Region: California
Report

In July 2017, the Legislature passed AB 398, extending the state’s cap‑and‑trade program through 2030. The program is one of the state’s key strategies intended to ensure GHG emissions are 40 percent below 1990 levels by 2030. Cap‑and‑trade is a complex program that requires many different design decisions that could affect both emissions and costs to businesses and households. In this report, we identify key CARB implementation decisions and major trade‑offs associated with those decisions. We also identify potential opportunities to improve Legislative oversight and future policy decisions to ensure that the administration is implementing the program in a way that is consistent with legislative intent and priorities.

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Despite the State’s efforts, we identified certain weaknesses in its processes for detecting workers’ compensation fraud. For example, although state law requires insurers to refer to CDI and district attorneys’ offices any claims that show reasonable evidence of fraud, insurers vary significantly in the number of fraud referrals they submit. We calculated the referral rates for 21 insurers that each had more than $150 million in earned workers’ compensation premiums for 2015 and 2016.

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The latest new vehicle sales data from California New Car Dealers Association shows Californians remain on track to exceed 2 million new light vehicle purchases in 2017, although sales are beginning to ease from comparable levels a year ago. Key findings from the data:

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California lawmakers have proposed more taxes and fees in the first half of the 2017-18 legislative session than in all of 2015 or 2016. If each proposal became law, the tax burden in California would increase by more than $373 billion per year. To put this in context, all revenue in the 2017-18 State Budget is expected to bring in $178.4 billion.

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This Working Paper focuses on this challenge through multiple case studies, covering both state and local governments. The case studies demonstrate a marked increase in both employer pension contributions and unfunded pension liabilities over the past 15 years, and they reveal that in almost all cases that costs will continue to increase at least through 2030, even under the assumptions used by the plans’ governing bodies—assumptions that critics regard as optimistic. It examines the impacts of increased pension contributions on other expenditures, including services traditionally considered part of government’s core mission. Pension costs have crowded out and will likely to continue to crowd out resources needed for public assistance, welfare, recreation and libraries, health, public works, other social services, and in some cases, public safety.

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