California (STOCA1) Governor Jerry Brown plans to use half of the revenue from the nation’s first state- run cap-and-trade air-pollution program to help ease a $9.2 billion deficit in the most populous U.S. state. Brown estimates the state will take in about $1 billion in the year beginning July 1 under the landmark legislation, which allows industry to buy and sell carbon credits to reduce greenhouse gases. The 73-year-old Democrat wants to use about $500 million on environmental programs now financed through the general fund, said H.D. Palmer, a Finance Department spokesman. “There would be an offset to the general fund to the degree that these fees are and can be used for programs currently being funded by the general fund on greenhouse gas emissions,” Palmer said in a telephone interview yesterday. California will auction tradable allowances that permit industries such as power generators and oil refiners to release carbon into the atmosphere if they can’t meet requirements to lower their pollution to 1990 levels. Brown is seeking to boost general-fund spending by 7 percent to $92.6 billion while asking voters to raise income and sales taxes to ward off further cuts to schools.
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