New York Defines “Disadvantaged Communities” for Use in Justice40 Predecessor Program

New York’s Climate Justice Working Group (“CJWG”) recently released draft criteria that will be used to identify “Disadvantaged Communities,” (“DACs”) as defined by the Climate Leadership and Community Protection Act (“CLCPA” or “Act”). Under the CLPCA, the state has identified DACs to direct economic and other benefits from required shifts to lower-emissions energy sources, reduced pollution and cleaner air, and economic opportunities. The draft criteria present a novel, detailed approach for regulators and other stakeholders to systematically consider how race, ethnicity, income, health, environmental burdens, and climate change risks impact New York communities, with meaningful impacts on how environmental justice (“EJ”) and climate issues are discussed on a broader scale.

Separately, New York took yet another step to more expansively address EJ in April 2022, following New Jersey’s lead: the state legislature passed a permitting bill that aims to address environmental equity when siting new facilities. If signed by the Governor, this bill will require environmental impact statements that evaluate whether the siting of a facility will cause or increase a disproportionate burden on disadvantaged communities.

Environmental Justice, DACs, and the CLCPA

The CLCPA, signed into law in 2019, sets ambitious greenhouse gas emission reduction targets, committing the state to reduce greenhouse gas emissions by 85% below 1990-levels by 2050, and by generating 100% zero-emission electricity by 2040. The Act created and requires the Climate Action Council—a 22-member committee composed of heads of state agencies, legislators, and experts (the “Council”)—to prepare a Scoping Plan that outlines how the state will achieve these targets. The Council released a Draft Scoping Plan (“Scoping Plan”) in December 2021, which was developed with input from local EJ community representatives and stakeholders. Once finalized, the Scoping Plan will establish the pathway, through economy-wide and sector-specific strategies, for the state to achieve the emission reductions set out in the Act while increasing renewable energy usage and ensuring environmental justice.

In a now well-known provision that has been referred to as the inspirational framework for the federal Justice40 initiative (“Justice 40”), the CLCPA also establishes a goal that DACs —defined by the Act as low-income and/or minority communities that bear disproportionate burdens of negative public health effects, environmental pollution, and impacts of climate change—will receive “40% of the overall benefits of spending on clean energy and energy efficiency programs” and requires that such communities receive at least 35% of the overall benefits of spending on clean energy and energy efficiency programs, projects or investments determined by the state.

CJWG Draft Criteria on DACs

The draft criteria established by the CJWG identifies 1,721 locations across New York State (representing 35% of all census tracts) that are considered DACs. If adopted, each of these census tracts (i.e., geographic units defined by the U.S. Census Bureau, which are relatively small, statistical subdivisions of counties and include about 4,000 people and 1,500 households on average) will receive the benefits provided in the CLCPA.

To determine which geographic areas are DACs, the CJWG considered each census tract’s relative burden, risk, vulnerability, or sensitivity based on environmental, racial, health, and income indicators. The CJWG identified and considered 150 indicators while developing the draft DAC criteria and, after assessing the available data, settled on 45 indicators. CJWG then used the criteria to calculate relative scores; tracts with higher scores relative to other tracts in the State or their region (NYC vs. Rest of State) were identified as DACs. To make the draft DAC list, a census tract must rank relatively high in terms of both “Environmental and Climate Change Burdens and Risks” and “Population Characteristics and Health Vulnerabilities” (or very high in either category). While the scoring approach for draft criteria includes several methods to balance rural and urban burdens and vulnerabilities, relatively fewer rural tracts were identified as DACs (15%) compared with suburban tracts (26%) and urban tracts (47%).

The CJWG will review the disadvantaged communities’ criteria on an annual basis and make updates where necessary. During annual reviews, the CJWG will examine available data to determine if the DACs’ criteria and list of census tracts require modifications.

Broader Implications

These criteria, though calibrated for use in the CLPCA’s benefit distribution scheme system, have the potential to impact not only New York State policy outside the context of the CLPCA, but may also impact federal policy and actions in other states. In March 2022, the White House Council on Environmental Quality (“CEQ”) released its draft Climate and Economic Justice Screening Tool, which is anticipated to be a primary mechanism used by federal agencies to identify disadvantaged communities under Justice40, and ensure that they are receiving benefits intended from federal programs.

Under CEQ’s proposed approach, disadvantaged communities are those that that are, based on census-tract level data, (1) above the 65th percentile for low income, (2) at or below 20% for higher education enrollment rate, and (3) above the threshold for one or more environmental or climate burden related to underinvestment in, among other things, climate change, clean energy and energy efficiency. Notably absent from CEQ’s approach, however, is the inclusion of race in identifying disadvantaged communities—an omission that had not gone without notice or criticism in light of the central role race and racism have played in creating disparities in communities across the country, and the role it plays in predicting environmental inequity.

While CEQ’s race-neutral approach is not meant to discount the established connection between race and environmental inequity, but rather to avoid potential discrimination-related legal challenges to the federal government’s implementation of Jutsice40, New York’s proposed approach provides an alternative path in which race is considered, and provides a framework for other states—and the federal government— to create or revise approaches to distributing benefits to EJ communities.

Comment Opportunities and Next Steps

March 9, 2022, marked the beginning of a 120-day public comment period for New Yorkers to provide feedback on the draft before the criteria is finalized. To comment on the draft criteria, visit the Disadvantaged Community Criteria webpage, here.

B&D's Environmental Justice practice has been at the forefront of EJ issues for decades, bringing specialized private sector and government experience to bear. We represent multinational companies and municipal clients in complex disputes and high-profile project development, corporate ethics and governance, environmental compliance, and investigations related to EJ and Title VI of the Civil Rights Act of 1964 enforcement. For more information, please contact the authors.