BILL ANALYSIS �
AB 1447
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Date of Hearing: April 28, 2014
ASSEMBLY COMMITTEE ON TRANSPORTATION
Bonnie Lowenthal, Chair
AB 1447 (Waldron) - As Amended: April 22, 2014
SUBJECT : California Global Warming Solutions Act of 2006:
Greenhouse Gas Reduction Fund: traffic signal synchronization
SUMMARY : Adds traffic signal synchronization to the list of
sustainable infrastructure projects eligible to receive money
from cap-and-trade auction proceeds if the project is designed
and implemented to achieve cost-effective reductions in
greenhouse gas emissions and includes specific reduction targets
and metrics to evaluate the project's effect.
EXISTING LAW :
1)Enacts the Global Warming Solutions Act of 2006 (AB 32
(Nunez), Chapter 488, Statutes of 2006) that requires the Air
Resources Board (ARB) to adopt a statewide greenhouse gas
emissions limit equivalent to the statewide greenhouse gas
emissions levels in 1990 to be achieved by 2020.
2)Requires ARB to provide each region of the state with
greenhouse gas emission reduction targets for the automobile
and light truck sector.
3)Requires a regional transportation plan to include a
sustainable communities strategy designed to achieve the
regional targets for greenhouse gas emission reduction.
4)Requires ARB to adopt regulations to achieve maximum
technologically feasible and cost-effective greenhouse gas
emission reductions; to this end, authorizes ARB to permit the
use of market-based compliance mechanisms (cap-and-trade
program) to comply with greenhouse reduction regulations.
5)Requires cap-and-trade auction proceeds be used to reduce
greenhouse gas emissions in the state through investments
related to, but not limited to:
a) Energy efficiency and renewable energies;
b) State-of-the-art systems to move goods and freight,
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advanced technology vehicles and vehicle infrastructure,
advanced biofuels, and low-carbon and efficient public
transportation;
c) Water use and supply, land and natural resource
conservation and management, forestry, and sustainable
agriculture;
d) Strategic planning and development of sustainable
infrastructure projects, such as transportation and
housing;
e) In-state diversion of municipal solid waste and disposal
through waste reduction, division, and reuse;
f) Programs implemented by local and regional agencies,
local and regional collaboratives, and nonprofit
organizations coordinating with local governments; and,
g) Research, development, and deployment of innovative
technologies, measures, and practices.
6)Requires the Department of Finance (DOF), in consultation with
ARB, to develop and submit a three-year investment plan to the
Legislature to guide the use of auction proceeds.
7)Requires the investment plan to allocate: (1) a minimum of
25% of the available moneys in the fund to projects that
provide benefits to identified disadvantaged communities; and,
(2) a minimum of 10% of the available moneys in the fund to
projects located within identified disadvantaged communities.
FISCAL EFFECT : Unknown
COMMENTS : ARB's cap-and-trade program was established to help
the state meet its AB 32 goals. Under the cap-and-trade
program, ARB places a cap on greenhouse gas emissions by issuing
a limited number of tradable permits (called allowances) equal
to the cap. Each year, the number of allowances declines in
proportion to the cap to achieve the intended emission
reductions. Businesses that aggressively reduce their emissions
can trade their surplus allowances to firms that find it more
expensive to reduce their emissions. In distributing the
emissions allowances, ARB allocates a portion of the allowances
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for free to covered entities, places some in a cost containment
reserve, and auctions the remainder. The price of auctioned
allowances is set by the marketplace. Over time, program
regulations require a greater reliance on auctioning, which
will, among other things, help maximize incentives for sources
to reduce their emissions and provide proceeds (auction
revenues) that can be reinvested for public benefit to further
the purposes of AB 32.
To guide investment of auction proceeds, the Legislature passed
and the Governor signed
AB 1532 (John A. P�rez), Chapter 807, Statutes of 2012, which
created the Greenhouse Gas Reduction Fund Investment Plan and
Communities Revitalization Act. Among other provisions, AB 1532
requires DOF and ARB to develop and submit a three-year
investment plan to identify priority investments that will help
achieve greenhouse gas reduction goals. Auction proceeds are to
be appropriated to state agencies by the Legislature consistent
with the investment plan.
The first investment plan, for fiscal years 2013-14 through
2015-16 was released in May last year. The 2013-14 Budget Act,
however, did not appropriate any funds pursuant to the
investment plan. Instead it loaned $500 in auction proceeds to
the General Fund. For the 2014-15 Budget, the Governor proposed
spending $850 million on a variety of programs, including $250
million for high-speed rail and approximately $350 million for
other transportation-related investments. No funds have been
proposed specifically for traffic signal synchronization.
In addition to the Governor's proposal, Senator Steinberg
recently announced his proposed strategy for investing auction
proceeds. The specifics of his plan have not yet been released,
but the plan reportedly calls for 10% of an estimated $5 billion
annually in auction proceeds to be used as a permanent source of
funding for state highway road rehabilitation and for complete
streets for traffic management, repair, deferred maintenance,
bikeways, and road and highway retrofit. It is unclear if
traffic signal synchronization would be allowed under the
Senator's proposal.
The City of Los Angeles was the first major city in the world to
synchronize all of its 4,500 traffic lights. This effort to
reduce congestion, pollution, and wasted time took 30 years and
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cost roughly $400 million, $150 million of which came from
transportation bonds authorized by the Highway Safety, Traffic
Reduction, Air Quality, and Port Security Bond Act of 2006, a
nearly $20 billion bond measure approved by the voters as
Proposition 1B in November 2006. That measure provided $250
million to fund traffic signal synchronization or other
technology-based improvements to improve safety, operations, and
the effective capacity of local streets and roads. Of the $250
million available for this effort, $150 million was allocated to
the City of Los Angeles. The effort reportedly has had great
success reducing traffic congestion and associated air
pollution.
The author introduced this bill to provide a means of funding
future traffic signal synchronization projects, funding for
which has diminished along with transportation bond dollars.
These projects would be eligible to use auction proceeds
assuming data support projected reductions in greenhouse gas
emissions as a result. Arguably, traffic signal synchronization
projects are already eligible for funding as part of sustainable
transportation infrastructure projects called for in the
investment plan. However, they are not specifically identified.
AB 1447 would specifically clarify that these projects are,
indeed, eligible.
Writing in opposition to this bill, the California Municipal
Utilities Association discourages calling out the traffic signal
synchronization program instead preferring broad funding
categories consistent with current law. Others argue that the
ARB lacks the authority to raise revenue through auction
proceeds and, therefore, authority to spend the proceeds is
premature.
Double-referral : This bill passed out of the Natural Resources
Committee on April 21, 2014, with a vote of 9-0.
Previous legislation:
AB 32 (Nunez), Chapter 488, Statutes of 2006, enacted the Global
Warming Act of 2006 that requires ARB to adopt a statewide
greenhouse gas emissions limit equivalent to the statewide
greenhouse gas emissions levels in 1990 to be achieved by 2020.
AB 1447
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AB 1532 (John A. P�rez), Chapter 807, Statutes of 2012, creates
the Greenhouse Gas Reduction Fund Investment Plan and
Communities Revitalization Act to set procedures for the
investment of auction revenues.
SB 535 (De Leon), Chapter 830, Statutes of 2012, provides that
the required investment plan for cap-and-trade revenue is to
allocated funds as follows: 1) a minimum of 25% of the
available moneys in the fund to projects that provide benefits
to identified disadvantaged communities; and, 2) a minimum of
10% of the available moneys in the fund to projects located
within identified disadvantaged communities.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file
Opposition
California Chamber of Commerce
California Municipal Utilities Association
Analysis Prepared by : Janet Dawson / TRANS. / (916) 319-2093