Posted on 05/18/2009 9:26:52 AM PDT by NormsRevenge
SACRAMENTO – Call it overhead.
The state Air Resources Board plans to collect more fees from industries responsible for large amounts of greenhouse gases to recoup the administrative costs of implementing California's landmark climate change law.
The proposed $50 million in annual assessments would nick Californians for about $1.50 a year after the costs are passed down, regulators estimate.
The climate change program has been partly living on borrowed money for some time, tapping various state accounts to pay for 155 positions within the air board and for about 20 others assigned to different agencies.
The additional staff, which includes technical and policy experts on global warming, thus far has produced a series of programs to curb emissions.
Among the broadest accomplishments: a comprehensive policy to slash greenhouse gases in all sectors of the economy and a first-in-the-nation requirement that fuel providers reduce the carbon intensity in gasoline and diesel by 10 percent by 2020 – a move that also could spur the market for alternative fuels and drive down oil imports.
Regulators anticipate adopting the fees next month and could send out the first round of bills in early 2010.
Of the loans taken out to cover mostly payroll, $32 million was diverted from the state's bottle and can recycling program this fiscal year. Most of that money is raised by deposits collected at stores.
An additional $15.7 million was redirected out of the state's Motor Vehicle Account, which helps pay for Department of Motor Vehicles operations and the California Highway Patrol. The remaining debt is divided among other programs.
The $50 million raised by new fees would cover ongoing expenses and a gradual repayment of the principal and interest owed to these accounts. The fees will continue after the loans are paid off in four years, but most likely at a lower rate depending on the state's fiscal condition. Regulators estimate the fees will amount to about $36 million annually.
The strategy is to levy charges at the industrial source based on annual emissions, from refineries to utilities to cement makers, said Jon Costantino, a state regulator who developed the fee proposal. Those industries targeted for fees account for 85 percent of the greenhouse gas emissions linked to global warming.
“We took an economy-wide, upstream approach instead of going downstream and charging everybody's car or house,” Costantino said.
The pinch may go unnoticed by the average consumer once the fees trickle down, Costantino said. For example, the additional costs work out to a “hundredths of a penny” for a gallon of gas. Once the loans are paid back, the price to consumers will be closer to $1 a year, he said.
But that fractional amount disguises the aggregate pain for industry. For example, the initial assessment would be $19.2 million for gasoline, $16.1 million for natural gas producers, $6.6 million for electricity importers and $5.6 million for diesel fuel makers.
The proposal worries an industry already leery of the campaign against global warming, which accelerated with the 2006 passage of Assembly Bill 32 that requires rolling back greenhouse gas emissions to 1990 levels by 2020, a 25 percent reduction.
“We want to make sure they do it right,” said Dorothy Rothrock, who represents a coalition formed to represent business interests on climate change issues. “It sets the stage for how they may be looking at future fee regulations.”
Rothrock sees a litany of problems with the first attempt.
“There's all sorts of places where this breaks down,” she said.
Among those: There's no guarantee that the money will be spent for the intended purpose, businesses might not be able to pass on the costs given competition in the marketplace and the fee could set a precedent for even more assessments.
The American Lung Association of California has endorsed the plan, saying fees are “strongly needed” and will assure that the state maintains momentum toward curbing global warming.
Energy interests have submitted comments raising concerns about the potential of being double-billed once all of the other electricity-related regulations are in place.
Power companies also question why the board wants to include imported electricity, noting the potential “legal complications that could arise from adopting a fee that may violate the (federal) Commerce Clause.”
Costantino, the state regulator, noted that the Legislature allowed the fees by passing the landmark global warming law. Subsequent budget bills, signed by Gov. Arnold Schwarzenegger, order the air board to impose those fees to cover a repayment schedule to the other state accounts.
“Where this money is penciled in meets the criteria of the law,” Costantino said.
At what point do the pitchforks come out?
Refiners should immediately announce that they’ll not serve the California market when this requirement takes effect.
All regulations put forth by any Agency not directly accountable to the Voters by Direct Election Shall only apply to Government and Government Employees.
MMMMM...what’s that smell?
Boiled frogs in CA.
Last manufacturing plant to leave Kal-ee-for-nee-a please turn out the (compact fluorescent) lights.
This statement is classic leftist bureaucrat speech. The Air Resources board is targeting organizations that will unable or unwilling to protest. The impact of the fees and regulations will be diluted and hidden when reaching the masses. The greens and their rat allies are expert at deception about the impact and existence of energy taxes.
All the talk of additional administrative staff makes me wonder is this what Obama meant by creating green jobs?
Corps. emit far less emissions on way out of Kali, less payroll too.
A company I worked for had a plan to build an asphalt storage facility in Stockton. By the time the air board, the county board and neighborhood board got done with us, we built the plant in Reno.
Since this is not a direct tax on consumers, it will be passed down in higher costs from energy producers who will then be villified by the state and the dems for gouging the consumers.
What a racket!
The regulators have the green jobs. Green is also the color of $$. [I guess they left that part out.]
The pitchforks are already out. If all the ballot measures fail (except for probably 1F) the state is going to have to declare bankruptcy.
Here are some worthless trough feeders who should be the first to be turned into something worthwhile, like Soylent Green.
Or dog food.
Well golly, they won’t have Enron around to blame for the next liberal induced energy crisis.
At what point do companies simply state “we are leaving”?
How about the low tax states putting up ads?
BTW has anyone notice how the michigan ads have switched to golf courses? (i wonder if they mean UAW golf courses)
I would love to see a commercial where one state compares their tax structure to california’s abomination of a tax code.
(2) One billion dollars ($1,000,000,000) shall be made available, upon appropriation by the Legislature and subject to such conditions and criteria contained in a statute enacted by the Legislature, to the State Air Resources Board for emission reductions, not otherwise required by law or regulation, from activities related to the movement of freight along California’s trade corridors. Funds made available by this paragraph are intended to supplement existing funds used to finance strategies and public benefit projects that reduce emissions and improve air quality in trade corridors commencing at the state’s airports, seaports, and land ports of entry.As the Wall Street Journal published back in 2006 (California Plots Greenhouse-Gas Strategy),
CARB, the nation's largest and most influential state environmental regulatory agency, has about 1,000 employees, including scientists and engineers who, working there in the 1960s, helped design the nation's pioneering antismog program. The agency enjoys enough bipartisan political support that when Gov. Arnold Schwarzenegger announced in August that California would impose the nation's first broad cap on greenhouse-gas emissions, the state Legislature simply set deadlines for reducing emissions and left it mostly up to CARB to figure out how to do it, telling the agency to prepare regulations by 2012. California's goal is to cut emissions by about 25% by 2020.To flesh out California's law, Dr. Sawyer, who was appointed by Mr. Schwarzenegger in December, says he will push every approach that is cost-effective. He plans to send staff members to the United Kingdom and Japan to see how their pioneering regulatory programs work. He plans to hire 100 experts, including economists who will develop computer models of the state's past and future emissions. He is also looking for specialists who can design an emissions-trading program tailored to California's economy.
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Manufacturers: OK. Our new number in AZ will be (602) 555-1234 if you need anything. It's been real.
I don't know. I kinda like my dog. I'd be concerned that kind of crap might be bad for him.
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