As carbon “fee” initiative appears headed to November ballot, critics question costs, effects

Washington voters will likely have another chance to decide the fate of a carbon tax initiative this fall. The Associated Press reports,

A broad, diverse coalition of tribes, community, labor and environmental groups say they’ve gathered enough signatures to put a “carbon fee” measure on the ballot. It comes two years after voters in this state rejected a carbon tax that would have been the first in the nation.

Oops. We should have written carbon fee, not tax. Those quotes the AP put around “carbon fee” signal one carefully constructed aspect of I-1631: It imposes a “pollution fee” instead of a tax. As The Lens reports, this has obvious messaging appeal.

An analysis of the initiative by Carbon Washington when it was first filed in March noted that having I-1631 levy a fee has the “political benefit of avoiding the dreaded ‘t’ word — tax. However, from a pricing perspective, the difference between a fee and tax is not so important.”

The AP writes that carbon pricing has faced challenges here before.

Washington state has been on the forefront of policy to curb greenhouse gas emissions blamed for global warming. But carbon-pricing efforts backed by Gov. Jay Inslee, a Democrat, and other lawmakers haven’t gained much traction. Inslee proposed but failed to get support for a carbon tax bill in the most recent legislative session.

Now, environmental, community, faith-based and other groups — some of whom lined up against the carbon tax measure that failed in 2016 — see this citizens’ initiative as the best opportunity to tackle climate change and move away from fossil fuel use.

Business groups say that industry is already at, to use the word again, the forefront of clean energy.

Gary Chandler, vice president of governmental affairs for the Association of Washington Business, said businesses are already doing a lot to reduce their carbon footprint.

The state with its abundance of hydroelectric power is one of the cleanest, he said, and has passed several laws to reduce carbon emissions, including renewable energy standards.

Chandler said the actions will have a negligible impact on overall global emissions, while businesses in the heavily trade-dependent state will be at a competitive disadvantage with those that won’t have to pay the fee.

The Seattle Times summarizes the initiative.

The initiative by the Alliance for Jobs and Clean Energy would create an escalating Washington carbon “fee” on most fossil-fuels emission, and invest the revenue in clean energy, clean water, forests and other projects that seek to slow or help cope with climate change.

The fee would start at $15 a metric ton of carbon, which would add an estimated 14 cents to the cost of a gallon of gasoline. The fee would rise annually by $2 per ton of carbon emission, plus the rate of inflation.

And explains the proponents’ choice of a “fee.”

Initiative proponents said they opted for a carbon fee — rather than a tax — so the spending of this revenue could be tied to spending on projects that could help reduce carbon emissions from fossil-fuel combustion and other greenhouse gases that contribute to climate change.

Money raised from a tax can be spent more broadly through legislative action. Fees, like those charged at state parks, are spent more narrowly.

As mentioned above, the price consequences, then, are identical; the only difference is that the fee revenues are more easily earmarked. It’s not an insubstantial amount of money.

The carbon fee would raise an estimated $1 billion annually initially, and the spending would be overseen by an independent board drawn in part from the public, which proponents hope will provide accountability.

At the gas pump, these fees would hit everyone, including low-income residents. This differs from carbon-tax initiative, rejected by voters in 2016, which would have rebated up to $1,500 to some 460,000 low-income families.

The Spokesman-Review reports critics question the creation of a new board to oversee the spending.

Opponents counter [the initiative] is really about raising money from businesses and the public and giving it to a new, unwieldy bureaucracy.

The bureaucracy has a great deal of latitude as TJ Martinell reports in The Lens.

Although the initiative text spells out ways for that money to be spent and how much of it must be allocated for those purposes, the ultimate decision is left to a board consisting of 15 voting members and six co-chairs including the commissioner of public lands and the directors of the state Departments of Commerce, Ecology and the Recreation and Conservation Office.

We’ll doubtless hear much more about this in the coming months. Martinell’s story includes a nugget that we’d not noticed before.

…[Washington Policy Center Environmental Director Todd] Myers also criticizes a clause at the end of I-1631’s text that says if the initiative is declared invalid, then the state Department of Ecology is called to enforce Governor Jay Inslee’s carbon cap policy that was eventually declared struck down in Thurston County Superior Court late last year on the grounds that Ecology lacked statutory authority.

“Rather than take the Governor’s cap-and-trade rule directly to the voters or the legislature, as the judge said was required, they simply throw it in at the end of I-1631,” Meyers writes.

Not sure how that would work. It promises to be an interesting campaign.