No Plan on How to Spend AB-32’s Carbon Trading Slush Fund
01/20/2012 2 Comments
During the Prop 23 debate it was clear to me that CARBs Cap and Trade scheme was nothing more than another tax on citizen that would go in to a big environmental slush fund. The Cap and Trade program will kick into gear in August when CARB holds its first emissions allowance auction. The State is planning on making $1 billon on that first auction, with the allowance selling between $10-40 dollars.
However, the money form these allowances cannot go into the General Fund according to Tiffany Roberts, Senior Fiscal and Policy Analyst for Energy and Climate Change at the LAO. Roberts recently explained to Craig Miller at KQED’s Climate Watch that there are legal restrictions on how revenues from cap and trade can be used.
“These revenues can’t go to fund general tax purposes,” Roberts said. “They have to be used either to mitigate greenhouse gas emissions or to mitigate the adverse effects of greenhouse gas emissions.”
The governor is looking for $500 million of the billion for his budget. He is looking for items in his budget that are now going to “mitigate the adverse effects of greenhouse gas emissions,” and swap out those funds for $500 million of the AB-32 slush fund money.
The Governor’s budget indicates that he’s plans to spend the $500 million in four broad categories:
- Clean and Efficient Energy
- Low-Carbon Transportation
- Natural Resource Protection
- Sustainable Infrastructure and Development
However, Craig identified a problem with the swap in his conversation with Roberts
Roberts expressed concern over the lack of a timely, detailed plan laying out how the revenues would be spent. “It’s very important that such a plan be submitted to the legislature during the budget process with adequate time for the legislature and the public to scrutinize it,” said Roberts. But the budget says that no detailed expenditure plan will be released until after the California Air Resources Board (CARB) holds its first auction of credits in mid-August. At that point ARB will know how much money it brought in and can plan how to spend it. But August is well past the deadline to sign a budget, which means that the “uncategorized” revenues from cap-and-trade will be part of that budget without any legislative, or public, review of where they will go. [My emphasis added]
What is a billion here and a billion there, small potatoes when it comes to environmental slush funds. However, when the program gets rolling analysis are estimating the carbon trading could sucking in $15 billion annually. Think how much damage that could do the State’s economy, sucking money out of the State’s economy. Think about how much economic chaos the lefty environmental wackos could create if they get $5-10 billion a year from the CARB slush fund.