BILL ANALYSIS Ó
SB 400
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Date of Hearing: June 29, 2015
ASSEMBLY COMMITTEE ON TRANSPORTATION
Jim Frazier, Chair
SB
400 (Lara) - As Amended June 1, 2015
SENATE VOTE: 27-9
SUBJECT: California Global Warming Solutions Act of 2006:
Greenhouse Gas Reduction Fund.
SUMMARY: Requires the High Speed Rail Authority (HSRA) to fund
projects that offset construction impacts of the high speed rail
project. Specifically, this bill:
1)Requires HSRA to allocate 25% of appropriated cap-and-trade
funds to projects that reduce greenhouse gas (GHG) emissions
and improve air quality in disadvantaged communities and
designated non-attainment areas. Suggested qualifying
projects include, but are not limited to:
a) Public transit improvements that reduce congestion;
b) Transportation improvements that reduce congestion;
c) Alternative transportation options;
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d) Natural systems such as rural and urban forests that
reduce GHG emissions or increase the sequestration of
carbon; and,
e) Use of low- and zero-emission equipment for
transportation construction.
2)Makes related, technical amendments.
EXISTING LAW:
1)Created HSRA in 1996 to direct development and implementation
of an intercity high-speed rail service that is fully
coordinated with other public transportation services. In
2008, voters approved Proposition 1A authorizing $9.95 billion
in general obligation bonds for the high-speed rail program
and related commuter rail services.
2)Requires, pursuant to AB 32 (Nunez), Chapter 488, Statutes of
2006, the California Air Resources Board (ARB) to adopt GHG
emissions reductions measures to achieve the goal of reducing
GHG emissions to 1990 levels by 2020, including market-based
mechanisms (e.g., cap-and-trade program).
3)Established the Greenhouse Gas Reduction Fund (GGRF) in the
State Treasury and required all cap-and trade proceeds to be
deposited into the fund
4)Requires the Department of Finance (DOF) to develop a
three-year investment plan guide expenditure of cap-and-trade
auction revenues to achieve GHG emissions reductions
consistent with AB 32.
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5)Requires the GGRF investment plan to allocate, at a minimum,
25% GGRF money to benefit disadvantaged communities and to
allocate 10% of GGRF moneys within disadvantaged communities.
6)Continuously appropriates 25% of the GGRF to HSRA for
acquisition, construction, environmental review and design of
the initial operating segment and Phase I Blended System.
FISCAL EFFECT: Unknown
COMMENTS: The communities along the high-speed rail corridor
through California's Central Valley suffer from some of the
state's worst air quality. In fact last year, the American Lung
Association noted that, despite vast improvements over the last
few decades, the Central Valley still has the nation's highest
levels of ozone and fine particle pollution.
The author introduced SB 400 out of concern for communities like
these that are already burdened by nearby, heavily congested
highway corridors. He notes that, while the high-speed rail
project will eventually reduce GHG emissions and air pollution,
the project will be detrimental to the Central Valley in the
short-term due to the environmental impacts from construction.
Recognizing concerns such as these, HSRA committed to achieving
zero-net GHG emissions related to construction activities,
material deliveries, and worker travel. For example, the
authority has committed to planting trees to offset the first
phases of construction. Furthermore, HSRA is working with the
San Joaquin Unified Air Pollution Control District (District) to
provide additional mitigation for construction emissions. Under
a Memorandum of Understanding (MOU) between HSRA and the
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District, each quarter the HSRA construction contractor will
submit a list of equipment that has been used during the quarter
along with the number of miles driven or hours used. HSRA will
then pay the District a dollar value equivalent to be used for
programs to, for example, replace aging farm and other
high-polluting equipment. This mitigation is intended to
complement requirements that HSRA already imposes on its
construction contractor to use clean construction vehicles.
HSRA expects that it could pay the District approximately $40
million under the terms of the MOU. HSRA has undertaken these
measures despite the fact that the U.S. Transportation Board
ruled that California's environmental review laws are federally
pre-empted; consequently, the project is not required to comply
with the California Environmental Quality Act, including
requirements to mitigate environmental impacts.
The author appears to believe these efforts by HSRA are
insufficient; hence he introduced
SB 400 to direct 25% of the cap-and-trade money directed to the
high-speed rail project (or $125 million if cap-and-trade
auctions bring in $2 billion annually as anticipated) to
projects that benefit communities in designated extreme
non-attainment areas.
Committee concerns: The author's frustration about the impacts
to disadvantaged communities in the Central Valley and elsewhere
are understandable. However, SB 400 raises a number of
legitimate concerns:
1)Re-directing 25% from HSRA's only steady funding source could
threaten completion of the project and jeopardize any future
environmental benefits that might be realized. The project is
already sorely underfunded and SB 400 would exacerbate that
problem.
2)SB 400 is intended to offset environmental impacts due to
construction but does not impose any requirement that the
re-directed dollars be spent in communities near the
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construction zones. Instead, SB 400 requires monies to be
spent in areas designated as extreme non-attainment areas.
California has two extreme non-attainment areas: the San
Joaquin Valley and the South Coast Air Basin. Conceivably, SB
400 could result in millions of dollars being spent in
Southern California, hundreds of miles from the high-speed
rail construction sites.
3)The amount of mitigation required by SB 400 (worth about $125
million annually) may have little or no relation to the actual
construction-related environmental impacts and will
significantly drive up the cost of the high-speed rail
project.
The committee may wish to consider the following dichotomy:
Should high-speed rail project dollars be spent to achieve
definitive, near-term environmental benefits in the state's most
disadvantaged communities or should those dollars be spent to
increase the likelihood that the high-speed rail project will be
completed and its promised environmental benefits potentially
realized?
Double referral: This bill will be referred to the Assembly
Natural Resources Committee should it pass out of this committee
Previous legislation: AB 32 (Nunez), Chapter 488, Statutes of
2006, required ARB to develop a plan of how to reduce emissions
to 1990 levels by 2020.
SB 535 (De Leon), Chapter 830, Statutes of 2012, required DOF,
when developing the three-year investment plan for cap-and-trade
to allocate 25% of these funds to projects that provide benefits
to disadvantaged communities and to allocate a minimum of 10% to
projects located in disadvantaged communities.
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SB 862 (Committee on Budget and Fiscal Review), Chapter 36,
Statutes of 2014, established a long-term cap-and-trade
expenditure plan by continuous appropriation and designated 25%
of annual cap-and-trade proceeds to the HSRA.
REGISTERED SUPPORT / OPPOSITION:
Support
Coalition For Clean Air
Opposition
None on file
Analysis Prepared by:Victoria Alvarez / TRANS. / (916)
319-2093
SB 400
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