The San Francisco Bay Area marked another eco-record by becoming the second region in the nation to assess fees against businesses based on emissions. In a nearly unanimous vote, the Bay Area Air Quality Management District voted on new rules that will affect up to three thousand businesses.

The Bay Area Air Quality Management District (BAAQMD), a state governmental agency that covers counties from Napa to Santa Clara, is mandated to meet air quality standards, educate the public and form air quality policy. Before releasing the new fee rule, the BAAQMD regulated a variety of other air pollutants through a mix of permits, rules, incentives and planning.

The new emissions rule charges businesses 4.4 cents per ton of carbon dioxide after July 1. The money raised will fund greenhouse gas emissions tracking. The rule is specifically designed to affect large scale offenders, who may pay up to fifty thousand dollars annually, but will cost most small businesses less than a dollar per year. The many oil refineries located within BAAQMD’s jurisdiction have threatened to sue, though the fee constitutes a tiny fraction of their annual profit margin.

BAAQMD chair and San Mateo County Supervisor Jerry Hill defended the decision. "Someone needs to take a first step, and we're running out of time, when you look at the bay rising 3 feet by 2100 and the devastating effects of climate change. The more expensive proposition if we do nothing." San Mateo County includes much of the coast line between San Francisco and Santa Cruz.

The BAAQMD voted for the law despite possible jurisdictional challenges and conflicts with state and federal laws. Some business leaders worry that the rule creates an unstable business climate. Yet BAADMQ members hope that the fee will inspire businesses to change their ways. The fees are meant to incentivize green building and renovation by placing a consequence behind being a polluter. BAADMQ members also cited recent studies that indicate a direct relationship between air pollution and health problems in California.

The law is far reaching in the precedent it sets. Larger versions of similar fees are being considered for federal policy, as well as cap and trade programs. Boulder, Colorado is the only other area in the US that has a similar fee program, though San Francisco is considering an additional carbon tax that voters will decide in November. The Coalition for Clean Air called the BAAQMD’s vote a “monumental decision.”

Get the details at the SF Chronicle.