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The 2022-23 California Spending Plan: Resources and Environmental Protection

Legislative Analyst's Office · lao-4633 · Post · 2022-10-10

The 2022-23 California Spending Plan: Resources and Environmental Protection Translate Our Website This Google ™ translation feature provided on the Legislative Analyst's Office (LAO) website is for informational purposes only. The LAO is unable to guarantee the accuracy of this translation and is therefore not liable for any inaccurate information resulting from the translation application tool. Choose your language: × Skip to main content Home --> Policy Areas Capital Outlay, Infrastructure Criminal Justice Economy and Taxes Education Environment and Natural Resources Health and Human Services Local Government State Budget Condition Transportation Other Government Areas Publications The Budget Propositions and Initiatives Staff Careers About Us Search LAO Contact Rachel Ehlers Update (11/17/22): Estimated federal allotments to SWRCB have been updated to $760 million. See More Publications Like This Back to the Top --> Tweet October 10, 2022 The 2022-23 California Spending Plan Resources and Environmental Protection Overview Crosscutting Issues Natural Resources Environmental Protection Overview The 2022-23 budget package provides a total of $23.7 billion from various fund sources—the General Fund, bond funds, and a number of special funds—for programs administered by the California Natural Resources and Environmental Protection Agencies. This is a net decrease of $8.7 billion (27 percent) compared to 2021-22 estimated levels. This decrease is primarily due to a large amount of one-time funding—mostly from the General Fund—provided to departments within both agencies in 2021-22. As discussed below, many departments also received notable one-time funding augmentations in 2022-23, but at lower aggregate levels. From a spending perspective, however, this year-to-year comparison is somewhat misleading. This is because the 2022-23 budget package included a significant amount of funding—roughly $5 billion, across numerous departments—that was appropriated this summer but attributed to 2021-22. Because of this timing, departments will spend these funds in 2022-23 and over the coming years. A significant amount of the one-time funding the budget package provides for Natural Resources and Environmental Protection departments in 2021-22 and 2022-23 is for capital outlay projects or is appropriated in response to the declared drought emergency through the California Emergency Relief Fund (CERF). As such, much of it is excluded from the state appropriations limit. (For more on this, please see our state appropriations limit spending plan post .) Figures 1 and 2 display total funding provided for the major departments overseen by the California Natural Resources and Environmental Protection Agencies, respectively. Figure 1 Natural Resources Budget Summary (Dollars in Millions) 2020 21 Actual 2021 22 Estimated 2022 23 Enacted Change From 2021 22 Amount Percent Totals $11,088 $20,481 $16,239 $4,243 21% By Department Water Resources a $4,020 $6,986 $4,359 $2,628 38% Forestry and Fire Protection 2,132 3,382 3,401 19 1 General obligation bond debt service 1,296 1,289 1,268 21 2 Parks and Recreation 1,260 1,899 1,480 418 22 Energy Commission 740 2,938 1,450 1,488 51 Fish and Wildlife 450 1,059 890 168 16 Wildlife Conservation Board 329 374 853 478 128 Conservation 163 429 337 92 21 Conservation Corps 155 174 279 106 61 Natural Resources Agency 87 835 704 131 16 Coastal Conservancy 74 156 715 559 358 State Lands Commission 51 356 51 305 86 Other resources programs b 4,351 604 451 153 25 By Funding Source General Fund $4,098 $14,071 $11,243 $2,828 20% Special funds c 3,736 4,818 3,997 821 17 Bond funds 2,979 1,274 677 597 47 Federal funds 276 319 321 3 1 a Includes funding from contractors of the State Water Project that is continuously appropriated to the department. b Includes state conservancies, Coastal Commission, and other departments. c Includes General Fund provided through the California Emergency Relief Fund. Figure 2 Environmental Protection Budget Summary (Dollars in Millions) 2020 21 Actual 2021 22 Estimated 2022 23 Enacted Change From 2021 22 Amount Percent Totals $5,939 $11,946 $7,511 $4,435 37% By Department CalRecycle $3,811 $2,204 $2,497 $293 13% Water Resources Control Board 1,065 4,358 1,678 2,680 62 Air Resources Board 633 4,307 2,562 1,745 41 Toxic Substances Control 282 865 566 299 35 Pesticide Regulation 109 145 136 9 6 Other departments a 40 66 72 7 10 By Funding Source General Fund $2,320 $5,365 $1,544 $3,821 71% Special funds b 3,231 5,388 5,551 164 3 Bond funds 31 17 14 3 17 Federal funds 358 1,177 402 775 66 a Includes the Environmental Protection Agency, Office of Environmental Health Hazard Assessment, and general obligation bond debt service. b Includes General Fund provided through the California Emergency Relief Fund. CalRecycle = California Department of Resources Recycling and Recovery. Crosscutting Issues Energy Package As shown in Figure 3, the spending plan provides $7.9 billion over five years—almost entirely from the General Fund—for new and expanded programs intended to promote electricity reliability, reduce greenhouse gases (GHGs), and provide financial relief to electricity ratepayers. This amount includes $2.9 billion in 2022-23, along with $2.3 billion scored in 2021-22. In addition to this funding, the spending plan includes various complementary policy changes related to lithium extraction and processing. We describe some of the key components of the energy package below. (We note that the Legislature and Governor also approved legislation that provides a pathway to extend the Diablo Canyon Power Plant [DCPP], which we describe in more detail later in this post.) Figure 3 Summary of Energy Package General Fund, Unless Otherwise Noted (In Millions) Program Department 2021 22 2022 23 2023 24 2024 25 2025 26 Totals Reliability $2,250 $908 $1,165 $100 $100 $4,523 Investments in Strategic Reliability Assets DWR $1,500 $700 $20 $75 $75 $2,370 Residential Solar and Storage CPUC — — 900 — — 900 Distributed Electricity Backup Assets CPUC 550 — 100 25 25 700 Demand Side Grid Support CEC 200 — 95 — — 295 Transmission and Energy Financing IBank — 200 50 — — 250 DOE Grid Resilience Match CEC — 5 — — — 5 Support for Reliability DWR — 3 — — — 3 Clean Energy — $764 $1,261 $54 $93 $2,173 Equitable Building Decarbonization CEC/CARB — $182 $780 $53 $92 $1,107 Incentives for Long Duration Storage CEC — 140 240 — — 380 Oroville Pump Storage DWR — 100 140 — — 240 Carbon Removal Innovation CEC — 50 50 — — 100 Industrial Decarbonization CEC — 100 — — — 100 Hydrogen Grants CEC — 100 — — — 100 Food Production Investment Program CEC — 25 50 — — 75 Offshore Wind Infrastructure CEC — 45 — — — 45 Energy Modeling CEC — 7 — — — 7 Distributed Energy Workload a CPUC — 1 1 1 1 5 Hydrogen Hub GO Biz — 5 — — — 5 Energy Data Infrastructure CEC — 5 — — — 5 AB 525 Implementation b Various — 4 — — — 4 Ratepayer Relief — $1,230 — — — $1,230 California Arrearage Payment Program c CSD — $1,200 — — — $1,200 Capacity Building Grants CPUC — 30 — — — 30 Totals $2,250 $2,902 $2,426 $154 $193 $7,926 a Public Utilities Commission Utilities Reimbursement Account. b Includes $1.5 million Energy Resources Program Account and $2.6 million General Fund. c General Fund through the California Emergency Relief Fund. DWR = Department of Water Resources; CPUC = California Public Utilities Commission; CEC = California Energy Commission; IBank = California Infrastructure and Economic Development Bank; DOE = Department of Energy; CARB = California Air Resources Board; GO Biz = Governor’s Office of Business and Economic Development; and CSD = Department of Community Services and Development. Reliability. The spending plan includes a total of $4.5 billion for programs that primarily focus on ensuring electric reliability. Some of the major programs include: Investments in Strategic Reliability Assets. The spending plan allocates $2.4 billion over five years to the Department of Water Resources (DWR) to support activities that secure additional electricity resources intended to ensure summer electric reliability. Resources eligible for funding include: (1) extension of the operating life of existing generating facilities, (2) new temporary power generators larger than 5 megawatts, (3) new energy storage systems of at least 20 megawatts, and (4) certain zero-emission fuel technologies. Residential Solar and Storage. The budget agreement includes $900 million in 2023-24 to expand the Self-Generation Incentive program administered by the California Public Utilities Commission. Funding will be available for customers of publicly owned utilities, as well as investor-owned utilities. Of the incentives, 70 percent must go to low-income residential customers who install new behind-the-meter solar systems paired with energy storage systems, or new standalone storage systems. The remaining 30 percent is available for other residential customers who install energy storage systems. Distributed Electricity Backup Assets. The budget provides $700 million—including $550 million scored in 2021- 22—to the California Energy Commission (CEC) for a new Distributed Electricity Backup Assets program. The program will provide incentives for certain distributed energy resources that can be used to support the state’s electrical grid during extreme events. Eligible projects are (1) efficiency upgrades, maintenance, and capacity additions at existing power plants and (2) deployment of new zero- or low-emission technologies, such as fuel cells or energy storage at existing or new facilities. Demand Side Grid Support Program. The budget includes $295 million—including $200 million scored in 2021- 22—to establish a new Demand Side Grid Support program. The program will provide incentives to reduce customer net electricity load during extreme events. Program participants must reduce their electricity and/or provide back-up generation service during extreme events. Transmission and Energy Financing. The budget provides $250 million to expand the Climate Catalyst Revolving Loan Fund program administered by the California Infrastructure and Economic Development Bank. The expanded program will include electric transmission and other energy projects. Initial funding must support new transmission from the Salton Sea region. Clean Energy. The package provides a total of $2.2 billion for programs primarily intended to reduce GHGs. Some of the major new programs include: Equitable Building Decarbonization. The plan includes nearly $1.1 billion over five years to establish a new Equitable Building Decarbonization Program to reduce GHG emissions from buildings. Most of the funding is allocated to CEC to establish two new different programs: (1) a direct install program and (2) a statewide incentive program. The direct install program will support direct low- or no-cost building upgrades to low-to-moderate income families in under-resourced communities, with the intention of assisting households that might not otherwise be able to make these improvements. Eligible upgrades include conversion to electric appliances, energy efficiency, and home cooling to protect against extreme heat. The statewide incentive program will provide incentives for low-carbon building technologies, such as heat pumps, space and water heaters, and other electric technologies. Long-Duration Energy Storage Program. The budget provides $380 million to CEC for a new program that will provide financial incentives for innovative long-duration energy storage projects. Eligible projects include compressed air or liquid air technologies, flow batteries, thermal storage, and hydrogen demonstration projects. Oroville Pump Storage. The budget includes $240 million to DWR for a pump storage project at the Oroville Dam. This project is intended to allow the facility to use some of its existing pump storage capacity, while limiting the potential adverse environmental impacts associated with pumping. Carbon Removal Innovation Program. The budget provides $100 million to CEC for a new Carbon Removal Innovation Program. The program will provide financial incentives for projects that advance technologies for direct air capture of atmospheric carbon. Projects that support enhanced oil recovery are ineligible for funding. Industrial Grid Support and Decarbonization Program. The budget includes $100 million for a new program at CEC that will provide financial incentives for projects at certain industrial facilities that reduce GHG emissions and support the electric grid. Eligible projects include electrification of processes that currently use natural gas, energy efficiency, and certain carbon capture and storage projects. Hydrogen Program. The spending plan includes $100 million to CEC for a new Hydrogen Program. The program will provide incentives for projects that produce, process, deliver, store, or use hydrogen that is produced from renewable energy sources. Ratepayer Relief. The plan includes $1.2 billion from the General Fund through CERF for the California Arrearage Payment Program, which provides funding for residential utility customers with unpaid electricity bills accrued during the pandemic. (This funding would extend a previous relief payment program to cover arrearages accrued through the end of the 2021 calendar year.) We discuss this funding in more detail in our human services spending plan post. New State Lithium Tax and Ban on Local Lithium Taxes. Lithium is a key component of batteries that are used to provide electricity storage and make electric vehicles. The spending plan includes various policy changes related to lithium extraction and processing. Most notably, it levies a new state excise tax on lithium extraction. The tax rate will range from $400 to $800 per metric ton of lithium carbonate equivalent that a producer extracts, adjusted annually for inflation. A total of 80 percent of the revenue from this tax will go to the counties where lithium extraction occurs, while the other 20 percent will go to the Salton Sea Restoration Fund. The budget package also prohibits local governments from levying excise taxes on lithium extraction or storage. Diablo Canyon Power Plant Extension Chapter 239 of 2022 (SB 846, Dodd) makes various changes intended to provide a pathway to extend operations of DCPP—the state’s only remaining nuclear power plant, which currently is scheduled to shut down in 2025. Although not included as part of the budget bill or budget trailer legislation, Chapter 239 has significant state budget implications. We highlight some of the major budget-related provisions below. (The bill also includes a variety of other regulatory and ratepayer-related changes, which we do not discuss.) General Fund Loan to Support DCPP Extension. The Department of Finance may loan up to $600 million from the General Fund to a newly established Diablo Canyon Extension Fund. DWR is then authorized to loan these funds to the operator of DCPP (Pacific Gas and Electric) to support activities needed to extend the operations of the power plant to 2030. The state has applied for funding to repay the loan, at least in part, from the federal Civil Nuclear Credit Program. Chapter 239 also specifies the Legislature’s intent to provide a total loan of up to $1.4 billion for DCPP extension activities. However, additional loans from the General Fund to the Diablo Canyon Extension Fund will require future legislative authorization. Future Funding for Clean Energy Reliability and Land Conservation. As part of Chapter 239, the Legislature expressed its intent to provide funding to support clean energy reliability and land conservation activities in future budgets. This includes intent language to provide a total of $1 billion from 2023-24 through 2025-26 to support a Clean Energy Reliability Investment Plan to be developed by CEC. The plan must identify projects that accelerate the deployment of clean energy resources, support demand response, assist ratepayers, and increase energy reliability. Chapter 239 also includes intent language to provide $10 million in 2023-24 and $150 million in 2024-25 to support a Land Conservation and Economic Development Plan to be developed by the California Natural Resources Agency (CNRA). This plan must support environmental enhancements and access to DCPP lands, as well as local economic development in a manner that is consistent with existing decommissioning efforts. Both plans must be submitted to the Legislature by March 1, 2023, and funding is subject to future legislative appropriation. Drought Response and Resilience Package $2.9 Billion Over Three Years for Drought Response and Water-Related Activities. California is in the third year of a serious drought. By October 2021, the Governor had declared a drought state of emergency in all 58 counties. In response to these conditions, the 2022-23 budget package includes $2.9 billion General Fund (including $1 billion through CERF) for water and drought-related activities, spread across numerous departments and activities. Figure 4 summarizes this Drought Response and Resilience Package. Of the total, $2.3 billion reflects new resources available in 2022-23 ($1.9 billion of which is scored in 2021-22) and $565 million that the Legislature intends to appropriate in 2023-24. This total includes $36 million for ongoing activities, including to support new staff in a number of departments and for DWR to enhance its forecasting practices. (Besides the totals shown in the figure, the budget agreement expresses intent to provide additional funding in future years, including $100 million for watershed resilience over 2024-25 and 2025-26 and $500 million for water storage slated for 2025-26.) Figure 4 Drought Response and Resilience Package (In Millions) a Activity Department 2021 22 2022 23 2023 24 Totals Drinking Water, Water Supply and Reliability, and Flood $515 $90 $385 $990 State Revolving Fund projects SWRCB $400 — — $400 Water recycling and groundwater cleanup SWRCB 100 $90 $210 400 Aqueduct solar panel pilot study DWR 15 — — 15 Flood and dam safety DWR — — 75 75 PFAs support SWRCB — — 100 100 Habitat and Nature Based Solutions $415 $239 $151 $804 Aquatic and large scale habitat projects Various b $122 $7 $7 $136 Fish and wildlife protection CDFW 175 — — 175 Watershed resilience projects WCB, DWR 76 c 225 144 445 State land and migratory bird habitat projects CDFW, DWR 25 — — 25 Climate induced hatchery upgrades CDFW 17 — — 17 Salmon study, tribal co management activities DWR, CDFW — 7 — 7 Immediate Drought Support $560 $82 $29 $672 Small and urban community drought relief DWR $300 — — $300 Technical assistance and emergency response Various d 169 $7 — 176 Water rights modernization SWRCB 44 — $6 49 Drought food assistance DSS 23 — — 23 Data, research, and communications DWR 17 75 17 109 Drought permitting compliance and enforcement SWRCB 8 — 7 15 Water Conservation and Agriculture $441 $441 Water conservation and turf replacement DWR $185 — — $185 Agriculture and Delta drought response programs DWR 60 — — 60 State water efficiency and enhancement program CDFA 60 — — 60 SGMA implementation DWR 56 — — 56 Multi benefit land repurposing DOC 40 — — 40 Relief for small farmers CDFA 25 — — 25 Agriculture technical assistance CDFA 15 — — 15 Totals $1,932 $411 $565 $2,908 a All from the General Fund, including roughly $1 billion through the California Emergency Relief Fund. b Includes funding for DWR ($125.5 million), CDFW ($5.5 million), SWRCB ($4.1 million), and CNRA ($432,000). c Includes $50 million for Metropolitan Water District of Southern California. d Includes funding for SWRCB ($55 million), DWR ($50 million), and contingency funding for emergency costs that may materialize ($71 million). SWRCB = State Water Resources Control Board; DWR = Department of Water Resources; PFAs = per and polyfluoroalkyl substances; CDFW = California Department of Fish and Wildlife; WCB = Wildlife Conservation Board; DSS = Department of Social Services; CDFA = California Department of Food and Agriculture; SGMA = Sustainable Groundwater Management Act; DOC = Department of Conservation; and CNRA = California Natural Resources Agency. As shown in the figure, the package includes $665 million for immediate drought response activities, such as $300 million to support grants for drought relief projects in small communities and urban areas and $176 million for technical assistance and emergency response. The latter includes $50 million to address urgent drinking water shortages, $21 million to purchase and position water storage tanks, and $71 million in flexible contingency funding for drought-related emergencies that may emerge over the year. The package also includes $441 million for water conservation efforts over the near and longer term, such as grants for local agency projects and for replacing turf with more drought-tolerant plants ($185 million), and support for groundwater recharge projects related to implementing the requirements of the 2014 Sustainable Groundwater Management Act ($56 million). Additionally, the budget includes continued funding for the State Water Efficiency and Enhancement Program ($60 million), which provides grants to farming operations to replace irrigation systems with more water- and energy-efficient equipment. Some of the funded activities in the package—such as allocating grants for improving drinking water and wastewater systems as well as for ecosystem restoration and watershed resilience projects—likely will take multiple years to complete. Of note, the package provides roughly $7 million ongoing from the General Fund for positions at DWR, CNRA, the State Water Resources Control Board (SWRCB), and the California Department of Fish and Wildlife (CDFW). These new staff are intended to expedite habitat restoration projects in the Sacramento-San Joaquin Bay-Delta and to finalize voluntary agreements among the state, water users, and environmental groups to help implement SWRCB’s forthcoming update to the Bay-Delta Water Quality Control Plan. As shown in the figure, the package also includes $122 million for implementing related projects. The funding provided in this year’s package builds on the Drought and Water Resilience Package that was approved as part of the 2021-22 spending plan, which included an additional $880 million from the General Fund in 2022-23 to continue several activities undertaken last year. Wildfire and Forest Resilience Package The budget provides a total of $900 million from the General Fund on a one-time basis over three years—$80 million in 2021-22, $320 million in 2022-23, and $500 million in 2023- 24—for various departments to implement a package of proposals focused on wildfire prevention and improving landscape health. This funding is in addition to $200 million annually in continuously appropriated funding from the Greenhouse Gas Reduction Fund (GGRF) for similar purposes. As shown in Figure 5, roughly 45 percent of funds over the three years—$582 million—is to support programs designed to promote healthy forests and landscapes, generally by removing hazardous fuels. Another roughly one-third of the funds—$382 million—is to support the installation and maintenance of wildfire fuel breaks. The remaining funds—totaling $336 million—are for projects to provide regional capacity for forest health projects, as well as to encourage forest sector economic stimulus, science-based forest management, and community hardening. Figure 5 Wildfire and Forest Resilience Package General Fund, Unless Otherwise Noted (In Millions) Program Department 2021 22 2022 23 2023 24 Totals Resilient Forests and Landscapes $80 $212 $290 $582 Forest Health Program a CalFire — $120 $120 $240 Post fire reforestation CalFire $50 — 50 100 Stewardship of state owned land CDFW — 30 30 60 Stewardship of state owned land Parks — 20 20 40 Forest Legacy Program a CalFire 10 4 19 33 Urban forestry CalFire 20 — 10 30 Stewardship of state owned land CNRA — 15 15 30 Forest Improvement Program a CalFire — 11 14 25 Tribal engagement CalFire — 10 10 20 Reforestation nursery CalFire — 2 2 4 Wildfire Fuel Breaks — $190 $192 $382 Fire prevention grants a CalFire — $115 $117 $232 Prescribed fire and hand crews a CalFire — 35 35 70 CalFire unit fire prevention projects CalFire — 20 20 40 Forestry Corps and residential centers a CCC — 20 20 40 Regional Capacity — $55 $155 $210 Conservancy projects Various conservancies — $35 $135 $170 Regional Forest and Fire Capacity Program DOC — 20 20 40 Community Hardening — $22 $22 $44 Home hardening OES, CalFire — $13 $12 $25 Defensible space inspectors CalFire — 5 5 10 Land use planning and public education UC ANR, CalFire — 4 5 9 Forest Sector Economic Stimulus — $22 $22 $44 Workforce development CalFire, CWDB — $15 $15 $30 Woody biomass transportation CalFire — 5 5 10 Market development OPR — 2 2 4 Science Based Management — $19 $19 $38 Monitoring, research, and management CalFire — $7 $8 $15 State demonstration forests CalFire — 5 5 10 Remote sensing CNRA — 3 2 5 Permit efficiencies CARB — 2 2 4 Permit efficiencies SWRCB — 2 2 4 Totals $80 $520 $700 $1,300 a Includes some Greenhouse Gas Reduction Fund. CalFire = California Department of Forestry and Fire Protection; CDFW = California Department of Fish and Wildlife; Parks = Department of Parks and Recreation; CNRA = California Natural Resources Agency; CCC = California Conservation Corps; DOC = Department of Conservation; OES = Governor’s Office of Emergency Services; UC ANR = University of California Agriculture and Natural Resources; CWDB = California Workforce Development Board; OPR = Governor’s Office of Planning and Research; CARB = California Air Resources Board; and SWRCB = State Water Resources Control Board. Zero Emission Vehicle Package As shown in Figure 6, the budget includes $2.5 billion in 2022-23 for programs intended to promote zero-emission vehicles (ZEVs). (Amendments to the 2021-22 budget in the summer of 2022 also added $619 million General Fund for ZEV programs.) The budget agreement also expresses the Legislature’s intent to provide an additional $3 billion for ZEV programs in future years, which would bring the total package to $6.1 billion over the multiyear period, as shown in the figure. However, budget trailer legislation specifies that most planned allocations in 2023-24 and beyond are subject to future appropriations and will depend on future assessments of the availability of state and federal funds. Figure 6 Summary of Zero Emission Vehicle (ZEV) Package General Fund, Unless Otherwise Noted (In Millions) Program Department 2021 22 2022 23 2023 24 2024 25 2025 26 Totals Passenger Vehicles Clean Cars 4 All and Other Equity CARB — $256 a — — — $256 ZEV Fueling Infrastructure Grants CEC $215 15 $210 $90 $40 570 Equitable At Home Charging CEC 20 — 160 80 40 300 Heavy Duty Vehicles Drayage Trucks and Infrastructure CARB $82 — $95 $48 — $225 CEC 96 — 105 49 — 250 Transit Buses and Infrastructure CARB — — 140 110 $70 320 CEC — — 60 50 30 140 School Buses and Infrastructure CARB — $1,125 b — — — 1,125 CEC — 375 b — — — 375 Clean Trucks, Buses and Off Road Equipment CARB — 600 c — — — 600 CEC 99 — 315 31 25 470 Ports CARB — — 60 120 70 250 CEC — — 40 80 30 150 Other Sustainable Community Strategies CARB — — $200 $80 $59 $339 Emerging Opportunities CARB $53 — 35 12 — 100 CEC 54 — 35 11 — 100 Hydrogen Infrastructure CEC — — 20 20 20 60 Charter Boats Compliance CARB — $60 d 40 — — 100 Transportation Package ZEV CalSTA — 77 e 77 e 77 e 76 e 383 f Totals $619 $2,508 $1,592 $858 $460 $6,113 a Includes $126 million Greenhouse Gas Reduction Fund (GGRF). b Proposition 98 General Fund. c GGRF. d Includes $20 million GGRF. e Federal funds. f Total includes $76 million in 2026 27. CARB = California Air Resources Board; CEC = California Energy Commission; and CalSTA = California State Transportation Agency. Much of the funding will go to continue or expand existing programs. Some of the most significant changes from ZEV efforts in prior years include: School Buses and Infrastructure ($1.5 Billion Proposition 98 General Fund). This program will provide competitive grants to school districts to replace nonelectric school buses with electric buses and purchase related infrastructure. For more details about this program, please see our spending post on Proposition 98. New Federal Funding for ZEV Infrastructure ($383 Million). The budget package includes federal funding available to California through the Infrastructure Investment and Jobs Act (IIJA) enacted in November 2021. Specifically, it assumes $383 million for five years from the National Electric Vehicle Infrastructure Formula Program, which is intended to support fueling infrastructure along designated alternative fuel corridors, such as along the Interstate Highway System. Extreme Heat Package As displayed in Figure 7, the budget includes $365 million across two years ($165 million in 2022-23 and $200 million in 2023-24) aimed at improving extreme heat adaptation and resilience across the state. As shown, this funding is spread across nine different departments—most of which are not under CNRA—for a variety of activities. The majority of the funding for the package comes from the General Fund, with the exception of the Farmworker Low-Income Weatherization Program, which is funded from GGRF. The largest component of the package is the Community Resilience Centers Program ($170 million), which is an existing competitive grant program focused on building or upgrading buildings to provide shelter, respite, and services for communities during extreme heat events. The package also includes $75 million for the Governor’s Office of Planning and Research for the Community Resilience and Extreme Heat program, which was initiated in 2021-22 and provides grants for projects to mitigate the impacts of extreme heat or the urban heat island effect. Also notable is $50 million for the California Department of Forestry and Fire Protection (CalFire) for the Urban Forestry program to provide grants to improve green spaces at low-income schools and transportation corridors vulnerable to extreme heat. In addition to the funding for the above package, the budget augments that funding by $100 million for green schoolyards in 2022-23. Figure 7 Extreme Heat Package General Fund, Unless Otherwise Noted (In Millions) Program Department 2022 23 2023 24 Totals Cool Communities $127.0 $168.0 $295.0 Community Resilience Centers Program SGC $85.0 $85.0 $170.0 Community Resilience and Extreme Heat Program OPR 25.0 50.0 75.0 Urban Forestry Program for schools a CalFire 17.0 33.0 50.0 Protecting Vulnerable Populations and Ecosystems $31.8 $17.8 $49.5 Farmworker Low Income Weatherization Program b CSD $15.0 — $15.0 Outreach to employers about extreme heat CDPH 1.5 — 1.5 Outreach to and oversight of long term care facilities CDPH 1.5 — 1.5 Outreach to workers about extreme heat DIR 8.0 8.0 16.0 Education and mitigation strategies for residential and childcare facilities DSS 2.8 5.8 8.5 Animal Mortality Management Program CDFA 0.6 0.6 1.2 Origin Inspection Program CDFA 0.3 0.3 0.5 Integrated Pest Management technical assistance CDFA 1.1 1.6 2.7 Integrated Pest Management technical assistance DPR 1.1 1.6 2.7 Increasing Public Awareness $6.0 $14.0 $20.0 Community based public awareness campaign OPR $6.0 $14.0 $20.0 Totals $164.8 $199.8 $364.5 a In addition to the amounts in this package, the budget includes $100 million for the Urban Forestry Program for schools and child care facilities in 2022 23. b Funded from the Greenhouse Gas Reduction Fund. SGC = Strategic Growth Council; OPR = Governor’s Office of Planning and Research; CalFire = California Department of Forestry and Fire Protection; CSD = Department of Community Services and Development; CDPH = California Department of Public Health; DIR = Department of Industrial Relations; DSS = Department of Social Services; CDFA = California Department of Food and Agriculture; and DPR = Department of Pesticide Regulation. Nature-Based Solutions Package As shown in Figure 8, the budget provides a total of $1.1 billion on a one-time basis over three years—$669 million in 2022-23, $428 million in 2023-24, and $20 million in 2024- 25—primarily from the General Fund, for various departments to implement a package of proposals aimed at implementing nature-based solutions. Many of these efforts are intended to help the state achieve a goal of conserving 30 percent of the state’s land and coastal waters by 2030. The package includes a total of $246 million across the State Coastal Conservancy (SCC) and Ocean Protection Council to prepare for and respond to sea-level rise. It also includes a total of $245 million for the Wildlife Conservation Board to implement land planning, acquisition, and restoration projects. Figure 8 Nature Based Solutions Package General Fund, Unless Otherwise Noted (In Millions) Program Department 2022 23 2023 24 2024 25 Total Land Acquisition and Management Programs $204.0 $95.0 — $299.0 Various WCB programs WCB $150.0 $95.0 — $245.0 Wetlands Restoration Program CDFW 54.0 — — 54.0 Regionally Focused Programs $271.0 $129.0 — $400.0 Implementation of conservancy programs Various conservancies $70.0 $100.0 — $170.0 Wildlife corridors (Including Liberty Canyon) CDFW, SMMC 52.0 — 52.0 San Joaquin Valley flood plain restoration WCB 40.0 — — 40.0 Natural Community Conservation Program Planning and Land Acquisition CDFW 36.0 — — 36.0 Wetlands Restoration Program in Delta DC 36.0 — 36.0 Climate Smart Land Management Program DOC 14.0 6.0 — 20.0 Multibenefit Land Repurposing Program DOC — 20.0 — 20.0 San Francisco Bay wetlands support SCC 11.0 — — 11.0 Redondo Beach wetlands restoration CNRA 10.0 — — 10.0 Resource conservation strategies WCB 2.0 3.0 — 5.0 Youth and Tribal Programs $109.0 $42.0 $1.0 $152.0 Tribal program CNRA $70.0 $30.0 — $100.0 Local and Tribal Nature Based Solutions Corps CCC 38.0 11.0 — 49.0 Tribal staffing CNRA 1.0 1.0 $1.0 3.0 Sea Level Rise Programs $75.0 $152.0 $19.0 $246.0 Coastal adaptation projects SCC $37.5 a $97.0 $9.0 $143.5 Coastal adaptation projects and efforts CNRA (OPC) 37.5 a 55.0 10.0 102.5 Other Programs $9.8 $10.3 — $20.0 Healthy Soils Program CDFA — $10.0 — $10.0 Compost Permitting Pilot Program CalRecycle $7.5 — — 7.5 Partnerships and improvements CNRA 2.0 — — 2.0 California nature support CNRA 0.3 0.3 — 0.5 Totals $668.8 $428.3 $20.0 $1,117.0 a Greenhouse Gas Reduction Fund. WCB = Wildlife Conservation Board; CDFW = California Department of Fish and Wildlife; SMMC= Santa Monica Mountains Conservancy; DC = Delta Conservancy; DOC = Department of Conservation; SCC = State Coastal Conservancy; CNRA = California Natural Resources Agency; CCC = California Conservation Corps; OPC = Ocean Protection Council; CDFA = California Department of Food and Agriculture; and CalRecycle = California Department of Resources Recycling and Recovery. Cap-and-Trade Expenditure Plan The budget package includes a $1.6 billion discretionary expenditure plan from GGRF, as summarized in Figure 9. Much of this funding goes to existing programs. We describe some of the most significant and discretionary expenditures in more detail in other sections of this post. The $1.6 billion figure does not include $2.7 billion in current-law continuous appropriations from GGRF or other ongoing spending commitments from the fund agreed to in prior years. In total, the spending plan includes $4.3 billion of expenditures from GGRF in 2022-23. Figure 9 Cap and Trade Discretionary Expenditure Package (In Millions) Program Department 2022 23 ZEV Package $746 HVIP CARB $600 Clean Cars 4 All & Equity CARB 126 Charter boats compliance CARB 20 a AB 617 $270 Community Air Protection incentives CARB $210 a Local Air District Implementation CARB 50 Technical Assistance to Community Groups CARB 10 Methane Emissions $220 Organic waste infrastructure CalRecycle $180 Alternative manure management program CDFA 20 Methane reductions from landfills and wastewater CalRecycle 10 Methane reductions from cattle feed CDFA 10 Monitoring $135 Methane monitoring CARB $105 Community air monitoring CARB 30 Other $205 Sea level rise Coastal Conservancy, OPC $155 School ventilation upgrades (CalSHAPE) CEC 20 Low Income Weatherization Program CSD 15 High GWP Refrigerants CARB 10 Wood stoves CARB 5 Total $1,576 a Budget also includes an additional $40 million General Fund for these purposes. ZEV = zero emission vehicle; HVIP = Hybrid and Zero Emission Truck and Bus Voucher Incentive Project; CARB = California Air Resources Board; AB 617 = Chapter 136 of 2017 (AB 617, C. Garcia); CalRecycle = California Department of Resources Recycling and Recovery; CDFA = California Department of Food and Agriculture; OPC = Ocean Protection Council; CEC = California Energy Commission; CSD = Department of Community Services and Development; and GWP = Global Warming Potential. Natural Resources California Natural Resources Agency The budget includes a total of $704 million from various funds to support CNRA, including $664 million from the General Fund. This total is a net decrease of $131 million, or 16 percent, from the estimated 2021-22 level. This decrease is primarily due to one-time funds that CNRA received in 2021-22. The expiration of these one-time funds is partially offset by the one-time funding included for CNRA in the packages discussed in the “Crosscutting Issues” section of this post, as well as the augmentations discussed below. Funding for Specific Non-State Projects. The budget provides $192 million from the General Fund on a one-time basis in 2022-23 and 2023-24 to CNRA for various specific projects to be undertaken by non-state entities. Some of the most significant of these augmentations include: $95 million in 2022-23 for specific local legislative priority projects. $40 million in 2022-23 to support rebuilding several Jewish summer camps that were damaged by wildfires. $23 million in 2022-23 for projects to rehabilitate and improve the National Park Service’s John Muir Trail. $15.5 million in 2022-23 to support activities such as museum improvements, education, outreach, publications, and walking tours at the Armenian American Museum ($10 million), the Museum of Tolerance ($5 million), and the San Francisco Historical Society Museum ($510,000). Recreational Trails and Greenways Program. The budget includes $35 million from the General Fund on a one-time basis for the Recreational Trails and Greenways Program, which is a competitive grant program that supports nonmotorized infrastructure projects that promote new or alternate access to parks, waterways, outdoor recreational areas, and natural environments. California Climate Information System (CalCIS). The budget includes $18.3 million from the General Fund on a one-time basis and three positions for the planning and development of the first phase of a new CalCIS. This system, which will be managed by the Department of Conservation (DOC), is intended to help the state store and manage data related to its climate goals. Ocean Protection Council Funding. The budget includes $25 million from the General Fund on a one-time basis for the Ocean Protection Council. This includes $10 million to support the Ocean Science Trust and $7 million for the Marine Mammal Stranding Network for equipment upgrades. It also includes funding for two legislative priorities: monitoring sharks ($6 million) and the Monterey Bay Aquarium ($3 million). Department of Water Resources The budget package includes $4.4 billion from various sources for DWR. (These totals include the roughly $1.9 billion in annual payments from water contractors for DWR’s work on the State Water Project that are continuously appropriated outside of the annual budget act.) This is $2.6 billion, or 38 percent, less than the amount provided in 2021-22. (As discussed above, year-to-year comparisons are somewhat complicated by the significant amount of funding that was included in this summer’s budget package and made available for spending in 2022-23 but scored in 2021-22.) A notable share of DWR’s funding is included in the Drought Response and Resilience and Energy packages described above, including a significant increase—$1.5 billion in 2021-22 and $700 million in 2022- 23—to take on a new role in energy procurement for the state. Continued Water and Climate Resilience Activities. Consistent with last year’s multiyear Drought and Water Resilience Package funding agreement, the budget provides $370 million for DWR to continue four activities initiated in 2021-22. This funding is for flood management activities ($110 million), water conveyance repairs ($100 million), projects at the Salton Sea ($100 million), and implementation of the Sustainable Groundwater Management Act ($60 million). In addition, consistent with the multiyear Climate Resilience Package agreed to as part of the last year’s budget, the 2022-23 budget includes $125 million for DWR to undertake habitat restoration projects. Various Flood Management Activities. In addition to the aforementioned components of the drought packages, the budget funds a number of other flood management activities, including: Urban Flood Risk Reduction Projects. The budget includes $33 million from the General Fund on a one-time basis. This amount funds continued construction costs for two existing capital outlay projects—$18 million for the Smith Canal Gate Project in the Stockton area and $5 million for levee strengthening in Reclamation District 117 which serves the South Stockton, Lathrop, and Manteca areas. This budget appropriation also includes $10 million for DWR staff to continue providing state operations support for several ongoing flood management projects that are funded with Proposition 1E (2006) bond monies. Operations and Maintenance for Habitat Mitigation Project. The budget includes $27.5 million in one-time General Fund to create an endowment for long-term maintenance of a habitat site in the expanded Yolo Bypass that meets mitigation requirements for the Lower Elkhorn Basin Levee Setback flood management project. Delta Flood Emergency Preparedness, Response, and Recovery Program. The budget package provides $18.5 million over the next three years (including $2.5 million in 2022-23) from Proposition 1 (2014) for activities to improve flood preparedness in the Delta region. National Flood Insurance Program. The budget includes $3 million ongoing and $1 million one time from the General Fund to support state compliance activities for this federal program. Activities will include developing a new compliance tracking tool, and ongoing support for one new position and eight existing positions that were previously funded with expiring bond funds. Specific Local Projects and Efforts. The budget provides $76 million one-time General Fund to DWR for various specific local projects that reflect legislative priorities. For example, this includes $21.8 million to the Alameda County Public Works Agency for the Alameda Creek Restoration Phase III project, $9 million to the County of Napa for water infrastructure and wildfire-related needs in the Cities of St. Helena and Napa, and $8.5 million to City of La Habra for the Coyote Creek-Imperial Channel Improvement Project, among other smaller projects. California Department of Forestry and Fire Protection The budget includes a total of $3.4 billion from various funds to support CalFire, including $3 billion from the General Fund. This is roughly the same amount of funding provided to CalFire in 2021-22, as the department received large amounts of one-time funding in both years. We describe the main programmatic expansions and facility-related projects in CalFire’s 2022-23 budget below, as well as in the Wildfire and Forest Resilience Package and Extreme Heat Package portions of the “Crosscutting Issues” section above. Expansion of Wildfire Response Funding. The budget provides roughly $850 million in 2022-23, of which about $500 million is ongoing—almost entirely from the General Fund—for various augmentations aimed at enhancing the state’s wildfire response. These augmentations, which are detailed in Figure 10, mainly support additional personnel and equipment at CalFire, but also provide wildfire response resources for the Governor’s Office of Emergency Services, California Military Department, and California Conservation Corps (CCC). Notably, the budget package also includes approval of a memorandum of understanding (MOU) with Unit 8, which represents CalFire firefighters. As we discuss in our August analysis , this MOU could increase out-year wildfire response costs significantly. Figure 10 Major Expansions of Wildfire Response Capacity in 2022 23 Budget Program/Purpose Department Description Firefighter crew CalFire $169 million GF in 2022 23, $164 million GF ongoing, and 827 positions to staff and support 17 new Firefighter 1 crews and fund associated equipment and special repairs. Staffing to support CMD and CCC fire crews CalFire $104 million GF in 2022 23, $50 million GF ongoing, and 238 positions to support the addition of CCC and CMD crews, as discussed below. Emergency surge capacity and resource enhancement CalFire $188 million GF in 2022 23, $15 million GF ongoing, and 34 positions to purchase various types of reserve equipment, including four fire hawk helicopters, 54 fire engines, and ten dozers, as well for a three year helitanker contract. Relief staffing CalFire $97 million GF in 2022 23, $85 million GF ongoing, and 455 positions to increase firefighter staffing levels. Short term fire protection augmentation CalFire $83 million GF on a one time basis to support fire protection resources, including crews staffed by CalFire and CMD personnel, from July through December 2022. CAD/AVL programs CalFire $42 million ($24 million GF and $18 million SETNA) in 2022 23, $31 million ($23 million GF and $8 million SETNA) ongoing, and 43 positions to expand and support AVL and CAD systems. Enhancing and expanding fire crews: Task Force Rattlesnake CMD $40 million GF in 2022 23 and $41 million GF annually thereafter and 15 State Active Duty positions to convert 13 seasonal CMD hand crews to 14 year round hand crews. Direct mission support CalFire $38 million ($29 million GF) in 2022 23, $36 million ($28 million GF) ongoing, and 190 positions to provide additional administrative and program support throughout various CalFire divisions. Fire Integrated Real Time Intelligence System (FIRIS) CalFire and OES $30 million ongoing GF and 31 positions ($24 million and 11 positions for OES and $6 million and 20 positions for CalFire) to support the FIRIS system. Contract county crews CalFire $25 million GF in 2022 23 and $35 million ongoing GF to fund 12 hand crews for contract counties, and an adjustment to the approach to calculating contract county reimbursements. Training centers CalFire $16 million GF in 2022 23 and $272,000 ongoing GF for 13 new fire engines and other equipment for the Ventura Training Center and the California Fire Training Center South. Enhancing the fire and rescue mutual aid fire fleet OES $11 million ongoing GF and 11 positions to support the OES mutual aid fire engine program. Enhancing and expanding CCC fire crews CCC $8 million GF in 2022 23 and $10 million ongoing GF to support ten hand crews (four new crews and conversion of six seasonal crews to year round), and an additional 18 staff positions and 13 corpsmember positions to support these crews. Rightsizing CCC fire crew resources CCC $2 million ongoing GF for 13 additional corpsmembers and 11 staff to support existing CCC fire crews. CalFire = California Department of Forestry and Fire Protection; GF = General Fund; CMD = California Military Department; CCC = California Conservation Corps; CAD = Computer Aided Dispatching; AVL = Automatic Vehicle Locator; SETNA = State Emergency Telephone Number Account; and OES = Governor’s Office of Emergency Services. Implementation of Recent Legislation. The budget provides $36.5 million and 49 positions for CalFire, as well as funding in future years, to implement various wildfire-related bills that were recently enacted. For example, it includes $14 million on an ongoing basis to support the overtime costs to backfill employees on Enhanced Industrial Disability Leave as a result of Chapter 857 of 2017 (SB 334, Dodd) and Chapter 897 of 2018 (SB 1144, Dodd). The spending plan also provides $10 million in 2022-23 ($8 million ongoing) and 29 positions to implement legislation enacted in 2021 related to community wildfire preparation and mitigation, including Chapter 225 (AB 9, Wood), Chapter 375 (AB 642, Friedman), and Chapter 382 (SB 63, Stern). Various Capital Outlay Projects. The budget includes $188.3 million ($163.2 million General Fund and $25.1 million in lease revenue bonds) in 2022-23 for various capital outlay projects, mainly focused on replacing and relocating facilities such as unit headquarters, fire stations, and air attack bases. This includes funding both for continuing phases of previously approved projects as well as for new projects. Department of Parks and Recreation The budget includes roughly $1.5 billion from various funds to support the Department of Parks and Recreation (Parks), including $924 million from the General Fund. This total is a net decrease of $418 million, or 22 percent, from the estimated 2021-22 level. This decrease primarily is due to the expiration of over $1 billion in one-time General Fund augmentations that were provided in 2021-22. The expiration of these one-time funds is partially offset by the additional funding for Parks discussed below. Park Access Programs. The budget includes $328 million from the General Fund on a one-time basis over multiple years for programs that improve park access. First, it includes $225 million over four years ($75 million in 2022-23, $56 million in 2023-24, $69 million in 2024-25, and $25 million in 2025-26) for the Statewide Parks Program, which is an existing competitive grant program focused on creating new local parks and improving existing local parks in the state’s most disadvantaged communities. Second, it includes $25 million annually for three years for the Outdoor Equity Grants Program authorized by Chapter 675 of 2019 (AB 209, Limón). This program, which also received one-time funding in 2020-21, provides grants to local public entities and nonprofit organizations to provide outdoor educational experiences to underserved and at-risk youth. Third, it includes $15 million to support Parks’ K-12 and Interpretive Enrichment Program, including paying for buses for field trips to parks, as well as technology and curriculum updates. Finally, it provides $13.5 million for the State Parks Pass Program, which provides state park passes that can be checked out at libraries. California Cultural and Art Installation in Parks Program. The budget provides $25 million one time from the General Fund for Parks to partner with nonprofit and other organizations to provide grants to artists to support art in state and local parks. Activities With an African American and Tribal Focus. The budget provides a total of $25 million one time from the General Fund to support efforts to improve engagement with the African American and Native American communities and support improvements to interpretation at state parks. This includes $15 million for a partnership with the California African American Museum to address gaps in the representation, preservation, and interpretation of California’s significant African American history at California state parks. It also includes $10 million and six positions to support Native American engagement and interpretation in state parks. Funding for Specific Programs and Projects. The budget provides $495 million from the General Fund on a one-time basis to Parks for various specific projects outside of state parks. This includes $453 million for specific local legislative priority projects and $25 million for the India Basin Project in San Francisco, as well as a few other smaller projects. Beach Restoration. The budget includes $15 million on a one-time basis from the Public Beach Restoration Fund, via a transfer from the General Fund, to provide funding for the construction of three beach restoration projects in Orange County, the City of San Clemente, and the Cities of Encinitas and Solana Beach. The budget package also includes associated budget trailer legislation clarifying that the state is not obligated to provide financial contributions towards beach restoration projects that receive federal support. Cannabis Resources. The budget authorizes 61 permanent positions, 40 vehicles, and 12 pieces of heavy equipment with an estimated cost of roughly $9 million ongoing to be funded from the continuously appropriated Cannabis Tax Fund. These resources will support the Cannabis Watershed Protection Program, which is aimed at preventing and remediating damage from illegal cannabis cultivation in parks. Various Capital Outlay Projects. The budget includes a total of $115 million in 2022-23 for various capital outlay projects at state parks ($83 million from the General Fund and $32 million from various bond and special funds). This includes $29 million, mostly from the General Fund, for the Colonel Allensworth State Historic Park Visitor Center. This also includes a $50 million General Fund transfer to the Natural Resources and Parks Preservation Fund for future capital outlay projects, with $1 million set aside to identify needed projects. California Energy Commission The budget provides $1.5 billion to CEC, a 51 percent ($1.5 billion) decrease compared to revised prior-year spending levels. Much of the year-over-year decrease reflects a significant amount of one-time funding provided in 2021-22 for ZEV- and energy-related activities. The CEC budget includes funding for a wide variety of programs that we describe in the Energy Package, ZEV Package, and DCPP Extension sections above, in addition to a new Climate Innovation Program. Climate Innovation Program. The spending plan includes $100 million General Fund in 2022- 23—and a total of $525 million over four years—for a new Climate Innovation Program. The program will provide financial incentives to California-headquartered companies developing and commercializing new technologies that help reduce GHGs or improve climate resiliency. Eligible technologies include those related to (1) zero-emission transportation; (2) lithium processing, manufacturing, and recovery; (3) regenerative agriculture; (4) drought; and (5) wildfire prevention. Companies receiving funding through the program generally will be required repay the grant amount plus 20 percent after a business “liquidity event,” which includes an Initial Public Offering and certain types of change in ownership in the company. Department of Fish and Wildlife The budget includes $890 million from various sources for CDFW—including $412 million from the General Fund—and authority for more than 70 new positions. This reflects a decrease of $168 million, or 16 percent, compared to the 2021-22 level, due to one-time augmentations reflected in the prior year. As highlighted earlier, the department is receiving funding from the Drought Response and Resilience, Wildfire, and Nature-Based Solutions packages. The budget also includes $33 million in 2022-23, consistent with the 2021-22 budget’s Climate Resilience Package, to continue activities to protect fish and wildlife from changing conditions. Fine-Scale Vegetation Mapping and California Natural Diversity Database. The budget includes $33 million in 2022-23 and $20 million in 2023-24 from the General Fund for the following: Fine-Scale Vegetation Mapping. The budget provides $20 million in both 2022-23 and 2023-24 to complete fine-scale mapping of vegetation and habitat, using standards consistent with the National Vegetation Classification System, to support the state’s ability to make conservation and habitat management decisions. California Natural Diversity Database. The budget provides $13 million in 2022-23 to eliminate an inventory backlog in the California Natural Diversity Database. This database inventories the status and locations of rare plants and animals in California and is maintained as a part of a national network to inform conservation decisions and environmental reviews of proposed projects. Department of Conservation The budget includes a total of $337 million from various funds to support DOC, including $192 million from the General Fund. The department’s total funding level is a net decrease of $92 million, or 21 percent, from the estimated 2021-22 level. This decrease is primarily due to several one-time appropriations in 2021-22. As highlighted above, DOC is also receiving General Fund across 2021-22 and 2022-23 from the Drought Response and Resilience ($40 million), Wildfire ($20 million), and Nature-Based Solutions ($14 million) budget packages. Moreover, consistent with the multiyear Climate Resilience Package agreed to as part of last year’s negotiations, the budget provides $50 million in 2022-23 for the department to implement a biomass to hydrogen/biofuels pilot project. Oil Well Abandonment and Remediation. The budget includes $100 million from the General Fund over two years—$50 million in 2022-23 and $50 million in 2023- 24—for the department’s California Geologic Energy Management (CalGEM) Division to plug wells and decommission facilities. CalGEM will use the proposed funding to hire three types of external contractors: (1) a construction management contractor to manage the remediation projects, (2) a contractor to conduct financial obligations and land ownership research, and (3) contractors to plug wells and decommission facilities. Existing CalGEM staff will provide oversight by issuing permits, witnessing different stages of the project, and managing contracts. CalGEM: Mission Transformation and Oversight. The budget includes 17 positions and $5.1 million ongoing from the Oil, Gas, and Geothermal Administrative Fund for district operations, federal underground gas storage safety requirements implementation, program support, and administration support. Conservation Corps The budget includes a total of $279 million from various funds to support CCC, including $220 million from the General Fund. This total is a net increase of $106 million, or 61 percent, from the estimated 2021-22 level. This increase primarily is due to $58 million provided for the department in the Wildfire and Forest Resilience and Nature-Based Solutions packages (discussed in the “Crosscutting Issues” section of this post), as well as the augmentations discussed below. Hand Crews. As noted earlier in Figure 10, the budget includes $8 million in 2022-23 and $10 million ongoing from the General Fund to support ten hand crews (four new year-round crews and conversion of six seasonal crews to year-round), as well as an additional 18 staff positions and 13 full-time equivalent corpsmember positions to support these crews. Various Capital Outlay Projects. The budget includes $124 million, mostly from the General Fund and lease revenue bond funds, for various capital outlay projects to construct and/or renovate CCC centers. Most notably, this includes $67 million from the General Fund to replace the existing Greenwood Residential Center and $55 million in lease revenue bonds to construct a new residential center in the City of Auberry. State Coastal Conservancy The budget provides $715 million from various sources for SCC in 2022-23, including $587 million from the General Fund. This reflects an increase of $559 million, or 358 percent, over the 2021-22 level, primarily due to the following augmentations. Sea-Level Rise Adaptation Projects. The package includes funding for SCC to support projects designed to prepare for and respond to sea-level rise, to be undertaken both by the conservancy and through grants to other entities. This includes $144 million across three years ($37.5 million in 2022-23) from the Nature-Based Solutions Package as displayed earlier in Figure 8, as well as an additional $120 million in 2022-23 ($80 million from GGRF and $40 million from the General Fund) and $300 million General Fund in 2023-24. Coastal Protection and Restoration Projects. The budget includes $350 million General Fund in 2022-23 for coastal protection and restoration projects, consistent with the multiyear Climate Resilience Package approved in 2021-22. Specific Local Projects and Efforts. The budget provides $74 million one-time General Fund to SCC for various specific local projects that reflect legislative priorities. For example, this includes $36 million to the East Bay Recreation and Park District for open space acquisition and clean-up at Point Molate, and $15 million to the City of Berkeley for marina and pier projects, among several other smaller projects. Coastal Property Acquisitions. The budget includes one-time flexible local assistance funding of $50 million General Fund in 2022-23 for SCC to acquire real property to restore coastal areas and increase public access to natural areas. Environmental Protection California Department of Resources Recycling and Recovery The spending plan includes $2.5 billion for the California Department of Resources Recycling and Recovery (CalRecycle), a 13 percent ($293 million) increase compared to revised prior-year spending. Much of the year-over-year increase is driven by one-time funding increases for the Beverage Container Recycling Program and methane reduction programs. We describe these budget actions below. Beverage Container Recycling Program. The budget includes $234 million from the Beverage Container Recycling Fund in 2022- 23—and a total of $391 million over three years—for a variety of activities intended to improve recycling rates and enhance consumer redemption options. These activities are summarized in Figure 11. The largest share of funding over the multiyear period is to support start-up costs for alternative beverage container redemption options, such as reverse vending machines, mobile recycling, and bag drop programs. Figure 11 Additional Funding for Beverage Container Recycling Program Funding From Beverage Container Recycling Fund (In Millions) Program 2022 23 2023 24 2024 25 Totals Start up costs for alternative redemption options $73 $73 $73 $220 Quality improvement payments 90 — — 90 Start up loans for processors and recyclers 30 — — 30 Support a deposit return system for reusable containers (AB 962) 25 — — 25 Plastic market development payments 10 7 3 20 Workforce development 5 — — 5 Identify redemption sites on website 1 — — 1 Totals $234 $80 $76 $391 AB 962 = Chapter 502 of 2021 (AB 962, S. Kamlager). Methane Emission Reductions. The spending plan includes a total of $190 million from GGRF on a one-time basis in 2022-23 for existing programs intended to reduce methane emissions from waste and landfills. This includes $180 million for grants to implement organic waste regulations adopted pursuant to Chapter 395 of 2016 (SB 1383, Lara). The additional $10 million is to expand food waste co-digestion projects at existing wastewater treatment plants. State Water Resources Control Board The budget includes $1.7 billion from various sources for SWRCB, with $377 million from the General Fund. Total funding is down $2.7 billion (62 percent) from the revised 2021-22 spending level. This change is primarily due to one-time augmentations reflected in the prior year, including $800 million federal Coronavirus Fiscal Recovery Fund dollars that were provided for water bill arrearages, along with General Fund associated with many of the funding packages. As discussed earlier, the Drought Response and Resilience package includes $697 million General Fund for SWRCB over 2021-22 and 2022-23. Consistent with last year’s multiyear Drought and Water Resilience Package funding agreement, the budget also provides $150 million in 2022-23 for SWRCB to continue two activities—$100 million for groundwater cleanup and water recycling projects and $50 million to address water contamination from per- and polyfluoroalkyl substances (PFAs). (As shown earlier in Figure 4, the 2022-23 drought package includes additional funding for those purposes as well.) In addition, the budget provides funding for the following activities. Increased Spending to Clean Up Underground Storage Tanks. The budget includes a one-time $200 million local assistance increase from the Underground Storage Tank Cleanup Fund (USTCF) to support contamination cleanup at leaking petroleum underground storage tanks. It also shifts spending authority for $81 million USTCF from state operations to local assistance for the same purposes. This funding will allow SWRCB to reimburse applicants for a backlog of cost claims associated with storage tank cleanup and to respond to new claims. It builds on a similar one-time local assistance augmentation of $200 million USTCF in 2021-22. Federal Funds for Drinking Water and Wastewater Projects. California expects to receive about $3.5 billion over five years from the federal IIJA to improve local water infrastructure. About $1.8 billion of these funds will be administered by SWRCB through its existing State Revolving Fund (SRF) programs. These SRF programs provide loans and nonrepayable financing to local governments, water agencies, and tribal governments for planning, design, and construction of drinking water and wastewater systems’ eligible capital projects. An additional $1.7 billion over five years will also be available through the SRF programs for specific water quality efforts to address emerging contaminants and replace lead service lines. In recent years, the SRF programs have received roughly $210 million in federal funds annually, so the IIJA funding represents a significant increase. From 2022 to 2026, total annual funding for California’s SRF programs could range from approximately $700 million to as high as $2.3 billion. The U.S. government requires that states provide funding to “match” the federal funds, typically 20 cents to each $1 received. Historically, California has used water bond funds or contributions from SRF recipients to meet this match requirement for federal SRF funds, however, bond funds are beginning to run out. The aforementioned Drought Response and Resilience Package provides $400 million General Fund (reflected in 2021-22) to help SWRCB meet the increased match requirement. SWRCB estimates California will begin to receive its 2022 allotments of roughly $760 million from the federal government in the fall. The federal funds do not go through the budget because SRF monies are continuously appropriated. Border Rivers and Dichlorodiphenyltrichloroethane (DDT) Cleanup. The budget includes $15 million one-time General Fund to address water quality issues in rivers entering the state from across the Mexican border. This funding builds on a $20 million one-time General Fund augmentation provided in 2021-22, which supported activities to enhance efforts underway by the U.S. Environmental Protection Agency in collaboration with Mexico. Additionally, the budget provides $5.6 million for SWRCB to help clean up historical dumping of the chemical insecticide DDT along the Southern California coast. Various State Operations Augmentations. The budget provides authority for about 90 new positions to support SWRCB’s various new or expanded activities. This includes 17 new permanent positions for SWRCB to manage drought curtailment orders and enforcement of water rights as part of the drought package. The new personnel filling these positions will assist water diverters in understanding how to comply with curtailment regulations, monitor diversions, investigate complaints of unauthorized diversions, conduct hearings to resolve disputes, and respond to requests for exemptions from curtailment orders. The budget also provides authority for 29 new permanent positions to manage the SRF, including review and management of applications and agreements, loan servicing, and communications to solicit eligible projects. Additionally, as part of the Drought Response and Resilience Package discussed earlier, the budget provides SWRCB with funding and authority to hire eight new positions to inform consideration and adoption of voluntary agreements in the Delta. California Air Resources Board The spending plan provides $2.6 billion to the California Air Resources Board (CARB), a $1.7 billion (41 percent) decrease compared to revised prior-year spending. Much of the year-over-year decrease reflects a significant amount of one-time funding provided in the 2021-22 budget for ZEV activities. The 2022-23 CARB budget includes funding provided in the ZEV, Energy, and Cap-and-Trade packages described above. Other significant CARB budget actions are described below. AB 617 Implementation. The budget includes a total of $310 million in 2022-23 ($270 million GGRF and $40 million General Fund) to implement Chapter 136 of 2017 (AB 617, C. Garcia), also known as the Community Air Protection Program. The funding goes to incentives for activities to reduce air pollution in heavily polluted communities ($250 million), support for local air district implementation ($50 million), and technical assistance to community groups ($10 million). The budget plan also intends to provide a combined $300 million General Fund in 2023-24 for these activities. Methane Monitoring Satellites. The budget includes $105 million GGRF to support satellites used to monitor methane emissions. CARB will contract with a third-party to launch and operate the satellites. Community Air Monitoring. The budget allocates $30 million GGRF to support expanded community-level air monitoring. Funding will support mobile monitors that will be used to provide a one-time snapshot of air pollution at the local level. Charter Boat Emission Reductions. The spending plan includes $60 million ($40 million General Fund and $20 million GGRF) to support activities that reduce local pollution from commercial harbor craft. The funding will provide financial support to owners of boats who are required to reduce their emissions pursuant to CARB’s commercial harbor craft regulation. The budget agreement also includes $40 million General Fund in 2023-24 for these activities. Department of Toxic Substances Control The budget provides $566 million from various fund sources to support the Department of Toxic Substances Control (DTSC) in 2022-23, a decrease of roughly $300 million (35 percent) compared to 2021-22 revised spending estimates. The year-to-year change largely reflects one-time funds the department received in 2021-22 that are not sustained at the same levels in 2022-23, such as General Fund resources related to addressing brownfields and the Exide facility. Governance and Fiscal Reform Implementation. The budget includes $49.5 million and 260 positions in 2022-23 and ongoing to implement the governance and fiscal reforms enacted last year as part of Chapter 73 of 2021 (SB 158, Committee on Budget and Fiscal Review). Among other things, the legislation restructured and increased the charges that support the department’s two major special funds. The spending enacted in the 2022-23 budget essentially reflects the authorization required to spend the additional revenues the reforms have begun generating. The funding will go toward activities such as additional inspections of hazardous waste generators and enhanced criminal enforcement investigations. The new positions also will support implementation of the brownfields cleanup funding the department received under SB 158—$300 million in 2021-22 and $100 million in both 2022-23 and 2023-24. Greenville Lead Cleanup Project. The budget provides $47 million in 2022-23 for DTSC to remove soil with elevated lead concentrations in the town of Greenville. This contamination was discovered during debris cleanup following the Dixie Fire. The cleanup will include removing the contaminated soil. Department of Pesticide Regulation The budget provides $136 million from various fund sources to support the Department of Pesticide Regulation (DPR) in 2022-23, a decrease of roughly $9 million (6 percent) compared to 2021-22 revised spending estimates. The decrease is largely due to one-time General Fund resources provided last year for the development of the Pesticide Notification Network. As highlighted earlier in Figure 7, the budget includes General Fund augmentations for DPR of $1.1 million in 2022-23 and $1.6 million in 2023-24 from the Extreme Heat Package to support the adoption of sustainable pest management practices through additional technical assistance and outreach. Pesticide Enforcement. The budget package includes trailer legislation that enhances DPR’s pesticide enforcement authority in several ways. First, the legislation provides DPR with the authority to levy administrative penalties for serious multijurisdictional pesticide use violations. (Previously, County Agricultural Commissioners [CACs] had the sole authority to administratively enforce pesticide use violations.) Second, the legislation increases CAC administrative penalties and statewide civil and criminal penalties for pesticide use violations. Third, the legislation increases DPR administrative penalties for pesticide residue violations and expands the number of situations in which DPR can levy these penalties. Finally, the legislation increases several existing DPR administrative penalties for pesticide sales and licensing violations. (The Director of DPR is permitted to adjust all administrative and civil penalty levels for inflation in future years.) The budget also provides $582,000 annually from the DPR Fund to investigate and develop pesticide-related enforcement cases. In addition, the budget includes $300,000 annually from the DPR Fund over the next three years for the department to have the Attorney General’s Office represent DPR in civil and criminal pesticide use enforcement actions. Subscribe | California State Legislature | Online Voter Registration | Privacy Policy | Accessibility Legislative Analyst's Office | The California Legislature's Nonpartisan Fiscal and Policy Advisor 925 L Street, Suite 1000 Sacramento, CA 95814 | (916) 445-4656