The State of California will devote billions of dollars in new cap-and-trade revenue to fund projects intended to further curb climate impacts. In addition to investments in high-speed rail and public transit, millions of dollars will support affordable transit-oriented development (TOD). CNT research helped make the case that building affordable housing near transit can significantly reduce GHG from auto emissions.

Home to the 12^th-highest carbon emissions in the world, the State of California established a cap-and-trade program in 2006 that sets limits (the cap) on the amount of greenhouse gases (GHG) that factories, power plants, and oil refineries can emit. Companies that emit more can buy additional allowances, and ones that emit less can sell their unused allowances (the trade).

The program is expected to raise $5 billion dollars a year by the end of the decade. In the meantime, California legislators wrestled with the question of what to do with the early revenues.

CNT was asked to contribute research and analysis that quantifies theclimate benefits of constructing affordable housing units near public transit. Working with the California Housing Partnership Corporation(CHPC) and TransForm, a statewide transit advocacy group, CNT calculated reductions in vehicle miles traveled (VMT) for five different income groups living in three types of locations.

Among the findings of the CNT analysis were two key points:

• Lower Income households drive nearly 50% fewer miles when living within a quarter-mile of frequent transit than those living further away, in areas that do not incorporate transit-oriented development (TOD) principles. When living within a half-mile of frequent transit they drove 25-30% less.
• Higher Income households drive more than twice as many miles and own more than twice as many vehicles as Extremely Low-Income households living within a quarter-mile of frequent transit.

CHPC and TransForm used the VMT data to compute related reductions in GHG emissions from personal vehicle use. They found that investing 10% of cap-and-trade proceeds in affordable TOD housing would cut VMT by over 100 million miles in just three years. In 55 years (the estimated life of the to-be-constructed housing), VMT would be reduced by 5.7 billion miles and GHG emissions would be cut by more than 1.58 million metric tons.

On June 15, 2014, the California State Legislature approved a spending plan that includes an initial $65 million for development of affordable homes near transit, with other funds earmarked for construction and operation of high-speed rail lines, as well as for public transit. Going forward, a full 10% of cap-and-trade revenue will be allocated to help struggling California families live closer to transit, jobs, and other amenities.

“By demonstrating the clear relationship between lower-income households living near transit and lower vehicle miles traveled, the CNT report played a critical role in helping the California Housing Partnership make the case to our state leaders that lower-income Californians are part of the solution to our climate change challenge,” said Matt Schwartz, president of the California Housing Partnership Corporation. “The state of California now recognizes that creating and preserving affordable homes near transit must be a priority in our state’s investment strategy, not an afterthought.”

“For almost two years, even legislators that supported affordable housing said to us that they were worried we could not prove it could be a greenhouse gas reduction strategy,” said Stuart Cohen, Executive Director of TransForm. “CNT’s research provided the definitive proof we needed.”

“If cities and regions really want to get serious about climate protection, sustainable development, and regional resiliency, they’ll have to start incorporating affordability and equity measures, as California is doing now,” said Scott Bernstein, President of CNT. “As our research in California and across the country shows, location efficiency is key to keeping housing and transportation options as convenient and affordable as possible, and to minimizing our contributions to climate change.”

“We are always proud to see our research have the kind of positive impact on public policy it’s had in California,” said Kathryn Tholin, CEO of CNT. “CNT’s goal since day one has been to create efficient, sustainable, and equitable communities. Our recent work with CHPC and TransForm to make the case for affordable housing as a climate protection strategy is a perfect example, and we are thrilled for their success.”