California Budget Deal on Cap and Trade Program Reached : Transportation Comes Out on Top


Today the Legislature put forward an agreement for how to spend AB 32 Cap and Trade revenues for Fiscal Year 2014-15, as well as an expenditure plan for future years. Policy in Motion whipped up a quick reader’s digest on The Good, The Bad, and The Beautiful:

The Good:

  • For the first year of the program’s funding (2014-15), transportation-related programs will receive over 70% of the $872 million allocated.  This includes $250M for High-Speed Rail; $25M for Transit and Intercity Rail Capital Program; $25M for Low Carbon Transit Operations; $65M for Affordable Housing; $65M for Sustainable Communities; and $200M for Low Carbon Transportation.
  • For future years (beginning in 2015-16), SB 375 related programs will receive 35% of cap and trade revenues on a continuously appropriated basis.  This includes 10% for Transit and Intercity Rail Capital Program (administered by Caltrans and CTC); 5% for Low Carbon Transit Operations (via State Transit Assistance formula); 10% for Affordable Housing; and 10% for Sustainable Communities.
  • Additionally, the High Speed Rail Authority will receive 25% of continuously appropriated funding for the construction of the High Speed Rail.

The Bad:

  • Misses the opportunity for a competitive process to get the best projects on the ground and encourage innovation – which is really at the heart of this market-based economic approach of doing a cap and trade program.
  • Does not consider the cost of how much GHG reduction we can get per dollar spent – though it seems like a lot of money, the reality is we only have a limited amount of dollars to ensure that California meets its AB 32 greenhouse gas reduction goals.
  • No dedicated funding for active transportation – bicycling, walking, and the land use patterns necessary to facilitate bikable and walkable communities is vital for any comprehensive transportation funding program.
  • No dedicated funding for street maintenance – as we invest in new transit buses and promote urban infill development maintaining a basic state of good repair is not only necessary for the cars and buses using urban roads but is a vital piece of complete and safe streets as bicyclists and pedestrians also are users of pavement.

……And the Beautiful:

  • Now that we have funding allocated for sustainable communities we need to look forward toward working with the Administration to develop guidelines that will grow beautiful communities through “people-oriented development.” We must keep this vision through the implementation process of revenue allocation from the AB 32 cap and trade program.

Lauren Michele, Principal/Founder, Policy in Motion.

Lauren earned a Master’s of Science degree from the UC Davis Institute of Transportation Studies after working as a transportation planning professional at Fehr & Peers, a climate change policy analyst at the Center for Clean Air Policy in Washington D.C., and an air quality program assistant at the Sacramento Metropolitan Air Quality Management District.  At the UC Davis Urban Land Use and Transportation Center (ULTRANS) she focused on the links between California’s Senate Bill 375 and developing federal climate/energy legislation and the transportation reauthorization.  Her academic work includes teaching undergraduate courses in Transportation Policy at UC Davis and experiential learning while living and researching multi-modal transportation planning in Europe.

Lauren currently serves as Policy Director for the Transportation Coalition for Livable Communities — an organization which includes the California Alliance for Jobs, California Transit Association, National Resources Defense Council, League of California Cities, State Association of Counties, and the Metropolitan Planning Organizations and Councils of Governments throughout the state. The Coalition promotes the investment of cap and trade revenue to address both the greenhouse gas reduction goals of AB 32 and critical transportation system maintenance and operation needs that build on the framework of SB 375 and other GHG reduction strategies.

Her firm, Policy in Motion, specializes in sustainable transportation policy.  Policy in Motion offers planning practitioners, policy makers, and public agencies an understanding of how to integrate sustainability policy into transportation infrastructure and land use decisions.  Lauren Michele’s 2011 book, “Policy in Motion: Transportation Planning in California after AB 32” explores the State’s evolving policies for sustainable living through transportation planning, and identifies how outdated regulatory frameworks must be aligned with supporting paradigm shifts if California is to move forward in a truly unified vision for “People-Oriented Development” and transportation.  Lauren’s 2012 film documentary, “Policy in Motion: Growing Beautiful Communities” continues to explore how an integrated approach to transportation planning and funding based on “People-Oriented Development” (POD) can improve community quality of life while meeting California’s environmental and economic goals. Policy in Motion’s book and film are available for purchase on-line at Barnes & Noble, Amazon, and


By Lauren Michele

Lauren Michele – Founder/Owner of Policy in Motion – is a policy consultant/advisor and communications strategist, specializing in progressive and non-partisan politics. She helps candidates and clients build campaigns, coalitions, and communication strategies. Lauren has 15 years of experience working with federal, state, and local government agencies; non-profit organizations; foundations; universities; and political/issue campaigns, including a Presidential Campaign and a California State Bond. Ms. Michele has over a decade of experience working virtually both in team and individual environments, with Policy in Motion offices in California. Policy in Motion’s mission is to promote the environmental, economic, and social well being of communities —fostering a sustainable future for all people and the planet.

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