The California Global Warming Solutions Act of 2006 designates the State Air Resources Board as the state agency charged with monitoring and regulating sources of emissions of greenhouse gases. The act authorizes the state board to include the use of market-based compliance mechanisms. Existing law requires all moneys, except for fines and penalties, collected by the state board from the auction or sale of allowances as part of a market-based compliance mechanism to be deposited in the Greenhouse Gas Reduction Fund and to be available upon appropriation. Existing law requires the California Environmental Protection Agency to identify disadvantaged communities and requires the Department of Finance, in consultation with the state board and any other relevant state agency, to develop, as specified, a 3-year investment plan for the moneys deposited in the Greenhouse Gas Reduction Fund.

Existing law requires the 3-year investment plan to allocate a minimum of 25% of the available moneys in the fund to projects that benefit disadvantaged communities and to allocate a minimum of 10% of the available moneys in the fund to projects located in disadvantaged communities.

This bill would require the state board to prepare, and post on its Internet Web site, a specified report on the projects funded to benefit disadvantaged communities.

Date of Hearing: April 29, 2015

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Jimmy Gomez, Chair

ABPCA Bill Id:AB 1179

Author:(Rendon) – As Introduced Ver:February 27, 2015

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill requires the Air Resources Board (ARB) to prepare and post on its website a report on AB 32 Greenhouse Gas Reduction Fund (GGRF) projects funded in or benefiting disadvantaged communities pursuant to existing law. The report must include:

1. A general description of the project.

2. The location where the project will be implemented

3. The estimated completion date of each project.

4. The amount awarded to each project from the GGRF.

FISCAL EFFECT:

Increased costs of $200,000 for ARB (GGRF) to collect data and make it available in a format consistent with the reporting requirements.

Data collected by the agencies cover a diversity of project types with a wide variety of information and formats. The new tasks specific to this bill include:

1. Identifying data for 14 GGRF agencies, more than 40 sub-programs, hundreds of project types, and thousands of individual projects and mapping individual projects.

2. Verifying that each project meets the SB 535 criteria and is a benefit to a disadvantaged community.

3. Posting GGRF projects benefitting disadvantaged communities and their status on ARB’s website.

COMMENTS:

1. Purpose. The purpose of this bill is to increase transparency and public access to information regarding the funding of projects in disadvantaged communities from AB 32 cap-and-trade revenues.

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 b) 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.

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.

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.

3. Current Reporting. ARB currently develops an annual report that provides a program-level status of GGRF appropriations and disadvantaged community benefits achieved by each State agency. The report does not include individual project‑level information.

ARB has requested approval from the California Technology Agency (CTA) to develop and implement an information technology system that would track individual GGRF funded projects implemented by State agencies and would include a public interface that includes the information requested in this bill.

Once ARB receives approval of the GGRF project tracking system from CTA, the project tracking system is expected to be operational within two years.

This bill would require ARB to work with administering agencies to define manual reporting and data capture processes while the project tracking system is still under development. The author may wish to amend this bill to require program related reporting.

Analysis Prepared by: Jennifer Galehouse / APPR. / (916) 319-2081

Date of Hearing: April 13, 2015

ASSEMBLY COMMITTEE ON NATURAL RESOURCES

Das Williams, Chair

ABPCA Bill Id:AB 1179

Author:(Rendon) – As Introduced Ver:February 27, 2015

SUBJECT: California Global Warming Solutions Act of 2006: disadvantaged communities: report

SUMMARY: Requires the Air Resources Board (ARB) to report on projects funded in or benefiting disadvantaged communities pursuant to SB 535.

EXISTING LAW:

1. Requires ARB, pursuant to California Global Warming Solutions Act of 2006 [AB 32 (Núñez), Chapter 488, Statutes of 2006], to 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.

2. Authorizes ARB to permit the use of market-based compliance mechanisms to comply with GHG reduction regulations, once specified conditions are met.
   
   

3. Establishes the Greenhouse Gas Reduction Fund and requires all moneys, except for fines and penalties, collected by ARB from the auction or sale of allowances pursuant to a market-based compliance mechanism (i.e., the cap-and-trade program adopted by ARB under AB 32) to be deposited in the Fund and available for appropriation by the Legislature.

4. Establishes the Greenhouse Gas Reduction Fund Investment Plan and Communities Revitalization Act [AB 1532 (John A. Pérez), Chapter 807, Statutes of 2012] to set procedures for the investment of GHG allowance auction revenues. AB 1532 authorizes a range of GHG reduction investments and establishes several additional policy objectives.
   
   

5. 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 [SB 535 (De Leon), Chapter 830, Statutes of 2012].

THIS BILL requires ARB to prepare, and post on its website, a report on the projects funded pursuant to SB 535. The report must include:

1. A general description of the project.

2. The location where the project will be implemented.

3. The estimated date of completion of each project.

4. The amount awarded to each project.

5. The status of any moneys in the fund that are not awarded pursuant to this section and the reasons, if any, why those moneys have not been awarded.

FISCAL EFFECT: Unknown

COMMENTS:

Background. 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 percent 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 percent 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.

SB 535 directed that, in addition to reducing greenhouse gas emissions, a quarter 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 percent of the funds must be for projects located within those communities.

In October 2014, CalEPA released its list of disadvantaged communities for the purpose of SB 535. To inform its decision, CalEPA relied on the California Communities Environmental 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 (census tracts) identified as disadvantaged for SB 535's purposes 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.

REGISTERED SUPPORT / OPPOSITION:

Support

California Black Health Network (CBHN)

California Pan-Ethnic Health Network (CPEHN)

Opposition

None on file

Analysis Prepared by: Lawrence Lingbloom / NAT. RES. / (916) 319-2092