California Dump Truck Owners Association (CDTOA) - California Construction Trucking Association (CCTA)

Supervisor Gary C. Ovitt, San Bernardino Sun, 04/18/2010

The Board of Supervisors last week adopted a resolution supporting the California Jobs Initiative, proposed to be considered by the voters on the November 2010 ballot. If passed, implementation of Assembly Bill 32 will be suspended until California's unemployment rate is at 5.5percent or less for four consecutive calendar quarters.

California has always been a leader in business innovation and technology, and also in environmental stewardship. But this is one case where our effort to be a leader could drive our economy into total collapse.

In 2006, California's Legislature passed Assembly Bill 32, a sweeping law designed to combat global warming. At the time the bill was signed by the governor, the unemployment rate in California was 4.8 percent. Since its adoption, California has been hit by a global recession and the state unemployment rate has now surpassed 12 percent, with the County of San Bernardino's rate of unemployment nearing 15 percent.

Supporters of AB 32 often talk about "green jobs" and "green economy." And I have stated repeatedly that I believe renewable energy will be a key component of our regional economic future. We will continue to be a leader in the development of renewable energy because we have the resources here, namely the sun and the wind.

But "green jobs" don't fix the problem. The California Air Resources Board's own flawed and ridiculously optimistic estimate is that job growth from AB 32 will be minimal. And that estimate was made before this historic downturn.

Several studies predict that AB 32 will cost small businesses billions of dollars with massive increases in the price of gasoline, electricity, food and water, thereby slowing economic recovery and job creation. AB 32 contains a provision that would allow the governor to delay implementation in the event of "extraordinary circumstances," including "significant economic harm." Unfortunately, to date the governor has not agreed that the current economic crisis in California is severe enough to delay the implementation of AB 32.

The nonpartisan Legislative Analyst's Office in March 2010 issued a report that not only highlighted the flaws in CARB's analysis, but found that "The (greenhouse gas) mitigation measures that raise costs for certain forms of energy in California, can, especially in the near term, reduce the rates of return for certain business enterprises, impairing their profitability and, at the extreme, even inducing them to relocate or expand elsewhere."

The report further states: "Implementing AB 32 will involve various labor force dislocations, including temporary job losses and unemployment for some people, and permanent unemployment and income disruption for others."

Because of the enormous investments required by utilities, fuel producers, businesses and families to achieve AB 32's required carbon reductions, experts predict significant financial impacts, such as: over 1.1 million lost jobs statewide; increased costs to the average family of $3,857 annually in expenses for housing, transportation, food and energy; increase of $49,691 per small business; devastate budgets of California through massive losses in tax revenue; $3.7 billion a year in higher gasoline and diesel costs; up to $50,000 added to the cost of a new home; possible $143 billion cap and trade auction tax to offset AB32's higher energy prices and job losses.

The California Jobs Initiative will keep AB 32 on the books while adjusting its timetable until the state's unemployment crisis improves. With more than 2.2million people out of work in the state and the jobless rate at close to 15 percent or higher in some counties including San Bernardino, the initiative represents a common-sense approach to protecting jobs and holding the line on costs for California's struggling families.

An analysis done for the California Small Business Roundtable by Cal State Sacramento found the costs to every segment of the economy would be devastating. Each California household would pay an extra $4,000 per year. Most small businesses operate on a 10 percent profit margin, and AB 32 would impose at least 10 percent in new costs. The cost to the California economy as a whole: $182.6 billion annually or 10 percent of the total state economy. And in the end, the potential loss of 1.1 million jobs.

The AB 32 law itself says in its findings that, "National and international actions are necessary to fully address the issue of Global Warming." This is an issue that must be dealt with at those levels, not at the state level. Our best efforts will have a minuscule impact on global emissions. If no one else is playing by these rules, we're putting ourselves at an enormous competitive disadvantage.

As we all know, California is in enough trouble already. This is like throwing a drowning man an anchor. We cannot afford to implement this regulatory regime that will drive up costs, drive out business, and drive families to the poorhouse.

Passage of this initiative could potentially save more than a million jobs and prevent devastating expense increases to families and small businesses in San Bernardino County.

San Bernardino County Supervisor Gary C. Ovitt is chairman of the Board of Supervisors and represents the 4th District, which includes Chino, Chino Hills, Montclair and Ontario.

http://www.sbsun.com/pointofview/ci_14910346