Auction Proceeds Funding Guidelines

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Cap-and-Trade Auction Proceeds

Funding Guidelines for Administering Agencies

State law requires the California Air Resources Board (CARB) to develop guidance for all State agencies that receive appropriations from the Greenhouse Gas Reduction Fund (GGRF), including guidance on reporting, quantification methods, and maximizing benefits to disadvantaged communities.  To comply with this law, CARB developed Funding Guidelines to help these agencies use their appropriations in a way that reduces greenhouse gases, furthers the purposes of Assembly Bill (AB) 32 (Nuñez Chapter 488, Statues of 2006), maximizes benefits to disadvantaged communities, and meets the other statutory requirements.

On December 21, 2015, CARB released the "Cap-and-Trade Auction Proceeds:  Funding Guidelines for Agencies that Administer California Climate Investments," followed by the "Funding Guidelines Supplement for FY 2016-17 Funds" on December 30, 2017.  CARB released the "2017 Draft Funding Guidelines for Agencies that Administer California Climate Investments" on August 4, 2017.  CARB is in the process of updating the Funding Guidelines and has released the Discussion Document to identify proposed changes.

2018 Funding Guidelines Discussion Document for Agencies that Administer California Climate Investments  

The legislative priorities identified in Assembly Bill 398 (E. Garcia, Chapter 135, Statues of 2017), along with the Fiscal Year 2017-18 appropriations, reflect the increasingly important role of California Climate Investments in facilitating the reduction of greenhouse gases while also reducing air pollution; helping communities adapt to the impacts of climate change; and providing meaningful benefits to disadvantaged communities, low income communities, and low income households.

In response to legislative direction, CARB staff is revising the August 4, 2017 Draft Funding Guidelines to provide flexibility in implementing more diverse set of investment types while maintaining transparency of reported outcomes from these investments and ensuring meaningful community benefits.  The release of the Draft Revised Funding Guidelines and community meetings are anticipated in Spring 2018.

We welcome your consideration of the anticipated revisions and invite you to submit written comments and view comments on the Discussion Document.

AB 1550 Investment Targets for Agencies Administering FY 2017-18 Funds

CARB staff has released the Investment Targets for Agencies Administering FY 2017-18 Funds to identify program-level investment minimums to benefit disadvantaged communities, low-income communities, and low-income households for California Climate Investments programs funded in FY 2017-18.  CARB, in collaboration with agencies that administer California Climate Investments programs, develop individual targets for each program to drive investments that achieve direct and meaningful benefits to these populations and help ensure that statutory requirements are met.  Information on the legislative requirements of AB 1550 (Gomez, Chapter 369, Statutes of 2016) is available here.

2017 Draft Funding Guidelines

CARB staff has released the 2017 Draft Funding Guidelines for Agencies that Administer California Climate Investments that reflect the legislative requirements of AB 1550 (Gomez, Chapter 369, Statutes of 2016) and feedback from stakeholders from prior years of program implementation.  CARB staff hosted a series of community meetings and a workshop to discuss the draft document and receive public comment. 

The passage of AB 1550 in 2016 modifies the existing Senate Bill 535 (De León, Chapter 830, Statutes of 2012) investment requirements for disadvantaged communities, and provides new funding targets for low-income communities and low income households. As a result, CARB must update the Funding Guidelines to reflect the new legislative requirements.

In February 2017, the California Environmental Protection Agency (CalEPA) and CARB jointly held three community meetings and a statewide webinar to discuss how to identify disadvantaged and low-income communities, and how to assess whether projects benefit individuals living in these communities. For information on these meetings, see the Public Meetings page.

In April 2017, after considering input, CalEPA identified the list of disadvantaged and low-income community census tracts for the purposes of AB 1550 investments. For more information, see CARB staff has also considered the comments received from the community meetings in the development of the draft Funding Guidelines. More information on SB 535 and AB 1550 implementation is available here.

The recent enactment of AB 398 (Garcia, Chapter 135, Statutes of 2017) and AB 617 (Garcia, Chapter 136, Statutes of 2017) combats air pollution at the neighborhood level, and helps California achieve its ambitious climate goals by providing direction on a post-2020 Cap-and-Trade Program. AB 398 also identifies a list of priorities for the Legislature to consider for future appropriations from the Greenhouse Gas Reduction Fund (GGRF or Fund). Upcoming legislative action on expenditure of GGRF monies may necessitate conforming changes to CARB's Funding Guidelines. CARB staff is releasing the draft Funding Guidelines now to provide guidance to agencies already administering California Climate Investments from prior appropriations, and to solicit public input on the new requirements to fulfill AB 1550. CARB staff will update the draft Funding Guidelines as needed to implement any future direction from the Legislature.

Funding Guidelines Supplement For FY 2016-17 Funds

The Funding Guidelines Supplement for FY 2016-17 Funds and en español (Supplement), is to be used in conjunction with the Funding Guidelines, and provides interim direction for administering agencies implementing the September 2016 funding appropriations established in the Budget Act of 2016 (AB 1613, Chapter 370, Statutes of 2016).

The purpose of this Supplement is to provide:

  1. Disadvantaged community investment targets for all programs based on the FY 2016-17 budget appropriations and statutory requirements under SB 535.
  2. For new programs created under 2016 legislation, criteria for how to determine whether proposed projects provide benefits to disadvantaged communities, in accordance with requirements under SB 535.
  3. For new programs created under 2016 legislation, guidance on reporting requirements.

Note on AB 1550 Implementation: This Supplement is focused on the FY 2016-17 definition of disadvantaged communities and minimum investment targets; it does not include any direction on investment targets or criteria to meet the requirements enacted under AB 1550 (Gomez, Chapter 369, Statutes of 2016). Guidance on the implementation of AB 1550 will be included in the 2017 update to the Funding Guidelines. The broader Funding Guidelines update in 2017 will include public workshops and multiple opportunities for public input on how best to establish a consistent set of requirements and recommendations for implementing AB 1550 requirements across all GGRF programs.

Board Hearing and Workshop Archives

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For questions, please contact:
Cheryl Laskowski at 916-324-2828 or via e-mail