In June 2009 James Boyce, UMass Amherst economics professor, was appointed by Gov. Arnold Schwarzenegger to the Economic and Allocation Advisory Committee, charged with advising the state of California on implementing a cap-and-trade system to reduce greenhouse gases.
The Economic and Allocation Advisory Committee released its final recommendations earlier this week. The committee recommends that California “rely principally, and perhaps exclusively, on auctioning as the method for distributing allowances,” and that roughly 75% of the auction revenue “should be returned to households either through lump-sum payments or through cuts in individual income or sales tax rates.” The committee recommends that the remaining 25% be devoted to public investments in the clean energy transition.
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