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CLT UPDATE
Wednesday, December 18, 2019

Impact of a TCI pact


The pact being developed by Massachusetts and other East Coast states to cap carbon emissions from vehicles could add up to 17 cents to the price of a gallon of gas, according to the newest estimates, but could also generate more than $500 million in revenue for state government in Massachusetts.

Leaders from a coalition of eastern states, including Massachusetts, have been working for over a year to develop a regional "cap-and-invest" program to reduce carbon pollution from cars and trucks. They plan to release a draft memorandum of understanding on Tuesday that states would be asked to sign onto next spring once it is finalized.

The officials involved in the effort, known as the Transportation Climate Initiative, are eyeing a reduction in emissions of up to 25 percent by 2032, but it will come at a cost....

The plan to reduce carbon emissions from vehicles by 25 percent would add an estimated 17 cents to the price of a gallon of gas at the pump starting in 2022....

TCI has significant backing from many of the major employer groups in Massachusetts, including Associated Industries of Massachusetts and the Greater Boston Chamber of Commerce, but has been coming under increasing fire from a small group of Republican legislators and small business groups.

The National Federation of Independent Business in Massachusetts, the Massachusetts Fiscal Alliance and Citizens for Limited Taxation signed on to a multi-state letter released Tuesday opposing TCI because of the additional cost it will add for employers. It considers the program to be akin to a gas tax increase.

A MassINC poll released Wednesday found that a majority of registered voters in Massachusetts, Connecticut, Maryland, New York, New Jersey, Pennsylvania and Virginia -- the largest states in the coalition - strongly or somewhat support their home state's participation in the Transportation and Climate Initiative.

In Massachusetts, 68 percent of the 629 respondents said they support the program, compared to 21 percent who oppose it and 11 percent who are unsure, according to the poll, which was sponsored by the Barr Foundation and conducted before the latest estimated impacts on gas prices were known.

Theoharides said that unlike a gas tax the price per gallon is not fixed and would depend on how the market responds to the caps that get adopted on pollution and how much of the expense suppliers pass on to consumers.

State House News Service
Tuesday, December 17, 2019
Compact Could Add Nickel to 17 Cents to Gallon of Gas


The regional gas fee agreement being pursued by the Baker administration as an anti-climate change measure could raise prices at the pump by 17 cents in just the first year, according to estimates by state officials — who didn’t immediately say how high prices might go in subsequent years....

A draft version of a memorandum of understanding for the Transportation Climate Initiative was also released Tuesday, with a final version expected in the spring of 2020, at which point each state will determine whether or not to sign on. Massachusetts is one of 12 Atlantic seaboard states and the District of Columbia involved in TCI negotiations.

A similar measure already in effect in California has driven gas prices to between $4 and $5 a gallon there. Critics have said the measure could be economically damaging to Massachusetts — especially in neighboring states such as Vermont and New Hampshire opt not to join the compact.

The average price of gasoline in Massachusetts this week is $2.557 a gallon, according to AAA. The proposed 17-cent increase, if applied today, would jack up gas prices to $2.727.

A letter of opposition to TCI was released today by Massachusetts Fiscal Alliance, the National Federation for Independent Business, and Citizens for Limited Taxation, who have voiced concern that TCI will be adopted by Gov. Charlie Baker by executive order, without a vote of the Legislature.

“The more people learn about the extremes of this tax and the undemocratic way it’s being forced upon residents, the less popular it becomes,” Paul D. Craney, spokesman for the Massachusetts Fiscal Alliance, said in a statement.

The anti-TCI coalition’s letter states: “Unlike motor fuel taxes levied to pay for roads, bridges, and transportation infrastructure (a reasonable fee for use), the TCI would be the equivalent of a “sin tax” – a penalty for engaging in bad behavior. We do not believe that driving to and for work, transporting children to school, transporting goods, going to the grocery store, and all the other necessary activities that generally require a vehicle should be treated by governments as a sin. These are not activities people can, or should be forced to, avoid.

“The TCI tax is a poorly conceived, fundamentally regressive, and economically damaging proposal. It would — on purpose — make the day-to-day transactions of life painfully expensive, especially for those of us who are going through bad times and are struggling every day to get by. Government should not do this to its citizens. Government exists to serve the people, not to bend them to the will of elite opinion. For these philosophical and financial reasons, states should reject the TCI at the first available opportunity,” states the letter, which was delivered to Gov. Charlie Baker and legislators.

The Boston Herald
Tuesday, December 17, 2019
Regional gas fee agreement could raise fuel costs by 17 cents in first year
Critics have warned TCI climate initiative could do economic harm


In Massachusetts, this system could mean an influx of around $500 million a year for transportation purposes, starting as soon as January 2022.

The states still need to approve the initiative, and some might not agree to participate in this new market. Katie Theoharides, the state’s energy and environmental affairs secretary, said all but three states need legislative approval to participate. Massachusetts does not, although Theoharides said the Governor Charlie Baker administration would make its decision in consultation with legislative leaders on Beacon Hill....

Critics of the program such as the conservative Massachusetts Fiscal Alliance have argued TCI is effectively a tax hike. Another small-governance organization, Citizens for Limited Taxation, noted in a statement Tuesday that gas tax increases were rejected the last time voters had a direct say on the matter, in a 2014 ballot measure.

What’s more, with state lawmakers likely to debate a gas tax increase next year, implementing TCI could lead to two separate hikes at the pump.

The Boston Globe
Tuesday, December 17, 2019
States disclose details of new emissions controls that would drive up gas prices


Today, Governor Chris Sununu announced that New Hampshire will not be participating in the Transportation and Climate Initiative (TCI). Under this scheme, New Hampshire drivers would be forced to pay a significant new gas tax with little environmental benefit to the state.

“I will not force Granite Staters to pay more for their gas just to subsidize other state’s crumbling infrastructure,” said Governor Chris Sununu. “New Hampshire is already taking substantial steps to curb our carbon emissions, and this initiative, if enacted, would institute a new gas tax by up to 17 cents per gallon while only achieving minimal results. This program is a financial boondoggle and the people of New Hampshire will never support it.” ...

“There are clearly better ways to achieve the purported goals of this program,” said Office of Strategic Initiatives Director Jared Chicoine. “This proposal is a huge hit to the wallets of rural drivers. The data makes it clear that — even without the TCI proposal — the market is already projected to reach many of the same environmental benchmarks."

State of New Hampshire
Office of the Governor, Chris Sununu
News Release December 17, 2019
New Hampshire Declines to Participate In the Transportation Climate Initiative


New Hampshire is backing out of the controversial regional TCI compact just hours after a draft policy was released Tuesday, with Granite State Gov. Chris Sununu citing increase costs in gas prices as his reason for their retreat....

Officials told reporters that they did not examine how those economic impacts would change if any of the 12 states or the District of Columbia decided to back out. They also didn’t immediately say how high gas prices might go in subsequent years.

Opponents of the TCI compact have said that if neighboring states such as New Hampshire back out, the Massachusetts economy could take a hit due to higher gas prices.

Sununu announced that New Hampshire will not be participating in the Transportation and Climate Initiative because drivers would be forced to pay more for gas with “little environmental benefit to the state.” Rural communities would be left at a severe disadvantage if New Hampshire participated in the TCI, according to Sununu’s office, as drivers will bear the brunt of the artificially higher gas prices.

The Boston Herald
Tuesday, December 17, 2019
New Hampshire backs out of regional climate initiative


Outraged anti-tax warriors Tuesday vowed to fight a “tone deaf” regional initiative — already rejected by New Hampshire officials — that could hike the cost of gas by as much as 17 cents a gallon in just the first year, saying the proposal is an insult to Bay State voters’ who rejected a gas tax five years ago.

“The people spoke very clearly that they didn’t want a gas tax. This flies in the face of that vote and it just shows you how tone deaf Beacon Hill is,” said Holly Robichaud, who was behind a victorious 2014 ballot initiative that repealed a gas tax hike of 24 cents a gallon and built-in automatic increases for years to come....

“The people spoke very clearly that they didn’t want a gas tax. This flies in the face of that vote and it just shows you how tone deaf Beacon Hill is,” said Holly Robichaud, who was behind a victorious 2014 ballot initiative that repealed a gas tax hike of 24 cents a gallon and built-in automatic increases for years to come.

The current proposal, called the Transportation Climate Initiative, could increase gas prices an estimated 17 cents a gallon in the first year by levying fees on fuel companies that would be passed on to drivers. The price could balloon from there — all without a vote from the state Legislature. Gov. Charlie Baker has signaled he could use his executive authority to approve the plan.

“Every time we turn around they’re looking to hit drivers with some new fee,” said Robichaud. “They should get the message and get off the backs of drivers.” ...

“This all boils down to the same thing as before — it’s a way to subsidize the MBTA,” said Geoff Diehl, a former state representative who was also a part of the 2014 “Tank the Gas Tax,” campaign. “Voters didn’t like it the first time they tried it.”

If Vermont follows New Hampshire’s lead and opts out of the TCI, that would leave more border gas stations high and dry as drivers go across state lines for their gas. Businesses that see their costs rise, and shoppers who see prices rise won’t be far behind.

“This will just send people out of state again,” said Robichaud.

Robichaud and Diehl are part of a growing opposition to TCI that includes the Massachusetts Fiscal Alliance, the National Federation for Independent Businesses and Citizens for Limited Taxation. The coalition denounced the proposal yesterday and are pushing for legislators to review and vote on the plan after its release in the spring of 2020.

“We’re going to fight this thing one way or another,” said Robichaud. “This isn’t about saving the world, its about grabbing more money.”

The Boston Herald
Tuesday, December 17, 2019
‘Tank the Gas Tax’ targets Gov. Charlie Baker’s fuel fee proposal


Gov. Charlie Baker’s push to join a regional anti-climate change compact — predicted to jack up gas prices by up to 17 cents in just the first year — took a potentially critical blow even as it was being rolled out Tuesday, when New Hampshire quickly rejected it as a “financial boondoggle” and a burden on drivers.

“I will not force Granite Staters to pay more for their gas just to subsidize other states’ crumbling infrastructure,” Granite State Gov. Chris Sununu said of the the controversial Transportation Climate Initiative. “This program is a financial boondoggle and the people of New Hampshire will never support it.”

New Hampshire’s rejection came just hours after a draft memorandum of understanding was released Tuesday for the consideration of the 12 Atlantic Seaboard states and the District of Columbia that have been involved in TCI negotiations. The multi-state compact is intended to reduce carbon emissions and raise money for transportation projects by driving up gas prices. But critics say that driving up gas prices in Massachusetts if neighboring states don’t go along is a recipe for economic disaster — sending drivers, businesses and shoppers across the border to avoid higher costs....

While they pegged the first year’s increase at 17 cents a gallon, officials didn’t immediately say how high prices might go in subsequent years and told reporters that they did not examine how the economic impacts would change if neighboring states opted out, as New Hampshire now has done.

TCI opponents say if neighboring states such as New Hampshire or Vermont opt not to join, the Massachusetts economy could take a hit due to higher gas prices.

“We have been talking about this for a while and today was the first day the TCI coalition came out with a proposal,” MassFiscal Alliance spokesman Paul Craney said. “Within the first day already they have suffered a major setback as one of the crucial states in the region decided it is not going to join.”

“I’m not surprised to hear New Hampshire is not joining TCI, as they’ve shown reluctance up to this point,” state Rep. Marc Lombardo said. “Once again a Massachusetts tax increase will be an economic win for New Hampshire. I hope the governor will reconsider joining TCI.” ...

Baker was not available for comment late Tuesday on New Hampshire opting out. Baker spokeswoman Anisha Chakrabarti did not directly address Sununu’s decision, saying in a statement the administration “is pleased by the robust participation by Northeast and Mid-Atlantic states throughout the program’s ongoing development process and by the broad coalition of support from members of both the business and environmental communities.”

The average price of gasoline in Massachusetts this week is $2.557 a gallon, according to AAA. A 17-cent increase, if applied today, would jack up gas prices to $2.727. A similar climate measure already in effect in California has driven gas prices to between $4 and $5 a gallon there at times.

A final version of the TCI memorandum of understanding is expected to be released in the spring, at which point each state will determine whether to sign on.

The Boston Herald
Tuesday, December 17, 2019
Gas levy plan hits bump as N.H. opts out


The pact being developed by Massachusetts and other East Coast states to cap carbon emissions from vehicles could add up to 17 cents to the price of a gallon of gas, according to the newest estimates, but could also generate more than $500 million in revenue for state government in Massachusetts.

Leaders from a coalition of eastern states, including Massachusetts, have been working for over a year to develop a regional "cap-and-invest" program to reduce carbon pollution from cars and trucks and generate the resources needed to expand clean transit options and improve public health.

The effort, known as the Transportation Climate Initiative, has also become a central part of Gov. Charlie Baker's transportation and climate agenda, with the administration proposing to earmark half of all proceeds generated toward improving public transit...

But the coalition already began to splinter Tuesday in light of the newly forecast economic impacts, with New Hampshire Gov. Chris Sununu announcing that his state would not participate.

"We are already taking substantial steps to curb our carbon emissions, & this initiative, if enacted, would institute a new gas tax by up to 17 cents per gallon while only achieving minimal results. This program is a financial boondoggle and the people of NH will never support it," Sununu wrote on Twitter....

The officials involved in the effort are eyeing a reduction in emissions of up to 25 percent by 2032, but it will come at a cost.

States in the coalition are exploring three scenarios for capping emissions from motor gasoline and on-road diesel, with a final cap proposed after a public comment period ends on Feb. 28.

The plan to reduce carbon emissions from vehicles by 25 percent would add an estimated 17 cents to the price of a gallon of gas at the pump starting in 2022....

Chris Hoagland, and economist in the climate change division of Maryland's Department of the Environment, said TCI's model showed that emissions from vehicles – which cover 43 percent of all emissions in the region – would decline by 6 percent to 19 percent without any additional action.

That drop, according to Hoagland, would result from the ongoing shift to more fuel efficient cars and trucks, but could fluctuate depending on whether federal fuel efficiency standards are rolled back....

She also suggested that member states would also meet every few years to review the program, and could accelerate the emission reduction targets in the future....

The concept, however, has been coming under increasing fire from a small group of Republican legislators and small business groups.

Rep. Timothy Whelan, a Brewster Republican, and Rep. Marc Lombardo, a Billerica Republican, both submitted public comments to the coalition arguing that the Legislature should get to vote before Massachusetts joins any partnership.

The National Federation of Independent Business in Massachusetts, the Massachusetts Fiscal Alliance and Citizens for Limited Taxation were also among a cohort of business and anti-tax groups from Maine to Virginia to sign on to a letter released Tuesday opposing TCI because of the additional cost it will add for employers.

"Make no mistake, this is a tax," the groups wrote in their letter. "More precisely, it is a carbon dioxide tax being implemented through a gas tax."

The opponents argued that not only would the program add to municipal costs for busing, plowing and other services, but low-income families and small business owners would feel the pinch.

"Since motor fuels are economically 'inelastic,' the higher costs imposed by the TCI's fuel tax will have to come out of other areas of household budgets," the letter stated....

[Massachusetts Energy and Environmental Affairs Secretary Kathleen Theoharides] said that unlike a gas tax the price per gallon is not fixed under the compact and would depend on how the market responds to the caps that get adopted on pollution and how much of the expense suppliers pass on to consumers.

The program would set a limit on emissions from fuel, and hold auctions at which fuel suppliers that transport gasoline into Massachusetts and other states could purchase allowances for every ton of carbon dioxide that the fuel they are carrying would emit when burned.

The states estimate that the program could generate $7 billion a year across the region by 2032 in proceeds from these auctions, sending $500 million or more back to Massachusetts to be reinvested in clean transit options.

State House News Service
Tuesday, December 17, 2019
TCI Framework Details Gas Price Impacts, Emissions Cuts


Chip Ford's CLT Commentary

“I will not force Granite Staters to pay more for their gas just to subsidize other state’s crumbling infrastructure.  New Hampshire is already taking substantial steps to curb our carbon emissions, and this initiative, if enacted, would institute a new gas tax by up to 17 cents per gallon while only achieving minimal results. This program is a financial boondoggle and the people of New Hampshire will never support it.”

It must be so gratifying to have a true Republican governor making such decisions.  That's one down and twelve states to go.  Vermont's Republican Gov. Phil Scott has also expressed reservations about joining the tax-hike cabal, so that could be number two.

Instead of a Republican, the serfs and subjects of the Massachusetts oligarchy have Charlie Baker as a self-appointed Royal Governor the architect of "the financial boondoggle."

"The data makes it clear that — even without the TCI proposal — the market is already projected to reach many of the same environmental benchmarks," New Hampshire Office of Strategic Initiatives Director Jared Chicoine stated.

One of our opposition coalition members, Marc Fitch of Connecticut's Yankee Institute for Public Policy sent our coalition members the following analysis:

The “reference case,” or baseline scenario used by the Georgetown Climate Center to project what would happen from 2022-2032 if states DID NOT IMPLEMENT THE TCI projects a 19% REDUCTION in carbon emissions over that decade.

So our region can expect to see a significant reduction in carbon emissions without TCI ever being implemented.

If TCI is implemented, emissions are then projected to fall by between 20% and 25% in total for the decade. So that’s an increased emissions reduction of between 1 and 6 percentage points on top of a presumed reduction of 19 percent — which means that the huge economic costs imposed by the TCI are less effective at producing emissions reductions than are policies and practices that are already in place — namely fuel economy standards and increased sales of electric vehicles.

TCI revenue is projected to fall between $1.4 billion and $5.6 billion ANNUALLY. So to produce a mere 1 percentage point reduction in emissions over 10 years, they would impose a $14 billion tax on the region’s economy. To produce the high-end estimate of an additional 6 percentage point reduction in emissions (25% overall), they would impose a $56 billion tax on the region’s economy.

They project that if the costs are passed on to consumers, gas taxes will increase by:

.05 per gallon in 20% reduction scenario
.09 per gallon in 22% reduction scenario
.17 per gallon in 25% reduction scenario

Here is the Transportation & Climate Initiative's own baseline ("reference case") projection from its August report scroll down to slide #16.

The scheme plans to impose a $14 billion tax increase on the region to reduce emissions 1 percentage point over ten years; $56 billion for a reduction of 6 percent.

This is not about "mitigating the threat of climate change" as much as it is about hiking taxes with no fingerprints, no accountability and no limitations.


Much like the United States of America turning over some of its national sovereignty through foreign compacts like the World Trade Organization, or European nations turning theirs over to a European Union, Gov. Baker's "financial boondoggle" plans to extend unilateral power to hike gas taxes to a new and unaccountable cabal, "a multi-state compact" — The Transportation Climate Initiative which will never be held accountable for its unilateral decisions effecting our lives.

The State House News Service noted that Baker administration Energy and Environmental Affairs Secretary Kathleen Theoharides said that, unlike a gas tax, the price per gallon is not fixed and would depend on how the market responds to the caps that get adopted on pollution and how much of the expense suppliers pass on to consumers.

The Boston Herald reported:  "While they pegged the first year’s increase at 17 cents a gallon, officials didn’t immediately say how high prices might go in subsequent years and told reporters that they did not examine how the economic impacts would change if neighboring states opted out, as New Hampshire now has done."

But this does not mean that Gov. Baker intends to entirely surrender Beacon Hill's ability to hike gas taxes on its own.  That right is reserved.

The Boston Globe noted that with state lawmakers likely to debate a gas tax increase next year, implementing TCI could lead to two separate hikes at the pump.


The State House News Service yesterday reported:

A MassINC poll released Wednesday found that a majority of registered voters in Massachusetts, Connecticut, Maryland, New York, New Jersey, Pennsylvania and Virginia — the largest states in the coalition strongly or somewhat support their home state's participation in the Transportation and Climate Initiative.

In Massachusetts, 68 percent of the 629 respondents said they support the program, compared to 21 percent who oppose it and 11 percent who are unsure, according to the poll, which was sponsored by the Barr Foundation and conducted before the latest estimated impacts on gas prices were known.

There it is again.  "68 percent of the 629 respondents said they support the program . . . before the latest estimated impacts on gas prices were known."

In fact, last Wednesday the State House News Service first reported:

The poll's question did not reference the potential of higher costs on motorists when asking about their support for the program.

The next day, The Salem News reported:

But the survey of nearly 7,000 voters didn't ask if they supported new taxes and fees to implement the program, and critics pounced on the omission.

"People may be in favor of TCI but do they know the costs?" [Christopher Carlozzi, Massachusetts state director of the National Federation of Independent Businesses] said Wednesday. "The poll didn't explain that the costs would be passed along to consumers at the gas pumps."

In my commentary on Friday I wrote:

. . . This comes after the release of a poll conducted by MassINC that purports to show alleged great support for TCI. The poll is apparently intended to shape rather than reflect public opinion — what's commonly called a "push poll" — asking questions in a calculated way that returns the desired response.

Any credible pollster would have included that critical piece of information in any legitimate poll if it expected an honest result, don't you think?

Once motorists and taxpayers become aware of what's being done to them under the guise of "climate change mitigation" do you think the support will remain?

In fact, do you think we'll see any polls even conducted once the citizens wake up to this unconscionable assault?

And they are slowly awakening, beginning to absorb what's being plotted against them.


A CLT member, Jim G., brought to my attention a clause in the U.S. Constitution that seems to specifically prevent such multi-state compacts.  I've passed it along to the allies in our multi-state opposition coalition.  The response from one was:  "Yes, down the road my guess is there will be a legal arm to this [opposition]."

"No State shall, without the Consent of Congress, lay any Duty of Tonnage, keep Troops, or Ships of War in time of Peace, enter into any Agreement or Compact with another State, or with a foreign Power, or engage in War, unless actually invaded, or in such imminent Danger as will not admit of delay."

The United States Constitution
Article I, Section 10, Clause 3

Chip Ford
Executive Director


 

State House News Service
Tuesday, December 17, 2019

Compact Could Add Nickel to 17 Cents to Gallon of Gas
By Matt Murphy

The pact being developed by Massachusetts and other East Coast states to cap carbon emissions from vehicles could add up to 17 cents to the price of a gallon of gas, according to the newest estimates, but could also generate more than $500 million in revenue for state government in Massachusetts.

Leaders from a coalition of eastern states, including Massachusetts, have been working for over a year to develop a regional "cap-and-invest" program to reduce carbon pollution from cars and trucks. They plan to release a draft memorandum of understanding on Tuesday that states would be asked to sign onto next spring once it is finalized.

The officials involved in the effort, known as the Transportation Climate Initiative, are eyeing a reduction in emissions of up to 25 percent by 2032, but it will come at a cost.

The draft will put forward three scenarios for capping emissions from motor fuel, with a final cap proposed after a public comment period ends on Feb. 28.

The plan to reduce carbon emissions from vehicles by 25 percent would add an estimated 17 cents to the price of a gallon of gas at the pump starting in 2022. If states elected for a smaller reduction goal of 22.5 percent, the cost per gallon, based on the group's modeling, would drop to 9 cents. The third option presented in the memo is for a 20 percent emission reduction by 2032 at a cost to drivers of 5 cents per gallon.

The Baker administration, with Energy Secretary Kathleen Theoharides leading the negotiations between the states, has been pursuing TCI since late 2018 as a central component to its transportation and climate agenda.

TCI has significant backing from many of the major employer groups in Massachusetts, including Associated Industries of Massachusetts and the Greater Boston Chamber of Commerce, but has been coming under increasing fire from a small group of Republican legislators and small business groups.

The National Federation of Independent Business in Massachusetts, the Massachusetts Fiscal Alliance and Citizens for Limited Taxation signed on to a multi-state letter released Tuesday opposing TCI because of the additional cost it will add for employers. It considers the program to be akin to a gas tax increase.

A MassINC poll released Wednesday found that a majority of registered voters in Massachusetts, Connecticut, Maryland, New York, New Jersey, Pennsylvania and Virginia -- the largest states in the coalition - strongly or somewhat support their home state's participation in the Transportation and Climate Initiative.

In Massachusetts, 68 percent of the 629 respondents said they support the program, compared to 21 percent who oppose it and 11 percent who are unsure, according to the poll, which was sponsored by the Barr Foundation and conducted before the latest estimated impacts on gas prices were known.

Theoharides said that unlike a gas tax the price per gallon is not fixed and would depend on how the market responds to the caps that get adopted on pollution and how much of the expense suppliers pass on to consumers.

The program would set a limit on emissions from fuel, and hold auctions at which fuel suppliers that transport gasoline into Massachusetts and other states could purchase allowances for every ton of carbon dioxide that the fuel they are carrying would emit when burned.

The states estimate that the program could generate $7 billion a year across the region in proceeds from these auctions, sending $500 million or more back to Massachusetts to be reinvested in clean transit options.

"One of the big pieces for us is getting as many states on board as we can," Theoharides said. The secretary said that while there does need to be a "critical mass" of participation for the program to work, she did not think all 13 jurisdictions would need to sign on for the program to be successful.

Theoharides said the coalition has also estimated $10 billion in public health benefits through the program from reduced cases of conditions like asthma and $892 in avoided costs due to climate change.

Twelve states and the District of Columbia have been working with the Georgetown Climate Center to put together the Transportation Climate Initiative since late 2018.

The cap-and-invest program is modeled off the Regional Greenhouse Gas Initiative, which focused on driving down emissions from power plants, but Theoharides said it has the potential to reduce carbon emissions by three times the levels achieved through RGGI.

The TCI coalition states represent 72 million people and 52 million registered vehicles, with a gross domestic product larger than the economy of California at $5.3 trillion.


The Boston Herald
Tuesday, December 17, 2019

Regional gas fee agreement could raise fuel costs by 17 cents in first year
Critics have warned TCI climate initiative could do economic harm
By Mary Markos

The regional gas fee agreement being pursued by the Baker administration as an anti-climate change measure could raise prices at the pump by 17 cents in just the first year, according to estimates by state officials — who didn’t immediately say how high prices might go in subsequent years.

The initial projections of the economic impact of the Transportation Climate Initiative, a multi-state compact that would implement a gas cap to reduce carbon emissions, were presented to press during a conference call with Massachusetts Energy and Environmental Affairs Secretary Kathleen Theoharides and officials from Maryland and Georgetown Climate Center.

Their modeling evaluated the results of carbon caps that would reduce anywhere from six percent 19 percent Co2 emissions by 20 to 25 percent between 2022 and 2032.

A draft version of a memorandum of understanding for the Transportation Climate Initiative was also released Tuesday, with a final version expected in the spring of 2020, at which point each state will determine whether or not to sign on. Massachusetts is one of 12 Atlantic seaboard states and the District of Columbia involved in TCI negotiations.

A similar measure already in effect in California has driven gas prices to between $4 and $5 a gallon there. Critics have said the measure could be economically damaging to Massachusetts — especially in neighboring states such as Vermont and New Hampshire opt not to join the compact.

The average price of gasoline in Massachusetts this week is $2.557 a gallon, according to AAA. The proposed 17-cent increase, if applied today, would jack up gas prices to $2.727.

A letter of opposition to TCI was released today by Massachusetts Fiscal Alliance, the National Federation for Independent Business, and Citizens for Limited Taxation, who have voiced concern that TCI will be adopted by Gov. Charlie Baker by executive order, without a vote of the Legislature.

“The more people learn about the extremes of this tax and the undemocratic way it’s being forced upon residents, the less popular it becomes,” Paul D. Craney, spokesman for the Massachusetts Fiscal Alliance, said in a statement.

The anti-TCI coalition’s letter states: “Unlike motor fuel taxes levied to pay for roads, bridges, and transportation infrastructure (a reasonable fee for use), the TCI would be the equivalent of a “sin tax” – a penalty for engaging in bad behavior. We do not believe that driving to and for work, transporting children to school, transporting goods, going to the grocery store, and all the other necessary activities that generally require a vehicle should be treated by governments as a sin. These are not activities people can, or should be forced to, avoid.

“The TCI tax is a poorly conceived, fundamentally regressive, and economically damaging proposal. It would — on purpose — make the day-to-day transactions of life painfully expensive, especially for those of us who are going through bad times and are struggling every day to get by. Government should not do this to its citizens. Government exists to serve the people, not to bend them to the will of elite opinion. For these philosophical and financial reasons, states should reject the TCI at the first available opportunity,” states the letter, which was delivered to Gov. Charlie Baker and legislators.


The Boston Globe
Tuesday, December 17, 2019

States disclose details of new emissions controls that would drive up gas prices
By Jon Chesto and Adam Vaccaro

Officials in a dozen Northeast and mid-Atlantic states rolled out details on Tuesday for an ambitious plan to control carbon emissions from vehicles by imposing new fuel controls at the wholesale level, potentially driving up the cost of gas for motorists.

The scenarios spelled out in the Transportation & Climate Initiative proposal could translate to an extra 5 cents per gallon to 17 cents per gallon at the pump, depending on whether suppliers fully pass on the costs to drivers and how aggressively the states choose to curb emissions. The models are based on cutting 20 percent to 25 percent of carbon emissions from the region’s transportation sector over a 10-year period.

Under the plan, wholesalers that deliver carbon-emitting fuels would need to buy allowances through periodic auctions, with the proceeds from those auctions going back to the states. Suppliers could then buy and sell these credits.

In Massachusetts, this system could mean an influx of around $500 million a year for transportation purposes, starting as soon as January 2022.

The states still need to approve the initiative, and some might not agree to participate in this new market. Katie Theoharides, the state’s energy and environmental affairs secretary, said all but three states need legislative approval to participate. Massachusetts does not, although Theoharides said the Governor Charlie Baker administration would make its decision in consultation with legislative leaders on Beacon Hill.

“The important thing here is getting the mechanism in place and having as much of the region participate as possible,” Theoharides said. “It’s pretty stark how much of an impact this could have on meeting [our] climate goals.”

The amount of allowances made available would decline over time, presumably making them more expensive. The system would be modeled after a similar regional cap-and-trade program that’s already in place for power plants.

“The goal is that as the allowances become more scarce, their cost goes up, sending the signal that the market still needs to work on cleaner options,” Theoharides said. “Fuel suppliers may look at things [like] low-carbon fuels.”

The Baker administration has said that half of the new revenue would be dedicated to public transit, specifically toward initiatives meant to reduce carbon emissions: electrifying buses and commuter trains, for example, or adding more vehicles to increase system capacity.

Other money could go toward biking and pedestrian infrastructure, electric vehicle rebates or charging infrastructure, or even improving broadband in rural towns to make telecommuting easier.

Baker last week gave a full-throated endorsement of TCI before business leaders and environmental advocates in downtown Boston. Flanked by Theoharides and state transportation secretary Stephanie Pollack, Baker said the program was crucial to reducing greenhouse gases from tailpipes and encouraged the region’s business community to support the policy.

“This program obviously is designed both to support public transit initiatives as well as other carbon reduction initiatives that you can pursue,” Baker said last week. “These are all initiatives that we support and we believe in, and they’re worth significant resources.”

But the advent of the program has also presented tricky politics for Baker, who has said he opposes an increase to the gas tax. Baker has said TCI is not technically a tax, but it would function similarly to one by raising the cost of gasoline to fund transportation-related projects.

Critics of the program such as the conservative Massachusetts Fiscal Alliance have argued TCI is effectively a tax hike. Another small-governance organization, Citizens for Limited Taxation, noted in a statement Tuesday that gas tax increases were rejected the last time voters had a direct say on the matter, in a 2014 ballot measure.

What’s more, with state lawmakers likely to debate a gas tax increase next year, implementing TCI could lead to two separate hikes at the pump.

The governor has argued the cap-and-trade system is better than the gas tax because it would be implemented in several states rather than just one, and because the cap may encourage fuel companies to develop lower-carbon energy sources for vehicles.


State of New Hampshire
Office of the Governor
Chris Sununu

News Release December 17, 2019
New Hampshire Declines to Participate In the Transportation Climate Initiative

Concord, NH – Today, Governor Chris Sununu announced that New Hampshire will not be participating in the Transportation and Climate Initiative (TCI). Under this scheme, New Hampshire drivers would be forced to pay a significant new gas tax with little environmental benefit to the state.

“I will not force Granite Staters to pay more for their gas just to subsidize other state’s crumbling infrastructure,” said Governor Chris Sununu. “New Hampshire is already taking substantial steps to curb our carbon emissions, and this initiative, if enacted, would institute a new gas tax by up to 17 cents per gallon while only achieving minimal results. This program is a financial boondoggle and the people of New Hampshire will never support it.”

Rural communities would be left at a severe disadvantage if New Hampshire participated in the TCI, as drivers will bear the brunt of the artificially higher gas prices.

“NHDES has been actively monitoring the TCI process for the past year in order to fully understand the potential long and short term impacts of this potential regional program on NH,” said DES Commissioner Bob Scott. “NHDES intends to continue to observe these efforts and represent the interests of NH."

“There are clearly better ways to achieve the purported goals of this program,” said Office of Strategic Initiatives Director Jared Chicoine. “This proposal is a huge hit to the wallets of rural drivers. The data makes it clear that — even without the TCI proposal — the market is already projected to reach many of the same environmental benchmarks. Here in New Hampshire, we are already aggressively moving forward with smarter environmental initiatives like more EV charging stations, offshore wind, and low income solar incentives to ensure New Hampshire’s long legacy of environmental stewardship continues to move forward."

###


The Boston Herald
Tuesday, December 17, 2019

New Hampshire backs out of regional climate initiative
By Mary Markos

New Hampshire is backing out of the controversial regional TCI compact just hours after a draft policy was released Tuesday, with Granite State Gov. Chris Sununu citing increase costs in gas prices as his reason for their retreat.

“I will not force Granite Staters to pay more for their gas just to subsidize other state’s crumbling infrastructure,” Sununu said. “New Hampshire is already taking substantial steps to curb our carbon emissions, and this initiative, if enacted, would institute a new gas tax by up to 17 cents per gallon while only achieving minimal results. This program is a financial boondoggle and the people of New Hampshire will never support it.”

The Transportation Climate Initiative, a multi-state compact that would implement a gas fee to reduce carbon emissions, could raise prices at the pump by 17 cents in just the first year, according to estimates by state officials. Massachusetts Energy and Environmental Affairs Secretary Kathleen Theoharides and officials from Maryland and Georgetown Climate Center presented estimates of the measure’s economic impact after a draft version of a memorandum of understanding was released Tuesday.

Officials told reporters that they did not examine how those economic impacts would change if any of the 12 states or the District of Columbia decided to back out. They also didn’t immediately say how high gas prices might go in subsequent years.

Opponents of the TCI compact have said that if neighboring states such as New Hampshire back out, the Massachusetts economy could take a hit due to higher gas prices.

Sununu announced that New Hampshire will not be participating in the Transportation and Climate Initiative because drivers would be forced to pay more for gas with “little environmental benefit to the state.” Rural communities would be left at a severe disadvantage if New Hampshire participated in the TCI, according to Sununu’s office, as drivers will bear the brunt of the artificially higher gas prices.

“NHDES has been actively monitoring the TCI process for the past year in order to fully understand the potential long and short term impacts of this potential regional program on NH,” said DES Commissioner Bob Scott. “NHDES intends to continue to observe these efforts and represent the interests of NH.”

“There are clearly better ways to achieve the purported goals of this program,” said Office of Strategic Initiatives Director Jared Chicoine. “This proposal is a huge hit to the wallets of rural drivers. The data makes it clear that — even without the TCI proposal — the market is already projected to reach many of the same environmental benchmarks. Here in New Hampshire, we are already aggressively moving forward with smarter environmental initiatives like more EV charging stations, offshore wind, and low income solar incentives to ensure New Hampshire’s long legacy of environmental stewardship continues to move forward.”


The Boston Herald
Tuesday, December 17, 2019

‘Tank the Gas Tax’ targets Gov. Charlie Baker’s fuel fee proposal
By Hillary Chabot

Outraged anti-tax warriors Tuesday vowed to fight a “tone deaf” regional initiative — already rejected by New Hampshire officials — that could hike the cost of gas by as much as 17 cents a gallon in just the first year, saying the proposal is an insult to Bay State voters’ who rejected a gas tax five years ago.

“The people spoke very clearly that they didn’t want a gas tax. This flies in the face of that vote and it just shows you how tone deaf Beacon Hill is,” said Holly Robichaud, who was behind a victorious 2014 ballot initiative that repealed a gas tax hike of 24 cents a gallon and built-in automatic increases for years to come.

The current proposal, called the Transportation Climate Initiative, could increase gas prices an estimated 17 cents a gallon in the first year by levying fees on fuel companies that would be passed on to drivers. The price could balloon from there — all without a vote from the state Legislature. Gov. Charlie Baker has signaled he could use his executive authority to approve the plan.

“Every time we turn around they’re looking to hit drivers with some new fee,” said Robichaud. “They should get the message and get off the backs of drivers.”

Neighboring states are already opting out of the 12-state TCI, a regional compact seeking to reduce carbon emissions by capping gas use. New Hampshire Gov. Chris Sununu cited increased gas costs yesterday when announcing he wouldn’t join the multi-state compact. Sununu’s announcement came as officials released a draft proposal yesterday.

Baker administration officials have insisted the regional agreement isn’t a gas tax, but early estimates released yesterday show that the average Bay State driver would pay more at the pump. A portion of the cash collected would go to the state to fix roads and the ailing MBTA.

“This all boils down to the same thing as before — it’s a way to subsidize the MBTA,” said Geoff Diehl, a former state representative who was also a part of the 2014 “Tank the Gas Tax,” campaign. “Voters didn’t like it the first time they tried it.”

If Vermont follows New Hampshire’s lead and opts out of the TCI, that would leave more border gas stations high and dry as drivers go across state lines for their gas. Businesses that see their costs rise, and shoppers who see prices rise won’t be far behind.

“This will just send people out of state again,” said Robichaud.

Robichaud and Diehl are part of a growing opposition to TCI that includes the Massachusetts Fiscal Alliance, the National Federation for Independent Businesses and Citizens for Limited Taxation. The coalition denounced the proposal yesterday and are pushing for legislators to review and vote on the plan after its release in the spring of 2020.

“We’re going to fight this thing one way or another,” said Robichaud. “This isn’t about saving the world, its about grabbing more money.”


The Boston Herald
Tuesday, December 17, 2019

Gas levy plan hits bump as N.H. opts out
By Mary Markos

Gov. Charlie Baker’s push to join a regional anti-climate change compact — predicted to jack up gas prices by up to 17 cents in just the first year — took a potentially critical blow even as it was being rolled out Tuesday, when New Hampshire quickly rejected it as a “financial boondoggle” and a burden on drivers.

“I will not force Granite Staters to pay more for their gas just to subsidize other states’ crumbling infrastructure,” Granite State Gov. Chris Sununu said of the the controversial Transportation Climate Initiative. “This program is a financial boondoggle and the people of New Hampshire will never support it.”

New Hampshire’s rejection came just hours after a draft memorandum of understanding was released Tuesday for the consideration of the 12 Atlantic Seaboard states and the District of Columbia that have been involved in TCI negotiations. The multi-state compact is intended to reduce carbon emissions and raise money for transportation projects by driving up gas prices. But critics say that driving up gas prices in Massachusetts if neighboring states don’t go along is a recipe for economic disaster — sending drivers, businesses and shoppers across the border to avoid higher costs.

Sununu argued that drivers would be forced to pay more for gas with “minimal results,” putting rural communities at a severe disadvantage.

TCI proponents claim the gas fees would result in a reduction of Co2 emissions anywhere from 6% to 19% by 2032, according to Tuesday’s presentation by Massachusetts Energy and Environmental Affairs Secretary Kathleen Theoharides and officials from Maryland and the Georgetown Climate Center.

While they pegged the first year’s increase at 17 cents a gallon, officials didn’t immediately say how high prices might go in subsequent years and told reporters that they did not examine how the economic impacts would change if neighboring states opted out, as New Hampshire now has done.

TCI opponents say if neighboring states such as New Hampshire or Vermont opt not to join, the Massachusetts economy could take a hit due to higher gas prices.

“We have been talking about this for a while and today was the first day the TCI coalition came out with a proposal,” MassFiscal Alliance spokesman Paul Craney said. “Within the first day already they have suffered a major setback as one of the crucial states in the region decided it is not going to join.”

“I’m not surprised to hear New Hampshire is not joining TCI, as they’ve shown reluctance up to this point,” state Rep. Marc Lombardo said. “Once again a Massachusetts tax increase will be an economic win for New Hampshire. I hope the governor will reconsider joining TCI.”

The measure could generate between $1.4 billion and $7 billion per year regionally, according to estimates in the draft agreement, with about $500 million per year for Massachusetts. Up to half of the revenue from the TCI would be directed to the Commonwealth Transportation Fund and remaining funds would be invested in local transportation programs, according to the Baker administration.

Baker was not available for comment late Tuesday on New Hampshire opting out. Baker spokeswoman Anisha Chakrabarti did not directly address Sununu’s decision, saying in a statement the administration “is pleased by the robust participation by Northeast and Mid-Atlantic states throughout the program’s ongoing development process and by the broad coalition of support from members of both the business and environmental communities.”

The average price of gasoline in Massachusetts this week is $2.557 a gallon, according to AAA. A 17-cent increase, if applied today, would jack up gas prices to $2.727. A similar climate measure already in effect in California has driven gas prices to between $4 and $5 a gallon there at times.

A final version of the TCI memorandum of understanding is expected to be released in the spring, at which point each state will determine whether to sign on.


State House News Service
Tuesday, December 17, 2019

TCI Framework Details Gas Price Impacts, Emissions Cuts
By Matt Murphy

The pact being developed by Massachusetts and other East Coast states to cap carbon emissions from vehicles could add up to 17 cents to the price of a gallon of gas, according to the newest estimates, but could also generate more than $500 million in revenue for state government in Massachusetts.

Leaders from a coalition of eastern states, including Massachusetts, have been working for over a year to develop a regional "cap-and-invest" program to reduce carbon pollution from cars and trucks and generate the resources needed to expand clean transit options and improve public health.

The effort, known as the Transportation Climate Initiative, has also become a central part of Gov. Charlie Baker's transportation and climate agenda, with the administration proposing to earmark half of all proceeds generated toward improving public transit.

But the coalition already began to splinter Tuesday in light of the newly forecast economic impacts, with New Hampshire Gov. Chris Sununu announcing that his state would not participate.

"We are already taking substantial steps to curb our carbon emissions, & this initiative, if enacted, would institute a new gas tax by up to 17 cents per gallon while only achieving minimal results. This program is a financial boondoggle and the people of NH will never support it," Sununu wrote on Twitter.

The coalition, chaired by Massachusetts Energy and Environmental Affairs Secretary Kathleen Theoharides, released a draft memorandum of understanding on Tuesday that states would be asked to sign onto next spring once it is finalized.

The officials involved in the effort are eyeing a reduction in emissions of up to 25 percent by 2032, but it will come at a cost.

States in the coalition are exploring three scenarios for capping emissions from motor gasoline and on-road diesel, with a final cap proposed after a public comment period ends on Feb. 28.

The plan to reduce carbon emissions from vehicles by 25 percent would add an estimated 17 cents to the price of a gallon of gas at the pump starting in 2022. If states elected for a smaller reduction goal of 22 percent, the cost per gallon, based on the group's modeling, would drop to 9 cents.

The third option presented is for a 20 percent emission reduction by 2032 at a cost to drivers of 5 cents per gallon.

Theoharides said TCI represents a "chance to really make a global impact on emission reductions."

Chris Hoagland, and economist in the climate change division of Maryland's Department of the Environment, said TCI's model showed that emissions from vehicles – which cover 43 percent of all emissions in the region – would decline by 6 percent to 19 percent without any additional action.

That drop, according to Hoagland, would result from the ongoing shift to more fuel efficient cars and trucks, but could fluctuate depending on whether federal fuel efficiency standards are rolled back.

"The thing that is important is that while the reference case does show 19 percent due to clean vehicle standards and the adoption of electric vehicles, those reductions are not guaranteed and they could be as low as 6 percent. What this policy does is lock in those reductions," Theoharides said.

She also suggested that member states would also meet every few years to review the program, and could accelerate the emission reduction targets in the future.

The new economic forecasts also figure to play heavily into the upcoming debate that House Speaker Robert DeLeo has planned for January to generate new revenue for transportation.

Several of his top deputies have suggested a gas tax hike would be high on the list of options.

While a straight gas tax hike may be less popular with business leaders, TCI has significant backing from many of the major environmental and employer groups in Massachusetts, including Associated Industries of Massachusetts and the Greater Boston Chamber of Commerce.

Transit activists also see an opportunity in the program to generate significant new resources to invest in improved public transit and build new sidewalks and bicycle paths.

"We applaud Governor Baker's leadership in advancing this important public policy initiative that will improve the lives of people in every corner of the Commonwealth who use our transportation system, breath the air, or care about climate change. TCI will stand as a model for the rest of the nation," Transportation for Massachusetts Director Chris Dempsey said.

The concept, however, has been coming under increasing fire from a small group of Republican legislators and small business groups.

Rep. Timothy Whelan, a Brewster Republican, and Rep. Marc Lombardo, a Billerica Republican, both submitted public comments to the coalition arguing that the Legislature should get to vote before Massachusetts joins any partnership.

The National Federation of Independent Business in Massachusetts, the Massachusetts Fiscal Alliance and Citizens for Limited Taxation were also among a cohort of business and anti-tax groups from Maine to Virginia to sign on to a letter released Tuesday opposing TCI because of the additional cost it will add for employers.

"Make no mistake, this is a tax," the groups wrote in their letter. "More precisely, it is a carbon dioxide tax being implemented through a gas tax."

The opponents argued that not only would the program add to municipal costs for busing, plowing and other services, but low-income families and small business owners would feel the pinch.

"Since motor fuels are economically 'inelastic,' the higher costs imposed by the TCI's fuel tax will have to come out of other areas of household budgets," the letter stated.

Sen. Marc Pacheco and the Baker administration have said the Legislature would not need to vote on participation because the legislators authorized the administration to pursue regional market-based approaches to fight climate change in the 2008 Global Warming Solutions Act.

A MassINC poll released Wednesday found that a majority of registered voters in Massachusetts, Connecticut, Maryland, New York, New Jersey, Pennsylvania and Virginia -- the largest states in the coalition - strongly or somewhat support their home state's participation in the Transportation and Climate Initiative.

In Massachusetts, 68 percent of the 629 respondents said they support the program, compared to 21 percent who oppose it and 11 percent who are unsure, according to the poll, which was sponsored by the Barr Foundation and conducted before the latest estimated impacts on gas prices were known.

Theoharides said that unlike a gas tax the price per gallon is not fixed under the compact and would depend on how the market responds to the caps that get adopted on pollution and how much of the expense suppliers pass on to consumers.

The program would set a limit on emissions from fuel, and hold auctions at which fuel suppliers that transport gasoline into Massachusetts and other states could purchase allowances for every ton of carbon dioxide that the fuel they are carrying would emit when burned.

The states estimate that the program could generate $7 billion a year across the region by 2032 in proceeds from these auctions, sending $500 million or more back to Massachusetts to be reinvested in clean transit options.

Baker proposed in a transportation bond bill still pending before the Legislature to set aside half of any new revenue to the state for public transit.

Theoharides also said the state would look to invest in electrification of public transit, charging corridors for electric vehicles, more electric buses, ways to make it easier to walk and bike and telecommuting infrastructure for more rural areas.

"We are going to double down on the investments that reduce emissions so that we can get the most bang for our buck," Theoharides said.

Twelve states and the District of Columbia have been working with the Georgetown Climate Center to put together the Transportation Climate Initiative since late 2018.

The cap-and-invest program is modeled off the Regional Greenhouse Gas Initiative, which focused on driving down emissions from power plants, but Theoharides said it has the potential to reduce carbon emissions by three times the levels achieved through RGGI.

"One of the big pieces for us is getting as many states on board as we can," Theoharides said.

In addition to Sununu, Vermont's Republican Gov. Phil Scott has also expressed reservations about joining the pact. Theoharides said that while there does need to be a "critical mass" of participation for the program to work, she did not think all 13 jurisdictions would need to sign on for the program to be successful.

The coalition has estimated $10 billion in public health benefits through the program from reduced cases of conditions like asthma, between 1,900 and 8,900 new jobs and $892 in avoided costs due to climate change.

The Harvard School of Public Health plans to do a more detailed health analysis for early 2020.

The TCI coalition states represent 72 million people and 52 million registered vehicles, with a gross domestic product larger than the economy of California at $5.3 trillion.

 

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