Environmental groups are pressing California lawmakers to include a multibillion-dollar climate resilience bond on the November 2024 ballot, as related funding faces probable cuts in the annual state budget.
Nearly 180 organizations have now signed on to a petition demanding that Gov. Gavin Newsom (D) and state legislators “pass a robust and equitable climate bond” for the public’s consideration in the upcoming elections.
“We have aligned to recommend $10 billion in investments that we view as the floor for California to continue making timely progress on its ambitious climate and natural resources commitments,” the groups stated, in a letter initially drafted in February but last updated in early June.
California, long a national leader on environmental issues, has set lofty targets for emissions reductions in the years to come as it continues to battle drought and wildfires driven by climate change. But the state appears on track to fall short of those goals, and is in the midst of a struggle to close a looming $45 budget deficit, an effort that will likely include significant cuts to climate measures for the second year in a row.
After California’s 2022-2023 budget included $54 billion for climate action over the next five years, about $3.1 billion of that sum was slashed last year. In a January budget proposal for 2024-2025, Newsom suggested $2.88 billion in climate-related cuts, adding $3.35 billion more in his May revision, the groups noted.
Stressing that “California’s future sits on the edge of a knife,” the petitioners warned state lawmakers that they risk “gambling with our children’s future and natural heritage found nowhere else.”
Bond financing in California is a mechanism for long-term borrowing through which the state raises money by selling bonds to investors — repaying those sums with interest in the future. Proposed versions of a ballot measures would put billions raised through bond sales toward helping gird the state against the changing climate in an effort to mitigate the impact of looming cuts.
From 1986 through 2020, Californians have voted in favor of issuing $178.787 billion in bonds and against issuing $33.092 billion, according to the California Legislative Analyst’s Office.
Among the nearly 180 groups that have signed the letter are the Environmental Defense Fund, Sierra Club California, The Pew Charitable Trusts, Audubon California, California Environmental Voters and the Asian Pacific Environmental Network.
“Californians are depending on their leaders to have climate courage, not wave the white flag,” Melissa Romero, Deputy Legislative Director of California Environmental Voters, said in a statement. “Voters need a chance to support a robust, equitable climate bond.”
Lawmakers have a deadline of June 27 to add bond measures to the November ballot. Meanwhile, Newsom and his legislative colleagues have only until July 1 to negotiate the final terms of their annual spending plan.
Discussions have come to a standstill on two similar, climate-oriented bond proposals: AB 1567, introduced by Assemblymember Eduardo Garcia (D) in February 2023, and SB 867, introduced around the same time by State Sen. Ben Allen (D).
The former would have authorized the issuance of $15.995 billion in bonds for projects related to drinking water, fire prevention, drought preparation, flood defense, extreme heat mitigation, clean energy and workforce development, per the bill.
The latter would have supported $15.5 billion in bonds to finance initiatives related to extreme heat mitigation, biodiversity, nature-based solutions, climate-smart agriculture, park creation, outdoor access and clean energy, as well as drought, flood, water, coastal, forest and wildfire resilience.
As the end-of-June ballot measure deadline approaches, negotiations within the legislature are reportedly ongoing, as lawmakers weigh how they might combine and trim the two proposals.
The Assembly was reportedly considering three versions that ranged from $6 billion to $10 billion, while the state Senate was looking at two options from $6.8 billion to $9 billion, according to two spreadsheets originally surfaced by Politico.
While neither Allen nor Garcia could speak to the details of the negotiations, Allen stressed the need “to be careful about how we craft it, both in terms of its scope and also its size.”
“This is a challenging time financially for the state, so we certainly want to make sure that it’s sized in a way that’s responsible, that’s going to maintain market credibility,” Allen told The Hill.
Garcia last week told the Los Angeles Times that negotiators were leaning toward $9 billion, while explaining to KQED that cuts “would allow us to stay the course.” Speaking to CalMatters, Garcia described the bond as “a can’t-miss opportunity” for closing funding gaps.
Asked whether he still maintained that $9 billion estimate, Garcia told The Hill that he and his Assembly colleagues worked on a $9 billion “proposed draft of priorities,” and that they are currently having a “conversation” with their state Senate counterparts.
Acknowledging that this is “a significantly different bond” than the one he originally introduced, Garcia expressed optimism that the legislators would come to an agreement despite the tight deadline.
But the question remains whether voters will have the appetite for borrowing billions and billions of dollars in bonds.
Lawmakers had previously intended to place tens of billions in bonds on the November 2024 ballot related to a variety of issues and sectors. But those intentions cooled after a $6.4-billion measure — aimed at supporting homeless and mentally ill individuals — only passed narrowly in the March primary with 50.18 percent of the vote, the Los Angeles Times reported.
The Public Policy Institute of California on Friday reported that 34 percent of residents recently surveyed described now as a “good time” to issue bonds for state programs and infrastructure projects, while 64 percent said that this is a “bad time.”
Allen was not discouraged by those results, noting that “it’s hard to feel good about just generic extra spending, if you have no idea what it’s for.”
Rather, he explained, people tend to become more interested when they understand that a particular investment could “help ensure that the future of the state will be a little brighter, people get more interested,” according to Allen.
“We’re focused on clean water and fire resiliency — all the kinds of things that are going to help make life better in the state in the future,” he said.
Garcia echoed these sentiments, identifying the need “to be very specific with voters, so that they get a really good understanding of what it is that they might be seeing.”
“Every California has experienced some type of climate impact,” he said, citing a range of effects from property damage to daily life disruptions.
While the lawmakers have signaled that the final bill will include a sum much lower than originally intended, the nearly 180 environmental organizations — dubbed the “climate bond coalition” — are petitioning for the full $10 billion.
They are also not the only voices that have been pressing for a robust climate bond’s passage: so, too, are water and renewable energy interests.
The Association of California Water Agencies described the state as being “underprepared to manage a water system with decreasing snowpack, less frequent precipitation and weather extremes.”
“State investment in water infrastructure is crucial to providing the reliable delivery of water,” the association, which represents public water agencies across the state, said in a policy document.
The top priorities highlighted by the agencies are improvements in dam safety and reservoir operations, as well as water recycling and desalination facilities.
Offshore Wind California, a coalition of industry partners, is requesting bond funding for port infrastructure, stressing that such facilities are needed to maintain floating wind structures.
“No single port will be able to serve all the needs of the offshore wind industry,” the group wrote.
Garcia emphasized the need to improve water infrastructure and wildfire protection and prevention, while also strengthening nature-based solutions, agriculture and community resilience.
Allen, meanwhile, added that the bill must “be driven by where the public and our in our experts see the greatest need.” That public perspective, he continued, routinely returns to the issues of clean water and wildfire resilience.
“When you float a bond, you’re basically saying that future taxpayers and budgets should help to pay for investments that we’re putting in place over the next few years,” Allen said.
“Will people 30 years from now feel good about helping to pay for these investments that we put in place today?” he asked. “That has to be our guiding principle.”