Editorial: California lawmakers are turning cap-and-trade into the slush fund critics long feared

State senators discuss the 2019-2020 state budget in Sacramento on June 13.
(Rich Pedroncelli / Associated Press)

For years, critics of California’s cap-and-trade program have lambasted it as a government slush fund. They say that politicians are able to dip into it to fund their pet projects or raid it to fill the shortfall of the moment — as long as they can assert a mildly credible connection between the spending and the state’s ambitious goals to fight climate change.

Well, California lawmakers are about to prove those critics right.

As part of the budget negotiations, lawmakers shelved Gov. Gavin Newsom’s controversial “water tax” that would have raised $140 million a year to help low-income communities finally clean up their contaminated water systems.

Instead, lawmakers plan to fund the much-needed water cleanups with $100 million a year in cap-and-trade dollars — money that is paid to the state by polluters and which is legally required to be spent on projects to reduce the greenhouse gases responsible for global warming.


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So how do leaders justify using cap-and-trade dollars for water cleanups? Newsom’s office said that communities with tainted water need bottled water delivered in trucks that pollute the air. If the water supply is cleaned, that will reduce vehicle emissions.

By that ludicrous logic, California could pay for expanded Medi-Cal benefits with cap-and-trade dollars too, because if people have preventive healthcare, they’ll get sick less and drive to the hospital less and produce fewer greenhouse gases.

There is no question that the state needs to put up significant money to help pay for the infrastructure necessary for safe drinking water. Because of environmental degradation and industrial pollution, thousands of Californians — especially in low-income communities in the San Joaquin Valley — can’t drink a glass of tap water, brush their teeth or even take a shower without risking sickness. It’s a Third World problem in the world’s fifth-largest economy.

The Times supported the proposal to create a Safe and Affordable Drinking Water Fund and to pay for it with a 95-cent-per-month charge on residential water bills, along with new fees on dairies and feedlots. But that was a no-go with legislators, who worried that voters would rebel against a water tax, especially when the state has a $21.5-billion budget surplus.

Instead, they found an easier solution: Just take cap-and-trade dollars.

But cap-and-trade dollars are for projects that really reduce greenhouse gas emissions, such as replacing dirty diesel engines or capturing methane pollution from dairies. Lawmakers undermine public trust in — and public support for — the state’s climate program when they divert that money to other needs.


What’s more, the state will have to struggle to meet its ambitious goals to slash greenhouse gas emissions to 40% below 1990 levels by 2030. The changes necessary to dramatically shrink the state’s carbon footprint will be be extremely costly, and will be seen and felt by Californians in their homes, their jobs, their utility bills and their communities. The state needs every cap-and-trade dollar it has to fight global warming.

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