The press release says that according to an economic analysis released by the California Air Resources Board and reviewed by Environmental Defense Fund, impacts of CARB’s plan to implement AB 32 (or more fondly known as the Global Warming Solutions Act of 2006) are likely to be “small and positive, which is consistent with the growing body of research about the state’s climate change law.” 

CARB reports that it combined a well-tested, peer-reviewed model of California’s economy known as the Environmental Dynamic Revenue Assessment Model (
EDRAM), with an energy model, ENERGY2020, capable of showing changes in the generation mix, production costs and pollutant characteristics of the electricity sector. This pairing, says CARB, enables study of how energy costs will influence the relative balance of investments in infrastructure and labor in all economic sectors, thereby revealing the production and jobs implications of policies that put a price on climate change pollution.

CARB estimates that in 2020, fuel consumption will be 5% lower after implementing AB 32’s Climate Change Scoping Plan, the blueprint for reducing greenhouse gas emissions to 1990 levels by 2020. California’s Gross State Product is projected to be affected slightly; instead of growing to $2,502 billion in 2020, it is forecasted to be $2,498 billion with AB 32 implementation—a slight difference of 0.2% in the context of 35% overall growth from 2008 to 2020. The analysis also indicates that personal income and employment are projected to increase very slightly (0.1%).  

“These findings are consistent with others that show Californias economy will be virtually unchanged through 2020,” said Dr.
James Fine, an economist for Environmental Defense Fund, based in Sacramento. “There will, however, be important changes that save households money, greatly reduce our dependence on foreign oil and improve the health of our communities.”

So, the state’s economy will be “virtually unchanged through 2020.” Phew. That’s comforting…


And speaking of CARB, since the AGC of California again made its plea to hold off on new off-road diesel emission regulations to CARB at a board meeting on March 11, absolutely nothing has happened since. AGC’s stance is still that since the economy has reduced construction activity substantially in the state, fewer emissions are being released as a result. In fact, current emissions are in the 1990 range a la AB 32. Let’s see what CARB (and the federal EPA) have up their sleeves.


And remember that Gas Tax Swap controversy? Well, according to AGC of California, the governator saw the light and signed amending legislation to fix what would have been a tax nightmare for users of off road diesel, such as construction, railroads and farming. The legislature approved SB 70, which had the gas tax provisions, ABX8 6 and ABX8 9, included, and that AGC helped draft. It exempts off road diesel from the increase in the new diesel sales tax. The corrections in SB 70 will, according to AGC, save the construction industry $4 million to $5 million in diesel taxes.

The Gas Tax Swap will generate an additional $400 million annually for highway and road construction. It allows for additional sales of Proposition 1B bonds because the bonds are now backed by the increase in the gas tax rather than the general fund. All of these revenues are protected by Article XIX of the California Constitution, which restricts use of the gas tax to highway and road construction only.


As if the governator has enough to do these days, now he has to hire another Caltrans director. After Will Kempton quit last July to take over the Orange County Transportation Authority, new director Randell Iwasaki, who was promoted last August to director, is also calling it quits. Iwasaki will also take over a smaller transportation entity, the Contra Costa Transportation Authority.

Pundits have indicated that according to the state controller’s office, Iwasaki was earning around $140,000 as Caltrans director; his new salary is $195,000. Plus, with possible upcoming Caltrans staff cuts in the 1,500 range recommended by the Legislative Analyst’s Office, Iwasaki just didn’t want the headaches associated with such cutbacks. Don’t blame him. And the money’s a plus, too.