Dive Brief:

• The 11 Northeastern and Mid-Atlantic states and District of Columbia that comprise the Transportation and Climate Initiative (TCI) released a draft memorandum of understanding (MOU) outlining the proposed framework of their cap-and-invest program to cut transportation emissions, which are responsible for 40% of the region's greenhouse gas emissions. 
• TCI would set a regional cap on the amount of gasoline and diesel emissions allowed, and that number would decrease each year. The cap level will not be announced until the final plan is revealed, but TCI's stated intent is to reduce emissions by up to 25%. The proceeds from auctioning pollution allowances to "polluters" — estimated at up to $7 billion annually — would be invested into clean transportation options such as public transit or zero-emission vehicles.
• TCI will accept public comment on the draft until Feb. 28, and a final MOU is expected in the spring. Participants then will have the choice to sign the final document and participate in the program, which could begin by 2022.

Dive Insight: 

The launch of this cap-and-invest program occurred in December 2018, with the stated goal of producing a draft policy within a year. Although the overall process is taking longer to implement than some other climate action plans, getting 12 jurisdictions to agree on the terms of a single program takes time, Daniel Gatti, senior transportation analyst at the Union of Concerned Scientists (UCS), told Smart Cities Dive via email. UCS would like to see "the program up and running as quickly as possible, but we also want it done right," Gatti said. 

The TCI program has also been met with some controversy. Opponents of the cap-and-invest program contend it has flaws, primarily that costs would trickle down to consumers and not remain at the polluter level. Projections suggest that, depending on the aggressiveness of the yet-to-be-announced cap level, citizens might end up paying 7 to 29 cents more per gallon of gas over the next 12 years.

Massachusetts Gov. Charlie Baker supports the program, but state legislators are trying to ensure the governor cannot agree to the TCI agreement without approval from the legislature. State lawmakers say the program essentially is a gas tax and they should have a say in whether it is implemented.

Concerns about higher gas prices also prompted New Hampshire's governor to say the state will not participate in the TCI program. New Hampshire previously had been involved with the program but reportedly reversed course just hours after the TCI draft was released this week. State leaders said there are better ways to achieve the goals in TCI's program than taxing citizens.

Uniformly higher gas prices statewide would disproportionately affect citizens in rural areas who have few — if any — transportation choices except to drive. The Ethan Allen Institute opposes this cap-and-invest program because of the cost burden to citizens and lack of program equity, especially for low-income citizens.

However, numerous advocacy groups, including the UCS, support TCI's effort. UCS said in a statement that these states "are rising to the challenge" of taking climate action at a time when the crisis is more urgent than ever.

"This program is bold and ambitious and represents an important first step towards addressing the largest source of transportation pollution," Gatti said.

UCS also suggests that TCI should reach out to communities most affected by transportation pollution and make sure they are included in the process. UCS' findings indicate communities of color in the Northeast and Mid-Atlantic live in areas with higher air pollution than their state's average, and they are exposed to 66% more air pollution from vehicles than white citizens. TCI's draft plan does mention that it is a priority to expand low-carbon and clean mobility options in areas disproportionately affected by climate change, and that program participants should work with their communities to assess equity impacts.

Despite the support, UCS does not believe the caps TCI establishes will be sufficient to meet the levels that leading science indicates would be necessary to prevent dangerous levels of global warming. UCS believes the program could be strengthened to establish more stringent limits, include higher auction prices, provide more investments in clean transportation and include all transportation fuels such as aviation and marine fuel oil, not just gasoline and diesel.

States will have the option to go along with the program once the cap levels are announced in the final memorandum of understanding next year. The long policy-setting process allows TCI adequate time to take these concerns into consideration and perhaps tweak the draft plan to be more favorable for dissenting parties.