Amicus brief filed for contractor long frozen out of contracts Settlement reached in mobile home park case Cap and trade appealed Prairie dog ruling petition to the 10th Circuit Reply filed in Kinderace petition to Supreme Court Affirmative action case … Continue reading
Yesterday, on behalf of our clients in Morning Star Packing Company v. California Air Resources Board, we filed our Petition for Review in the California Supreme Court, asking the state high court to review and reverse the court of appeal’s … Continue reading
Opposition to Assembly Bill that would gut protections for coastal homeowners Golden parakeet should fly off endangered species list Taxpayer victory in San Diego over union objections Notice of appeal filed in cap-and-trade case Public trust case goes to the … Continue reading
“Cap and Trade” argument set for Tuesday Supreme Court turns down free speech case The public trust doctrine in Washington State Sea urchin filing School choice victories in Florida! School choice brief filed in Georgia Reply brief in Jaguar case … Continue reading
Next Tuesday I will be arguing on behalf of Morning Star Packing Co., the National Tax Limitation Committee, and several other clients in PLF’s challenge to California’s unconstitutional auction of air emissions permits. This case will determine whether California can … Continue reading
PLF testifies before Senate Subcommittee PLF’s Damien Schiff testified before the Senate Subcommittee on Fisheries, Water, and Wildlife concerning agency abuses of private property owners under the Clean Water Act. (PLF’s testimony begins at minute 26:25 here). We focused on a number of … Continue reading
Imagine your state limited the number of drivers licenses to less than those already issued, in order to reduce greenhouse emissions (which many argue raise global temperatures). And then, it sold the right to your license at auction to the highest bidder. How … Continue reading
As the holidays approach, California is siphoning billions of dollars in auction revenue proceeds generated under CARB’s cap-and-trade program governing greenhouse gas emissions for purposes that are unrelated to greenhouse gas emissions. Fast speed rail, disadvantaged communities (identified by zip codes), natural … Continue reading
The briefing in our lawsuit challenging the auction component of CARB’s cap-and-trade regulation has been completed for many months, but the California Court of Appeal, Third District, has yet to set a date for oral argument. Although the panel was … Continue reading
On Friday, May 1, 2015, we filed our final brief in California’s appellate court in connection with our challenge to CARB’s scheme to sell carbon dioxide emissions allowances at auction to the highest bidders. CARB intends to generate billions of dollars of revenue for the state from the auctions and use the funds for a variety of purposes that have little if anything to do with reducing carbon dioxide emissions. Those unrelated purposes include diversion of funds to California’s general fund, high speed rail, and projects to benefit disadvantaged communities.
The California Constitution requires that such uses of the revenues be authorized by at least a two-thirds supermajority vote of both houses of the legislature. CARB purported to create the auction under a 2006 statute known as A.B. 32, which was not enacted by a supermajority legislative vote. Accordingly, the auction revenues are unconstitutional taxes. Moreover, nothing in A.B. 32 actually authorizes CARB to sell emissions allowances at auction for billions of dollars.
CARB argues that the auction revenues are not illegal taxes because those who purchase emissions allowances at auction do so voluntarily. But that ignores the realities facing California businesses that must comply with the cap and trade regulation, such as PLF’s client Morning Star Packing Company. Morning Star makes tomato paste from tomatoes received from farms by heating the tomatoes in boilers fueled by natural gas, which causes carbon dioxide emissions in excess of CARB’s regulatory threshold. As a result, Morning Star’s tomato processing facilities are required to obtain a sufficient number of emissions allowances in order to continue operating in California. Because Morning Star does not receive all its required emissions allowances free of charge from CARB, it is forced to obtain them through other means, including purchasing them from CARB at the auctions. Under the cap and trade regulation, this is a necessary cost of staying in business in California.
To characterize such payments as “voluntary” stretches the meaning of the term beyond recognition. One could just as well argue that the payment of California income tax is “voluntary” because a California resident could choose to move out of the state and no longer be subject to the tax. But, for those who choose to remain in California, the state income tax does not somehow become “voluntary” and not a tax. Merely because a company like Morning Star chooses to continue to do business in the state by purchasing emissions allowances at auction does not make the auction payments any more “voluntary” or any less of a tax.
A PLF video provides additional insight into the case, and more information can be found at PLF’s website.