{"id":297,"date":"2010-11-03T12:43:02","date_gmt":"2010-11-03T17:43:02","guid":{"rendered":"http:\/\/blogs.law.columbia.edu\/climatechange\/?p=297"},"modified":"2012-01-31T15:26:36","modified_gmt":"2012-01-31T20:26:36","slug":"will-prop-26-scuttle-california-climate-regulations","status":"publish","type":"post","link":"https:\/\/blogs.law.columbia.edu\/climatechange\/2010\/11\/03\/will-prop-26-scuttle-california-climate-regulations\/","title":{"rendered":"Will Prop. 26 Scuttle California Climate Regulations?"},"content":{"rendered":"
<\/div>

Daniel M. Firger
\nAssociate Director<\/p>\n

California voters handily defeated<\/a> Proposition 23 on election day, ensuring that state regulators can move forward on implementation of A.B. 32, the Global Warming Solutions Act of 2006. \u00a0Just last week, the California Air Resources Board issued a Proposed Regulation Order<\/a> establishing a statewide cap-and-trade system, which is subject to final approval on December 16, 2010; having cleared the Prop. 23 hurdle, that regulatory process will now continue apace, unhindered for the time being by other political roadblocks.<\/p>\n

Yet what the ballot box giveth, the ballot box may taketh away.<\/p>\n

While Prop. 23 failed to garner enough Californians\u2019 support to stop climate change regulation in its tracks, a less well publicized but potentially more troubling proposition succeeded at the polls. Proposition 26<\/a>, passed with 52.6% of the vote on November 2, amends the California constitution to require a two-thirds supermajority vote in the state legislature to make \u201cany change in state statute which results in any taxpayer paying a higher tax.\u201d (Click here<\/a> for the full text of the proposition). Aside from the clear fiscal impact of such a change \u2013 taxes could be levied with a simple majority under the state\u2019s previous rules \u2013 this inocuous language may make it difficult, if not impossible, for regulators to implement some components of A.B. 32.<\/p>\n

This is because Proposition 26 defines \u201ctax\u201d broadly, as \u201cany levy, charge, or exaction of any kind imposed by the State.\u201d The definition admits few exceptions. These include the following five categories only:<\/p>\n

(1) \u00a0 \u00a0Charges imposed for specific benefits granted directly to the payor, which are not provided to others and which do not exceed the costs of conferring such benefits;
\n(2) \u00a0 \u00a0Charges imposed for specific government services provided directly to the payor, which are not provided to others and which do not exceed the costs of providing such services;
\n(3) \u00a0 \u00a0Charges designed to recoup the regulatory costs related to issuing licenses and permits, and performing investigations, inspections, and audits, etc.;
\n(4) \u00a0 \u00a0Entrance fees for the use of state property, or charges related to the purchase, rental, or lease of such property; or
\n(5) \u00a0 \u00a0Civil or criminal fines and penalties imposed by state courts as a result of violations of law.<\/p><\/blockquote>\n

Such narrow exceptions may make a GHG emissions permitting regime under A.B. 32 more difficult to impose, because the requirement for utilities and refineries to hold emissions allowances could be considered a tax within the meaning of Prop. 26. \u00a0Depending on the precise language of CARB\u2019s final regulations establishing a cap-and-trade system and whether, for instance, CARB will be allocating allowances for free or holding auctions, state cap-and-trade rules may require approval by a supermajority of both the California Senate and the Assembly before they can go into effect.<\/p>\n

Much, of course, depends on how Prop. 26 is ultimately interpreted by the California courts. And, with solid Democratic majorities in both houses of the state legislature, a two-thirds vote for climate change legislation is not outside the realm of possibility. \u00a0For now, all eyes are on CARB, which has until mid-December<\/a> to promulgate final climate rules. After that, the lawsuits.<\/p>\n","protected":false},"excerpt":{"rendered":"

Daniel M. Firger Associate Director California voters handily defeated Proposition 23 on election day, ensuring that state regulators can move forward on implementation of A.B. 32, the Global Warming Solutions Act of 2006. \u00a0Just last week, the California Air Resources Board issued a Proposed Regulation Order establishing a statewide cap-and-trade system, which is subject to […]<\/p>\n","protected":false},"author":580,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[5680],"tags":[835],"class_list":{"0":"post-297","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-clean-energy","7":"tag-state-activity","8":"czr-hentry"},"yoast_head":"\nWill Prop. 26 Scuttle California Climate Regulations? - Climate Law Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/blogs.law.columbia.edu\/climatechange\/2010\/11\/03\/will-prop-26-scuttle-california-climate-regulations\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Will Prop. 26 Scuttle California Climate Regulations? - Climate Law Blog\" \/>\n<meta property=\"og:description\" content=\"Daniel M. Firger Associate Director California voters handily defeated Proposition 23 on election day, ensuring that state regulators can move forward on implementation of A.B. 32, the Global Warming Solutions Act of 2006. \u00a0Just last week, the California Air Resources Board issued a Proposed Regulation Order establishing a statewide cap-and-trade system, which is subject to […]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/blogs.law.columbia.edu\/climatechange\/2010\/11\/03\/will-prop-26-scuttle-california-climate-regulations\/\" \/>\n<meta property=\"og:site_name\" content=\"Climate Law Blog\" \/>\n<meta property=\"article:published_time\" content=\"2010-11-03T17:43:02+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2012-01-31T20:26:36+00:00\" \/>\n<meta name=\"author\" content=\"Daniel Firger\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@sabincenter\" \/>\n<meta name=\"twitter:site\" content=\"@sabincenter\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Daniel Firger\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/2010\\\/11\\\/03\\\/will-prop-26-scuttle-california-climate-regulations\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/2010\\\/11\\\/03\\\/will-prop-26-scuttle-california-climate-regulations\\\/\"},\"author\":{\"name\":\"Daniel Firger\",\"@id\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/#\\\/schema\\\/person\\\/c8ae1fcab1bafe39a4a76017696d6db7\"},\"headline\":\"Will Prop. 26 Scuttle California Climate Regulations?\",\"datePublished\":\"2010-11-03T17:43:02+00:00\",\"dateModified\":\"2012-01-31T20:26:36+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/2010\\\/11\\\/03\\\/will-prop-26-scuttle-california-climate-regulations\\\/\"},\"wordCount\":509,\"commentCount\":1,\"publisher\":{\"@id\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/#organization\"},\"keywords\":[\"State Activity\"],\"articleSection\":[\"Clean Energy\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/2010\\\/11\\\/03\\\/will-prop-26-scuttle-california-climate-regulations\\\/\",\"url\":\"https:\\\/\\\/blogs.law.columbia.edu\\\/climatechange\\\/2010\\\/11\\\/03\\\/will-prop-26-scuttle-california-climate-regulations\\\/\",\"name\":\"Will Prop. 26 Scuttle California Climate Regulations? 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