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Home My WebLink About2010-08-24 Item No. 15CITY OF i/,c\ LADE (,`'jLSIri0 DREAM EXTREME REPORT TO CITY COUNCIL TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: ROBERT A. BRADY CITY MANAGER DATE: AUGUST 24, 2010 SUBJECT: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE SUPPORTING PROPOSITION 23 Background Proposition 23 is on the November 2, 2010 ballot for consideration by the voters of California. Passage of this proposition would temporarily reschedule the implementation of costly Green House Gas (GHG) regulations and requirements contained in Assembly Bill AB 32. Proposition 23 would not repeal AB 32 and the GHG reduction programs but would allow the programs to be implemented when the economy has improved. Discussion California already has the strictest air and water quality protection laws in the United States and Proposition 23 will not weaken those laws in any way. Proposition 23 is a measure that would temporarily re-schedule the implementation of GHG reduction programs until the economy has had a chance to recover and is able to fund the costly GHG programs without causing significant adverse economic impacts. This revised implementation process will provide employers with the needed opportunity to stabilize and build their workforces. It would also give cities and counties the opportunity to deliver essential services during these difficult economic times without the further burden of higher costs and reduced revenues resulting from AB 32. The attached fact sheet provides additional information regarding Proposition 23. AGENDA ITEM NO. 15 Page 1 of 8 Fiscal Impact There is no fiscal impact to the City associated with the adoption of this resolution. Recommendation It is recommended that the City Council adopt the attached resolution supporting Proposition 23. Prepared and Approved by: Robert A. Bradj City Manager Attachments Page 2 of 8 RESOLUTION NO. 2010-059 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LAKE ELSINORE, CALIFORNIA, IN SUPPORT OF PROPOSITION 23 WHEREAS, California's economy is still suffering from a severe economic recession with an unemployment rate of more than 12% with more than two million out of work; and WHEREAS, local governments are facing budget deficits and potential spending cuts as a result of reduced revenues due to the recession; and WHEREAS, California's global warming law (AB 32) would impose significant additional costs on California cities and counties, specifically an up to 60% increase in electricity rates, increased natural gas costs and increased transportation fuel costs; and WHEREAS, AB 32 would also burden many local governments with a new state-mandated fee on some local facilities such as waste-treatment plants, landfills, cogeneration facilities and other operations totaling several billion dollars; and WHEREAS, the increased costs resulting from AB 32 would reduce economic activity and result in more than one million lost jobs; and WHEREAS, the California Air Resources Board and others have determined that AB 32's higher energy costs and job losses will disproportionately impact low-income families and small businesses; and WHEREAS, the reduced economic activity resulting from AB 32 would reduce revenues to local governments and the state which could equal between $2.2 billion to $5.8 billion per year; and WHEREAS, according to the California Air Resources Board and other experts, the greenhouse gas emission reductions from AB 32 would have no measurable impact on global warming; and WHEREAS, the Proposition 23 would temporarily suspend AB 32 until such time as the economy recovers, specifically when the unemployment rate returns to 5.5% for four consecutive quarters; and WHEREAS, the Proposition 23 would be a prudent strategy for local governments to avoid higher costs and reduced revenues so that they would have more resources to dedicate for delivering vital public services; and Page 3 of 8 Resolution No. 2010-059 Page 2 of 3 WHEREAS, according to the independent Legislative Analyst, "During the likely suspension of AB 32, state administrative costs to develop and enforce regulations pursuant to AB 32 would be reduced significantly. We estimate that the resulting state administrative cost savings-and ultimately lower fees-could be in the low tens of millions of dollars annually;" and WHEREAS, according to the independent Legislative Analyst, "The suspension of the proposed cap-and-trade regulations could result in lower energy prices for consumers, including state and local government agencies that are large consumers of energy, than would be the case if AB 32 regulations were allowed to take effect. These lower energy prices, in turn, also would have positive economic impacts on the state;" and WHEREAS, the City of Lake Elsinore requests that the Southern California Association of Governments (SCAG) and the Western Riverside Council of Governments adopt similar resolutions of support for Proposition 23; and WHEREAS, the Proposition 23 does not have any impact on existing environmental laws in California. NOW, THEREFORE, the City Council of the City of Lake Elsinore, California, hereby endorses the Proposition 23 to temporarily suspend implementation of AB 32 (The Global Warming Solutions Act). PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Lake Elsinore, California, this 24th day of August, 2010. MELISSA A. MELENDEZ, MAYOR CITY OF LAKE ELSINORE ATTEST: CAROL COWLEY, CMC CITY CLERK Page 4 of 8 Resolution No. 2010-059 Page 3 of 3 APPROVED AS TO FORM: BARBARA ZEID LEIBOLD CITY ATTORNEY STATE OF CALIFORNIA COUNTY OF RIVERSIDE SS CITY OF LAKE ELSINORE I, Carol Cowley, Interim City Clerk of the City of Lake Elsinore, California, hereby certify that Resolution No. 2010-059 was adopted by the City Council of the City of Lake Elsinore, California, at a regular meeting held on the day of 2010, and that the same was adopted by the following vote: AYES: NOES: ABSENT: ABSTAIN: CAROL COWLEY INTERIM CITY CLERK Page 5 of 8 Page 6 of 8 VEOSON 24*3 011,) ' California Jobs Initiative A Much-Needed Safety Net for Cities and Counties Budget Crisis Already Hurting Cities and Counties-AB 32 Mandates Will Make it Worse. Local government leaders are well aware of the pain caused by the most severe economic crisis since the 1930s with more than 2 million people out of work, home foreclosures, reduced revenues and record high budget deficits. Now the state is proposing to add billions in new costs to implement AB 32 (Global Warming Solutions Act) despite warnings it will have no impact on global warming and will cause reduced economic activity, lost jobs and further reductions in state and local revenues. While Other States Exercise Fiscal Caution, California is on the Road to Billions in Higher Energy, Building and Infrastructure Costs Other states, including those engaged in the Western Climate Initiative, the federal government and nations across the globe are re-thinking their expenditures on greenhouse gas reductions, having recognized the need to protect jobs and rebuild rather than weaken their economies. California, on the other hand, is racing blindly toward implementing the most far-reaching and expensive new regulations in our state's history. AB 32-related costs include: • Up to 60% higher electricity costs (Source: Southern California Public Power Authority, representing Los Angeles Department of Water and Power, Pasadena, Burbank, Azuza, Banning, Cerritos, Colton, Glendale, Riverside, Vernon and the Imperial Irrigation District) • Increased gasoline and diesel costs of $3.7 billion a year. (Source: Sierra Research) • Increased costs of $50,000 for a new home. (Based on National Renewable Energy Laboratory estimates for the cost of a zero net energy home.) • Increased vehicle costs from $1,000 to $3,000.(Source: CARB and auto maker estimates) • A proposed AB 32 cap-and-trade auction tax of $143 billion between 2012 and 2020. (CARB, Economic and Allocation Advisory Committee), in the form of direct costs to some cities and indirect costs equivalent to as much as a 53 cent per gallon increase in the cost of gasoline • More than one million lostjobs (Varshney and Associates) AB 32 Usurps Local Control Locally elected leaders are the most familiar with the needs and resources of their communities, and best equipped to make decisions for the good of their constituents. AB 32 would shift local control to the state in such critical areas as: • Land use California Jobs Initiative 1215 K Street, Suite 2260, Sacramento, CA 95814 Phone: 866-247-09111 Fax: 916-329-74041 www.yeson23.com I info@veson23.com Yes on 23, California Jobs Initiative, a Coalition of Taxpayers, Employers, Food Producers, Energy, Transportation and Forestry Companies, with major funding provided by Valero and Tesoro. Page 7 of 8 • Transportation • Waste management • Building codes Municipal climate change policies would not be subject to the provisions of the California Jobs Initiative, so local leaders would retain the ability to develop and implement climate change policies that make sense for their communities. AB 32 = Higher Costs, Regulatory Confusion and Lost Revenues for Cities and Counties • The cost of reducing GHG emissions from municipal buildings, facilities, vehicles, wastewater, landfills and other government operations will require enormous expenditures by local governments. In addition higher energy costs will decrease economic activity, leading to lost jobs and reduced revenues for state and local governments. • AB 32's costs will come on top of federal regulations currently being developed, which could carry enormous price tags and possibly conflict with state GHG reduction requirements. Add to that the billions in increased obligations passed off by Sacramento to local governments as the state's persistent budget deficits make it impossible to sustain basic public services, and it's a recipe for municipal insolvency. Proposition 23 Will Help Us Recover While Keeping Key Environmental Protections Intact California already has the strictest air and water quality protection laws in the country, and Proposition 23 will not weaken those laws in any way. Nor would the measure repeal AB 32. It is a responsible measure that would temporarily re-schedule the onset of costly GHG reduction programs until the economy has a chance to recover (when the unemployment rate returns to 5.5 % for four consecutive quarters.) This prudent pause will give employers a chance to stabilize and grow their workforces and would give cities and counties the opportunity to deliver essential services during these difficult times without the further burden of higher costs and reduced revenues resulting from AB 32. Proposition 23 is a coalition of taxpayers, energy companies, local officials, food processors and others committed to saving jobs and protecting California's economy and includes among others: California Hispanic Chambers of Commerce; California Small Business Association; California Small Business Alliance; Silicon Valley Black Chamber of Commerce; National Tax Limitation Committee; California Taxpayer Protection Committee; Carson Black Chamber of Commerce; American GI Forum of California; California Manufacturers and Technology Association, California League of Food Processors; Lumber Association of California and Nevada; Howard Jarvis Taxpayers Association; California Poultry Association, Printing Industries of California; California Coalition of Filipino American Chambers; Southern California Rock Products Association; Santa Maria Valley Contractors Association, California Independent Oil Marketers Association (CIOMA); California Automotive Wholesalers Association; Chemical Industry Council of California; Los Angeles Regional Homeless Restoration Advisory Coalition; Alliance of Contra Costa Taxpayers; California Cotton Ginners and Growers Associations, Western Agricultural Processors Association, California Dairy Campaign, Fontana Hispanic. Chamber of Commerce, California Dump Truck Owners Association; Kern County Black Chamber of Commerce, American GI Forum Women of California, Kern County Taxpayers Association, Nisei Farmers League and California Citrus Mutual. Page 8 of 8