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Calif. Assembly defeats cap-and-trade extension, expansion

In the final stages of a marathon June 1 session in the California Assembly, divided state lawmakers defeated a proposal to extend the state's cap-and-trade program through 2030, a key component of California's bid to slash greenhouse gas emissions 40% below 1990 levels by that time. The program's legal authority currently expires after 2020, a fact that has contributed to a recent slump in auctions of carbon emissions allowances.

Failing on a 35-39 vote in the Democrat-dominated body, Assembly Bill 378 stumbled over concerns among Republicans and pro-business Democrats about the creation of new air-quality standards for industrial facilities, in addition to Gov. Jerry Brown's refusal to sign a cap-and-trade extension bill without a two-thirds majority. A.B. 378 sought only simple majority consent. A still active bill in the Senate, S.B. 775, would deliver two-thirds approval to circumvent an ongoing legal challenge to the program on the claim that it represents an illegal tax. The Senate bill, however, does not seek to integrate local pollution controls with the cap-and-trade program.

"As I look at the two bills we've been talking about, air quality is an issue we need to deal with," said Republican Assemblyman Rocky Chávez, who opposed the bill, on the Assembly floor. "But the bigger issue is actually carbon... once we deal with that we can talk about the smaller issue of air quality."

Other opponents criticized the bill's "command-and-control" approach to reducing air pollution, compared to the "market-based" cap-and-trade program.

But lawmakers from especially polluted districts defended the measure. "The issue of air pollution isn't a small issue... it is a very important issue, particularly in my district where seven out of 10 children suffer from respiratory disease," countered Assemblyman Eduardo Garcia, a Democrat who represents Imperial County, which borders Mexico. The law that set the state's emissions reductions target at 40% succeeded in the last session only with the passage of Garcia's companion bill, A.B. 197, which directed the Air Resources Board to prioritize regulations to protect disadvantaged communities. Garcia called the addition of air quality provisions a "starting point to be able to put together cap-and-trade 2.0."

"Big oil won but this fight is not over," said Cristina Garcia, the author of the bill, in a June 2 post on Twitter. "There is a lot to talk about how ambitious our climate goals are and how far we've gone," Garcia said on the Assembly floor ahead of the vote. "But I also want to emphasize how challenging our air quality goals are as well, and the devastating effects on my community and many others around the state."