I 
115TH CONGRESS 
2D SESSION 
H. R. 4889 
To cap the emissions of greenhouse gases through a requirement to purchase 
carbon permits, to distribute the proceeds of such purchases to eligible 
individuals, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 29, 2018 
Mr. BEYER (for himself, Ms. NORTON, Mr. LOWENTHAL, Mr. CONNOLLY, Mr. 
RASKIN, Ms. VELA´ZQUEZ, Mr. MCGOVERN, Ms. DELAURO, Ms. LEE, Ms. 
SCHAKOWSKY, Mr. HUFFMAN, Mr. HASTINGS, Mr. DESAULNIER, Ms. 
LOFGREN, Mr. CARTWRIGHT, Mr. KHANNA, Mr. MCNERNEY, Mr. TED 
LIEU of California, Mr. BLUMENAUER, Mr. COHEN, Mr. WELCH, Mrs. 
NAPOLITANO, Mr. CAPUANO, Mr. MCEACHIN, and Mr. SCOTT of Vir-
ginia) introduced the following bill; which was referred to the Committee 
on Energy and Commerce, and in addition to the Committee on Ways 
and Means, for a period to be subsequently determined by the Speaker, 
in each case for consideration of such provisions as fall within the juris-
diction of the committee concerned 
A BILL 
To cap the emissions of greenhouse gases through a require-
ment to purchase carbon permits, to distribute the pro-
ceeds of such purchases to eligible individuals, and for 
other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Healthy Climate and 
Family Security Act of 2018’’. 
SEC. 2. FINDINGS. 
The Congress finds the following: 
(1) Carbon dioxide and other greenhouse gas 
emissions continue to rise. In 2013, CO2 levels in 
the atmosphere reached 400 parts per million for the 
first time in human history. Ten of the world’s 
warmest years on record have occurred since 2000, 
and 2016 was the warmest year ever recorded. 
(2) The warming of our planet has led to more 
frequent, dangerous and expensive extreme weather 
events, including heat waves, storms, fires, droughts, 
floods and tornadoes. 
(3) More than 97 percent of climate scientists 
agree that our planet is warming, primarily because 
of the extraction and burning of fossil fuels. 
(4) The atmosphere is a common resource that 
belongs equally to all. 
(5) Stabilizing the climate can and must be 
done in a way that supports vibrant economic 
growth and a thriving middle class. 
(6) Legislation to address climate change and 
accelerate the transition to a clean energy economy 
must be fair, transparent and built to last. 
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SEC. 3. AUCTION OF CARBON PERMITS AND DISTRIBUTION 
OF HEALTHY CLIMATE DIVIDENDS. 
(a) IN GENERAL.—The Internal Revenue Code of 
1986 is amended by adding at the end the following new 
subtitle: 
‘‘Subtitle 
L—Auction 
of 
Carbon 
Permits 
and 
Distribution 
of 
Healthy Climate Dividends 
‘‘Chapter 101. Cap and Dividend Program Rules. 
‘‘Chapter 102. Healthy Climate Dividends. 
‘‘Chapter 103. Border Adjustments. 
‘‘CHAPTER 101—CAP AND DIVIDEND 
PROGRAM RULES 
‘‘Sec. 9901. Definitions. 
‘‘Sec. 9902. Carbon permits. 
‘‘Sec. 9903. Auctions. 
‘‘Sec. 9904. Compliance obligation. 
‘‘Sec. 9905. Penalty for noncompliance. 
‘‘Sec. 9906. Carbon capture and sequestration. 
‘‘Sec. 9907. Trading. 
‘‘Sec. 9908. Banking and borrowing. 
‘‘SEC. 9901. DEFINITIONS. 
‘‘For purposes of this subtitle: 
‘‘(1) ADMINISTRATOR.—The term ‘Adminis-
trator’ means the Administrator of the Environ-
mental Protection Agency. 
‘‘(2) CARBON PERMIT.—The term ‘carbon per-
mit’ means a carbon permit established by the Sec-
retary under section 9902(a). 
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product derived therefrom for use as a combustible 
fuel offered for sale in United States markets. 
‘‘(5) CRUDE OIL.—The term ‘crude oil’ includes 
crude oil condensates, natural gasoline, shale oil, any 
bitumen or bituminous mixture, any oil derived from 
a bitumen or bituminous mixture, and any oil de-
rived from kerogen-bearing sources. 
‘‘(6) FAIR
MARKET
VALUE.—The term ‘fair 
market value’ means the average auction price for 
carbon permits during the 4 quarters immediately 
preceding a failure to surrender, when required 
under section 9904, the required number of carbon 
permits under such section. 
‘‘(7) STATE.—The term ‘State’ means the sev-
eral States, the District of Columbia, the Common-
wealth of Puerto Rico, the United States Virgin Is-
lands, Guam, American Samoa, the Commonwealth 
of the Northern Mariana Islands, and any other 
commonwealth, territory, or possession of the United 
States. 
‘‘(8) VINTAGE YEAR.—The term ‘vintage year’ 
means the calendar year for which a carbon permit 
is established under section 9902. 
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‘‘SEC. 9902. CARBON PERMITS. 
‘‘(a) IN GENERAL.—The Secretary, in consultation 
with the Administrator, shall establish a separate quantity 
of carbon permits for calendar year 2019 and each cal-
endar year thereafter, as set forth under subsection (b). 
‘‘(b) EMISSIONS REDUCTION SCHEDULE.— 
‘‘(1) IN
GENERAL.—The quantity of carbon 
permits established by the Secretary, in consultation 
with the Administrator, under subsection (a) for any 
calendar year before 2050 that is between the near-
est target years specified in paragraph (2) preceding 
and succeeding such calendar year shall be the quan-
tity of such permits that represents an equal, pro 
rata reduction from the preceding year to the suc-
ceeding year. 
‘‘(2) TARGETS.— 
‘‘(A) INITIAL
TARGET.—The quantity of 
carbon permits established for 2019 shall be 
equal to 12.5 percent less than the number of 
metric tons of carbon dioxide emitted in the 
United States in 2005. 
‘‘(B) DECADAL
TARGETS.—The quantity 
of carbon permits established for— 
‘‘(i) 2020 shall be equal to 20 percent 
less than the number of metric tons of car-
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bon dioxide emitted in the United States in 
2005, 
‘‘(ii) 2025 shall be equal to 30 percent 
less than the number of metric tons of car-
bon dioxide emitted in the United States in 
2005, 
‘‘(iii) 2030 shall be equal to 40 per-
cent less than the number of metric tons 
of carbon dioxide emitted in the United 
States in 2005, 
‘‘(iv) 2035 shall be equal to 50 per-
cent less than the number of metric tons 
of carbon dioxide emitted in the United 
States in 2005, 
‘‘(v) 2040 shall be equal to 60 percent 
less than the number of metric tons of car-
bon dioxide emitted in the United States in 
2005, 
‘‘(vi) 2045 shall be equal to 70 per-
cent less than the number of metric tons 
of carbon dioxide emitted in the United 
States in 2005, and 
‘‘(vii) 2050 shall be equal to 80 per-
cent less than the number of metric tons 
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of carbon dioxide emitted in the United 
States in 2005. 
‘‘(3) REPORTS.— 
‘‘(A) CALENDAR YEAR 2048.—In 2048 the 
Secretary, after consultation with the Adminis-
trator, will submit a report to Congress making 
recommendations concerning the program es-
tablished under this subtitle for years after 
2050, including the quantity of carbon permits 
to be established and any reductions that may 
be necessary to ensure a healthy climate. 
‘‘(B) AVERTING CATASTROPHIC CLIMATIC 
IMPACT.—The Secretary shall report to Con-
gress if the Secretary, after consultation with 
the Administrator, determines the emissions re-
ductions targets under this subsection should be 
revised in order to avert catastrophic climate 
impacts. 
Such 
report 
shall 
include 
rec-
ommended revisions to the existing emissions 
reduction schedule and the basis for those rec-
ommendations. 
‘‘(c) IDENTIFICATION
NUMBERS.—The Secretary 
shall assign to each carbon permit established under sub-
section (a) a unique identification number that includes 
the vintage year for that carbon permit. 
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‘‘(d) LEGAL STATUS OF CARBON PERMITS.— 
‘‘(1) IN GENERAL.—A carbon permit does not 
constitute a property right. 
‘‘(2) TERMINATION OR LIMITATION.—Nothing 
in this subtitle or any other provision of law shall be 
construed to limit or alter the authority of the 
United States, including the Secretary acting pursu-
ant to statutory authority, to terminate or limit a 
carbon permit. 
‘‘(3) OTHER PROVISIONS UNAFFECTED.—Noth-
ing in this subtitle relating to carbon permits issued 
under this section shall affect the application of any 
other provision of law to a covered entity (including 
the Clean Air Act), or the responsibility for a cov-
ered entity to comply with any such provision of law. 
Regional and State greenhouse gas initiatives are 
not preempted by this subtitle. 
‘‘(e) REGULATIONS.—Not later than December 31, 
2018, the Secretary shall promulgate regulations to carry 
out the provisions of this subtitle. 
‘‘SEC. 9903. AUCTIONS. 
‘‘(a) PERIODIC AUCTIONS.—The Secretary shall con-
duct periodic public auctions of carbon permits established 
under section 9902(a). The Secretary shall conduct at 
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