Wash. Gov. Inslee proposes carbon fee to pay for transportation projects 

Source: Nathanael Massey, E&E reporter • Posted: Thursday, December 18, 2014

Washington Gov. Jay Inslee (D) wants to rebuild his state’s transportation infrastructure and plans to charge carbon emitters in order to come up with the funds.

The governor is rolling out a proposed state budget in stages this week and is expected to speak to the design and implementation of a state carbon fee today. But details released about funding for the transportation sector yesterday indicate that about a third of the $12 billion needed to rebuild roads and bridges would come from a fee levied on the state’s biggest polluters.

“It’s transportation pollution paying for transportation choices,” Inslee said, speaking at the proposal’s release.

Revenue from a carbon pollution fee would account for $4.8 billion of the state’s 12-year transportation spending, with the rest generated from tolls, fees and construction bonds.

The governor is pitching the carbon price mechanism — which would apply to roughly 130 entities in oil and gas and electrical sectors, and put a hard cap on the state’s greenhouse gas emissions — as a way to meet state budget commitments in a number of areas, said David Postman, an Inslee spokesman.

Revenue would be divided among education, transportation and environmental spending, he said.

Washington is one of a number of states eyeing a price on carbon as a means of generating revenue (ClimateWire, Dec. 12). The state is currently facing a $2.35 billion budget shortfall over the next two years, much of it stemming from a court mandate to pay back shortfalls in education spending.

Playing the budget card

Action on climate change has been central to Inslee’s governorship but has been stymied by a politically divided Legislature (ClimateWire, Nov. 6). After the midterm elections, Republicans control the state Senate and Democrats hold only a slim majority in the House.

Inslee has previously indicated that a carbon fee’s potential for revenue might make it more attractive to Republican state lawmakers, who have resisted the idea in the past.

The House and Senate will craft their own budget proposals during the upcoming session next year.

The governor’s office has not yet indicated whether it would seek to link a carbon price system to California’s cap-and-trade system, British Columbia’s revenue-neutral carbon price, or a possible carbon price in Oregon, although the three states and the province are nominally committed to regional carbon pricing under a number of nonbinding compacts.

Along with plans for new bridges and revamped highway corridors, the proposed transportation budget would provide funds for electric vehicle and alternative fuel incentives, along with the infrastructure, such as charging stations, needed to support them. Funding would also be provided for new bicycle and pedestrian transit, as well as a program to shift the state’s ferries from diesel to natural gas.