Just Transition Committee releases rough draft to community on plan to transition from coal
Committee compiles 11 recommendations to assist workers and communities inpacted by Colorado's transition away from coal
CRAIG — It took a month longer than expected due to challenges from the COVID-19 pandemic, but Colorado finally has a plan to transition away from coal.
The Just Transition Advisory Committee released its draft to the public in early August, marking some five months of work to compile the outline of the plan.
Colorado House Bill 19-1314 established the advisory committee for a Just Transition plan, tasking the committee with developing recommendations for the state. The bill also declared that “a strong and comprehensive policy is needed to invest new financial resources in coal communities that are seeking to diversify and grow their local and regional economies in a manner that is both sustainable and equitable.”
Colorado is the first state to establish an office to help with the transition and to develop a statewide strategy to move away from coal. The 19-member advisory committee includes representatives of affected workers and communities as well as people with expertise in economic development and workforce programs, utilities, legislators and agency leaders. The members elected Dennis Dougherty, executive director of Colorado’s AFL-CIO labor union, as the chair and Ray Beck, Moffat County commissioner, as the vice-chair.
According to the Just Transition draft, the advisory committee focused on three key areas for the plan: coal transition workers, coal transition communities and fiscal issues.
The coal transition workers section was the most robust of the proposed plan.
“Our goal for workers is to ensure the shift to a clean energy economy fulfills a moral obligation to assist impacted workers who have powered Colorado for generations,” the advisory committee said. “Workers displaced from coal-related jobs should receive the support necessary to plan effectively for their transitions and achieve new career goals that allow them and their families to thrive economically and continue to contribute to Colorado and their communities.”
In the section, the committee came up with the following recommendations:
- Assist all interested coal transition workers in developing individual transition plans for achieving their financial, career and/or retirement goals while maintaining or achieving economic self-sufficiency.
- Develop a package of training, job search and relocation support services, similar to the federal Trade Adjustment Assistance program, to help workers achieve their transition goals.
- Assist worker transitions with temporary income and benefit assistance, including a wage and health differential benefit for most workers, and a wage and health replacement benefit as an option for workers nearing retirement.
- Establish length-of-service requirements for coal workers to be eligible for the training, job search, and relocation services outlined in Recommendation 2 and the income and benefit assistance outlined in Recommendation 3.
- Ensure that workers who accept positions with their existing employer at lower pay will qualify for the wage and health differential benefit, and that workers who choose a training program or job do not waive their right to other benefits if those initial choices do not work out for them (subject to established timeframes and eligibility requirements).
“For coal transition workers, we recommend the state provide a comprehensive set of supports to help them thrive in a future without coal. That includes assistance with career planning, mentorships, and robust and flexible support for workers seeking retraining, searching for new jobs or starting new businesses,” the draft states. “It also includes financial assistance for those who must relocate for new jobs. And, ultimately, it includes several years of income support for those engaged in training programs or whose new jobs do not pay as well or have as good a set of benefits as the coal jobs they lost.”
Following the recommendations for coal transition workers, the plan then focused on the coal transition communities.
“Our goal for communities is to help those that are transitioning away from coal to develop and implement locally driven, asset-based plans that achieve long-term prosperity by creating jobs that can support families, building a viable and diversified tax base, and spurring long-term local wealth creation and social cohesion,” the advisory committee said.
In the section, the committee came up with the following recommendations:
- Assist affected communities with the creation of local transition plans that pivot from resource extraction to new industry sectors that provide living wages and an adequate tax base.
- Align and coordinate existing State programs to support local transition plans and facilitate the growth of existing businesses while attracting new industries and businesses.
- Invest in local physical and community infrastructure to maintain and improve quality of life and critical services.
- Establish a state-wide independent investment intermediary focused on leading and structuring investments in coal transition communities, consistent with their established local transition plans.
- Establish a state-wide investment fund focused on making investments in coal transition communities, in collaboration with those communities and consistent with their local transition plans. The purpose of the fund is to lower risk for other investors and to provide a mechanism for long-term investments in these communities.
“For coal transition communities, we recommend the state help build the capacity for communities to plan their own economic futures and help with technical assistance and expertise from around the state and nation,” the draft states. “We also recommend the state align and coordinate its wide array of economic and community development programs and services to help coal transition communities (and communities throughout rural Colorado) to better compete. And we suggest some new ideas for how to coordinate and fund these efforts, with special attention to reducing the risk for those who choose to invest in communities facing the greatest challenges.”
Finally, the committee highlighted the fiscal issues with the transition from coal for workers and communities. In the section regarding fiscal issues, the committee made just one recommendation:
- Review State tax, fiscal, and regulatory policies to continue support for essential services and infrastructure, identify appropriate state and local taxation policies for utility-scale renewable energy projects, and support efforts by utilities to reinvest in coal transition communities.
The problems with the fiscal issues that could arise from the transition are too difficult to project at this time, the committee says.
“The legislation creating this planning process also directed us to consider the costs of our proposals and potential sources of funding to pay those costs,” the committee says. “In the era of COVID-19, this has been difficult. While we have made some efforts to estimate costs, we are not yet comfortable enough with their accuracy to share them in this plan.
“The question of how to pay for the costs is even less clear,” the committee added. “Colorado is a relatively low tax state — and many of the coal transition communities are relatively low tax communities. Colorado also has some of the most restrictive tax and spending limitations in the nation, so even in the best of times the issue of funding would likely be our most daunting challenge.”
Now that the draft has been submitted, there’s still work to be done before the final plan is submitted to Gov. Jared Polis and the General Assembly by Dec. 31.
- The Office of Just Transition, in cooperation with other state agencies, will review, further develop and vet suggestions in preparation for completing the final plan.
- The OJT will work with other appropriate agencies to assess the capacity of the various coal transition communities to develop and successfully implement their local transition plans, and it will begin to coordinate the State’s support for these efforts.
- The OJT will coordinate virtual public engagement efforts to help ensure the voices of all parties affected by this transition have a chance to be heard.
“This is just the first step in a long process of ensuring a just transition for Colorado’s coal workers and communities,” the committee says. “Much work lies ahead, and the JTAC is committed to do what it can to ensure the workers and communities that helped power our state’s prosperity in the past can continue to thrive here in the future.”
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