Last week we wrote a piece on an initiative in California that, if approved by voters this November, would place fees on oil drilling and use the funds to develop an ethanol and alternative energy economy.
Proponents of Proposition 87 say the initiative will raise about $4 billion over ten years. Oil companies oppose the initiative and have already started running ads in advance of the November vote.
In the initial report, we quoted Vinod Khosla, the venture capitalist who is a driving force behind the ballot, as stating that the money would get spent as follows: roughly 60 percent would go to entrepreneurs setting up businesses, such as ethanol filling stations; 30 percent would go to universities, and ten percent would go to running the program an miscellaneous tasks.
The Yes on 87 people wanted to slightly clarify the comments. It's similar but a little different. Here is how the initiative dictates where the money will go:
57.5 percent will go into the Gasoline and Diesel Use Reduction Account. This account will be used for loans, loan guarantees, credits and possibly other incentives for the following activities: buying cars running E85 (85 percent ethanol) or other gas-light cars.(businesses and individuals can apply for funds--school districts and mass transit authorities, however, will have first priority); setting up ethanol stations; setting up businesses that help build the ethanol infrastructure; setting up facilities for ethanol and clean fuel production; and research grants to private organizations.
26.75 percent will go to an account that will help fund university research.
9.75 will go to an account for accelerating the adoption or approval of clean technology. These are one-time start-up loans and grants.
2.5 percent goes to vocational training
3.5 percent goes to public education.