4 hours Ago By Greenberg Traurig, LLP
On Dec. 5, 2024, the California Air Resources Board (CARB) issued an enforcement notice (Notice) regarding Senate Bill (SB) 253, the Climate Corporate Data Accountability Act. In the Notice, CARB stated it will not enforce penalties against entities acting in good faith for “incomplete reporting” violations in the first reporting cycle.
This comes on the heels of Gov. Gavin Newsom signing SB 219 , which delays CARB’s deadline finalizing regulations that implement SB 253 and SB 261. See our October GT Alert .
According to the Notice, CARB “recognizes that companies may need some lead time” to prepare their reports regarding their Scope 1 and Scope 2 emissions, which are due in 2026, based on 2025 data. The Notice states that CARB will exercise enforcement discretion as long as companies “demonstrate good faith efforts to comply with the requirements of the law. Thus, for the first reporting cycle, CARB will not take enforcement action for incomplete reporting against entities, as long as the companies make a good faith effort to retain all data relevant to emissions reporting for the entity’s prior fiscal year.
” State Sens. Scott Wiener and Henry Stern, authors of SB 253 and SB 261, expressed “serious concern” about the Notice in a letter to CARB Chair Liane Randolph on Dec. 11, 2024, saying it is “unacceptable” that CARB signaled that companies did not have to fully comply with the 2026 reporting obligations.
The senators argue that “it is vital that California provide clear signals to the business community that our state remains committed to pursuing emissions transparency through a robust disclosure regime on the timeline enacted in 2023.” The authors are “beyond frustrated” that CARB has not taken meaningful steps to implement the legislation. CARB’s deadline to issue implementing regulations is now July 1, 2025, and according to the letter, despite CARB receiving $8.
4 million for implementation, the agency has not hired any new staff. The letter closes with the authors threatening to bring CARB leadership before the Legislature for Oversight hearings in 2025 if the agency does not make progress on “these critical steps.” Whether CARB will respond to the senators’ letter or amend its Notice remains unclear, although CARB may publish guidance on its next steps ahead of the July 1, 2025, deadline to finalize regulations implementing the laws.
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