BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     SB 189


                                                                    Page  1





          Date of Hearing:  July 13, 2015 


                       ASSEMBLY COMMITTEE ON NATURAL RESOURCES


                                 Das Williams, Chair


          SB  
          189 (Hueso) - As Amended June 1, 2015


          SENATE VOTE:  26-14


          SUBJECT:  Clean Energy and Low-Carbon Economic and Jobs Growth  
          Blue Ribbon Committee.


          SUMMARY:  Establishes the Clean Energy and Low-Carbon Economic  
          and Jobs Growth Blue Ribbon Committee (Committee) within the  
          California Environmental Protection Agency (CalEPA) to advise  
          state agencies on economic benefits and job growth related to a  
          cleaner, low-carbon economy. 


          EXISTING LAW:   


          1)Under the California Global Warming Solutions Act of 2006 (AB  
            32): 

             a)   Requires the California Air Resources Board (ARB) to  
               adopt GHG emissions reduction measures to achieve a  
               reduction in statewide GHG emsisions to the 1990 level.  

             b)   Requires ARB to appoint an Economic and Technology  
               Advancement Advisory Committee (ETAAC) to advise on  








                                                                     SB 189


                                                                    Page  2





               technological research and development opportunities.



             c)   Requires ARB to prepare and approve a Scoping Plan, on  
               or before January 1, 2009 and once every five years  
               thereafter, for achieving the maximum technologically  
               feasible and cost-effective reductions in GHG emissions  
               from sources of emissions by 2020.  Establishes the  
               Environmental Justice Advisory Committee (EJAC) to advise  
               ARB on the development of the Scoping Plan and other  
               pertinent matters.  



             d)   Establishes the Greenhouse Gas Reduction Fund (GGRF) in  
               the State Treasury, requires all funds, except for fines  
               and penalties, collected pursuant to a market-based  
               mechanism be deposited in the GGRF, and requires the  
               Department of Finance, in consultation with ARB and any  
               other relevant state agency, to develop a three-year  
               investment plan for the moneys deposited in the GGRF. 





             e)   Requires that the GGRF be used to facilitate GHG  
               emissions reductions in this state consistent with AB 32.   
               Requires that annual budget appropriations from the GGRF be  
               consistent with the investment plan. 



             f)   Requires the GGRF investment plan to allocate, at a  
               minimum, 25% of the funds to benefit disadvantaged  
               communities, and to allocate 10% of the funds for projects  
               within disadvantaged communities. 









                                                                     SB 189


                                                                    Page  3





          2)Under the California Alternative and Renewable Fuel, Vehicle  
            Technology, Clean Air, and Carbon Reduction Act of 2007,  
            funded through various vehicle and vessel related surcharges,  
            requires the California Energy Commission (CEC) to implement  
            the Alternative and Renewable Fuels and Vehicle Technology  
            Program (ARFVTP) to provide funding measures to develop and  
            deploy technologies and alternative and renewable fuels in the  
            marketplace to help attain the state's climate change  
            policies.  CEC is required to develop an investment plan for  
            the program in consultation with an advisory committee.  An  
            evaluation of the efforts funded by the ARFVTP that includes  
            research, development, and deployment efforts funded by this  
            program is required every two years, beginning in 2011. 



          3)Under the California Clean Energy Jobs Act (Proposition 39),  
            requires that $550 million be transferred to the Clean Energy  
            Jobs Fund for five fiscal years, beginning in 2013, for  
            appropriation by the Legislature for eligible projects to  
            improve energy efficiency and expand clean energy generation  
            in schools.  Proposition 39 also creates a Citizen's Oversight  
            Board to review and assess effectiveness of expenditures from  
            the fund.  



          4)Under the Electric Utility Industry Restructuring Act,  
            authorizes the Public Interest Renewable Energy Program  
            administered by CEC, to support the operation of existing  
            renewable facilities as well as the development of new and  
            emerging renewable technologies. 



          5)Establishes the Governor's Office of Business and Economic  
            Development (GO-Biz) within the Governor's Office for the  
            purpose of serving as the lead state entity for economic  
            strategy and marketing of California on issues relating to  








                                                                     SB 189


                                                                    Page  4





            business development, private sector investment and economic  
            growth.  



          6)Under the California Green Collar Jobs Act of 2008,  
            establishes the Green Collar Jobs Council (CGJC) within the  
            California Workforce Investment Board (CWIB) to focus on  
            developing the framework, funding, strategies, programs,  
            policies, partnerships, and opportunities necessary to address  
            the growing need for a highly skilled and well-trained  
            workforce to meet the needs of California's emerging green  
            economy. 



          7)Establishes the Commission for Economic Development to provide  
            continuing bipartisan legislative, executive branch and  
            private sector support and guidance for the best possible  
            overall economic development of the state. 


          THIS BILL:   


          1)States legislative findings relating to clean energy, GHG  
            emission reductions, and job creation.  


          2)States that the purpose of this bill is to create a single  
            independent blue ribbon committee to provide advice to state  
            agencies on the most effective ways to maximize California's  
            economic benefits and jobs growth via investments in a  
            cleaner, low-carbon economy.  


          3)Establishes the Committee within CalEPA.  Specifies that the  
            Committee be comprised of the following members: 









                                                                     SB 189


                                                                    Page  5






             a)   Five members appointed by the Governor and subject to  
               confirmation by the Senate; and,


             b)   One member each appointed by the Speaker of the Assembly  
               and the Senate Committee on Rules.


          4)Specifies that each member serve for a four-year term; members  
            shall not receive per diem or other compensation, but may be  
            reimbursed for travel expenses.  Any member who fails to  
            attend three Committee meetings in one year shall be removed  
            from the Committee.  


          5)Requires the Committee to hold its first meeting on or before  
            December 1, 2016, and requires that meetings be held quarterly  
            or at a frequency determined by the Committee.  


          6)Requires that Committee members have expertise in economic,  
            financial or policy aspects of clean energy economic growth,  
            job creation, workforce standards, and employment  
            opportunities for disadvantaged workers.  Specifies that at  
            least two members appointed by the Governor have experience  
            working on economic projects in disadvantaged communities.  


          7)Requires the Committee to "advise state agencies on the most  
            effective ways to expend clean energy and GHG-related funds  
            and to implement policies in order to maximize California's  
            economic and employment benefits," and: 


             a)   Develop guidance for tracking and reporting jobs  
               outcomes for state clean energy and low-carbon investments  
               to evaluate jobs outcomes; 









                                                                     SB 189


                                                                    Page  6






             b)   Develop guidance to measure the quantity and quality of  
               jobs created by state investments in clean energy and  
               low-carbon investments; 


             c)   Advise state agencies on the most effective ways to  
               require responsible contractor standards, as applicable,  
               and minimum training and skill certifications for workers  
               to ensure high-quality work for state clean energy and  
               low-carbon investments, and the most effective ways to  
               connect disadvantaged communities and other target  
               populations to good quality jobs;  


             d)   Advise state agencies on the most effective ways to  
               align state clean energy and low-carbon training funds with  
               existing state workforce development investments and  
               strategies; 


             e)   Provide an annual update to the Governor and the  
               appropriate policy and fiscal committees of the Legislature  
               on its activities; and, 


             f)   Consult with the Labor and Workforce Development Agency  
               and the California Workforce Investment Board (CWIB) when  
               appropriate.  


          8)Requires CEC, the Public Utilities Commission (PUC), ARB, and  
            any other state agency that has received advice from the  
            Committee to submit an annual progress report to the Governor  
            and the appropriate policy and fiscal committees of the  
            Legislature describing how it implemented or responded to the  
            advice, guidance, and any recommendations provided by the  
            Committee.  Specifies that this report may be combined with  
            any other annual report submitted by the agency.  








                                                                     SB 189


                                                                    Page  7







          9)Sunsets the reporting requirements on January 1, 2021.  


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee, this bill has the following costs: 


          1)Increased costs to CalEPA, potentially in the hundreds of  
            thousands of dollars annually, to house, staff and provide  
            administrative support to the Committee (General and/or  
            special funds).

          2)The bill would require CEC, PUC, ARB, and potentially other  
            state agencies implementing clean energy and low-carbon  
            policies and programs to issue reports annually through 2020,  
            as specified. To the extent that they cannot be integrated  
            with those already statutorily required, these reports are  
            likely to cost in the tens of thousands of dollars per agency,  
            per year. (General Fund and/or special funds).



          COMMENTS:  


          1)This bill.  According to the author: 

               Under existing law, there is no state agency responsible  
               for oversight of job creation or maximizing economic growth  
               as we set new standards for reducing GHG emissions.  AB 32  
               created the EJAC and the ETAAC to advise ARB? Although  
               ETAAC may advise ARB on state, regional, national, and  
               international economic and technological developments  
               related to GHG emissions reductions, its sole purpose is  
               not to focus on economic developments.  










                                                                     SB 189


                                                                    Page  8








               This bill would create a blue ribbon committee housed  
               within CalEPA that is solely focused on the most effective  
               way to implement clean energy and GHG emissions reduction  
               policies in order to create more jobs and encourage  
               economic innovation.  The creation of this committee does  
               not affect existing committees.  





          1)AB 32.  As part of AB 32's direction that ARB adopt a  
            statewide 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  
            requires ARB to prepare and approve a Scoping Plan at  
            five-year intervals.  


            The first Scoping Plan, adopted by ARB in 2008, described the  
            specific actions ARB and others must take to reduce statewide  
            GHG emissions to 1990 levels by 2020.  Pursuant to AB 32, the  
            reduction measures identified in the Scoping Plan had to be  
            proposed, reviewed, and adopted as individual regulations by  
            January 1, 2011, to become operative beginning on January 1,  
            2012.  According to ARB, a total reduction of 80 million  
            metric tons (MMT), or 16% compared to business as usual, is  
            necessary to achieve the 2020 limit.  Approximately 78% of the  
            reductions will be achieved through identified direct  
            regulations.  ARB intends to achieve the balance of reductions  
            necessary to meet the 2020 limit (approximately 18 MMT)  
            through a cap-and-trade program that covers an estimated 600  
            entities.


            In May 2014, ARB adopted a Scoping Plan update.  The Scoping  








                                                                     SB 189


                                                                    Page  9





            Plan update discusses the objective of achieving an 80%  
            reduction by 2050 and the need for a midterm target, but does  
            not propose or adopt a specific target.  According to ARB, the  
            update defines ARB's climate change priorities for the next  
            five years and sets the groundwork to reach California's  
            long-term climate goals.











            The 2014-15 Budget Act allocates cap-and-trade revenues for  
            the 2014-15 Fiscal Year and establishes 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% will 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.  In addition to reducing GHG emissions, 25%  
            of the proceeds from the GGRF must also go to projects that  
            provide a benefit to disadvantaged communities, as identified  
            by the California Environmental Protection Agency (CalEPA).  A  
            minimum of 10% of the funds must be for projects located  
            within those communities.  



            In October 2014, CalEPA released its list of disadvantaged  
            communities based on the California Communities Environmental  








                                                                     SB 189


                                                                    Page  10





            Health Screening Tool (CalEnviroScreen), a tool that assesses  
            all census tracts in California to identify the areas  
            disproportionately burdened by and vulnerable to multiple  
            sources of pollution.  Areas identified as disadvantaged by  
            CalEnviroScreen 2.0 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 large  
            swaths of the Coachella Valley, Imperial Valley and Mojave  
            Desert.



            In his January 5, 2015 Inaugural Address, Governor Brown  
            announced the following objectives:  1) Increase the amount of  
            renewable energy used in California from 33% to 50%;  2)  
            Reduce petroleum use in cars and trucks by up to 50%; and,  3)  
            Double the efficiency of existing buildings and make heating  
            fuels cleaner.
            
          1)Jobs and Economic Development Efforts.  There are a number of  
            entities throughout state government designed to increase  
            workforce and economic development efforts, with a particular  
            emphasis on emerging technology, green jobs, and the green  
            economy.  

             a)   GO-Biz:  GO-Biz serves as California's single point of  
               contact for economic development and job creation efforts.   
               GO-Biz markets the business and investment opportunities  
               available in California by working in partnership with  
               local, regional, federal, and other state public and  
               private institutions to encourage business development and  
               investment in the state.  

               The iHub Program within GO-Biz designates 'iHubs' (i.e.,  
               areas in the state) to stimulate partnerships, economic  
               development, and job creation by leveraging assets to  
               provide an innovation platform for startup businesses,  
               economic development organizations, business groups, and  








                                                                     SB 189


                                                                    Page  11





               venture capitalists.  These assets include research parks,  
               technology incubators, universities, and federal  
               laboratories. 



             b)   Commission for Economic Development: The commission,  
               consisting of the Lieutenant Governor as Chairperson, three  
               members appointed by each the Senate Committee on Rules and  
               the Assembly Speaker, and 10 members appointed by the  
               Governor, was established to provide bipartisan  
               legislative, executive branch and private sector support  
               and guidance for the best possible overall economic  
               development of the state.  

             c)   California Workforce Investment Board:  CWIB is charged  
               with developing a unified, strategic planning process to  
               coordinate various education, training, and employment  
               programs into an integrated workforce development system  
               that supports economic development.  CWIB has adopted  
               "sector strategies" as the statewide framework for  
               workforce development and works with partners, including  
               other state agencies, to support the emergence of effective  
               statewide and regionally driven sector initiatives.



             d)   Green Collar Jobs Council:  GCJC was created to address  
               the workforce needs that accompany California's growing  
               green economy under the purview of CWIB.  GCJC makes  
               recommendations and creates strategies for comprehensive  
               and effective workforce training opportunities to help  
               prepare California's current and future workforce to meet  
               the skills demand from businesses supporting the energy  
               efficiency and clean energy sectors.  GCJC is also tasked  
               with developing, collecting, analyzing, and distributing  
               statewide and regional labor market data on California's  
               new and emerging green industries workforce needs, trends,  
               and job growth and identifying funding resources and making  








                                                                     SB 189


                                                                    Page  12





               recommendations on how to expand and leverage these funds.   
               CWIB is required to report annually to the Legislature on  
               the status of GCJC activities, grants awarded, and its  
               development and implementation of a green workforce  
               strategic initiative.  



             The GCJC issued a Proposed Jobs and Workforce Development  
               Program Elements for Carbon Reduction Investments in  
               California in January 2014, which proposed "a common  
               approach to workforce development and job creation for  
               California's multiple public investments in carbon  
               reduction initiatives under the umbrella of AB 32."  

          2)Suggested amendment.  This bill requires the Committee to  
            advise state agencies on the most effective ways to connect  
            "disadvantaged communities and other target populations" with  
            green jobs; however, the bill is not clear what the other  
            target populations would be.  This may create confusion when  
            the Committee is implementing the bill and could inadvertently  
            authorize the Committee to focus on groups other than  
            disadvantaged communities.  The committee may wish to amend  
            the bill to strike out "and other target populations" to  
            ensure that the Committee's focus remain on disadvantaged  
            communities.

          3)Double referral.  This bill was double referred to the  
            Assembly Committee on Jobs, Economic Development; it passed  
            out of that committee on June 23 on a vote of 6-2.  


          


          REGISTERED SUPPORT / OPPOSITION:











                                                                     SB 189


                                                                    Page  13






          Support


          Alliance for Solar Choice


          American Lung Association, California


          Audubon California


          Azul


          Bloom Energy


          California League of Conservation Voters


          California State Association of Electrical Workers


          California State Pipe Trades Council 


          CalSTART


          Environment California


          Environmental Defense Fund


          Natural Resources Defense Council









                                                                     SB 189


                                                                    Page  14






          Sierra Club California


          Solar City


          Solar Energy Industries Association


          Sunrun


          Union of Concerned Scientists


          Western States Council of Sheet Metal Workers


          Opposition


          None on file




          Analysis Prepared by:Elizabeth MacMillan / NAT. RES. / (916)  
          319-2092