California Air Resources Board cap and trade program circumvents state open meeting laws with a Moonbeam assist

Strong headline, I know, but I didn’t believe this was true until I researched it myself. First some background; I once served as an elected official on my local school board. During orientation and virtually every annual CSBA meeting after that, along with numerous public meetings and letters to the editor where people constantly reminded us of the Brown Act, it loomed large as the most important law that we had to follow.

We were constantly reminded that if we did not follow the letter of the law and provide full and open access to all meetings (the exception being employee management) we would be guilty of breaking the open meeting law and subject to severe penalties. If our local school board in our small town ever tried to hold a closed-door meeting without the knowledge of the public, not only we would we be excoriated in the press and public discourse, but we would also have people filing for our election recall.

So, it was with shock and surprise that I learned today that the California Air Resources Board declared the method by which they could circumvent the public meeting laws. Even more shocking they put it in writing and, got the California State legislature to pass it as a law as a rider on a totally unrelated bill of legislation, and Governor Brown signed it into law on June 27th, 2012.

My friend Eric Eisenhammer first alerted me to the issue on his California Political Review blog. He writes:

On the afternoon the state budget was signed into law last Wednesday I received an email from a local activist informing me that hidden in a trailer bill titled SB 1018 was a provision exempting the upcoming cap and trade auction from open meeting rules.

CARB formed a company called Western Climate Initiative Inc. (WCI), to manage its upcoming cap and trade auction.  This shadowy corporation, registered in Delaware, will be responsible for imposing billions in hidden energy taxes on California ratepayers and small businesses without public scrutiny or accountability.

SB 1018 was a “gut and amend” bill, with over 100 pages inserted the day before the bill was signed into law along with the state budget.  This legislation did not go through one committee hearing and most legislators probably never had a chance to read it.  But buried in this bill in Section 12894(b)(2) is a line exempting WCI from a critical provision of the California Constitution, known as the Bagley-Keene Act, which provides meetings be open to public scrutiny.

Small business owners and citizen energy consumers care about protecting the environment, but CARB continually behaves as if it has something to hide.

When I first read that I really could not believe it. I could not believe that a state agency who is beholden to the same sorts of open meetings law that I was as a school board member would go to the lengths of trying to circumvent it, much less get it passed into law as an exception. So, I decided to check it out for myself.

First I located the document related to SB 1018. Eric was kind enough to direct me to the actual document and to the section that was relevant. Here is the URL of just one section of the monster sized SB1018 bill, section 39. The PDF:  http://www.leginfo.ca.gov/pub/11-12/bill/sen/sb_1001-1050/sb_1018_bill_20120627_chaptered.pdf

The relevant part is in 12894(b)(2) of SB 1018. You can find that section from the bottom of page 23 to near the top of page 24. The relevant section says:

Chapter 5. Greenhouse Gas Market-Based Compliance

Mechanisms and Linkages to the State

12894. (a) (1) The Legislature finds and declares that the establishment of nongovernmental entities, such as the Western Climate Initiative, Incorporated, and linkages with other states and countries by the State Air Resources Board or other state agencies for the purposes of implementing Division 25.5 (commencing with Section 38500) of the Health and Safety

Code, should be done transparently and should be independently reviewed by the Attorney General for consistency with all applicable laws.

(2) The purpose of this section is to establish new oversight and

transparency over any such linkages and related activities undertaken in relation to Division 25.5 (commencing with Section 38500) of the Health and Safety Code by the executive agencies in order to ensure consistency with applicable laws.

(b) (1) The California membership of the board of directors of the Western Climate Initiative, Incorporated, shall be modified as follows:

(A) One appointee or his or her designee who shall serve as an ex officio nonvoting member shall be appointed by the Senate Committee on Rules.

(B) One appointee or his or her designee who shall serve as an ex officio nonvoting member shall be appointed by the Speaker of the Assembly.

(C) The Chairperson of the State Air Resources Board or her or his designee.

(D) The Secretary for Environmental Protection or his or her designee.

(2) Sections 11120 through 11132 do not apply to the Western Climate Initiative, Incorporated, or to appointees specified in subparagraphs (C) and (D) of paragraph (1) when performing their duties under this section.

(c) The State Air Resources Board shall provide notice to the Joint Legislative Budget Committee, consistent with that required for Department of Finance augmentation or reduction authorizations pursuant to subdivision (e) of Section 28.00 of the annual Budget Act, of any funds over one hundred

fifty thousand dollars ($150,000) provided to the Western Climate Initiative, Incorporated, or its derivatives or subcontractors no later than 30 days prior to transfer or expenditure of these funds.

Did you catch it? Most people wouldn’t as it is a very short sentence written in gov-speak with redirected references to other laws. I only caught it because I was familiar with the sections pertaining to the state open meeting laws.

Here’s the relevant section:

(2) Sections 11120 through 11132 do not apply to the Western Climate Initiative, Incorporated, or to appointees specified in subparagraphs (C) and (D) of paragraph (1) when performing their duties under this section.

Still don’t see it? It is about sections 11120 through 11132 of The California Code.

What are Sections 11120 through 11132? Wikipedia has a good summary:

The Bagley-Keene Act of 1967, officially known as the Bagley-Keene Open Meeting Act, implements a provision of the California Constitution which declares that “the meetings of public bodies and the writings of public officials and agencies shall be open to public scrutiny”, and explicitly mandates open meetings for California State agencies, boards, and commissions. The act facilitates accountability and transparency of government activities and protects the rights of citizens to participate in State government deliberations. Similarly, California’s Brown Act of 1953 protects citizen rights with regard to open meetings at the county and local government level.

The act also reaffirms, “The people of this state do not yield their sovereignty to the agencies which serve them. The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know. The people insist on remaining informed so that they may retain control over the instruments they have created.”

Here’s the relevant section of the code, section 11121, which says private corporations setup to do state business are not exempt:

As used in this article, “state body” means each of the following: (a) Every state board, or commission, or similar multimember body of the state that is created by statute or required by law to conduct official meetings and every commission created by executive order. (b) A board, commission, committee, or similar multimember body that exercises any authority of a state body delegated to it by that state body. (c) An advisory board, advisory commission, advisory committee, advisory subcommittee, or similar multimember advisory body of a state body, if created by formal action of the state body or of any member of the state body, and if the advisory body so created consists of three or more persons. (d) A board, commission, committee, or similar multimember body on which a member of a body that is a state body pursuant to this section serves in his or her official capacity as a representative of that state body and that is supported, in whole or in part, by funds provided by the state body, whether the multimember body is organized and operated by the state body or by a private corporation.

Section 11122.5 reads:

(a) As used in this article, “meeting” includes any congregation of a majority of the members of a state body at the same time and place to hear, discuss, or deliberate upon any item that is within the subject matter jurisdiction of the state body to which it pertains. (b) (1) A majority of the members of a state body shall not, outside of a meeting authorized by this chapter, use a series of communications of any kind, directly or through intermediaries, to discuss, deliberate, or take action on any item of business that is within the subject matter of the state body. (2) Paragraph (1) shall not be construed to prevent an employee or official of a state agency from engaging in separate conversations or communications outside of a meeting authorized by this chapter with members of a legislative body in order to answer questions or provide information regarding a matter that is within the subject matter jurisdiction of the state agency, if that person does not communicate to members of the legislative body the comments or position of any other member or members of the legislative body.

There are some exceptions listed in 11122.5, such as for conversations in open air public meetings and gatherings, but nothing like the blanket exception written in for WCI in SB1018.

Consider this a minute. CARB sets up a private corporation, Western Climate Initiative Inc. to manage the cap and trade program, doesn’t even bother to put the corporation in California, and opts for Delaware and the advantages that brings over California incorporation. Delaware is well known as a corporate haven, and that alone suggests they want it out of the prying eyes of California taxpayers.

But that wasn’t good enough, they take the extraordinary step of writing in an exemption to prevent public scrutiny, and then hide it as a rider in the 100+ pages inserted the day before the bill was signed into law along with the state budget, effectively preventing any scrutiny.

What is CARB intent on hiding in WCI? Now, with a secret meetings get out of jail free card signed by Govenor Moonbeam, We may never know. Just like with the publicly funded Michael Mann fighting tooth and nail to prevent his emails from seeing sunshine, so it seems CARB has taken a cue from the behavior of climate science in general, and in a wave of the hand brushed aside the directive Bagley-Keene Open Meeting Act, deciding they know what is best for the people:

The people, in delegating authority, do not give their public servants the right to decide what is good for the people to know and what is not good for them to know.

In my opinion, this flagrant and orchestrated criminal disregard of the California open meetings law is the epitome of unmitigated gall on the part of CARB, and specifically CARB director Mary Nichols who has made it clear she doesn’t give a rats ass about what the people of California have to say about her empire and how it operates.

At this point, when they decide they can hold themselves above the law that every other town board, council, and agency has to follow,  I’m ready to declare CARB as an enemy of the people of California.

If you are a resident of California, complain loudly to your elected representatives and write your newspapers. The only way to fight this is with more sunshine.