BILL ANALYSIS Ó SB 398 Page 1 Date of Hearing: August 19, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair SB 398 (Leyva) - As Amended June 2, 2015 ----------------------------------------------------------------- |Policy |Natural Resources |Vote:|9 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill establishes the Green Assistance Program (GAP) to be administered by the Secretary for Environmental Protection (Cal EPA Secretary) in concert with environmental justice programs. Specifically, this bill: SB 398 Page 2 1)Requires GAP to provide technical assistance to small businesses, small nonprofits and disadvantaged communities applying for funding from the Greenhouse Gas Reduction Fund (GGRF). The technical assistance may include: a) Basic information on available programs, eligibility requirements, and deadlines. b) Referrals to designated contact people in agencies administering the programs. 2)Requires the Cal EPA Secretary to conduct outreach activities to inform eligible entities about GAP. Authorizes the Cal EPA Secretary to coordinate outreach activities with other state agencies, local agencies, and nonprofits. 3)Requires GAP to use existing resources appropriated by the Legislature to Cal EPA in the annual budget act. FISCAL EFFECT: Cost pressures in the hundreds of thousands to low millions of dollars from an unspecified source (GF, GGRF or other special fund). There are currently 14 state agencies that administer GGRF funds, approximately 40 sub-programs and hundreds of different project types. This bill requires Cal EPA to conduct outreach and directly work with over 2,000 disadvantaged communities identified by census track, as well as potentially thousands of small businesses and small nonprofit agencies. SB 398 Page 3 Although this bill requires the Cal EPA Secretary to use existing resources to establish the program, it will likely create substantial new workload. It is unlikely that Cal EPA will be able to absorb the costs and meet the requirements of the bill. COMMENTS: 1)Purpose. According to the author, currently there is no single place to assist small communities and businesses in accessing funds for mitigating the impacts of poor air quality. This bill creates a program to provide technical assistance to such entities applying for funding from AB 32 Cap and Trade revenues (GGRF). 2)Background. The California Global Warming Solutions Act of 2006 (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 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 SB 398 Page 4 of emission credits, the proceeds of which are quarterly deposited into the GGRF and available for appropriation by the Legislature. 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% 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. The 2015-16 40% annual allocation expenditure plan has not yet been adopted by the Legislature. 3)Disadvantaged Communities. 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. SB 398 Page 5 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 large swaths of the Coachella Valley, Imperial Valley and Mojave Desert. 4)Environmental Justice. The principles of environmental justice call for fairness, regardless of race, color, national origin or income, in the development of laws and regulations that affect every community's natural surroundings, and the places people live, work, play and learn. Cal EPA administers an Environmental Justice Small Grant program and awarded more than $500,000 in grants to 28 organizations to improve environmental and health conditions and promote public engagement in California communities disproportionately burdened by pollution. This bill requires GAP to coordinate with this and any other state environmental justice programs. Analysis Prepared by:Jennifer Galehouse / APPR. / (916) 319-2081 SB 398 Page 6