Lawmakers never agreed on cap-and-trade funding. Now what?

AB 32 by the professional fondler and amateur governor Arnold, create the ability for government to create cap and trade—without a vote of the people. Billions each year will be collected. The confused Guv Brown wants to give a billion dollars a year to the biggest boondoggle in California history, the choo-choo train. At this point there is just under one billion in cap and trade funds—that is money ADDED to the cost of the products and services you buy—it is an indirect tax on your, your family and your job.

“As lawmakers quarreled and attempted to direct funds into their individual districts, funding proposals included everything from road repairs to mosquito research. But as the dust cleared after last Friday’s legislative deadline, $969 million in cap-and-trade remained unspent.

The state will now hold onto those funds until January, when the governor proposes a spending plan for the new fiscal year.

What does mosquito research have to do with clear air? Roads? This is a slush fund, period. Government is out of control, with your money.

Lawmakers never agreed on cap-and-trade funding. Now what?

Allen Young , Sacramento Business Journal. 9/18/15

Back in June, the Brown administration announced that it would carve out more than $1 billion in expected cap-and-trade revenue from the budget discussion because lawmakers couldn’t agree on how to spend the money.

As lawmakers quarreled and attempted to direct funds into their individual districts, funding proposals included everything from road repairs to mosquito research. But as the dust cleared after last Friday’s legislative deadline, $969 million in cap-and-trade remained unspent.

The state will now hold onto those funds until January, when the governor proposes a spending plan for the new fiscal year.

“Those funds that were not appropriated remain unspent. The next opportunity will be the next budget cycle,” said H.D. Palmer, a spokesman for the California Department of Finance.

The administration hasn’t decided yet whether it will propose to spend the leftover funds in this fiscal year or next, said another department staffer in an email.

California’s cap-and-trade program charges heavy polluters, like big industrial firms and oil producers, for the emissions they generate. Then it directs the money into projects that are supposed to clean the air, like rebates for electric car purchases or improvements to public transit. So far, the only local project to win a cap-and-trade grant is a mixed-use housing project in West Sacramento.

That money comes from “carbon auctions” that are held four times a year. Overall, the administration expects to have nearly $3 billion in auction proceeds available to spend this fiscal year (including the $969 million that lawmakers didn’t act on).

The beneficiaries of cap-and-trade spending – those that lobby on behalf of renewable energy companies, affordable housing projects and the environment, to name a few – are not publicly lamenting the fact that nearly $1 billion was held up this year.

“It’s more important to get it right than to get it fast,” said Tim O’Connor, a lobbyist and California director of the Environmental Defense Fund.

California law stipulates that cap-and-trade funding must be spent on projects that reduce pollution. Some funding ideas put forward by lawmakers that never moved forward – such as using cap-and-trade dollars for road repairs – were “dubious at best” because the clean-air benefit is not clear, said O’Connor.

Republicans in the Assembly disagree, arguing that improving roads would decrease traffic, which would cut down on fumes caused by idling cars. In a countercharge, the GOP claimed that Democrats are guilty of using the money as a slush fund to pay for pet-projects that have little to do with the environment.

“W e flatly think the notion that cap-and-trade can’t be used for roads is moot. It’s being used for a train,” said Amanda Fulkerson, a spokeswoman for the Assembly Republican caucus, in reference to high-speed rail.

Such banter explains why nearly $1 billion in state money was left unspent this year.

High-speed rail received $500 million cap-and-trade funding this year, and so will an array of other projects. That’s because 60 percent of all cap-and-trade money is “continuously appropriated” – meaning it’s automatically spent each year, said Palmer from the Brown administration.