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An 86% shortfall on the cap'n trade auction -- not good for California's deficit.

First cap-and-trade auction a bust for California budget
A low price for credits and minimal demand for future offsets suggest California will see a mere fraction of the $1 billion that Gov. Jerry Brown and lawmakers estimated the state would receive this fiscal year. If demand remains similar in two forthcoming auctions, the state would generate only about $140 million, the nonpartisan Legislative Analyst's Office estimated Wednesday....

As California sells credits, it stands to benefit financially. Brown and lawmakers assumed California would take in $1 billion total this year, spending $500 million on state budget relief and $500 million on curbing greenhouse gas emissions. The California Air Resources Board sold $289 million in credits this month, but most of the money is dedicated for utilities and their ratepayers. That leaves $55.8 million for the state....

Lawmakers used their predicted environmental windfall to help plug the budget. They also passed two bills this year describing how additional money should be spent. They outlined seven goals, ranging from job creation to public health, and required that at least 25 percent of funds benefit "disadvantaged" communities. At one point, Brown suggested the money be tapped for high-speed rail construction, but lawmakers tabled that idea for two years....But now it's unclear how much money will be available this year for any of these purposes.

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