Buildings emissions bill faces cutoff; a soda tax gets a hearing

Carlyle floats a new version of cap-and-trade after pushback from environmental justice advocates

Today is fiscal cutoff day, on which most bills with any kind of cost to the state need to clear House Appropriations or Senate Ways And Means. Both committees have long agendas that include some high-stakes bills. Like the policy committee cutoff we wrote about last week, it’s festival of influence and pressure, with lawmakers scrambling to get their bills out of committee and high-priced lobbyists using tactics ranging from blatant strong-arming to subtle gamesmanship 

Among the proposals drawing heavy influence is House Bill 1084, which is what’s left of Gov. Jay Inslee’s proposed Healthy Homes and Clean Buildings Act, an aggressive plan to require buildings to be zero-carbon by 2030 move toward eliminating fossil fuels — mostly natural gas — from existing buildings by 2050. Buildings produce about 20 percent of the state’s emissions.

It ran into a buzz-saw of opposition from gas companies, the construction industry, and most crucially, several unions who represent workers who install and maintain gas lines. Fewer gas lines means fewer laborers putting pipes in streets, and fewer buildings plumbed for gas means fewer plumber and pipe fitters. Proponents argue that the shift to electrification would create many new jobs in fields such as installing heat pumps.

This kind of work could become a thing of the past.

The bill was substantially scaled back as it left the House Environment and Energy Committee, but not enough to mollify the unions, so things could get dicey today.

The sticking point is an idea called “just transition,” which is basically what would be done to cushion the impact on all the individual people in hard hats who currently work on the gas systems. Because creating a bunch of new jobs for electricians doesn’t necessarily do anything for them.

As a reminder, there’s a giant loophole in the cutoff calendar for bills deemed necessary to implement the budget, which certainly includes any tax increases, and can theoretically be invoked for anything with a major price tag.

Which is why there’s a hearing on a soda tax

For an object lesson in that calendar loophole, look no further than Senate Bill 5371, which is getting its first hearing of any kind this morning in the Senate Health and Long Term Care Committee 

The bill, sponsored by state Sen. June Robinson, D-Everett, who is also sponsoring the capital gains tax proposal we wrote about last week, would impose a 1.75 cent-per-ounce tax on sugary drinks, or 21 cents on a 12-ounce can. Taxing soda and other sugary beverages is a favorite of progressives in the public health sphere, who argue the drinks increase the risk of heart disease, high blood pressure, type 2 diabetes and tooth decay, especially among low-income people and communities of color. Currently in Washington, only the city of Seattle imposes such a tax.

Proponents say the tax would raise $221 million per year. Sixty percent of the money would be dedicated to health equity, while 40 percent would go to the larger public health system. Beefing up the public health system is a popular idea this year, given the pandemic.

But his is straight-up picking a fight with Big Soda, which is not known for bringing a knife to a gunfight. Less than three years ago, Coke, Pepsi et al spent $21 million to pass Initiative 1634, which prevents cities from following in Seattle’s footsteps to tax sugary drinks at the local level. With only token opposition campaign, the measure passed with 56 percent of the vote. 

And way back in 2010, the industry spent $16 million on a ballot initiative to roll back a soda tax, along with a tax on candy, that had been passed by the Legislature. That measure, Initiative 1107, passed in 2010 with 60 percent of the vote. 

After pushback from environmental justice activists, Carlyle tightens up cap and trade

Senate Energy, Environment and Technology Chair Reuven Carlyle rolled out a new version of his proposal to cut carbon emissions in Washington State late last week, in a bid to address the concerns of environmental justice advocates who argue that it doesn’t do enough to help communities who have been hurt the worst by pollution in the past.

Carlyle’s bill, Senate Bill 5126, or, more grandly, the Climate Commitment Act, is a form of the cap-and-trade approach to cutting emissions. The emissions that major polluters produce are capped, and the state auctions off the right to pollute under the cap, bringing in hundreds of millions of dollars for the state each year. Companies can buy and sell those rights to keep polluting, creating a marketplace that incentivizes them to pollute less.

Environmental justice advocates argue that system, which has been in place in California for years, drives pollution to places where it’s cheapest to produce, and allows polluters to buy the right to keep poisoning vulnerable neighbors. 

Among other things, the new version requires the Department of Ecology to conduct environmental reviews to make sure that pollution is reduced in overburdened communities, and to make sure that a large share of the money raised by the program provides “direct and meaningful benefits” to those communities.   

As we wrote a while back, a schism has emerged between cap-and-trade supporters and lawmakers who back an economy-wide carbon tax that would raise more money to address environmental justice concerns. Thus far, that proposal hasn’t made much progress, although the money from one or the other is baked into massive transportation spending packages under consideration in both the House and the Senate.

The new version of Carlyle’s bill also considerably reduces the burden of the program on electrical utilities, who are already under a separate mandate to decarbonize much of their power production. 

The biggest targets of any carbon pricing scheme are the state’s five oil refineries, which produce most of the fuel burned by cars and trucks in Washington. The tailpipes of those vehicles are collectively the largest source of carbon pollution here. The problem, of course, is that a lot of the money will come out of the wallets of ordinary Washingtonians in the form of higher gasoline prices.

Voters rejected other forms of carbon taxation in 2016 and 2018 after the oil companies spent millions arguing that the proposals would drive up the costs of fuel. The committee is scheduled to vote on the bill on Thursday.

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