Senate leader proposes permanent sources of funding for sustainable affordable housing and mass transit

April 14, 2014

Formidable coalition backs the long-term investment plan for clean infrastructure that promises smart growth, jobs, to meet California’s landmark climate goals

(Sacramento, CA) – Two months after a speech that provoked a firestorm debate on the best way to move California’s climate strategy forward, California Senate Leader Darrell Steinberg today presented a long-term investment strategy for projected Cap-and-Trade revenues, to further California’s pursuit of its landmark greenhouse gas reduction goals.

The investment strategy, unveiled at a Capitol press conference, dedicates a permanent source of funding for affordable housing in sustainable communities, mass transit, and offers a guaranteed catalyst for job-creation as California’s economy continues its recovery.

“Cap-and-Trade needs a long-term strategy that maximizes the efficiency of its revenues as we seek to curb greenhouse gasses. I am thrilled to stand with a broad coalition of good environmental stewards, advocates for social justice, experts in transit-oriented development, and the working men and women of California,” Senator Steinberg (D – Sacramento) said. “This strategy is designed to achieve the objectives of AB32 through significant reductions in greenhouse gas and the direction of public and private investment to California’s low-income and disadvantaged communities, which are disproportionately burdened by air pollution and the effects of climate change. “

“I thank Senator Steinberg for bringing forward his concept of what a long term expenditure plan for AB 32 should be to reduce greenhouse gas emissions and make critical investments in areas such as transit and energy efficiency," said Senator Fran Pavley (D-Agoura Hills). “I look forward to working with Senator Steinberg, our colleagues and other stakeholders as this bill moves forward.”

Overview
Both sustainable affordable housing and mass transit, key to achieving the goals of California’s Global Warming Solutions Act (AB32 of 2006), are already facing a catastrophic funding crisis. The strategy ensures that California’s suite of climate policies, taken as a whole, provides a net benefit to disadvantaged and low-income communities as California reduces greenhouse gas emissions, goals that were heavily-endorsed by voters with their rejection of Proposition 23 in 2010.

In addition to permanent funding sources for affordable housing and mass transit, the strategy (available here) also provides a permanent source of funding for highway and road rehabilitation to improve traffic flows and repair, to retrofit streets for cycle-lanes, and for the Governor’s High Speed Rail project, which is projected to reduce heavy emissions generated by air and road travel. Senator Steinberg’s proposed strategy identifies funding for green infrastructure projects and clean-vehicle programs, seed funds to assist clean projects, and rebates for consumers.

In an address before the Sacramento Press Club on February 19, Senator Steinberg proposed swapping Cap-and-Trade’s forthcoming expansion into the non-stationary fuels market for a direct Carbon Tax on those same fuels, while returning most of the revenues to low- and middle- income families through a tax credit, and a permanent source of funding for transit. In that speech, Senator Steinberg remarked “If all you report is that ‘Steinberg proposes Carbon Tax’, you’re missing half the speech and you’re missing half the point... My larger concern is the economic impact on low and moderate income people and how we achieve these essential climate goals.”

Affordable Housing
With bond funding exhausted and redevelopment funds eliminated by a California court, California has virtually no state investment in affordable homes while rents were higher in 2012 than they were at the height of the housing boom. The proposed strategy creates a permanent source of funding for affordable housing.

In a joint-statement from Ray Pearl of the California Housing Consortium, and Shamus Roller of Housing California, the affordable housing advocates said “California’s affordable housing community applauds Senate President pro Tem Steinberg for prioritizing much-needed commitment to state investment in developing affordable homes that create jobs while helping our state meet its goals to reduce greenhouse gas emissions through AB 32. This proposal would bring much-needed investment to build homes close to transit centers, and is welcome news particularly for the state’s urban areas. We call on California’s elected leaders to make this proposal the starting point for a comprehensive statewide funding strategy to increase the supply of affordable homes in communities across the state, create jobs, reduce homelessness, and improve health and educational outcomes.”

Smart Growth
The strategy proposes investments in affordable housing be centered in sustainable communities, illustrated by MacArthur Station, a mixed-use transit-oriented development in Oakland, California designed to redevelop and revitalize a transit-oriented community that enhances bicycle and pedestrian use, with increased access to BART and connecting public transit lines.

“Senator Steinberg's proposed investments will lead to cleaner, healthier communities. These are also investments in equity so that Californians at all economic levels will benefit” said Tom Adams, an environmental activist and retired environmental lawyer, adding “Under Senator Steinberg's proposals, California will set another milestone for global leadership on clean energy and climate. Over at the circus of the climate deniers the carnival barkers say climate policy will result in hardship. Senator Steinberg, on the other hand, is showing that sound climate policy means rebuilding our cities, creating jobs, improving transportation and increasing social equity.”

Mass Transit
Also true to Senator Steinberg’s February proposal is a commitment to provide a permanent source of funding for mass transit and develop 21st Century infrastructure for California to reduce traffic and their polluting emissions. The state’s road users are collectively on course to travel 1.1 billion miles daily by 2020, an increase of over 100 million miles travelled daily over the next six years.

Joshua Shaw, Executive Director of the California Transit Association said, “Senator Steinberg’s plan builds upon the foundation laid by Governor Brown, by confirming that public transit is not simply a discretionary service; it is essential – and becoming increasingly more vital to the health and well-being of our state.”

Tens of Thousands of New Jobs
A standard assessment used by Federal and State government projects that for every $1 billion invested in transportation projects, 17,000 jobs are created. Conversely, a study by the Economic Development Research Corporation projects that congestion threatens 480,000 jobs representing $32 billion per year in income by 2040.

“The California Alliance for Jobs supports the concepts contained in Senator Steinberg's Cap and Trade Long Term Investment Plan” said Jim Earp, Executive Director of California Alliance for Jobs, and “By making investments in transportation projects that reduce greenhouse gas emissions, California will continue its leadership role in addressing climate change while also creating thousands of skilled construction jobs building new transit lines, infill projects, and improving streets and roads that service transit corridors and alternative modes of transportation. We believe that while this is a significant step forward, there is still considerable work ahead to flesh out a proposal with many moving parts into a viable bill. We welcome the opportunity to continue to work with Senator Steinberg over the coming weeks and applaud his leadership on this critical issue.”

Formidable Coalition
Attending the press conference in support of the strategy:

  • Robbie Hunter, President, State Building and Construction Trades Council of California
  • Jim Earp, Executive Director, California Alliance for Jobs
  • Ann Notthoff, California Director, Natural Resources Defense Council
  • Tom Adams, environmental activist and retired environmental lawyer
  • Shamus Roller, Executive Director, Housing California
  • Marina Wiant, Policy Director, California Housing Consortium
  • Joshua Shaw, Executive Director of the California Transit Association 
  • Steve Heminger, Executive Director of the Metropolitan Transportation Commission
  • Bill Higgins, Executive Director, California Association of Councils of Governments 
  • Chris McKenzie, Executive Director, League of California Cities
  • Mike McKeever, Executive Director of Sacramento Area Council of Governments (SACOG)
  • Joel Keller, Board President, Bay Area Rapid Transit (BART)
  • Jeanie Ward-Waller, California Policy Advocate, Safe Routes to School National Partnership

What They’re Saying
“CSAC appreciates Senator President Pro Tempore Darrell Steinberg's leadership on the investment of Cap and Trade funding and recognition of the importance of investing in sustainable communities to achieve cost effective greenhouse gas (GHG) emissions reductions. Local governments stand ready to work with Senator Steinberg to seize the opportunity at the local level to make meaningful GHG reductions and help the State reach our AB 32 goals.”
Matt Cate, Executive Director, California State Association of Counties (CSAC)

“Cap and Trade was implemented by the Air Resources Board as a means to help achieve the goals outlined in AB 32 [the Global Warming Solutions Act of 2006], and expanded transit is critical to meeting those goals. We’re thankful that Senator Steinberg’s proposal acknowledges the role of transit systems in reducing greenhouse gas emissions levels in California.”
Donna DeMartino, Chair of the California Transit Association and General Manager/CEO of the San Joaquin Regional Transit District;

“A dedicated funding program for smart growth development near transit would be a game changer for BART and what it can accomplish to improve the quality of life in the Bay Area. Having funds to revitalize areas around our stations, such us our planned Transit Oriented Development project adjacent to the MacArthur BART Station in Oakland, will help encourage a transit first lifestyle affordable to all residents.”
Joel Keller, Board President, Bay Area Rapid Transit

"We applaud the Senator with his efforts that focus on a secure transit funding source for capital and operating expenses, assisting regional transportation agencies in our efforts in meeting AB 32 and SB 375 goals. The flexibility allowed with this proposal, allowing transit operators to use the funding for both operations and capital expenditures will provide vital and necessary transportation services to Orange County's transit-reliant population."
Darrell Johnson, Chief Executive Officer, Orange County Transportation Authority

“In 2008, Senate Pro Tem Steinberg established himself as a leader in the planning and development of sustainable communities when he authored SB 375. That legislation required metropolitan planning organizations (MPOs) to integrate land use and transportation planning by developing a “sustainable communities strategies” in the regional transportation plan that meet greenhouse gas reduction targets set by the state (from cars and light trucks). However, SB 375 also found the need for a sustainable source of funding to “accommodate the patterns of growth consistent with the state’s climate, air quality, and energy conservation goals. Today, the Pro Tem builds on his landmark SB 375 by proposing to invest in regional sustainable communities strategies and other transportation related investments. The California Association of Councils of Governments (CALCOG) supports the investment of cap and trade revenues in transportation, land use, and infrastructure for sustainable communities. Like the regional emission targets, an effective state investment plan requires a strong, well-defined role for the regional agencies responsible for achieving the state’s greenhouse gas emission reduction targets. CALCOG appreciates that this plan contemplates a role for regional governments in making the investment in sustainable communities. We also appreciate the Governor’s role in identifying this issue in his cap and trade investment plan. We now look forward to working with the Pro Tem and the Governor in the coming weeks to develop an efficient, accountable investment program that is consistent with SB 375 by prioritizing projects that achieve maximum greenhouse gas reductions.”
Bill Higgins, Executive Director of the California Association of Councils of Governments (CALCOG). CALCOG is a member association of councils of governments and regional transportation planning agencies in California, which includes the state’s 18 metropolitan planning organizations responsible for SB 375.

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