Capitol politics through the looking glass

The paradoxes are everywhere in the ongoing battle to close the state’s budget gap. Gov. Arnold Schwarzenegger is pushing for an economic stimulus package, even as he is advocating a tax increase – the antithesis of economic stimulus. Meanwhile, Democrats are holding out for environmental safeguards on transportation projects, even though their leaders sponsored a bill that eliminated similar regulations for housing projects just months ago.

The stalemate continues, in part, because of Democrats’ objections to eliminating some environmental protections, even though similar protections were lifted in a bill by Senate Leader Darrell Steinberg last year at the behest of housing developers. Meanwhile, the governor, who diligently projects an international image of environmental crusader, is leading the charge for weakening these same environmental laws.

Welcome to the world of California politics.

The governor has cited the easing of environmental regulations as a way to stimulate the economy, but has been deaf to the objections of truckers and business groups who strongly opposed new diesel and clear air rules adopted by the Air Resources Board last month – rules that were supported by Schwarzenegger. Estimates of the financial impact of the diesel regulations range from $5 billion to $10 billion, and more.

Like the transportation groups advocating this easing of regulations, the trucking and business groups cited the adverse economic impact that more environmental regulations would bring.

“You will have people screaming and saying this will lose jobs,” Schwarzenegger said at a Dec. 10 press conference. And while he said he understood businesses concerns, Schwarzenegger said, “I think that we should move forward with this whole thing.”

Now, the governor sees environmental rules as a hindrance to getting construction jobs started. As the governor vetoed the Democrats’ latest budget proposal Tuesday, he cited hang-ups over environmental regulations as part of the reason for his veto.
“I asked to expedite the environmental review process on more than $1 billion worth of transportation projects in order to create jobs immediately,” the governor said. “Expediting the start of these projects would create more than 18,000 jobs in 2009.  The legislation you sent me would have simply replaced the existing environmental review process with an even more time-consuming set of requirements.  Further, I asked for expedited permitting on these projects, a request your legislation does not address.”

Schwarzenegger spokesman Aaron McLear said there is no contradiction between the governor’s overall environmental record, and his current call to temporarily cast some environmental review aside.

“The governor’s record on the environment speaks for itself,” said McLear. “To suggest he would do anything that would be bad for the environment just doesn’t hold.”

McLear said the concessions Schwarzenegger seeks would “eliminate the red tape” on various transportation projects, including a new carpool lane on Highway 50 in Sacramento, and expansion of the Caldecott Tunnel in the East Bay.

“The governor’s No. 1 priority is getting people back to work.”

Assembly Speaker Karen Bass and Steinberg said the regulatory changes sought by the governor would do little to stimulate the state’s economy. “We should be clear that like all of the governor’s “stimulus” proposals, the additional bills we will pass do nothing to resolve California’s real and immediate emergency – the cash crisis,” they wrote in a joint op-ed in Wednesday’s Sacramento Bee.
Jim Earp, executive director of the California Alliance for Jobs, did not completely disagree with the Democrats’ assessment. But, he said, the changes sought by the governor are important for the state’s long-term fiscal health.

“If he’s going to support a package that includes taxes, he’s got to have something for it,” said Earp. “This is more long-term stuff. You can make the argument that the economic stimulus may not have an immediate impact on the budget for this year. But he’s looking at the long-term economic health of California.”

If there is a disconnect between the environmental record touted by the administration and the current call for easing environmental rules, there is a similar apparent paradox in the politics of Steinberg.

Last year, Steinberg authored SB 375, which offered some relief from the California Enivornmental Quality Act for residential home builders. The relief was part of a larger deal between housing builders, environmentalists, cities and others who agreed to provide incentives for transportation and housing projects that promote so-called “smart growth.”

Ed Manning, who represents residential home builders and was part of the SB 375 compromise, said Steinberg did support some targeted easing of environmental regulations. But, he said, the projects were only granted that relief if they were part of a larger development plan that had been approved by the state Air Resources Board.

“The CEQA relief was only for housing projects consistent with a CARB-approved regional sustainable communities plan,” said Manning. “It was relief from certain kinds of environmental analysis. We wouldn’t have to do greenhouse gas analysis, for example. We were granted relief from some of the studies trying to analyze the project’s specific impacts, instead of the overall impacts in the context of a larger development.”

Steinberg spokesman Jim Evans said that while the governor's request may sound similar to what was agreed to in SB 375, there are major differences. "They’ve very different. Under SB 375, projects do not get any CEQA benefits unless they fit into a larger plan that is approved by the ARB and fit into the larger greenhouse gas emission goals in AB 32.

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