BILL ANALYSIS Ó
AB 2722
Page 1
ASSEMBLY THIRD READING
AB
2722 (Burke)
As Amended May 31, 2016
Majority vote
------------------------------------------------------------------
|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Natural |6-3 |Williams, Cristina |Jones, Hadley, |
|Resources | |Garcia, Gomez, |Harper |
| | |McCarty, Mark Stone, | |
| | |Wood | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |14-6 |Gonzalez, Bloom, |Bigelow, Chang, |
| | |Bonilla, Bonta, |Gallagher, Jones, |
| | |Calderon, Daly, |Obernolte, Wagner |
| | |Eggman, Eduardo | |
| | |Garcia, Roger | |
| | |Hernández, Holden, | |
| | |Quirk, Santiago, | |
| | |Weber, Wood | |
| | | | |
| | | | |
------------------------------------------------------------------
SUMMARY: Establishes the Transformative Climate Communities
AB 2722
Page 2
Program (Program) in the Strategic Growth Council (SGC) to fund
the development and implementation of neighborhood-level
transformative climate community plans (plans). Specifically,
this bill:
1)Establishes the Program to fund the development and
implementation of neighborhood-level transformative climate
community plans that include multiple, coordinated greenhouse
gas (GHG) emissions reduction projects that provide local
economic, environmental, and health benefits that are directly
connected to communities most impacted by pollution and
vulnerable to climate change. States the intent of the
Legislature that private resources can "more effectively be
catalyzed to support innovative community and climate
transformation in disadvantaged communities."
2)Requires SGC, in coordination with the Assistant Secretary for
Environmental Justice and Tribal Affairs at California
Environmental Protection Agency (CalEPA), to award competitive
grants to eligible entities, as specified.
3)Directs SGC to award grants for plans and projects that
implement plans that contribute to the reduction of GHG
emissions and demonstrate potential climate, economic,
workforce, health, and environmental benefits located in
communities that have a demonstrated need for climate,
economic, workforce, health, and environmental benefits.
4)Authorizes SGC to award a grant over multiple years.
5)Requires SGC to weigh economic, environmental, and health
benefits equally with climate benefits. Defines "economic
benefits" as high-quality, well-paid employment opportunities
for residents, benefits for small businesses, and benefits for
AB 2722
Page 3
minority-, LGBT-, woman-, or disabled veteran-owned small
businesses in the plan's region. Defines "LGBT" as lesbian,
gay, bisexual, or transgender.
6) Requires SGC to "endeavor to identify" additional public and
private sources of funding to sustain and expand the Program
and a network of technical assistance providers to assist in
plan development, implementation, and project financing.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, this bill has the following state costs:
1)Cost pressures of up to $250 million (Greenhouse Gas Reduction
Fund (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: The Global Warming Solutions Act (AB 32 (Núñez),
Chapter 488, Statutes of 2006) requires ARB to adopt a statewide
GHG emissions limit equivalent to 1990 levels by 2020 and adopt
AB 2722
Page 4
regulations, including market-based compliance mechanisms, to
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.
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.
AB 2722
Page 5
According to the author, this bill is intended to establish a
new program to ensure that California is making "comprehensive,
cross-cutting, and transformative climate investments that
achieve multiple GHG, public health, and economic benefits in
our state's most vulnerable communities" to help cities, local
jurisdictions, and communities accelerate sustainability plans
and help California meet its ambitious climate change goals.
Analysis Prepared by:
Elizabeth MacMillan / NAT. RES. / (916) 319-2092 FN: 0003320