July 13, 2012 – Two California Chamber of Commerce-opposed “job killer” bills that increase energy costs, including fuel prices on consumers and businesses, passed their respective Senate and Assembly policy committees last week.

AB 1532 (J. A. Pérez; D-Los Angeles) and SB 1572 (Pavley; D-Agoura Hills) allocate funds from an illegal tax to various programs that are not necessary to cost-effectively implement the market-based trading mechanism under AB 32, the 2006 climate change law.

The bills will now head to the Senate and Assembly Appropriations committees.

A third bill, AB 2404 (Fuentes; D-Los Angeles), which is identical to the bills above, was held on the Assembly Appropriations Suspense File on May 25.

Lacks Authority

In opposing the bills, the CalChamber has pointed out that the California Air Resources Board (ARB) lacks authority and has been unable to justify the need to raise billions of dollars in revenue for the purposes anticipated in the bills.

ARB’s plan to impose a “cap-and-tax” will hurt jobs, and increase costs to the state and consumers. AB 32 was not intended to be a revenue source. If the state moves forward with a billion-dollar auction, the impacts on the state’s economy would be devastating.

Entities subject to the illegal tax include manufacturers, public agencies, universities, refineries, food processors and others. The impact on these entities will be severe and on top of the higher fuel and energy costs due to other climate change regulations.

Not only is an auction unnecessary for a successful cap-and-trade program, but the planned collection and distribution of auction revenues raises legal uncertainties.

Key Votes

•     AB 1532 passed the Senate Environmental Quality Committee, 5-2, on July 2.

Ayes: Hancock (D-Berkeley), Kehoe (D-San Diego), A. Lowenthal (D-Long Beach), Pavley (D-Agoura Hills), Simitian (D-Palo Alto).

Noes: Blakeslee (R-San Luis Obispo), Strickland (R-Thousand Oaks).

•     SB 1572 passed the Assembly Natural Resources Committee, 6-3, on July 2.

Ayes: Brownley (D-Santa Monica), Chesbro (D-North Coast), Dickinson (D-Sacramento), Huffman (D-San Rafael), Monning (D-Carmel), Skinner (D-Berkeley).

Noes: Grove (R-Bakersfield), Halderman (R-Fresno), Knight (R-Antelope Valley).