additional indicators to
CalEnviroScreen to identify disadvantaged communities for the
purpose of GGRF expenditures.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
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