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Lawmakers split as LAO warns of fiscal risks from proposed sustainable aviation fuel tax credit
Summary
The governor's proposed SAF tax credit — $1 to $2 per gallon depending on carbon intensity — drew support from airlines, unions and in‑state producers and criticism from the Legislative Analyst's Office over cost, environmental uncertainty and potential impacts on transportation funding.
Legislators and analysts sparred over a proposed sustainable aviation fuel tax credit the administration says would support decarbonizing aviation and preserve renewable-fuel jobs, while the Legislative Analyst's Office warned the credit could be an expensive and uncertain way to reduce emissions.
Andrew March of the Department of Finance described the proposal as a per-gallon credit against the diesel excise tax ranging from $1 to $2 depending on a fuel's carbon-intensity rating. "The floor would be a dollar for any sustainable aviation fuel that has a carbon intensity that's 50% lower than…
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