By Natalie Willis, Reporter, Valley Ag Voice
Agriculture and business groups are suing California over two climate disclosure laws signed by Gov. Gavin Newsom in October. Coined as the Climate Accountability Package, Senate Bills 253 and 261 require large U.S. companies doing business in California to report greenhouse gas emissions and climate-related financial risks.
The American Farm Bureau Federation, Western Growers Association, the California and U.S. Chambers of Commerce, and the Los Angeles County and Central Valley Business Federations jointly filed the lawsuit in the U.S. District Court for the Central District of California.
These climate disclosure laws will be enforced upon businesses in the state and those wishing to do business with California.
SB 253 applies to entities within the U.S. with a total annual revenue greater than $1 billion and do any business in the state. The California Air Resources Board will develop regulations for these businesses to publicly disclose GHG emissions annually in three scopes. Scope 1 refers to direct emissions that the business owns or controls, while scope 2 and 3 refer to indirect emissions that the business does not directly own or control.
Travis Cushman, deputy general counsel for the American Farm Bureau Federation, told The Packer that Scope 3 reporting requirements impose a nominal financial burden on American farmers.
“Scope 3 reporting requirements pose an existential threat to America’s Small and medium-sized farmers, risking a future where only the largest farms can survive,” Cushman said. “AFBF will fight to protect agriculture from Scope 3 data gathering and record keeping, whether it comes from California, the [Securities Exchange Commission], or elsewhere.”
Further, president of the California Chamber of Commerce, Jennifer Barrera explained that the new climate laws are not cost-effective and will not have a notable impact on climate change.
“Compelling businesses to report inconsistent and inaccurate information unnecessarily places them at risk for enormous penalties,” Barrera said in a statement.
The lawsuit also alleges that the bills violate the First Amendment by compelling companies to issue a charged, speculative statement to conform behavior to the state’s political agenda.
“Both laws unconstitutionally compel speech in violation of the First Amendment and seek to regulate an area that is outside California’s jurisdiction and subject to exclusive federal control by virtue of the Clean Air Act and the federalism principles embodied in our federal Constitution,” the lawsuit stated.
