Initiative Seeks to Postpone Implementation of AB 32 Until Statewide Unemployment Drops to 5.5% or Less for a Full Year

The California Secretary of State has qualified an initiative for the November ballot that would delay enforcement of the Global Warming Solutions Act, more commonly known as AB 32, until certain prosperous economic conditions are observed. In substance, AB 32 requires the state to reduce emissions of certain greenhouse gases to 1990 levels by 2020 and charges various agencies with achieving that goal through various means. The initiative would suspend AB 32 until California’s unemployment rate drops to 5.5% or less for four consecutive quarters. The initiative specifies that, during the suspension, state agencies would be prohibited from implementing AB 32, and all regulations previously adopted under AB 32’s aegis would be void and unenforceable. Initiative proponents argue that AB 32 would increase energy costs and hurt businesses, something that will lead to lost jobs at a time when California’s unemployment rate is already above 12%. Opponents argue that the initiative is a boon to oil companies and an obstacle to developing a clean energy industry and that the initiative is funded largely by out-of-state interests, including out-of-state oil interests.

As a practical matter, it should be noted that the economic conditions that are cited in this initiative have rarely occurred in California’s history. The last time that the unemployment rate in California was below 5.5% was in 2007. According to the California Employment Development Department, there have been three periods since 1976 when unemployment in the state remained below 5.5% for four or more quarters:
• January 1988 through December 1989
• October 1999 through June 2001
• October 2005 through June 2007

Thus, the initiative if passed could arguably be described as an attempt to permanently defeat AB 32 rather than merely suspending it.