Community Commentary:

This week marks the third birthday of Assembly Bill 32, the controversial measure known as the Global Warming Solutions Act of 2006. Gov. Schwarzenegger, still resolute in his desire to remain an environmental leader, held a media event to celebrate it.

Many in California’s business community, however, see no reason to celebrate. They worry that implementing this law will be more than our fragile economy can handle.

Like every resident in California, I want clean air to breathe, fresh water to drink and gorgeous beaches to enjoy, but there must be a balance between our environmental and economic needs. In 2006, when the California economy was going strong, the Legislature passed AB 32. The bill promised to slash California’s level of greenhouse gas emissions 25% by 2020. At the time, skeptics worried about the feasibility and the impact on business. It seems the skeptics were right.

Just months after the law was enacted, the attorney general filed suit against San Bernardino County, accusing the county of not taking into account the impact of the county’s rapid growth on global warming — despite the fact that the state had not yet adopted regulations for the county to use. At the time, it seemed like politicians were in a race to be the “greenest.”

Fast forward just three years and we have the worst economy the state, or nation for that matter, has seen in decades. Last fall the Air Resources Board prematurely developed regulations for the implementation of AB 32 that, according to the Legislative Analyst’s Office, California’s nonpartisan fiscal and policy advisor, were not fully vetted before being adopted. The office also found that the negative impact of AB 32 on the economy may be significantly larger than what the board reported. California businesses and families deserve an honest evaluation of this measure, and Air Resources Board has yet to provide one.

These regulations by most accounts are based on faulty economic numbers that will impose tremendous financial burdens on the state’s businesses with little to no guarantee of even reaching the program goals.

The California Small Business Assn. reports that the direct implementation costs of AB 32 could easily exceed $100 billion upfront. That doesn’t even take into account the lost output due to increased regulation, which will exceed $182 billion. Their research claims this will translate into an annual cost of $3,857 for every household in California.

In addition, more than 1 million jobs are expected to be lost as businesses grapple with the increased costs of regulation. At a time when unemployment has already climbed more than 12%, it is imperative that the state stay focused on producing jobs and economic growth, instead of hindering it. The Air Resources Board needs to complete a real economic analysis on its proposed regulations to ensure that those mandates will not do anything to sink our economy further into recession. Continuing to implement the recently added AB 32 regulations will only add an undue burden on California workers and families.

Furthermore, the loss from businesses and consumers will reduce the state’s tax revenue by an estimated $12.8 billion — and that is not good news for California. The Legislature struggled all year to resolve a $26-billion deficit. If AB 32 has the impact economists and businesses predict, it will only make things more complicated and difficult for the state’s finances — and for what? A hope and a prayer that AB 32 will reduce greenhouse gas emissions. That isn’t good enough.

Make no mistake, protecting our environment is an important priority of government, but we must take care to strike the appropriate balance. Considering the current crisis, the economy must be our priority. Postponing the implementation of AB 32 regulations will allow us to consider the needs of both and give the state time to develop a program that might actually work.

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TOM HARMAN (R-Costa Mesa) is a state senator who represents California’s 35th Senate District.