Governor Edmund G. Brown Jr. yesterday signed legislation that directs $900 million in cap-and-trade funds to greenhouse gas reducing programs that benefit disadvantaged communities, support clean transportation and protect natural ecosystems. The governor also signed bills that prioritize spending in communities disproportionally impacted by dirty air and carbon pollution

“These cap-and-trade investments will help spur innovation of all kinds to curb carbon pollution,” said Governor Brown at a signing ceremony in downtown Fresno, where cap-and-trade proceeds are helping to improve bus rapid transit services and access to affordable housing. “With these bills, we also will help communities hard hit by pollution and climate change.”

Under current law, 60 percent of annual cap-and-trade auction proceeds are allocated on an ongoing basis to public transit, affordable housing, sustainable communities and high-speed rail. The legislation signed today – AB 1550 by Assemblymember Jimmy Gomez (D-Los Angeles), AB 2722 by Assemblymember Autumn R. Burke (D-Inglewood), and SB 859 and AB 1613 (budget committees) – invests $900 million of the remaining unallocated funds for fiscal year 2016-17 and reserves approximately $462 million for appropriation in future years.

“While the ultimate goal of cap-and-trade is to reduce harmful greenhouse gas emissions, and not to generate revenue, wisely investing the funds that do come from cap-and-trade can help us meet California’s emission reduction goals,” said Assembly Speaker Anthony Rendon. “The bills signed today embody the aggressive and responsible approach we are taking in spending cap-and-trade funds to ensure that Californians in underserved communities – and communities most impacted by air quality problems – benefit from these investments.”

“These bills unleash badly needed resources that can make tangible improvements to environmental health and quality of life in our most polluted and impoverished communities,” said Senate President pro Tempore Kevin de León. “This year we set ambitious new targets for reducing harmful emissions of greenhouse gases and other toxic pollutants. Now it’s time to use every tool at our disposal to reach those goals and improve lives in the process. These funds are a down-payment toward those ends – they will increase access to electric vehicles, solar panels, and low-carbon public transit; help us improve household energy efficiency and create new parks; and bolster our forest and wetland management efforts to better prepare for damaging wildfires and floods. I’d like to thank Governor Brown and all of my colleagues in both chambers for their leadership and support getting these resources to where they are needed most.”

SB 859 by the Committee on Budget and Fiscal Review provides statutory provisions for the $900 million 2016 cap-and-trade expenditure appropriation in AB 1613 by the Committee on Budget, and a plan to produce more biomass energy in the face of California’s tree mortality epidemic:  

·        $368 million to the Air Resources Board including:

o   $133 million to the Clean Vehicle Rebate Program;

o   $80 million to the Enhanced Fleet Modernization Program, Plus-Up Pilot Project and up to $20 million of this amount may be used for other light-duty equity pilot projects;

o   $150 million for heavy-duty vehicles and off-road equipment investments; and

o   $5 million for black carbon wood smoke programs.

·        $140 million to the Office of Planning and Research for the Strategic Growth Council to provide transformative climate communities grants.

·        $135 million to the Transportation Agency for the Transit and Intercity Rail Program.

·        $80 million to the Natural Resources Agency for the Urban Greening program.

·        $65 million to the Department of Food and Agriculture, including:

o   $50 million for the early and extra methane emissions reductions from dairy and livestock operations;

o   $7.5 million for the Healthy Soils Program; and

o   $7.5 for the State Water Efficiency and Enhancement Program (SWEEP).

·        $40 million to the Department of Forestry and Fire Protection, including:

o   $25 million for the Healthy Forest Program; and

o   $15 million for urban forestry programs.

·        $40 million to the Department of Resources Recycling and Recovery for waste diversion and greenhouse gas reduction financial assistance.

·        $20 million to the Department of Community Services and Development for weatherization and renewable energy projects.

·        $10 million to the Department of Transportation for the Active Transportation Program.

·        $2 million to the Office of Planning and Research for the Strategic Growth Council to provide technical assistance to disadvantaged communities.

Given the uncertainty associated with recent auctions of carbon allowances, the state has prudently reserved one-third of the total amount of proceeds for future allocation. Cap-and-trade investments in California, including expenditures in today's legislation, total $3.2 billion.

“I am thrilled to see an investment of this magnitude being signed by the Governor,” said Assemblymember Joaquin Arambula (D-Fresno). “I am proud to be a voice for the San Joaquin Valley to ensure that the state continues to invest in this region, one of the fastest growing in California, yet one of the most disadvantaged. This is a significant step for the Valley and will position us as a leader in innovation and economic development as we address the challenges of climate change.”

The Governor also signed AB 2722, which creates the Transformative Climate Communities Program, a grant program administered by the Strategic Growth Council, for broad-based greenhouse gas emission reduction projects that provide local economic, environmental and health benefits to disadvantaged communities.

“This is a big shift in environmental policy for California, and it proves we can champion environmental justice and create jobs at the same time,” said Assemblymember Burke. “With this investment, we’re giving heavily polluted neighborhoods a chance at a cleaner, brighter future and boosting the local economy.”

AB 1550 modifies the current requirement that 25 percent of auction proceeds benefit disadvantaged communities and 10 percent spent directly in those communities. The new rules require at least 25 percent of funds go to projects benefitting and within disadvantaged communities and at least an additional 10 percent for low-income households or communities. 

“Today, with the Governor’s signature of AB 1550 we are affirming our commitment to equity so that more Californians can power their homes with clean energy, sign up for weatherization, obtain a clean vehicle rebate, and green their neighborhoods no matter their income,” said Assemblymember Gomez.