California Air Resources Board

Allows California gas corporations to include renewable natural gas interconnection in their rate base investments. Adds a provision regarding the displacement of conventional natural gas reducing greenhouse gas emissions as a potential eligibility element for California biomethane. Was not heard in the Senate Energy, Utilities, and Communications Committee.

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Has a variety of provisions regarding California’s gasoline specification, including allowing the Governor to suspend specification requirements in certain conditions and requiring the California Energy Commission (CEC)to assess alternative specifications, evaluate the possibility of a western region gasoline specification, and recommend strategies to support the state’s fuel transition. The bill also has provisions to improve oil and gas facility safety, including requiring more public input for the Department of Fish and Wildlife’s Office of Spill Prevention and Response to solicit and incorporate public input on worst case oil spill volumes and financial responsibility requirements and requiring testing for idle oil pipelines and use of best technology for onshore transport of offshore oil. Additionally, the bill allows increased oil extraction in Kern County but prohibits new production in health protection zones.

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Summary

Would have expressed the intent of the Legislature to enact legislation that would further support California’s efforts to decarbonize the built environment. Remains at the Assembly Desk.

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Summary 

Would have prohibited CARB from requiring the San Francisco bar pilots, serving the bays of Monterey, San Francisco, San Pablo and Suisun, to replace a pilot station boat before the end of the boat's useful life. CARB’s Commercial Harbor Craft regulation requires an earlier implementation date for the pilot vessels. The bill would have required the useful life to be between 25 and 35 years from the date the boat was commissioned and be determined by CARB in consultation with the Board of Pilot Commissioners and an accredited marine surveyor.

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Governor’s Veto Message

To the Members of the California State Assembly:

I am returning Assembly Bill 1296 without my signature.

This bill would prohibit state regulations, namely the Commercial Harbor Craft (CHC) regulation, from requiring the San Francisco Bar Pilots to replace pilot station vessels with lower-emitting vessels, unless such a regulation authorizes its replacement at the end of the vessel's useful life, prescribed as between 25 and 35 years.

In 2020, I issued Executive Order (EO) N-79-20, which directed the California Air Resources Board (CARB), among other things, to develop strategies to transition to 100 percent zero-emission off-road vehicles, vessels, and equipment by 2035, where feasible.  Under this EO, CARB amended the CHC regulation to accelerate emission reductions while providing safe, feasible, and flexible compliance options for affected vessels, including compliance extensions of up to six additional years for pilot station vessels beyond the compliance dates of December 2024 and December 2025.

While I recognize the challenges of adopting new technologies, California must work diligently to reduce air pollution that fouls our air and greenhouse gas emissions that contribute to our rapidly changing climate.  In addition, this amendment to the CHC rule would require CARB to resubmit its request for authorization to the U.S. Environmental Protection Agency (U.S. EPA) - a step that would delay the U.S. EPA's final decision and undo months of work.  Delays in receiving that federal authorization would deprive local communities of the substantial public health benefits associated with the regulations and compromise the State's ability to meet our federally mandated air quality standards.

For these reasons, I cannot sign this bill.

Sincerely,

Gavin Newsom

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Summary

Expresses the intent of the Legislature to enact legislation that would further support California’s efforts to decarbonize the built environment. Remains at the Assembly Desk.

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Summary

This bill will would require prior to installation and use, any equipment installed on a commercial harbor craft that interacts with the propulsion system of the craft to be approved for use with the propulsion system, as specified. The bill would require equipment to include an automatic override or bypass feature that ensures continued power to, and operation of, the craft. The proposed legislation would require that “any equipment installed on a commercial harbor craft that interacts with the propulsion system of the craft” need to be approved by the U.S. Coast Guard (USCG), a classification society, and propulsion system manufacturer, and include a bypass feature. Was not heard in the Assembly Transportation Committee.

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Summary

Would have exempted vehicles from smog check requirements if they have a special license plate issued pursuant to section 5004 of the Vehicle Code. In order to meet the specifications of the aforementioned Vehicle Code, a vehicle would have needed to meet one of the three following requirements: Be (1) A motor vehicle with an engine of 16 or more cylinders manufactured prior to 1965, (2) A motor vehicle manufactured in the year 1922 or prior thereto, or (3) A vehicle which was manufactured after 1922, is at least 25 years old, and is of historic interest. Was not heard in the Assembly Transportation Committee.

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Summary 

Would have expanded the regulation of intrastate pipelines to pipelines used for the transportation of carbon dioxide. The bill would have exempted intrastate gas pipelines regulated by the Public Utilities Commission and required the State Fire Marshal to adopt regulations no later than January 1, 2025, that establish procedures for maintaining, testing, and inspecting valves on intrastate hazardous liquid and carbon dioxide pipelines. Was not heard in the Assembly Natural Resources Committee.

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Summary

As related to CARB, revises pilot boat surcharge provisions, including specifying that the costs of obtaining new pilot boats for the purpose of complying with CARB’s 2022 amendments to the Commercial Harbor Craft Regulation include preliminary design and engineering and the costs of repowering existing pilot boats or acquiring new pilot boats.

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Summary 

Would have converted the current General Fund (GF) sales and use tax (SUT) partial exemption for the purchase of manufacturing equipment into a full exemption by exempting the local and district portions of the existing SUT to incentivize manufacturing within the State. The full exemption would have commenced on January 1, 2023, and end on January 1, 2028, at which time the partial exemption would have been re-instated through 2030. As related to CARB, this bill would have maintained the annual transfer of specified moneys dedicated to backfilling the manufacturing SUT exemption from the Greenhouse Gas Reduction Fund to the GF.

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Governor’s Veto Message

To the Members of the California State Assembly:

I am returning Assembly Bill 1951 without my signature.

This bill replaces the current partial manufacturing sales tax exemption with a full exemption until January 1, 2028. This change would result in substantial revenue loss to local governments, which impacts essential health, safety, welfare, and transportation services. Assuming there are no changes in taxpayer behavior, local agencies are estimated to lose over half a billion dollars each year.

As a strong supporter of California 's business climate and manufacturing industry, I agree with the intent of this bill to invest in California's economy, incentivize innovation, and spur a manufacturing marketplace that is competitive nation-wide. However, we cannot ask our local governments to bear this loss in revenue.

With our state facing lower-than-expected revenues over the first few months of this fiscal year, it is important to remain disciplined. The Legislature sent measures with potential costs of well over $20 billion in one-time spending commitments and more than $10 billion in ongoing commitments not accounted for in the state budget. Bills with significant cost pressures, such as this measure, should be considered as part of the annual budget process. For these reasons, I cannot sign this bill.

I look forward to working with the Legislature and stakeholders to propose something on this topic next year.

Sincerely,

Gavin Newsom

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