(The debate over how to spend the state’s cap-and-trade funding source was already hot last year. This year, it could become one of the largest transportation stories in the state, competing even with High Speed Rail. As such, Streetsblog L.A. welcomes op/ed pieces on how to best use those funds. Email ideas to firstname.lastname@example.org – DN)
In 2013, a significant new opportunity to improve Californians’ mobility options emerged in the Active Transportation Program (ATP), which consolidates and streamlines funding for bike, pedestrian, trails and Safe Routes to School programs. Through the hard work of advocates, the Legislature ended up increasing the total allocation to the activities in the ATP by more than a third for the next fiscal year. At the same time, the potential exists for an even bigger funding increase in the next decade, in the form of proceeds from the state’s cap-and-trade auction program.
With annual revenue expected to be in the billions, and a large chunk of proceeds slated to benefit disadvantaged communities, California has an opportunity to invest more aggressively and effectively in active transportation. However, the exact amount is far from guaranteed and many potential spending priorities will compete for a slice of the pie. With the governor’s preliminary budget scheduled for release on January 10, the time has come for our elected leaders to step up and invest in more livable streets and communities.
Cap-and-trade: California’s new revenue source
California’s landmark 2006 climate change law, AB 32, seeks to reduce the state’s greenhouse gas (GHG) emissions to 1990 levels by 2020, and 80 percent below that by 2050. The law includes a comprehensive portfolio of GHG reduction measures, one of which is cap-and-trade — a cap on overall emissions in certain industrial sectors paired with a system of tradeable emissions allowances under the cap. The state will distribute some of the allowances by selling them at quarterly auctions. A great summary of cap-and-trade can be found here.
The program is just wrapping up its first year and applies only to large power plants and industrial operations. Starting in the 2014-15 fiscal year, however, it will apply to distributors of fuel, including fuels used for transportation — a sector that accounts for 38 percent of GHG emissions statewide. The revenue potential is substantial: a Natural Resources Defense Council analysis, presented at a UCLA conference last February, estimates (pdf link) that total revenues could be as much as $8 billion annually once the program is fully up and running.