The first year of the two-year legislative session wrapped up last Saturday with major policy decisions such as Cap-and-Invest and Prop 4 coming down to the wire in the final hours of the session. 

On the Cap-and-Invest front, the legislature reauthorized the state’s Cap-and-Invest program through 2045. The structure of the program (AB 1207) remained largely the same while the legislature made more substantial changes to the Greenhouse Gas Reduction Fund (GGRF) appropriation structure (SB 840). Previously, GGRF was continuously appropriated in percentage, and these will now be replaced with fixed dollar amounts. Notably, $1 billion will go to high speed rail, $800 million to housing, and $270 million to wildfire resilience per year. An additional $1 billion will be discretionary funds for annual legislative appropriations. The remaining dollars were allocated to transit, air, and water programs. As Cap-and-Invest revenue grows, this new structure will likely lead to more discretionary funding and opportunities to fund Sierra Nevada priorities such as nature-based climate solutions and wildfire resilience. 

A last minute agreement came together on allocating Prop 4 climate bond funds for the 2026-2027 budget year, with the legislature appropriating approximately $3.4 billion of Prop 4 funds, about a third of the $10 billion available (SB 105). The Governor signed SB 105 last week which allocates significant funding to the Sierra Nevada, including $45 million to the Sierra Nevada Conservancy and $5.2 million to the California Tahoe Conservancy for regional projects. 

The end of the session also resulted in major decisions around energy affordability, which have been a priority for Governor Newsom and the legislature in 2025. This included key energy policies such as refilling the California wildfire fund to insure utilities against catastrophic losses and AB 825, which would lead the way for a West-wide electricity grid.

In terms of legislation, all bills that passed have now been sent to the Governor who has until October 12 to veto or sign legislation. Priority SBC and Sierra Consortium legislation, including SB 427 (which would permanently authorize the Habitat Conservation Fund) and AB 900 (which would support science-based management of 30×30 lands) made it to the Governor’s desk, where they will await their fate in the next month.

With so many significant policy and legislative decisions at the end of the first year of the two year session, SBC will continue to closely follow everything that is happening in Sacramento and what it all means for the Sierra Nevada region.