Newsom’s Proposed California Budget: What Does It Mean for Climate Equity?


By Emi Wang, Alvaro Sanchez,

Californians know that climate change is here, climate change is real, and climate change is the biggest threat to our planet’s future. Less known but recently more proven is that racist and discriminatory policies of the past, like redlining, have locked in pollution exposure among low-income communities of color and dramatically increased their climate-related risks. At Greenlining we know that fighting climate change means we must also fight the policy and economic structures that make low-income communities more vulnerable to climate change and less capable of addressing the challenge on their own. To make equity real in our climate fight we must meaningfully prioritize their needs and ensure we achieve direct, meaningful, and assured benefits to priority communities

In Governor Newsom’s recently announced Climate Budget proposal we see just how seriously California takes fighting climate change. The Governor proposes to invest over $12 billion in a span of five years under a strategy that seeks to mitigate the risks of climate impacts while also reducing greenhouse gases. 

The budget proposal includes several new approaches to resourcing California’s climate fight that many of us have championed for years and we are excited to explore their opportunities. Taken as a whole, however, the proposal falls short of meaningfully advancing equity and making the transformative investments necessary to comprehensively address climate change impacts in priority communities. We are eager to begin working with the governor’s team, the Assembly and the Senate to deliver a Climate Budget that fully addresses poverty and pollution at the same time. 

There is a lot to say about the governor’s proposal, the first move in a multi-month process culminating in approval of California’s budget to fight climate change for fiscal year 2020-2021. In this blog we focus on  the budget proposal’s top four takeaways for climate equity. 

#1: Gov. Newsom Proposes an Integrated and Comprehensive Climate Budget

This year’s proposal combines the Greenhouse Gas Reduction Fund , a Climate Resilience Bond, a Climate Catalyst Fund, General Fund One-Time Investments, General Fund Ongoing Expenditures, Existing Bond and Special Fund Expenditures to deliver a $12,483 billion investment strategy over five years to fight climate change.

This contrasts with previous budget proposals that focused almost exclusively on the GGRF and did not seek multi-year investment strategies, making this year’s proposal significantly bigger in size and scope. The proposal incorporates several strategies that advocates have called for over several years, including a multi-year funding strategy, a favorable financing revolving loan fund, and a dedicated funding source for climate resilience and adaptation. Governor Newsom’s strategy opens up potential opportunities and could significantly increase the available resources to fight climate change. 

At the same time, however, because this is a more comprehensive and long term approach, California must ensure that the strategy does not leave important equity approaches out or lock in strategies with undeveloped equity design. While these numbers are significant, it’s worth digging deeper to see whether these investments direct meaningful resources toward the most under-resourced communities.

#2: Climate Budget Needs a More Robust Equity Strategy Across the Board

While the governor’s proposal makes important investments that have the potential to advance equity, it is also missing an overall equity strategy, and we have questions about the new mechanisms that must be addressed before the Climate Budget is finalized.

For the past several years, California has made real equity gains via climate policy and investments. In coalition with our partners and allies, we have worked since 2012 to meaningfully embed equity into the GGRF, one of the approaches included within Gov. Newsom’s budget proposal. This work has resulted in equity legislation, targeted funding and robust guidelines. In January 2019, the California Air Resources Board released its Third Investment Plan, a document guiding future investment priorities, and called for California to deepen its commitment to technical assistance and capacity building, community-led transformations, coordinated and comprehensive strategies, and equity. Making equity real in the GGRF looks like:

  • Targeted investments in priority communities: Starting with SB 535 (De Leon, 2012) and followed by AB 1550 (Gomez, 2016), 35 percent of the GGRF must be invested in our state’s priority communities that are disproportionately impacted by poverty and pollution. It’s only appropriate to target investments to those communities that have borne the brunt of discriminatory policies and which are now most vulnerable to the impacts of climate change. 
  • High road equity guidelines: We’ve worked with individual agencies to craft program guidelines that require high equity standards. Many grant programs now require that investments be community-driven, reflective of priority community needs, produce multiple environmental, public health and economic benefits, and avoid substantial burdens. Some programs have been developed in their entirety with an equity lens, such as Transformative Climate Communities, Clean Cars for All, and Clean Mobility Options to name a few. Without these guidelines and programs, we know that these investments simply would not meet the needs of frontline communities and might actually harm them.
  • Technical assistance and capacity building: We commend the governor’s proposal for funding the implementation of SB 1072 (Leyva, 2018) Regional Climate Collaboratives, a program that seeks to address the capacity and technical assistance gaps in underserved communities. We know grant funding alone is not enough, because frontline communities frequently have the least resources and capacity to compete for climate funding. That’s why programs within the GGRF are starting to provide technical assistance to ensure that all communities have equitable opportunity and access to the resources that lead to local transformations. This work is uneven and far from perfect, but we hope that funding the Regional Climate Collaboratives will make significant progress towards helping local stakeholders across the state address climate change and equity goals.
  • Outreach: For communities to benefit from climate resources, they first have to know they exist. Over the course of several years, the agencies administering GGRF funding have coordinated outreach about the full suite of their programs, to ensure that information about climate investments reaches the communities and individuals who need it the most.
Gov. Newsom’s comprehensive Climate Budget proposal should build upon GGRF’s foundation, but we’re left with more questions than answers on how equity is meant to show up in the entire proposal. Beyond what’s taken years to build within the GGRF, the budget proposal appears to lack the robust equity infrastructure that we know is needed to deliver meaningful benefits to priority communities. In the non-GGRF funding mechanisms of the Climate Budget we notice:
  • Zero targeted investments in priority communities: There is zero mention of numbers or percentages targeted to the most under-resourced communities. This is extremely concerning. We know that without targeted funding, the wealthiest and most prepared communities will be first in line for available resources, and the most polluted and most vulnerable communities will be left behind. 
  • Agencies with little equity background: We know that some agencies we’ve worked with on GGRF funding know how to make equity real in how they do things, but we have questions about whether some of the agencies designated in the budget proposal to manage significant climate funding have that same commitment and experience. For example, the Infrastructure Economic Development Bank is proposed to manage the $1 billion Climate Catalyst Fund. Does iBank have the tools needed to ensure that loans will be available to low-income businesses and workers?
  • Uneven technical assistance and capacity building: There’s a lack of emphasis on the kinds of technical assistance and capacity building that would better address community needs and result in projects that provide community benefits. The Catalyst Loan Fund needs to make a commitment to fund technical assistance and capacity building for small businesses that require this help even to benefit from the loan fund itself. We are also interested in learning more about the technical assistance provisions within the Climate Resilience Bond, which allocates $25 million over five years to community planning. 
  • No Outreach Approach: It’s taken years for the GGRF to build up its outreach and education infrastructure, to spread the word about these important climate programs. Gov. Newsom’s budget proposal, by contrast, doesn’t offer any indications of if or how the administration might be thinking about building an outreach approach to reach frontline communities. 

Gov. Newsom’s budget strategy has an opportunity to build upon the equity infrastructure already created through GGRF and can invest more significantly in transformative, community-led change. We encourage his administration to leverage the tremendous wealth of environmental justice and equity expertise available in California and not develop this important budget strategy in a vacuum. We all want to see this robust package of climate investments succeed and we all want to ensure the strategy advances climate equity in meaningful ways. 

#3: We Need to Invest in the Programs We Know Work for Equity

We need to invest in the programs that we know work--the most forward-facing programs that are driven by community leadership and that provide the most equitable outcomes to frontline communities. Unfortunately, here too, the governor’s budget proposal falls short. It significantly cuts programs that have built an equity infrastructure over the past several years, that center the leadership of impacted communities, and that provide multiple direct environmental, health and socioeconomic benefits. 

Greenlining supports the following budget allocations for programs that fight climate change, invest in community leadership and build community resilience:

  1. $100 million for Transformative Climate Communities (zeroed out in the governor’s proposal)
  2. $100 million for Low Carbon Transportation Equity programs ($75 million in the governor’s proposal)
  3. $75 million for the Low-Income Weatherization Program (zeroed out in the governor’s proposal)
  4. $5 million for the Regional Climate Collaboratives ($35 million over five years in the governor’s proposal)

We have lots more to say on how we want to see the Climate Resilience Bond address the needs of California’s most vulnerable communities. We’ll follow up with a deep dive on this in the coming weeks. 

#4: Fighting Climate Change is Going to be Costly. We Need Better and More Tools

If we don’t make these upfront investments, California will suffer far more destruction through wildfires, extreme heat, sea level rise, flooding and other climate impacts. The economic impacts will be staggeringly high too. 

Protecting California from climate impacts, reducing pollution in the most polluted communities and building deep community resiliency will require far more than $12 billion over five years. Reversing decades of redlining and environmental pollution will require far more than what Gov. Newsom proposes. To raise the money needed to invest in fighting poverty and pollution we will need the governor, along with leaders in the Senate and Assembly, to consider progressive funding streams that can augment the resources available to fight climate change. We must consider all the available options and in doing so we must advance those that put the least strain on the people who already pay too much for our climate and economic crises. 

California must continue to place the burden of cost on companies that profit from poisoning our air and water and we must true up the actual cost of their pollution. California must also explore mechanisms that target polluters from our new, convenience-driven economy and find ways to regulate them to clean up their operations and alleviate the strain they put on communities, infrastructure, and the environment. California will also need to continue to borrow, as is proposed in this year’s budget proposal. California will have to tax the most responsible. It is widely proven that the wealthiest contribute significantly more to climate change than the poor and that fossil fuel companies are responsible for our climate crisis. As the New Economic Foundation states, “Taxation is a vital tool for making sure the right people are paying for climate action, that pollution is discouraged, and that clean economic activity is given the leg up that it needs.”


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