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Cap and Trade Funds

Paul Dyson

You know that a program has established itself when it sports an acronym.  Cap and Trade is now CnT (or CapnTrade to others) and has everyone at the State Capitol excited as it appears to represent a way to pay for a lot of people’s favorite environmental programs.  As I write in mid-May there is some arm wrestling going on in the Senate Budget Committee as to how much may be reserved for intercity passenger rail, for transit, and for High Speed Rail.  Much will depend on the Governor.  In my opinion the Governor is almost alone (one or two reps from the San Joaquin Valley being the exception) in being firmly committed to High Speed Rail.  But given the near certainty of the Governor’s re-election, with a Democrat majority in both houses, he has the power to push through his own program.

Of course no one really knows how much money there will be. Every fee or tax has its loopholes. How much can industry avoid paying, or will they leave the State?  So the discussion centers around percentages as much as around dollar amounts.  The Governor’s first proposal was for $300 million for “Rail Modernization”, of which $250 million would be for High Speed Rail.  The Capitol Corridor JPB immediately wrote a letter calling for 5 times as much for intercity, based on the total capital needs of the three state corridors of $4.1 billion.   Senator Jackson and others have called for from 5% to 10% to be reserved for intercity passenger.  A compromise is being sought that does not give the Governor a political black eye but nonetheless reserves a guaranteed part of the money for intercity. Negotiations continue.

Meanwhile Senator Pavley, author of the CnT legislation, is very concerned about the way all of the money generated by the program will be distributed.  With the Governor keeping the purse strings tight this is one of the few pots of money available and so legislators are desperately trying to find a “green” angle to their favorite programs.  This is where groups like RailPAC are invaluable to supporters of passenger rail in the legislature.  We have to help make the case for investment in new rolling stock to increase service, low emissions locomotives, including rebuilding and updating the existing fleet, electrification, and infrastructure that removes bottlenecks and improves both journey times and efficiency.

RailPAC’s long term policy of continuous incremental improvements is a sensible and affordable option, but let’s face it, it’s not exactly the sexiest of ideas.  “Going so less often” is not a slogan that will set the world ablaze!   But it does parallel the Governor’s call for fiscal responsibility, and it does ensure that we do not build any stranded assets.  As for electrification, recent reports on our air quality highlight what sensible people already knew; that our freeways generate pollution.  Electrification, initially with our urban passenger routes such as Caltrain and Metrolink, could significantly alleviate this problem and is, as far as I am concerned, the ideal candidate for Cap and Trade dollars.  If you agree, share your thought with your State Senator and Assemblymember.