Senate Budget and Fiscal Review Subcommittee No. 2 on Resources, Environmental Protection and Energy

The Senate budget subcommittee number two on resources, environmental protection, and energy will come to order. Let's establish a quorum.

Senators Reyes. Present. Reyes present. Senator Blake Spear. Present.

Blake Spear present. Senator Choi.

Here.

Senator Choi here. Senator McNerney. Yep. McNerney here.

Thank you. We have a quorum for today's hearing. All items are vote only. We will begin with public comment on these issues and then move to the vote only calendar. The issues we are voting on today have been discussed in several subcommittee hearings over the past couple of months.

We have heard and appreciate the feedback from the members of the public. The actions we will be taking represent the Senate's budget plan. This is a tough budget year, and we have made we and we have to make some very difficult decisions. I look forward to continuing conversations with the administration and assembly in a collaborative and thoughtful manner as we move towards a final budget agreement in the next few weeks. So we're going to begin with public comment.

We ask that you limit your comments to thirty seconds. For members of the public who wish to comment, please begin by stating your name and your organization. First witness, welcome.

Good morning. Julia Hall with the Association of California Water Agencies. I just wanna provide support for a few items that were listed here today. First, I wanna provide strong support for the $25,000,000 for the healthy rivers and landscapes. We really appreciate the recommendation to support that funding moving forward.

This is is providing essential funding for supporting habitat and water supply projects that are already helping with drought resiliency for the environment, farms, and people. Second, I wanna provide support for the recommendation to reject the special fund position cuts, especially at CDFW and the state water board. These are critical positions that provide really, important functions for the state, and they're also paid for by the fees paid by public water agencies. So we really appreciate that proposal.

And third, we wanna provide support for the redistribution of the proposition one funding.

As you stated, in a difficult year, it's great to see some more money going towards these natural resources. Thank you. Thank you.

Good morning. Chris Anderson, California Chamber Commerce. In the interest of brevity, just gonna echo the comments of ACWA with regards to the, 25,000,000 in contingent funding for the healthy implementation of the Healthy Rivers and Landscapes program. We're certainly appreciative of that. Thank you.

Thank you.

Good morning, madam chair, members of the committee. Felipe Fuentes here on behalf of the Associated General Contractors of California. We're a statewide association of general contractors that build all of your critical and valuable infrastructure, And we want to applaud the staff and urge you to, support their recommendation on item number 37 in rejecting the sustainable aviation fuel tax credit and the governor's May revision.

As staff points out and we have heard now, from many, examples, it would cost, our roads and our transportation network a tremendous amount of money, at least 165,000,000 in its first year and much more after that that would jeopardize the, the the network. So with that, thank you so much.

Thank you.

Good morning. On behalf Griselda Chavez, on behalf of the California Association Local Conservation Corps, we'd like to offer, once again, our strong support for the appropriation of $2,029,000 dollars in Prop 68 funds as grants to local corps. And these grants are these funds will enable the expansion of eight of our existing Prop 68 projects as well as, one and abbreviated comments made in previous hearings and expressed support for the fiscal year Prop four appropriation of the $12,000,000 for demonstrated job projects.

And lastly, on behalf of, CalStar and EFCO, we would like to thank the committee for the commitment to tier two discretionary funding. We ask that there be reconsideration of the rejection of the L Light Duty Incentive Program and urge the legislature to continue working with the governor's office to develop an agreeable proposal.

Thank you.

Thank you.

Good, morning. Good afternoon. My name is Michael Jacobson. I'm for the, Sierko and for the Cadamo Offshore Wind Project. I just wanna express my support and thank the committee and chair for the appropriation last year of $4,000,000 greatly supported and needed.

We are asking this year for 35,000,000, which is a really important step, and I wanted to just put something in front of you, a number numerical equation. We talk about why we do these things and why do we spend money on offshore wind when all these things are going on. Well, we have strange times. This is a product in state waters, and we have the unique opportunity to take forward California energy policy except for these or side of these complicated situations.

So my answer to this question I will put forward later is eight days or less than eight days.

That's what it would take for the five leases to produce enough power that would regenerate the money, in rate payer cost savings for the 35,000,000 that we're asking for. So less than eight days. So with that, just want to thank you all and thank you for your time, and we hope that you will support the funding asked by the state building trades. Thank you.

Thank you.

Good morning, chairs and members. Chris Nielsen on behalf of the World Resources Institute. Appreciate the staff's recommendation to reject the governor's proposal proposed sustainable aviation fuel. As we've seen, the world has changed since January when it was proposed originally. We've now seen the federal credit almost double.

We've seen the conflict in The Middle East, which has caused refining margins to increase. I think this the the evidence suggests that this proposal really is no longer needed, and so we appreciate your rejection today. Thank

you. Thank you.

And thank you, madam chair. Mark Fenstermaker for Earthjustice, echoing many of the comments of the previous speaker, appreciating staff's recommendation to reject the SAF incentive. Would just add that Earthjustice is concerned overall about the environmental benefits that come from SAF, and then particularly the approach here that may send a lot of this funding to refineries that are not even in California. Thank you.

Thank you.

Sorry, Griselda here again. Good morning. On behalf of the Breast Cancer Prevention Partners, we wanted to support issue 172 for the Safe for Consumer Products Program, as it's important work to enforce AB 347, AB 2,525, and SB 1266. And on behalf of MidPen and California Habitat Conservation Program yes. On issue 82, just wanted to appreciate the staff recommendation and reject the elimination of vacant staff at CDFW.

Thank you.

Thank you.

Thank you, madam chair. Giacchionis, behalf of the California fuels convenience lines. Also wanna add our support for, issue 37, the recommendation of the governor's staff proposal. Really appreciate staff's analysis recommendation there, and we continue to add our continued concerns that such a proposal could increase gas and diesel prices for Californians. Thank you.

Thank you. Anyone else want to offer public comment? Saying none, I'd like to turn it now to the dias. Comments from my colleagues on our last hearing before we take our votes. Very good.

Alright. So we're going to move on now to the vote only calendar.

First, the first group of votes will be on the motion to approve the staff recommendations for issues two, five through ten, twelve, fourteen, seventeen to thirty, thirty two to 37, 39 to 69, 71 to 74, 76 to eighty, eighty three to ninety, ninety nine, 100, one zero three, one zero six, one zero seven, one zero nine, one ten, one twelve, one thirteen to one fifteen, one twenty to one twenty seven, one twenty nine, one thirty to one thirty two, one thirty four, one thirty five, one thirty seven to one forty one, 143, 149, 15159.

I'm sorry, 156 to one fifty nine, one sixty one, one sixty two, one sixty three, 167, 170, 171, 173 to one seventy six, one eighty to one eighty two, one eighty four to one ninety, one ninety five, one ninety six, one ninety eight to 200, and two zero two.

I can make the motion.

And these are part of Part A. Thank you, Senator Choi, for that motion. Would you please take

the roll? Reyes. Aye. Reyes, aye. Blake Spear.

Aye.

Blake Spear, aye. Choi.

No. I Yeah. Aye.

Choi, aye. McNerney.

I am accustomed to many.

McNerney, Aye.

Motion is approved with a vote of four zero, and those budget items are out. Next is part a. The next items are item number eleven, fifteen, 31, seventy, eighty one, 96, 97, 98, one zero two, one nineteen, one forty five, one sixty eight, one seventy eight, one ninety three, and one ninety four. Do I have a motion to approve the staff recommendations for those issues?

We have a motion.

Senator McNerney has moved. Please take the roll. Reyes.

Aye. Reyes, aye. Blake Spear. Aye. Blake Spear, aye.

Choi.

Aye. No.

No. Choi, no.

Yes. This is supposed to be no? Yes.

Okay. Mick choi, no. McNerney?

Aye.

McNerney, aye.

That motion passes, is approved for the vote of three to one.

And the last group is items one, three, four, thirteen, sixteen, 38, 75, 82, 91 to 95, one zero one, one zero four, one zero five, one zero eight, one eleven, one sixteen to one eighteen, one twenty eight, one thirty three, one thirty six, one forty two, one forty four, one forty six to one forty eight, one fifty one to one fifty five, one sixty, one sixty four to one sixty six, one sixty nine, one seventy two, one seventy seven, one seventy nine, one eighty three, one ninety one, one ninety two, one ninety seven, and two zero one.

Do I have a motion to approve the staff recommendations on these issues?

I'll move it.

It's been moved by Senator McNerney. Please take

the roll. Senators Reyes. Aye. Reyes, aye. Blake Spear?

Aye. Blake Spear, aye. Choi? No, Blake. Choi no vote.

McNerney? Aye.

We will now move to part b. And before we take that vote, I would like to note that today, the California Air Resources Board and probably probably as we speak is meeting to discuss and vote on the proposed amendments to the cap and invest program. I remain concerned about the potential implications of the proposed amendments.

Particularly, I still fail to see the rationale for significantly cut cutting California's public investments while providing billions of dollars in new funding to industrial emitters through a mechanism with limited oversight, no direction from the legislature, and no documented benefits

to the

consumer affordability. Because of the potential drastic impacts to the greenhouse gas reduction fund, the Senate budget plan that we are voting on today withholds all GGRF appropriations, including continuous appropriations until specified conditions are made are met. A deal is a deal. If the very basis on which we negotiated extension of this program last year has vastly shifted, we need to revisit the GGRF funding framework and ensure legislative priorities are prioritized and key transit, affordable housing, air quality, and safe drinking water programs are not zeroed out.

I look forward to working with the assembly and the administration on maintaining the deal reached last year.

And now, we begin part b. On the issues two through five, eight, 10 to thirteen, sixteen, 22, 31, 32, 35, 37, 38, 40 to fifty, fifty three to 59. Do I have a motion?

We have a motion.

Thank you, Senator Choi. Please take the roll. Senators Reyes. Aye.

Reyes, aye. Blake Spear. Aye. Blake Spear, aye. Choi.

Aye. Choi, aye. McNerney.

McNerney, aye.

Aye.

That motion is approved on a four to zero vote. On issues six, seven, nine, fourteen, fifteen, seventeen, 23, 24, 26, 29, thirty, thirty three, 39, 52, and 61. Do I have a motion?

I'll move it.

Thank you, Senator McNerney. Would you please take the roll?

Senators Reyes? Aye. Reyes, aye. Blake's beer?

Aye.

Blakespeer, aye. Choi? No. Choi, no. McNerney?

Aye. McNerney, aye.

That motion is approved. Three to zero. Three to one. And on the last group of issues, a 18 I'm sorry. One, eighteen to twenty one, twenty five, 27, 28, 34, 36, 51, sixty, and sixty two.

Do I have a motion?

I'll move it.

Thank you. That motion is has been made by Senator McNerney. Please take the roll. Senators Reyes. Aye.

Reyes, aye. Blake Spear?

Aye. Blake Spear, aye. Choi? McNerney?

No.

Oh, Choi not voting. McNerney? Aye. McNerney, aye.

That motion is approved three to three to zero. Well, I want to thank all the individuals who participated in public testimony today and throughout the entire process. I do want to thank the l a o department of finance for the invaluable, information and testimony you provided during all of these hearings. For those who are not able to testify today but wish to, please submit your comments or suggestions in writing to the budget and fiscal review committee or visit our website.

Your comments and suggestions are important to us, and we want to include your testimony in the official hearing records.

I wanna thank you, and we appreciate your participation. Thank you to everyone for your patience and your cooperation. We have concluded the agenda for today's hearing. Senate budget subcommittee two is adjourned.