A tax on carbon pollution faces surprising opposition

Some environmental groups and social justice advocates are fighting a proposed emissions tax in Washington. What gives?

 

Court Olson spent about 50 hours last summer and fall approaching hundreds of strangers at suburban Seattle bus stops and farmers markets to talk about climate change. Olson was campaigning for a carbon tax in Washington state, and he gathered around 750 of the 300,000-plus petition signatures that put the measure on this November’s ballot.

In a couple of weeks, Washingtonians will vote on Initiative 732. It would be the first statewide carbon tax in the U.S., and a major step toward reducing climate-changing pollution. For Olson, a civil engineer and long-time Sierra Club member, voting ‘yes’ on the measure is a no-brainer. “We desperately need to get off fossil fuels and incentivize clean energy,” he says. “And the most effective first step is to put a price on fossil fuels and carbon emissions.” Initiative 732, in his view, is “the right thing to do.”

And yet the proposal has run into some surprising opposition — from environmentalists, social-justice groups and the state Democratic Party. The Sierra Club and Washington Environmental Council have taken formal positions opposing the measure, while the climate activist group 350 Seattle endorsed and then unendorsed it this summer. Meanwhile, many of these groups’ members, including Olson, are campaigning for I-732. 

Initiative 732 supporters get ready to canvass in Seattle
Courtesy of the CarbonWA campaign

A carbon tax reduces emissions by making it more expensive to use fossil fuels for energy and electricity. Polluters — the companies that own coal plants, for instance — would pay the state, and likely pass their extra cost onto consumers. Initiative 732 would establish a $15 per ton tax on carbon pollution in its first year. In its second-year, when the tax would climb to $25, gas prices would likely rise by about 25 cents per gallon, while coal-fired electricity would become about 2.5 cents more expensive per kilowatt-hour. That would amount to roughly a 5 to 15 percent increase in utility bills, according to opponents of I-732. Over time, costs would rise as the tax crept up to a $100-per-ton maximum. Studies suggest such a pricing scheme could help Washington meet its goal to reduce emissions to 50 percent of 1990 levels by 2050.

To offset the impact of the tax for everyday citizens, I-732 would reduce the state sales tax by 1 percent, and fund a tax rebate worth up to $1,500 a year for low-income, working families. The Sightline Institute, a Seattle-based think tank, calls the initiative the most progressive improvement to the state’s tax codes in nearly 40 years. NASA scientist and climate-crusader James Hansen has endorsed it, too.

Yet opponents argue that the initiative fails on two critical fronts. First, they say it doesn’t do enough to promote clean energy development. Because the money the state would collect would be offset by the reduced sales tax, the measure is considered "revenue neutral.” In other words, it won't increase the state budget. But the opposition would prefer an approach that did generate extra cash, which could be invested directly in renewable energy projects or expanded mass transit. Second, they say I-732 doesn’t do anything to buffer low-income families against the impacts of climate change, or fully protect them from energy and fuel price hikes, despite the tax rebate. “This is really an important opportunity to get this kind of policy right the first time,” says Cesia Kearns, of the Sierra Club’s Beyond Coal campaign. I-732, she says, doesn't meet the mark. 

It's not the first proposed carbon tax to encounter headwinds in Washington, despite the state’s progressive reputation. Near the end of 2014, Governor Jay Inslee, a Democrat, unveiled his own tax plan to reduce greenhouse gas emissions. But the proposal didn’t even make it through the state’s Democrat-controlled House in 2015. A revamped approach to cap carbon emissions under the state's Clean Air Act also ran into opposition this year. The final rule, released this September, set modest emissions reduction goals and was deemed “a disappointment” by the Western Environmental Law Center. 

“There was a need for creativity and a new approach,” says Kyle Murphy, co-director of the Yes on I-732 campaign, an offshoot of Carbon Washington, a state group focused on carbon pricing. The group developed I-732, and its “revenue-neutral” approach as an overture to tax-averse fiscal conservatives. It is modeled on a similar tax in British Columbia, which passed in 2008 and has helped lowered provincial tax rates and fuel consumption, but so far come up short on emissions targets.

State chapter leaders and national staff for the Sierra Club struggled with the decision to not support the proposed tax, Kearns says. But the club ultimately determined it wouldn’t do enough to help low-income families and communities of color. A better proposal – such as one being developed by the Alliance for Jobs and Clean Energy, a network of environmental and justice groups, including the Sierra Club – would not be revenue-neutral, and instead direct carbon tax money toward clean-energy and smart-grid programs, worker-training for alternative-energy jobs, and protections for communities that face heightened threats from air pollution and climate change.

Regardless of the tax breaks, I-732 would disproportionately harm low-income families and people of color, who can’t readily buy more efficient cars to weather higher gas prices, adds Ellicott Dandy, Economic & Environmental Justice Advocacy Manager of OneAmerica, a Seattle-based immigrant advocacy group. That shortcoming, Dandy says, exists because I-732’s authors failed to include and consult with these communities when they crafted their plan. The Sightline Institute agreed with that view in its analysis, suggesting that, if I-732 passes, an oversight committee should be established to oversee its implementation, and it should include representatives from communities of color and low-income areas.

But those arguments frustrate I-732 supporters. Murphy, with Yes on I-732, says that the sales-tax cut and rebate will help the very people opponents say are being ignored. More than 17 percent of Washington families will qualify for the rebate, according to Sightline. Additionally, the think tank estimates that the lower sales tax should compensate for any increase in utility bills and gas costs for most of those families. Most importantly, proponents say, the measure will finally get the ball rolling on urgently needed carbon cuts.

Olson adds that he and many other grassroots Sierra Club members feel their voices were ignored by national staff when setting the club’s position. In fact, Audubon Washington is the lone big-name conservation group supporting the initiative. Leaders of the group say they're endorsing it because the need for climate action is pressing. Many county-level Democratic offices and individual candidates and politicians have also endorsed the cause, despite the state party’s position. And Olson expects many members of environmental groups and Democratic voters to support the initiative, too, regardless of institutional opposition.

Enacting strong climate policies may be urgent, yet the struggle among Washington’s environmental and justice groups shows it’s essential that measures like I-732 also bolster vulnerable communities. A recent poll shows the “yes" campaign with a 5-point edge, but with 21 percent of voters still undecided, the outcome is far from assured. OneAmerica’s Dandy believes it's worth waiting for something better, and she says that Washington citizens will support a more ambitious and equitable program, if they get a chance: “I have faith the state of Washington has a pretty strong appetite for action on climate.” 

Joshua Zaffos is an HCN correspondent in Fort Collins, Colorado. Follow him @jzaffos.