LAO Says Zero Out AB 32 Funding

by Anthony Pignataro | May 4, 2011 3:07 pm

[1]MAY 4, 2011

California’s Global Warming Solutions Act of 2006[2] is in every sense of the word a landmark piece of legislation. Known by its legislative moniker AB 32, the law is, by far, the most sweeping and hard-hitting experiment in climate change of any of the nation’s 50 states.

Beginning this year, the California Air Resources Board (CARB) will implement a host of new regulations governing greenhouse gas emissions across the state. The goal is that by 2020, carbon dioxide emissions in California will be back down to 1990 levels; and by 2050, down 80 percent from that.

This is, to say the least, controversial. Leaving aside the issue of whether such a law could lead to a quantifiable difference in climate change, these new regulations will hit a massive number of businesses across the state with varying degrees of force. Some, like those operating diesel-burning trucks, will be hit especially hard with requirements for expensive new engines.

That fact has gotten a lot of press pretty much since the law passed. But the law is apparently controversial for another, less known reason. According to the state Legislative Analysts Office (LAO), the 2010-11 Resources trailer bill (known as SB 855[3]) included a provision “requiring a zero-based budget [ZBB] be submitted by April 1, 2011 for all AB 32 expenditures across state government in order to reevaluate the base funding requirements of AB 32 program implementation.”

Budget Realities

At a time when our esteemed state officials seem completely unable to dig themselves out of a $25 billion budget deficit, this seems completely reasonable. Forcing officials from even such a protected domain as CARB to justify all of their expenditures is eminently fair and rational. And it’s not just CARB that’s spending AB 32 dollars.

According to a spreadsheet provided by the LAO, nine state agencies are currently employing 182.5 people and spending a total of $37.7 million to implement AB 32. The largest of which is, of course, CARB, which accounts for $32.9 million and 155 staffers.

Now the LAO is not generally known for putting jokes into its usually sober, always non-partisan analyses, but I couldn’t help but laugh out loud when I read the following paragraph from a brief “Summary of LAO Findings and Recommendations[4]” the agency posted on Monday:

Funding for AB 32 implementation in the budget year was approved by the Legislature earlier this year in the budget process, presumably based on the assumption that the Administration would make a good-faith effort to comply with the statutory requirement (and be on time) and that the Legislature would make any necessary adjustments to the AB 32 budgets after having evaluated the ZBB report.

Oh man. Not sure which Legislature and administration the LAO has been watching lately, but the ones we have now don’t make a lot of “good faith efforts” to comply with anything. And don’t even get me started on how often they’re “on time.”

No Zero-Based Budget

In any case, as you’ve no doubt figured out by now, there is, as yet, no zero-based budget for AB 32 funds. A spokesperson for Cal-EPA — the department that oversees CARB — didn’t respond to my request for comment by press time. But according to the LAO, Cal-EPA Secretary Linda Adams sent a letter to Senator Mark Leno, D-San Francisco, on April Fools Day saying Gov. Jerry Brown “has been unable to devote sufficient attention to completing a careful review of the important report.” The LAO adds that Brown apparently will submit a zero-based budget for all AB 32 money, but “it is uncertain when the report will be submitted and whether it will be submitted in time to provide the Legislature an adequate review period.”

Though Brown is a hardcore supporter of AB 32, the LAO is apparently not as forgiving as Adams. The LAO recommends:

Given that the administration has failed to comply with the statutory requirement for a ZBB, we recommend that the Legislature reverse, for now, all AB 32-related expenditures in the budget year that it has previously approved. Such action should serve to encourage the Administration to submit the ZBB report in a timely enough manner to allow for thoughtful legislative evaluation of the report in the continuing budget process and to take necessary actions based on its review.

— Anthony Pignataro



  1. [Image]:
  2. California’s Global Warming Solutions Act of 2006:
  3. SB 855:
  4. Summary of LAO Findings and Recommendations:

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