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Pennsylvania declines to join Transportation Climate Initiative, for now

Pennsylvania is not among the states in the Northeast and Mid-Atlantic that will initially join the Transportation and Climate Initiative (TCI)—a regional effort to reduce pollution from vehicles. But observers say that state leaders might join later, after more details are worked out.

Several announcements on Monday from TCI supporters said that three of the 12 states that initially expressed interest in a Memorandum of Understanding (MOU) signed the carbon-reduction agreement on Monday: Connecticut, Massachusetts and Rhode Island. Washington, D.C., also agreed to join. Other states, including Pennsylvania, support the announcement but did not sign, according to the Georgetown Climate Center, which has facilitated discussions about the TCI for the past several years.

Several Pennsylvania groups representing small businesses have opposed TCI, saying that the cost of fuel would rise if the initiative were to go through in the state and particularly hurt consumers and small businesses.

“We are happy that Pennsylvania has not signed onto this,” said John Kulik, a spokesman for the Pennsylvania Petroleum Association, which represents independent fuel distributors. He said his organization will continue to work with policymakers to keep them informed about TCI’s impact on small businesses as Pennsylvania leaders consider joining the MOU in the future.

In a statement, DEP Press Secretary Jamar Thrasher said that Gov. Tom Wolf supports cap-and-invest programs.

“While the governor did not sign on to the TCI MOU, the Wolf Administration is supportive of the effort to reduce transportation emissions within the region,” Thrasher said. “Pennsylvania will continue to support the three TCI signatory states in this effort and evaluate Pennsylvania’s involvement in the future as part of a broader strategy to provide stable long-term funding of Pennsylvania’s transportation infrastructure.”

The MOU outlines a “cap-and-invest model” that would set a ceiling on transportation emissions, which supporters say will be reduced 30% over the first decade of the program. While the details would be worked out over the next year or so, that model would require gasoline and diesel wholesalers to purchase allowances for the carbon content of their fuel.

The revenue from those allowance sales would then be funneled back to participating states. The TCI is expected to raise $3 billion over 10 years for the participating jurisdictions, supports said. The money raised then would be used in various ways, including fixing transportation infrastructure, improving public transit, increasing bike lanes, and investing in green technologies, such as hybrid charging stations for vehicles.

“We welcome the bipartisan support for this new agreement that will help states to tackle the transportation crisis head on,” said Alli Gold Roberts, director of state policy at Ceres, a sustainability nonprofit. “The transportation sector is the largest and fastest growing source of greenhouse emissions in the U.S., and efforts like the Transportation and Climate Initiative will help to not only curb transportation emissions but revitalize state economies and create new jobs at a time when states need the relief the most.”

In addition to Pennsylvania, the other states that have expressed interest in pursuing TCI but that didn’t sign on Monday are Delaware, Maine, Maryland, New Hampshire, New Jersey, New York, Vermont and Virginia. North Carolina recently began to show support, bringing the Southeast into talks about the regional plan, supporters said Monday.

Supporters also said that they are not discouraged by those states withholding full support, saying that the agreement on Monday was a starting point. They expect more states to join as leaders see the benefits and as the details of a program are worked out.

Opponents in Pennsylvania, including the National Federation of Independent Business, have said they are concerned that extra costs eventually would be passed onto fuel consumers, which some estimates have shown could be at least 17 cents per gallon and up to 53 cents per gallon for diesel. Pennsylvania already has the second-largest gasoline tax in the nation behind California. Wholesalers can only absorb so much of an increase before having to pass costs onto end users at the pump.

However, supporters suggest any gas tax increase—if wholesalers passed the cost onto their customers—would more likely be closer to 5 cents to 9 cents per gallon. They also suggest that the savings in healthcare costs caused by reducing air pollution would far exceed any additional costs on fuel.

Ceres said in a news release that the TCI has support in the business community, noting that more than “100 businesses, investors and higher education institutions”—including Akamai, Biogen, Chatham University, DHL, Eastern Connecticut State University, Lyft, Nestlé, Novartis, State Street, Wayfair and Uber Eastern Connecticut State University—agreed to support the initiative in October.

Vicki Arroyo, executive director of the Georgetown Climate Center, was joined by top officials from the three states and Washington, D.C., to make the announcement during a Zoom call Monday. In addition to the health and environmental improvements, Arroyo has said in the past, the investments in green-energy infrastructure will create jobs. That same point was made by Massachusetts Governor Charlie Baker.

“By partnering with our neighbor states with which we share tightly connected economies and transportation systems, we can make a more significant impact on climate change while creating jobs and growing the economy as a result,” Baker said in a news release.

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