April 2017 Environment Committee Meeting Infinera 220 Humboldt Court CA2 | Sydney Conference Room Sunnyvale, CA 94089 April 12, 2017 1:30 - 2:00 pm – Networking 2:00 – 4:00 pm – Meeting Call-in information – Dial: 605-475-3215 | Code: 1052733 Agenda Time Item Who Outcome 1:30 Networking & Conversation All Information 2:00 Welcome & Introductions Marty Gothberg, Infinera Information 2:05 Presentation : Sustainability Accounting Standards Board Quinn Underriner, SASB Information 2:35 Opportunities for business leadership on climate Mike Mielke, SVLG Information 2:55 Discussion : Top 2017 Cmte Priority: Cap & Trade Extension – latest from the front lines (AB 151 and AB 378) Mike Mielke, SVLG Information 3:10 Discussion : Top 2017 Cmte: Engagement on SF Bay wetlands – Apr 21 event Lauren Boyd, SVLG Information 3:20 Legislative / Regulatory AB 388 (Mullin) – GGRF Funding AB 851 (Caballero) – Local Design-Build Project Delivery Lauren Boyd, SVLG Action 3:45 Discussion : Upcoming events Energy & Susty Summit, May 25 Mike Mielke, SVLG Information 3:55 Reminders / Open Forum All Information 4:00 Adjourn All N/A Reminder: No Cmte mtg in May (Summit). Our next meeting will be June 7. Host needed!
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Introduced by Assembly Members Burke and Cooper(Coauthors: Assembly Members Low Gipson, Grayson, Low, and
Rubio)
January 11, 2017
An act to amend Section 38561, 38562, and 38566 of, to add Section38567 to, and to add and repeal Section 38568 of, the Health and SafetyCode, relating to greenhouse gases.
legislative counsel’s digest
AB 151, as amended, Burke. California Global Warming SolutionsAct of 2006: market-based compliance mechanisms. mechanisms:scoping plan: report.
The(1) The California Global Warming Solutions Act of 2006 designates
the State Air Resources Board as the state agency charged withmonitoring and regulating sources of emissions of greenhouse gases.The state board is required to approve a statewide greenhouse gasemissions limit equivalent to the statewide greenhouse gas emissionslevel in 1990 to be achieved by 2020 and to ensure that statewidegreenhouse gas emissions are reduced to at least 40% below the 1990level by 2030.
The act requires the state board to prepare and approve a scopingplan for achieving the maximum technologically feasible andcost-effective reductions in greenhouse gas emissions and to updatethe scoping plan at least once every 5 years.
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This bill would require the state board to report to the appropriatepolicy and fiscal committees of the Legislature to receive input,guidance, and assistance before adopting guidelines and regulationsimplementing the scoping plan and a regulation ensuring statewidegreenhouse gas emissions are reduced to at least 40% below the 1990level by 2030.
This bill would require the state board, no later than January 1, 2019,and in conjunction with specified stakeholders, to report to theLegislature on the need for increased education, career technicaleducation, job training, and workforce development in ensuring thatstatewide greenhouse gas emissions are reduced to at least 40% belowthe statewide greenhouse gas emissions limit no later than December31, 2030, and as a result of the scoping plan, as specified.
The(2) The act authorizes the state board to include the use of
market-based compliance mechanisms and to adopt a regulation thatestablishes a system of market-based declining annual aggregateemissions limits for sources or categories of sources that emitgreenhouse gases, applicable from January 1, 2012, to December 31,2020, inclusive, as specified.
This bill would state the intent of the Legislature to enact legislationthat authorizes the state board to utilize a market-based compliancemechanism after December 31, 2020, in furtherance of the statewidegreenhouse gas emissions limit of at least 40% below the 1990 levelby 2030.
This bill would no longer limit the applicability of a regulation thatestablishes a system of market-based declining annual aggregateemissions limits for sources or categories of sources that emitgreenhouse gases from January 1, 2012, to December 31, 2020.
This bill would establish the Compliance Offsets Protocol Task Forcefor the purpose of investigating, analyzing, and providing guidance tothe state board in approving new offset protocols for a market-basedcompliance mechanism adopted pursuant to this part with a priorityon the development of new urban offset protocols, as specified. The billwould require the state board, in conjunction with the task force, todevelop a multitiered incentive system for compliance offset credits, asspecified.
Vote: majority. Appropriation: no. Fiscal committee: no yes.
State-mandated local program: no.
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The people of the State of California do enact as follows:
line 1 SECTION 1. It is the intent of the Legislature to enact later line 2 legislation to achieve the maximum technologically feasible and line 3 cost-effective reductions in greenhouse gas emissions in furtherance line 4 of the statewide greenhouse gas emissions limit target of at least line 5 40 percent below 1990 levels by 2030, pursuant to Section 38566 line 6 of the Health and Safety Code, by authorizing the State Air line 7 Resources Board to use a market-based compliance mechanism line 8 beyond the year 2020. line 9 SECTION 1. Section 38561 of the Health and Safety Code is
line 10 amended to read: line 11 38561. (a) (1) On or before January 1, 2009, the state board line 12 shall prepare and approve a scoping plan, as that term is understood line 13 by the state board, for achieving the maximum technologically line 14 feasible and cost-effective reductions in greenhouse gas emissions line 15 from sources or categories of sources of greenhouse gases by 2020 line 16 under this division. The line 17 (2) The state board shall consult with all state agencies with line 18 jurisdiction over sources of greenhouse gases, including the Public line 19 Utilities Commission and the State Energy Resources Conservation line 20 and Development Commission, on all elements of its plan that line 21 pertain to energy related matters energy-related matters, including, line 22 but not limited to, electrical generation, load based-standards or line 23 requirements, the provision of reliable and affordable electrical line 24 service, petroleum refining, and statewide fuel supplies to ensure line 25 the greenhouse gas emissions reduction activities to be adopted line 26 and implemented by the state board are complementary, line 27 nonduplicative, and can be implemented in an efficient and line 28 cost-effective manner. line 29 (b) The plan shall identify and make recommendations on direct line 30 emission emissions reduction measures, alternative compliance line 31 mechanisms, market-based compliance mechanisms, and potential line 32 monetary and nonmonetary incentives for sources and categories line 33 of sources that the state board finds are necessary or desirable to line 34 facilitate the achievement of the maximum feasible and line 35 cost-effective reductions of greenhouse gas emissions by 2020. line 36 (c) In making the determinations required by subdivision (b), line 37 the state board shall consider all relevant information pertaining line 38 to greenhouse gas emissions reduction programs in other states,
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line 1 localities, and nations, including the northeastern states of the line 2 United States, Canada, and the European Union. line 3 (d) The state board shall evaluate the total potential costs and line 4 total potential economic and noneconomic benefits of the plan for line 5 reducing greenhouse gases to California’s economy, environment, line 6 and public health, using the best available economic models, line 7 emission estimation techniques, and other scientific methods. line 8 (e) In developing its plan, the state board shall take into account line 9 the relative contribution of each source or source category to
line 10 statewide greenhouse gas emissions, and the potential for adverse line 11 effects on small businesses, and shall recommend a de minimis line 12 threshold of greenhouse gas emissions below which emission line 13 emissions reduction requirements will not apply. line 14 (f) In developing its plan, the state board shall identify line 15 opportunities for emission reductions emissions reduction measures line 16 from all verifiable and enforceable voluntary actions, including, line 17 but not limited to, carbon sequestration projects and best line 18 management practices. line 19 (g) The state board shall conduct a series of public workshops line 20 to give interested parties an opportunity to comment on the plan. line 21 The state board shall conduct a portion of these workshops in line 22 regions of the state that have the most significant exposure to air line 23 pollutants, including, but not limited to, communities with minority line 24 populations, communities with low-income populations, or both. line 25 (h) The state board shall update its plan for achieving the line 26 maximum technologically feasible and cost-effective reductions line 27 of greenhouse gas emissions at least once every five years. line 28 (i) (1) The state board shall report to the appropriate policy line 29 and fiscal committees of the Legislature to receive input, guidance, line 30 and assistance before adopting guidelines and regulations line 31 implementing the scoping plan adopted pursuant to this section. line 32 (2) A report to be submitted pursuant to this subdivision shall line 33 be submitted in compliance with Section 9795 of the Government line 34 Code. line 35 SEC. 2. Section 38562 of the Health and Safety Code is line 36 amended to read: line 37 38562. (a) On or before January 1, 2011, the state board shall line 38 adopt greenhouse gas emission emissions limits and emission line 39 emissions reduction measures by regulation to achieve the line 40 maximum technologically feasible and cost-effective reductions
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line 1 in greenhouse gas emissions in furtherance of achieving the line 2 statewide greenhouse gas emissions limit, to become operative line 3 beginning on January 1, 2012. line 4 (b) In adopting regulations pursuant to this section and Part 5 line 5 (commencing with Section 38570), to the extent feasible and in line 6 furtherance of achieving the statewide greenhouse gas emissions line 7 limit, the state board shall do all of the following: line 8 (1) Design the regulations, including distribution of emissions line 9 allowances where appropriate, in a manner that is equitable, seeks
line 10 to minimize costs and maximize the total benefits to California, line 11 and encourages early action to reduce greenhouse gas emissions. line 12 (2) Ensure that activities undertaken to comply with the line 13 regulations do not disproportionately impact low-income line 14 communities. line 15 (3) Ensure that entities that have voluntarily reduced their line 16 greenhouse gas emissions prior to the implementation of this line 17 section receive appropriate credit for early voluntary reductions. line 18 (4) Ensure that activities undertaken pursuant to the regulations line 19 complement, and do not interfere with, efforts to achieve and line 20 maintain federal and state ambient air quality standards and to line 21 reduce toxic air contaminant emissions. line 22 (5) Consider cost-effectiveness of these regulations. line 23 (6) Consider overall societal benefits, including reductions in line 24 other air pollutants, diversification of energy sources, and other line 25 benefits to the economy, environment, and public health. line 26 (7) Minimize the administrative burden of implementing and line 27 complying with these regulations. line 28 (8) Minimize leakage. line 29 (9) Consider the significance of the contribution of each source line 30 or category of sources to statewide emissions of greenhouse gases. line 31 (c) In furtherance of achieving the statewide greenhouse gas line 32 emissions limit, by January 1, 2011, the The state board may adopt line 33 a regulation that establishes a system of market-based declining line 34 annual aggregate emission emissions limits for sources or line 35 categories of sources that emit greenhouse gas emissions, line 36 applicable from January 1, 2012, to December 31, 2020, inclusive, line 37 gases that the state board determines will achieve the maximum line 38 technologically feasible and cost-effective reductions in greenhouse line 39 gas emissions, in the aggregate, from those sources or categories line 40 of sources.
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line 1 (d) Any regulation adopted by the state board pursuant to this line 2 part or Part 5 (commencing with Section 38570) shall ensure all line 3 of the following: line 4 (1) The greenhouse gas emission emissions reductions achieved line 5 are real, permanent, quantifiable, verifiable, and enforceable by line 6 the state board. line 7 (2) For regulations pursuant to Part 5 (commencing with Section line 8 38570), the reduction is in addition to any greenhouse gas emission line 9 emissions reduction otherwise required by law or regulation, and
line 10 any other greenhouse gas emission emissions reduction that line 11 otherwise would occur. line 12 (3) If applicable, the greenhouse gas emission emissions line 13 reduction occurs over the same time period and is equivalent in line 14 amount to any direct emission reduction required pursuant to this line 15 division. line 16 (e) The state board shall rely upon the best available economic line 17 and scientific information and its assessment of existing and line 18 projected technological capabilities when adopting the regulations line 19 required by this section. line 20 (f) The state board shall consult with the Public Utilities line 21 Commission in the development of the regulations as they affect line 22 electricity and natural gas providers in order to minimize line 23 duplicative or inconsistent regulatory requirements. line 24 (g) After January 1, 2011, the The state board may revise line 25 regulations adopted pursuant to this section and adopt additional line 26 regulations to further the provisions of this division. line 27 SEC. 3. Section 38566 of the Health and Safety Code is line 28 amended to read: line 29 38566. (a) In adopting rules and regulations to achieve the line 30 maximum technologically feasible and cost-effective greenhouse line 31 gas emissions reductions authorized by this division, the state line 32 board shall ensure that statewide greenhouse gas emissions are line 33 reduced to at least 40 percent below the statewide greenhouse gas line 34 emissions limit no later than December 31, 2030. line 35 (b) (1) The state board shall report to the appropriate policy line 36 and fiscal committees of the Legislature to receive input, guidance, line 37 and assistance before adopting rules and regulations implementing line 38 this section.
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line 1 (2) A report to be submitted pursuant to this subdivision shall line 2 be submitted in compliance with Section 9795 of the Government line 3 Code. line 4 SEC. 4. Section 38567 is added to the Health and Safety Code, line 5 to read: line 6 38567. (a) The Compliance Offsets Protocol Task Force is line 7 hereby established for the purpose of investigating, analyzing, and line 8 providing guidance to the state board in approving new offset line 9 protocols for a market-based compliance mechanism adopted
line 10 pursuant to this part with a priority on the development of new line 11 urban offset protocols. line 12 (b) The Compliance Offsets Protocol Task Force shall consist line 13 of multiple stakeholders, including, but not limited to, all of the line 14 following: line 15 (1) Scientists. line 16 (2) Representatives from air pollution control and air quality line 17 management districts. line 18 (3) Carbon market experts. line 19 (4) Environmental justice advocates. line 20 (5) Labor and workforce representatives. line 21 (6) Forestry and agriculture experts. line 22 (7) Business representatives. line 23 (c) The state board, in conjunction with the Compliance Offsets line 24 Protocol Task Force, shall develop a multitiered incentive system line 25 for compliance offset credits in the following order: line 26 (1) Offsets in disadvantaged communities, as identified pursuant line 27 to Section 39711. line 28 (2) Offsets in communities with stationary sources that emit line 29 greenhouse gases and are regulated by the state board. line 30 (3) Offsets in the state or on Native American or tribal lands. line 31 (4) Offsets in territories linked to the state through a greenhouse line 32 gas emission trading program. line 33 (5) Offsets in the United States. line 34 SEC. 5. Section 38568 is added to the Health and Safety Code, line 35 to read: line 36 38568. (a) No later than January 1, 2019, the state board shall line 37 report to the Legislature on the need for increased education, line 38 career technical education, job training, and workforce line 39 development in ensuring that statewide greenhouse gas emissions line 40 are reduced to at least 40 percent below the statewide greenhouse
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line 1 gas emissions limit no later than December 31, 2030, pursuant to line 2 Section 38566, and as a result of the scoping plan, adopted line 3 pursuant to Section 38561. The state board shall work in line 4 conjunction with all of the following: line 5 (1) Secretary of Labor and Workforce Development. line 6 (2) California Workforce Development Board. line 7 (3) State Department of Education. line 8 (4) California Community Colleges. line 9 (5) Trustees of the California State University.
line 10 (6) Regents of the University of California. line 11 (7) Interested stakeholders. line 12 (8) Green Collar Jobs Council, established pursuant to Section line 13 15002 of the Unemployment Insurance Code. line 14 (b) The report shall include, but need not limited to, providing line 15 policy guidance and recommendations on all of the following: line 16 (1) Creating and retaining jobs and stimulating economic line 17 activity in the state. line 18 (2) Preparing the state’s pupils and students with career line 19 technical education for the green economy. line 20 (3) Preparing the state’s pupils, students, and workers with the line 21 skills necessary to successfully compete in the global economy. line 22 (4) Developing worker retraining programs to assist the existing line 23 workforce with the necessary tools to upgrade their skills resulting line 24 in a just transition, as that term is defined by the state board. line 25 (5) Responding to the job creation and workforce needs of the line 26 state’s new and emerging industries, including emerging line 27 technologies that will result in greater greenhouse gas emissions line 28 reductions. line 29 (6) Integrating workforce skill requirements with the rapidly line 30 changing local and regional labor markets. line 31 (7) Developing job training programs to assist specific line 32 populations, such as at-risk youth, displaced workers, veterans, line 33 and others facing barriers to employment. line 34 (8) Targeting workforce development programs and activities line 35 in disadvantaged communities, as identified pursuant to Section line 36 39711, and communities that are located near entities regulated line 37 by the state board pursuant to this division. line 38 (9) Identifying and leveraging state and federal funding line 39 resources, including, but not limited to, moneys collected through line 40 a market-based compliance mechanism, developed pursuant to
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line 1 Part 5 (commencing with Section 38570), to implement the line 2 recommendations made in the report consistent with the regulatory line 3 purposes of this division. line 4 (c) (1) A report to be submitted pursuant to this section shall line 5 be submitted in compliance with Section 9795 of the Government line 6 Code. line 7 (2) Pursuant to Section 10231.5 of the Government Code, this line 8 section is repealed on January 1, 2023.
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PROBLEM California’s landmark climate change law, AB 32, required the Air Resources Board (ARB) to develop regulations and authorized market mechanisms to reduce California's greenhouse gas (GHG) emissions to 1990 levels by the year of 2020. SB 32 requires an additional 40 percent reduction by 2030. As the state prepares a comprehensive strategy to achieve the 2030 target, questions have been raised about the most effective and equitable approach, the role of market mechanisms like cap and trade or a carbon tax and how best to support clean air, sustain economic growth, and improve outcomes for disadvantaged communities.
Solution AB 378 emphasizes principles of accountability and equity as California continues it its efforts to reduce greenhouse gases. Specifically, AB 378 requires the ARB to account for the social costs of GHG emissions. AB 378 also authorizes the ARB to continue using a carbon-pricing market mechanism to the meet the statewide greenhouse gas reduction target established by SB 32, while adhering to principles that address equity issues that still persist in California’s disadvantaged communities. AB 378 also requires the ARB, in meeting the SB 32 target, to adopt an effective and equitable mix of measures, and ensure that these measures support achieving air quality and other public health goals.
BACKGROUND AB 32 required the ARB to adopt a statewide GHG emissions limit equivalent to 1990 levels by 2020 and adopt regulations to achieve maximum technologically feasible and cost-effective GHG emission reductions. AB 32 also authorized ARB to adopt the cap and trade regulation, which is in effect through 2020. 2016 legislation (SB 32 and AB 197) further requires ARB to ensure that statewide GHG emissions are reduced to at least 40% below the 1990 level by 2030, prioritize direct emission reductions, and consider social costs when adopting regulations to meet the 2030 limit.
STATUS INTRODUCED ON FEBRUARY 9TH - TO BE HEARD IN ASSEMBLY COMMITTEE ON NATURAL RESOURCES.
SUPPORT
American Lung Association Asian Pacific Environmental Network California Environmental Justice Alliance California League of Conservation Voters California Natural Gas Vehicle Coalition Center for Race, Poverty and the Environment Clean Energy Fuels Coalition for Clean Air Environment California Environmental Defense Fund Greenlining Institute Leadership Counsel for Justice and Accountability Natural Resources Defense Council NextGen Climate America Public Advocates State Building and Construction Trades Council Union of Concerned Scientists
OPPOSITION
CONTACT Mandi Strella [email protected] Office of Assemblymember Garcia 916-319-2058
Assembly Bill 378 Climate Equity Act
Assemblymembers C. Garcia, Holden, and E. Garcia.
california legislature—2017–18 regular session
ASSEMBLY BILL No. 378
Introduced by Assembly Members Cristina Garcia, Holden, andEduardo Garcia
(Coauthors: Assembly Members Bloom, Bonta, Eggman, Friedman,Gomez, Jones-Sawyer, Kalra, McCarty, Reyes, Mark Stone,Thurmond, and Ting)
February 9, 2017
An act to amend Section 38562.5 of, and to add Section 38567 to,the Health and Safety Code, relating to greenhouse gases.
legislative counsel’s digest
AB 378, as introduced, Cristina Garcia. California Global WarmingSolutions Act of 2006: regulations.
The California Global Warming Solutions Act of 2006 designatesthe State Air Resources Board as the state agency charged withmonitoring and regulating sources of emissions of greenhouse gases.The act authorizes the state board to include the use of market-basedcompliance mechanisms. The act requires the state board to approve astatewide greenhouse gas emissions limit equivalent to the statewidegreenhouse gas emissions level in 1990 to be achieved by 2020 and toensure that statewide greenhouse gas emissions are reduced to at least40% below the 1990 level by 2030.
The act requires the state board, when adopting rules and regulationsto achieve greenhouse gas emissions reductions beyond the statewidegreenhouse gas emissions limit and to protect the state’s most impactedand disadvantaged communities, to follow specified requirements,consider the social costs of the emissions of greenhouse gases, andprioritize specified emission reduction rules and regulations.
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This bill would additionally require the state board to consider andaccount for the social costs of the emissions and greenhouse gases whenadopting those rules and regulations. The bill would authorize the stateboard to adopt or subsequently revise new regulations that establish amarket-based compliance mechanism, applicable from January 1, 2021,to December 31, 2030, to complement direct emissions reductionmeasures in ensuring that statewide greenhouse gas emissions arereduced to at least 40% below the 1990 level by 2030.
This bill would require the state board, in ensuring that statewidegreenhouse gas emissions are reduced to at least 40% below the 1990level by 2030, to adopt the most effective and equitable mix of emissionsreduction measures and ensure that emissions reduction measurescollectively and individually support achieving air quality and otherenvironmental and public health goals.
The people of the State of California do enact as follows:
line 1 SECTION 1. The Legislature finds and declares all of the line 2 following: line 3 (a) It is a primary objective of the state to reduce greenhouse line 4 gas emissions, which is critical for the protection of all areas of line 5 the state but especially for the state’s most disadvantaged line 6 communities, which will be disproportionately impacted by climate line 7 change and emissions from sources of greenhouse gases, including line 8 short-lived climate pollutants, as well as criteria pollutants and line 9 toxic air contaminants.
line 10 (b) While low-income communities and communities of color line 11 in the state suffer from some of the worst air quality in the nation, line 12 the state has been and must continue to be a leader in making line 13 investments in historically disadvantaged communities. line 14 (c) Achieving the state’s climate and air quality goals in an line 15 equitable and effective manner will require a mix of direct line 16 regulations and incentives that hold major emitters accountable line 17 for the social costs of their emissions, protect the state’s economy, line 18 and direct investments to communities across the state. line 19 SEC. 2. Section 38562.5 of the Health and Safety Code is line 20 amended to read:
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line 1 38562.5. (a) When adopting rules and regulations pursuant line 2 to this division to achieve emissions reductions beyond the line 3 statewide greenhouse gas emissions limit and to protect the state’s line 4 most impacted and disadvantaged communities, the state board line 5 shall follow the requirements in subdivision (b) of Section 38562, line 6 consider and account for the social costs of the emissions of line 7 greenhouse gases, and prioritize both of the following: line 8 (a) line 9 (1) Emission reduction rules and regulations that result in direct
line 10 emission reductions at large stationary sources of greenhouse gas line 11 emissions sources and direct emission reductions from mobile line 12 sources. line 13 (b) line 14 (2) Emission reduction rules and regulations that result in direct line 15 emission reductions from sources other than those specified in line 16 subdivision (a). paragraph (1). line 17 (b) The state board may adopt or subsequently revise new line 18 regulations that establish a market-based compliance mechanism line 19 developed pursuant to Part 5 (commencing with Section 38570), line 20 applicable from January 1, 2021, to December 31, 2030, to line 21 complement direct emissions reduction measures in ensuring the line 22 reductions in greenhouse gas emissions required pursuant to line 23 Section 38566. line 24 SEC. 3. Section 38567 is added to the Health and Safety Code, line 25 to read: line 26 38567. In furtherance of ensuring the reductions in greenhouse line 27 gas emissions required pursuant to Section 38566 and consistent line 28 with this division, the state board shall do all of the following: line 29 (a) Adopt the most effective and equitable mix of emissions line 30 reduction measures to achieve the 2030 goal. line 31 (b) Ensure that emissions reduction measures collectively and line 32 individually support achieving air quality and other environmental line 33 and public health goals.
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AB 378— 3 —
To: Silicon Valley Leadership Group Environment Committee
From: Lauren Boyd, Water Resources Associate, Silicon Valley Leadership Group
Re: AB 388 (Mullin) – Greenhouse Gas Reduction Fund: wetland restoration projects
Date: April 7, 2017
Issue: Should some greenhouse gas reduction fund moneys be allocated to the reuse of dredged
material for wetland restoration projects?
Recommendation: Support.
Summary:
This bill would specify that the legislature may appropriate greenhouse gas reduction fund moneys to the
“reuse of dredged materials for wetland restoration projects,” including those projects that provide “flood
protection” and “carbon sequestration,” as an investment that reduces greenhouse gas emissions.
Background:
Greenhouse Gas Reduction Fund
California’s landmark climate legislation, AB 32 (Pavley), created the Greenhouse Gas Reduction Fund.
This fund is comprised of moneys gathered by the State Air Resources Board through market-based
compliance mechanisms – currently, the auction proceeds from cap-and-trade – to reduce greenhouse
gas emissions. The Legislature and Governor are able to appropriate moneys from the fund to reduce
greenhouse gas emissions through investments in several areas, including water use and supply, land
and natural resource conservation and management, forestry, and sustainable agriculture. In Fiscal Year
2016-2017 the Legislature and Governor appropriated $900 million to programs that support
transportation and sustainable communities, clean energy and energy efficiency, and natural resources
and waste diversion.
Beneficial Reuse of Dredged Materials
The “beneficial reuse” of dredged materials is a priority for the San Francisco Bay Region. Dredging is the
removal of sediment and debris from waterways, and is predominantly used by the U.S. Army Corps of
Engineers (ACOE) and other Federal entities to ensure safe navigation channels for boats and ships.
These dredged materials were placed at in-Bay disposal sites for most of the 20th Century, but a Long
Term Management Strategy (LTMS) program for the SF Bay Region is reducing in-Bay disposal and
increasing the beneficial reuse of dredged materials.
Dredged materials can be beneficially reused for wetland creation and restoration, as well as upland
levee maintenance and construction fill. Tidal wetland restoration requires sediment, such as the
sediment dredged from the Bay, to restore damaged wetlands to their appropriate height. These healthy,
restored wetlands can then provide many benefits to the economy and the environment, including
adjusting to sea level rise and reducing the impacts of storm surges. From 2001 to 2013 the LTMS
program achieved 44% beneficial reuse of dredged materials at large habitat restoration sites in the SF
Bay as they transitioned from in-Bay disposal to beneficial reuse.
This reuse is often and increasingly economically infeasible. The distance from dredging sites to
beneficial reuse sites, as well as the lack of offloading equipment at sites, poses economic problems.
Additionally, ACOE requires costs exceeding their Federal Standard, or the least costly dredged material
disposal option, to be paid by a non-Federal entity, which is often a state or local agency or nonprofit.
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These additional costs mean that dredged materials are disposed of 55 miles off-shore in the ocean
rather than employed for beneficial reuse.
Fiscal Impact:
No additional state costs. Moneys would be appropriated from the Greenhouse Gas Reduction Fund.
Analysis:
This bill would further the Leadership Group’s goal of supporting wetland restoration and flood mitigation
efforts in the SF Bay through increased funding for restoration projects. Specifically, moneys from the
Greenhouse Gas Reduction Fund would allow for restoration projects to continue relying on the beneficial
reuse of dredged materials for sediment. This is critical given that sediment levels in the SF Bay have
dropped dramatically over the past decade and reduced the sediment available for wetland restoration.
Without sediment from the beneficial reuse of dredged materials, it may be difficult for restoration projects
to restore wetlands.
The Leadership Group’s support for wetland restoration is founded on its tangible benefits for quality of
life and economic health in the region. Wetland restoration not only restores habitat and provides
increased recreational opportunities along the SF Bay shoreline, it also provides protection from sea level
rise and the associated increased flood risk to businesses. The Bay Area Council Economic Institute
estimates $10.4 billion in infrastructure damages to the SF Bay Area during the next 100-year storm
event, and these damages will be exacerbated by sea level rise. Healthy, restored wetlands can help
lessen the impacts of these storms by absorbing flood water and absorbing the impacts of storm surges.
Additionally, this bill would help further the Leadership Group’s goal of mitigating the effects of climate
change. Tidal wetlands have the potential to sequester greenhouse gases from the atmosphere and store
carbon, which can help reduce the impacts of greenhouse gas emissions on the environment. Although
allowing greenhouse gas reduction funds to be used for the beneficial reuse of wetland restoration will
necessarily mean that other investments will receive fewer allocations, the bill does not specify an amount
of continuous appropriations to this item. Instead, the bill adds language to the existing Health and Safety
Code to clarify that beneficial reuse qualifies for greenhouse gas fund investments.
Status: Ordered to third reading in Assembly on April 6, 2017.
Support: Audubon California; AZUL; Bay Planning Coalition; California Coastal Protection Network;
California Coastkeeper Alliance; California League of Conservation Voters; Citizens Committee to
Complete the Refuge; Coastal Environmental Rights Foundation; Defenders of Wildlife; Environmental
Justice Coalition for Water; Humboldt Baykeeper; San Francisco Baykeeper; Seventh Generation
Advisors; Trust for Public Land; WILDCOAST
Opposition: None on File
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To: Silicon Valley Leadership Group Environment Committee
From: Lauren Boyd, Water Resources Associate, Silicon Valley Leadership Group
RE: AB 851 (Caballero) – Local agency design-build projects
Date: April 10, 2017
Issue: Should special districts that provide or operate specified services be allowed to use the design-
build process for certain public works projects?
Recommendation: Support.
Summary:
This bill would allow special districts that operate “flood protection,” “habitat restoration or enhancement,”
“groundwater recharge or storage,” “surface water storage,” “water treatment facilities,” “wastewater
facilities,” “solid waste management facilities,” “water recycling facilities,” or “fire protection facilities” to
use the design-build procurement process for projects related to those services.
Existing legislation is restricted to special districts that operate “wastewater facilities,” solid waste
management facilities,” “water recycling facilities,” or “fire protection facilities,” and are constructing “local
or regional” facilities for those services.
Background:
Design-Build Procurement Process
State and local agencies grant contracts for the construction of public works projects. Historically, the
most common type of contract is a design-bid-build contract, but there is an increasing shift toward
design-build contracts. In the design-bid-build procurement process, local agencies grant separate
contracts for the design of a project and the construction of a project. In the design-build procurement
process, there is one contract for both the construction and the design of a project. According to a study
commissioned by the Design Build Institute of America, 59 percent of the construction dollars spent in
California is on design-build projects. While there are advantages and disadvantages to each type of
contract, the design-build process is praised as conducive to projects that are on-schedule, cost-effective,
high-quality, and at reduced risks. These efficiencies are largely credited to the increased collaboration
between the integration of the design and construction components of the project.
Over the past fifteen years, legislation has enabled state and local agencies to use the design-build
procurement process for the construction of public works projects. SB 785 (2014) repealed and
condensed these laws to enable state and local agencies to use the design-build process provided that
they follow a specific procurement process and satisfy specific workforce requirements. According to SB
785 legislative bill analyses, there was opposition to SB 785 from several construction and build trade
associations regarding its workforce requirements.
Public Works Projects
Local agencies must be responsive to the state’s aging infrastructure and the state’s changing climate.
The American Society of Civil Engineers’s 2017 Infrastructure Report Card estimates that there are $44.5
billion in drinking water infrastructure needs and $26.2 billion in wastewater infrastructure needs over the
next 20 years. Beyond the 20-year investment time frame, there is also a need for nimble infrastructure
investments that respond to the state climate’s interchange between years of extreme drought and surges
of extreme storms. The recent disasters at Oroville Dam and Anderson Dam underscore these dual
needs: Both dams are dilapidated and were unable to adequately respond to an influx of rain after years
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of drought. Local agencies will need to be responsive to these immediate and long-term needs for public
works projects.
Fiscal Impact: Unknown to date. Legislative bill analyses for SB 785 (2014) identified that overall cost
may increase due to a new bidding process or decrease due to increased efficiencies from the design-
build process. The bill would allow local agencies the option to choose design-build if it is deemed more
cost-effective than other delivery methods.
Analysis:
This bill would help advance several Silicon Valley Leadership Group priority items, including ensuring
safe and reliable water supplies for Silicon Valley and supporting wetland restoration and flood mitigation
efforts throughout the San Francisco Bay Area. Specifically, the bill would help advance these goals by
allowing the Santa Clara Valley Water District (SCVWD) – a special district that is responsible for or
involved in the provision of water supplies, flood protection, and habitat restoration for much of the Silicon
Valley – to enter into design-build contracts.
SCVWD, as well as other qualified special districts throughout the state, would be able to choose
between design-build and design-bid-build contracts as appropriate for a given projects. Design-build may
not be appropriate for every project, but they would be able to take advantage of the cost-effectiveness,
flexibility, timeliness, and reduced risk that can be associated with design-build projects. This option will
be critical as SCVWD approaches water supply, flood protection, and habitat restoration capital
improvement projects to make infrastructure improvements and adjust to climate change. For example,
SCVWD may look at the design-build process for capital improvements to Rinconada Water Treatment
Plant, Anderson Dam, or projects on the SF Bay Shoreline, which are major components of the Silicon
Valley water system.
Status: Assembly Committee on Local Government. Hearing on April 26, 2017.
Support: Santa Clara Valley Water District (Sponsor).