Appeals court upholds California’s cap-and-trade system

“‘A state appeals court handed a major victory to California’s signature climate-change program on Thursday in a lawsuit challenging the state’s ability to collect revenue from auctions its sponsored over the last five years,’ according to the Sacramento Bee.

“The 3rd District Court of Appeal upheld the California Air Resources Board’s program in a 2-1 decision, ruling that its auction sales do not equate to an illegal tax because the purchase of pollution credits by businesses is voluntary and the credits they buy are ‘a thing of value.’ The program was approved with a majority vote, and opponents believe a two-thirds vote was required to authorize a tax.

“’These twin aspects of the auction system, voluntary participation and purchase of a specific thing of value, preclude a finding that the auction system has the hallmarks of a tax,’ Justice Elena J. Duarte wrote for the majority.

“Justice Harry E. Hull, Jr., in his dissent, concluded that the program does amount to a tax, siding with the California Chamber of Commerce and Morning Star, a a Woodland-based tomato processor.

“Denise Davis, a spokeswoman for the California Chamber of Commerce, said the organization is deciding whether to appeal.

“’We are disappointed in the 2-1 decision,’ Davis said. ‘We are reviewing the decision and evaluating our options.’

“The decision is a victory for Gov. Jerry Brown and legislative Democrats who are working on a package that would extend the life of the program beyond 2020.

“’The court’s decision affirms the basic purpose and structure of the program – to deliver carbon reductions in a cost-effective and flexible manner, said Mary Nichols, chairwoman of the Air Resources Board. ‘The decision provides additional certainty for this keystone program, which supports all the other approaches California has underway to fight climate change.’”

The rest of the article is here.

Author: jeffpelline

Jeff Pelline is a veteran editor and award-winning journalist - in print and online. He is publisher of Sierra FoodWineArt magazine and its website Jeff covered business and technology for The San Francisco Chronicle for years, was a founding editor and Editor of CNET News, and was Editor of The Union, a 145-year-old newspaper in Grass Valley. Jeff has a bachelor's degree from UC Berkeley and a master's from Northwestern University. His hobbies include sailing and trout fishing.

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