Launching California’s Climate Bond – What’s Next?
In November 2024, California voters approved Proposition 4, a $10 billion Climate Bond intended to support a variety of projects that support wildfire prevention, safe drinking water, protecting biodiversity, and increased access to nature. VX News attended & recorded a webinar hosted by Wade Crowfoot, Secretary of the California Natural Resources Agency (CRNA), where he discussed the implementation of Proposition 4 and specific programs it will support with a variety of key agency leaders, including Lauren Sanchez, the recently appointed Chair of the California Air Resources Board (CARB).
Below is a lightly edited transcript of Secretary Crowfoot, Chair Sanchez, and other agency leaders' remarks.
“Thanks to our state legislature and governor – who, earlier this month, allocated the first tranche of this climate bond – $3.3 billion of the $10 billion total, we're in the position now to launch the implementation of this important investment. “ — Wade Crowfoot
Wade Crowfoot
My name is Wade Crowfoot, and I have the privilege of serving as our California Natural Resources secretary. And I'm really excited today to moderate this discussion on the climate bond. Thanks to our state legislature and governor – who, earlier this month, allocated the first tranche of this climate bond – $3.3 billion of the $10 billion total, we're in the position now to launch the implementation of this important investment.
Our conversation today will be in three parts. We'll hear first from leaders in the Governor's Office and our agencies about work to date on the climate bond and how it fits into our state leaders' vision for climate action across California. Then we'll hear a presentation that provides an overview of where we stand on the climate bond, and importantly, what's next about getting its investments working across the state of California, and then last half an hour, we'll have a question and answer session, which is intended to provide you just as much information as we can about the climate bond and its implementation.
So again, I’m excited to launch this conversation about the climate bond. Let me start with a thank you to all of the leaders and groups that came together to make the case for this important investment that drove us through the policy-making process. I would also like to thank the staff of legislators who were seminal in this work, certainly across our administration, the Governor's Office, and agencies.
We're in a remarkable place amidst a lot of environmental challenges and a lot of attacks from the federal government on all things climate action. The climate bond is a ray of light and hope that will move our climate agenda forward in California. To share that top-level thinking around how this fits into our work, I want to introduce two colleagues from the Governor's Office, Lauren Sanchez and Sarah Swig. Lauren has been a key architect with Governor Newsom on the state's climate agenda over the last several years, as she transitions from being his senior advisor on climate change to the Chair of the California Air Resources Board (CARB). Taking your place in the Governor's Office is Sarah Swig, who comes to us from Capitol Hill. We're very excited to welcome Sarah as the new senior advisor to Governor Newsom on all things climate change.
Lauren, let me start out with you from the sort of 10,000-foot level. Can you share how this climate bond fits into the Newsom administration's agenda on climate action?
Lauren Sanchez, appointed Chair of the California Air Resources Board
Absolutely. Thank you, Wade, and thank you to so many of the folks joining us today. You are a ray of hope and a way for us to run through the day, through the end of this year. It has been a deep honor to serve as Governor Newsom's climate advisor for the past four years, and I am excited to keep working on these issues with you all in my new capacity. I am so proud of the incredible climate progress we've made, despite the current headwinds we face from the federal administration. Such as the latest move today to prop up big, beautiful coal across our country.
A few recent points of progress. I just wanted to highlight today that the governor spoke on the global stage last week. We are running the fourth-largest economy in the world on a carbon-free engine. Already this year, nine out of 10 days, 100% clean energy. A huge amount of progress in that space that this administration has been really proud of. We also surpassed our initial goal of 2 million zero-emission vehicles. Now, 34% of new ZEVs in the United States are sold in California. We're leading the nation in ZEV manufacturing jobs and infrastructure.
As many of you know, key investments in the climate bond will go towards some of our big goals. Whether it was California being the first state to establish a 30 by 30 goal, and the tremendous progress we've made towards that with four plus years left to go; the comprehensive plans that we have to protect Californians from devastating wildfires; or our hotter, drier future as it relates to water management.
All of these billions of dollars allow us to make sure that we deliver on those plans and goals over the next year for Californians. This $10 billion is a huge ray of hope, and we have worked over the last seven years of this administration to put over $50 billion into our broad climate agenda, record levels of funding for this state. That $10 billion is going to help us make sure that record levels of funding remain in critical areas that the rest of my agency colleagues will speak to later.
The governor recently signed a package of climate bills that underscores our commitment to continuing all of this leadership. Slashing carbon pollution, driving economic growth, enlisting nature-based solutions into our climate agenda, and more. While we were in New York last week, the governor had the opportunity to meet with a number of international partners who are signing new partnerships on climate and economic growth, letting the world know that US states are continuing to lead on climate action.
With that, it gives me great pride to hand it over to my colleague, Sarah. I've been framing for many of my partners, the tremendous upgrade that you are all getting in her taking over the reins on all things climate here in the Governor's Office, and we are thrilled to welcome her home from DC.
Sarah Swig, Policy Advisor, Senator Alex Padilla at United States Senate
I am so excited to be here and to keep California on track as we enter the governor's final year in office. Fundamentally, these bond investments allow us to continue making progress towards our goals of achieving carbon neutrality by 2045 and urgently reducing climate risks to Californians. We are especially excited, and I am personally very excited about the potential for this bond to deliver on our nature-based solution markets, which harness the power of nature to remove carbon pollution and protect Californians from climate-driven extremes.
The governor has referred to this moment in time as the age of implementation. We know what we need to do to avoid the worst impacts of climate change, and we need to act urgently.
Wade Crowfoot
I think we all agree that the priorities are well aligned among our state leaders, the legislature, the governor, and all the partners here today. It's a team effort, both to meet California's world-leading climate targets and to protect the people in places of California from the impacts that are already here, and this climate bond helps us do that. Next, we're going to bring on agency leaders who are leading the implementation of the climate bond. The agency I lead, the California Natural Resources Agency, is charged with coordinating implementation of the bond, and the implementation happens across several departments and agencies across state government.
Joaquin Esquivel leads our California State Water Quality Control Board, or what we call the Water Board, and he will be leading critical investments in the climate bond. Christine Birdsong serves as the under secretary at the California Department of Food and Agriculture (CDFA), also an important recipient of bond funding and partner to many organizations here today. Last, Sam Assefa, who serves in the governor's cabinet and leads the Governor’s Office of Land Use and Climate Innovation (LCI), formerly OPR.
Before we get into the details of the bond, I wanted to ask each of you a question, so you can help orient everybody to the role that your entity is playing. Chair Esquivel, you all are focused on a lot of important priorities, including ensuring clean and safe drinking water in California communities. How do you plan on leveraging this bond towards priorities like that?
Joaquin Esquivel, Chair, California State Water Resources Control Board
This really is a generational moment. We have so many challenges we're facing with climate, and these dollars are really helping us implement during a really critical time. The State Water Resources Control Board is a five-member, full-time board. We, along with our nine Regional Water Quality Control Boards, oversee water quality. About a decade ago, the division of drinking water was transferred from the Department of Public Health to the state board. So we also oversee the nearly 3,000 community water systems in the state. We also set maximum contaminant levels and administer water rights. We have a pretty comprehensive one-stop shop on the regulatory side.
Our largest division by staffing is our Division of Financial Assistance. Since 2019, when Governor Newsom took office, the California State Water Resources Control Board has invested 13 billion dollars in drinking water systems, wastewater systems, water recycling, stormwater capture, and groundwater recharge. Those are in the form of loans and grants. There are actually over 70 different programs the State Water Board administers, on the financial side, on the infrastructure side. We don't make all of our wastewater agencies, or drinking water agencies, hunt and peck amongst those programs. So we have a one-stop shop application. We've had one for a number of years.
We're also fortunate that this fund is coming off of Proposition 1 fund dollars, which were administered out in 2014. We have the infrastructure and a yearly process at the statewide resources control board, where we evaluate our Intended Use Plan, which looks at what we funded the year prior and what applications are ready and in the queue. Are they ready for construction dollars, or do they need planning or financial assistance dollars, and spell those out in a yearly process. With that process, we've been able to take funds like the state revolving funds, which are part of federal programs, and then take general fund dollars and previous bond dollars. From this bond, we will receive about $1.2 billion of the $10 billion, and these dollars will continue to ensure that all Californians have access to clean and safe water. We've been able to reduce the number of Californians without access by half since the start of this administration, and so we'll be able to just kind of plug right in, if you will. We appreciate that we're still assessing. I think we received about $390 million for this coming year. Again. Our intended use plan easily lets us be able to have confidence that we can start to get those dollars out. We'll evaluate, you know, where this fits in with our program.
Importantly, it's not left up to applicants. If you are a water agency out there, if you have a recycled water project, you're maybe a municipality looking at stormwater capture. Do you know that there's a one-stop shop where you can come to the State Water Board at the Division of Financial Assistance and start to have those conversations? Whether it's planning dollars or you may be getting more if you're ready for construction, we're also able to accommodate those.
I really appreciate the public processes of the state board, where certainly there's a lot on the regulatory side, really critical decisions that we need to be making in the face of climate change. These bond dollars are really helping us to reduce our dependency on stressed watersheds, which we know we have several where we import from and that we move around the state, and importantly, creating drought-proof, resilient local supplies and recycled water, especially, which is a critical part of the governor's water supply strategy.
We're excited. We're excited that we are in implementation mode, and these dollars will be able to easily go toward ensuring that we continue to provide access to clean water. I know that with climate change, whether it's drought, floods, or wildfires, the impacts of climate change are really clamping down on our water systems, both at the local and regional levels. So we are excited to be able to get these dollars out, and excited to be part of a package of investments that makes sense. Working with our sister agencies to figure out how we maximize these very valuable dollars is going to be critical.
Wade Crowfoot
Christine, I want to turn to you. Our agencies work together on so many fronts. We're sort of a Venn diagram of caring for our natural resources and our agriculture together, whether it's improving soil health, building agricultural sustainability, or positively impacting biodiversity. I'm interested in your and Secretary Ross's priorities for leveraging this climate bond.
Christine Birdsong, Undersecretary, California Department of Food and Agriculture
California farmers and ranchers feed the world with the abundance and diversity of what we produce here in California. They do it not just despite the challenges presented by climate change, but they do it with the added goal of producing food and fiber sustainably by actively seeking to build healthier soils, reducing water and energy use, and encouraging biodiversity in all of their crop production practices. Climate Smart Agriculture is a key part of healthy local food systems, where we can connect our local producers with consumers and expand those opportunities for all people throughout California to access nutrition and reduce the miles traveled to deliver healthy California-grown food.
The bond amazingly reflects all of these values, and you can really see them in next year's budget. CDFA received almost $200 million as our piece of the pie to contribute to climate-smart agriculture. You'll see some of our familiar programs, like the Sustainable Water Efficiency Enhancement Program (SWEEP), our really popular Healthy Soils Program, which is always over-subscribed, and our Urban Agriculture Grant Program also received some funds to improve the viability of urban agriculture while improving food access across the state.
Part of the climate change impacts on agriculture is an increase in invasive pests, invasive species. So the climate bond is also giving us some money to invest in invasive species management. We have nearly $20 million for the Invasive Species Council of California to fund projects and activities on control and mitigation. We also have four new programs, which we are really excited about: the Tribal Food Sovereignty Product Program, the Regional Farm Equipment Sharing Program, the Mobile Farmers Market Grant Program, and our year-round Certified Farmers Market Programs. These new programs really do a lot of heavy lifting in terms of improving our local food systems, which is absolutely a part of climate-smart agriculture.
Wade Crowfoot
Sam, let me turn it over to you. You lead the Office of Land Use and Climate Innovation. Within the governor's office, you also chair our Strategic Growth Council, which is a multi-agency entity. I view you as one of our key leaders in building climate resilience, or helping California adapt to and weather all of these changes with climate change. I'm interested in how you view this bond in advancing the work you lead.
Sam Assefa, Director, Governor’s Office of Land Use & Climate Innovation, California
At LCI, the Governor’s Office of Land Use and Climate Innovation, and SGC, we have three very specific programs that will be directly impacted by Proposition 4. They are the Transformative Climate Communities Program (TCC), the Community Resilience Center Program, and the Extreme Heat and Community Resilience Program. We're extremely excited by Proposition 4 because it will not only provide vital funding for programs that really work in these three areas, but it will also help turn community climate resiliency plans that have been developed through these programs into real infrastructure and real projects
These programs have, for quite some time, a legacy of funding infrastructure that is transforming communities. I'll give the first of three specific examples quickly. SGC’s Transformative Climate Communities. Since 2018, we have invested over $224 million that has been awarded to 37 California communities that are most disadvantaged, from Siskiyou to San Diego. These are programs that are created and led by community groups on the ground. Proposition 4 funding will expand TCC capacity to support implementation of neighborhood-led projects that tie housing, mobility, and clean energy to local economic opportunities. TCC empowers neighborhoods themselves to design and lead the climate solutions. One example of a TCC program from about a decade ago is Watts Rising in LA.
I'm having connection issues, but generally, those three key existing programs will benefit significantly, along with some initiatives that are very similar and have been successful and embraced by the community.
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