May Revise Budget Proposes Extending Cap-and-Trade and Shifting $1.5 Billion from GGRF for Wildfire Prevention and Protection

The May Revision of the Governor’s budget proposes an extension of the Cap-and-Trade program that is best captured in a renaming of the program to the Cap-and-Invest program and enshrined in clear guiding principles that enable a stable and predictable price on carbon pollution to drive deeper investments in carbon reduction and clean technologies.

The May Revision proposes to shift $1.54 billion from the General Fund to the Greenhouse Gas Reduction Fund (GGRF) to support CAL FIRE’s fire prevention, fire control, and resource management activities on an ongoing basis. This proposal aligns with the polluter-pays principle in which carbon emitters will fund the state’s world-class forestry and fire protection programs in the face of wildfires that have become increasingly destructive because of climate change. The proposal also includes a General Fund backstop to protect CAL FIRE’s operations in the event Cap-and-Invest auction proceeds fall below projected revenues. To address the projected budget shortfall, the May Revision includes General Fund solutions to achieve a balanced budget, including a reversion of $31.5 million General Fund appropriated for the acquisition of property for a new CAL FIRE training center. CAL FIRE is exploring more cost-effective alternatives that will meet the same training capacity goals as the new additional training center project through a combination of expanding and upgrading existing training facilities and utilizing newly identified long-term lease opportunities to minimize delays in training output.