California Air Resources Board

Urgency bill enacting various policies related to electrical corporations, including authorizing public financing and ownership of electric transmission infrastructure; addressing wildfire mitigation spending and financing; liability of wildfire property claims; permitting of clean energy projects; transparency of electrical corporations’ return on equity; enforcement of timeliness of energization projects; prohibitions on large electrical corporations from including in their equity rate base an additional $6 billion of wildfire mitigation capital expenditures.

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Extends the current January 1, 2026, sunset date for the California Alternative Energy and Advanced Transportation Financing Authority’s sales and use tax exclusion program to January 1, 2028, adds fusion energy as an eligible alternative source, and modifies the stated purpose of the program to promote high-quality jobs and ensure that California communities and workers benefit from projects receiving financial assistance under the program.

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Requires the  Natural Resources Agency (CNRA) to develop strategies to reduce barriers and increase support for stewardship of conserved lands and collaborate with stakeholders, California Native American tribes, and relevant state agencies to prepare a section on stewardship as part of the 2027 annual report on progress made toward achieving the 30x30 goal, which the bill requires to include, among other things, recommendations to increase and improve stewardship of 30x30 lands, including innovative ways to reduce barriers and increase federal, state, and local support for stewardship, as specified. The bill would require the update to be posted on the agency’s internet website. 

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Specifies thermal energy storage for multiple existing financial incentive programs administered by the California Energy Commission and the California Infrastructure and Economic Development Bank relating to industrial decarbonization. CARB is in a consultation role. The bill places additional requirements on program participants such as mandating project labor agreements and establishing a community benefits fund or agreement.

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Adds a definition for "certified reclaimed refrigerant" in California statute to clarify the previous reference to the United States Environmental Protection Agency definition of “reclaim” in Section 84.3 of Title 40 of the Code of Federal Regulations. Under the new definition, “certified reclaimed refrigerant” means recovered refrigerant that meets four specific criteria based on CARB's Hydrofluorocarbons (HFC) regulation, which includes that it is reclaimed, has been analyzed to meet specifications, and is documented by a certified reclaimer to contain no more that 15% new refrigerant. The bill also delays the prohibition on new HFCs used exclusively for very low temperature refrigeration or cooling until 2028, as specified.

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Prohibits State agencies and local governments from adopting or enforcing a rule, regulation, resolution, or ordinance that directly or indirectly results in prohibiting the use of gas appliances in residential or nonresidential buildings, and the buying, selling, or use of gasoline-powered vehicles or equipment. Was not heard in the Assembly Utilities and Energy Committee.

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Extends a number of timelines in the process of determining regional housing needs, regional housing needs allocations, and housing element revisions, and requires the Department of Housing and Community Development to provide specific analysis or text to local governments to remedy deficiencies in their draft housing element revisions.

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To the Members of the California State Assembly:

I am returning Assembly Bill 650 without my signature.

This bill would require the Department of Housing and Community Development (HCD), if it finds that a draft housing element is deficient, to provide the specific analysis and the draft text that should be included in the jurisdiction's housing element.

I share the author's interest in improving the housing element process. In partnership with the Legislature, we have enacted numerous reforms to strengthen this process by demanding more rigorous site inventories, enforceable rezoning, and stronger accountability mechanisms to uphold state law.

Although intended to build on these recent efforts, I am concerned that this bill would inappropriately shift responsibility for preparing housing elements from local jurisdictions to HCD. While HCD provides technical assistance when requested and in response to inadequate housing elements, that support is no substitute to the local government's fundamental responsibility to plan for its share of housing needs. Further, shifting these duties to the state would add at least $11 million in new annual costs.

Housing element law has advanced considerably through recent legislation, much of which is now being implemented in the current planning cycle. As these changes take hold, it is critical to preserve the fundamental structure of local planning responsibility under state oversight. However, I look forward to continuing to work with the Legislature on additional opportunities to further improve this process.

For these reasons, I cannot sign this bill.

Sincerely,

Gavin Newsom

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Prevents CARB or local air district regulations with restrictions on oxides of nitrogen emissions from gas-fired appliances from applying to appliances that would be installed with a propane conversion kit. Was not heard in the Assembly Natural Resources Committee.

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Authorizes the California Independent System Operator (CAISO) and the electrical corporations whose transmission is operated by the CAISO to use voluntary energy markets governed by an independent regional organization, provided that specific requirements are met. This is an energy market expansion bill creating greater opportunity for renewable energy to be bought and sold. Requires greenhouse gas information and protocols be sufficient to enable compliance with the requirements of any State agency.

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Allows a local jurisdiction to count organic material used as a beneficial agricultural amendment towards its recovered organic waste procurement target under SB 1383 (Lara, Chapter 395, Statutes of 2016) if the material is processed at a facility authorized by the Department of Recycling and Resource Recovery using approved technologies and if the beneficial agricultural amendment is licensed for end use as an agricultural fertilizer by the Department of Food and Agriculture. Was not heard in the Assembly Natural Resources Committee.

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