BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF [STATE]: 

Section 1. Short Title.  

This Act shall be known and may be cited as the “Local Government Net Zero Policy Prohibition Act.” 

Section 2. Legislative Findings And Declarations 

The Legislature finds and declares as follows: 

1. Reliable, affordable energy is essential to the economic well-being of the residents of this state, the competitiveness of its businesses, and the security of its communities.  
2. Net zero greenhouse gas emission policies adopted at the local government level impose significant costs on ratepayers, consumers, businesses, and taxpayers without commensurate benefit to energy reliability, energy security, or the state’s broader economy.  
3. The patchwork of net zero mandates, carbon pricing schemes, procurement preferences, bans on natural gas hooks ups or fracking, and emissions targets adopted by individual local governments creates regulatory fragmentation that is detrimental to statewide energy planning, economic development, and the uniform treatment of businesses and residents.  
4. Local governments that mandate net zero policies, participate in carbon trading programs, or impose carbon-related charges directly or indirectly through climate lawsuits, or municipal lawsuits filed against the energy industry based on claims of climate costs or fraud, divert public funds from core governmental functions including public safety, infrastructure, and education.  
5. Uniform statewide energy and fiscal policy is a matter of statewide concern. The state has a compelling interest in preempting local government action that conflicts with statewide energy affordability, reliability, and security objectives.  
6. It is therefore the policy of this state to prohibit local governmental entities from adopting, funding, implementing, administering, or enforcing net zero greenhouse gas emission policies, as defined in this Act. 

Section 3. Definitions  

As used in this Act:   

1. “Carbon-intensive product or activity” means any product, fuel, substance, or activity the production, consumption, combustion, or use of which results in the direct or indirect emission of greenhouse gases, including without limitation motor fuels, natural gas, coal, diesel, aviation fuel, electricity generated from fossil fuels, industrial processes, and agricultural activities.  
2. “Cap-and-trade program” means any program that establishes an aggregate limit or cap on the total quantity of greenhouse gas emissions from specified sources, allocates or auctions emission allowances or credits to those sources, and permits the trading, banking, or transfer of such allowances or credits among participants as a means of compliance.  
3. “Carbon offset” means a reduction, removal, or avoidance of greenhouse gas emissions from a project or activity used to compensate for an equivalent emission occurring elsewhere, whether or not traded on a voluntary or compliance market.  
4. “Emissions trading program” means any market-based mechanism designed to reduce aggregate greenhouse gas emissions by allowing the buying, selling, or trading of emissions allowances, credits, offsets, or other instruments representing a quantity of greenhouse gas emissions or reductions thereof.  
5. “Greenhouse gas” means carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulfur hexafluoride (SF6), nitrogen trifluoride (NF3), and any other gas designated as a greenhouse gas by the [State Environmental or Energy Agency], and any combination or mixture of the foregoing.  
6. “Local governmental entity” means any county, municipality, city, town, village, township, borough, special district, school district, community college district, public university, public college, technical college, regional planning commission, transit authority, port authority, housing authority, hospital district, water management district, utility district, or any other political subdivision, instrumentality, agency, board, authority, or entity created under state law, or any officer, employee, official, or agent acting on behalf of any of the foregoing. The term includes multi-jurisdictional entities in which one or more local governmental entities participate. 
7. “Net zero policy” means any policy, program, initiative, plan, target, goal, commitment, resolution, ordinance, regulation, rule, code, standard, procurement preference, or contractual requirement, whether formal or informal, written or unwritten, that:  
   • (a) is designed or intended to achieve, promote, or advance a reduction of net greenhouse gas emissions to zero, or to a level equal to or less than the quantity of greenhouse gases removed from the atmosphere;  
   • (b) imposes, recommends, or creates incentives toward any numerical greenhouse gas emission reduction target, timeline, or pathway, including targets described as ‘carbon neutral,’ ‘climate neutral,’ ‘net negative,’ ‘100% clean energy,’ ‘carbon free,’ ‘Paris-aligned,’ ‘science-based,’ or any similar terminology;  
   • (c) requires, encourages, or creates preferences for the purchase, use, or procurement of goods, specific types of appliances, services, or energy based on the carbon content, carbon footprint, or greenhouse gas emission profile of such goods, services, or energy;  
   • (d) establishes, operates, administers, or participates in a cap-and-trade program or emissions trading program; 
   • (e) requires the purchase, retirement, or use of carbon offsets;  
   • (f) imposes any tax, fee, charge, assessment, or other financial obligation based on the carbon content, greenhouse gas emission rate, or carbon footprint of any fuel, product, activity, or transaction;  
   • (g) requires or provides for the divestment from, or refusal to contract with, businesses based on their greenhouse gas emissions, carbon footprint, fossil fuel operations, or failure to adopt greenhouse gas reduction commitments; or  
   • (h) requires or encourages membership in, payment of dues to, or participation in any organization, consortium, compact, coalition, or association whose primary purpose or a substantial purpose is the advancement of net zero greenhouse gas emission policies.   
8. “Public funds” means any money, assets, appropriations, revenues, taxes, fees, grants, loans, bonds, or other financial resources received, controlled, or expended by a local governmental entity, including state shared revenues, federal funds passed through the state, grant proceeds, and any other source of revenue, regardless of fund designation.  
9. “State shared revenue” means any revenue distributed to local governmental entities by the state pursuant to statute, including without limitation revenue sharing, local government assistance, educational foundation aid, transportation funds, and discretionary grant programs administered by state agencies. 

Section 4. Prohibition On Net Zero Policies — Direct Preemption      

• (a) GENERAL PROHIBITION. A local governmental entity shall not:   
  1. Adopt, enact, issue, implement, enforce, or require adherence to any net zero policy by resolution, ordinance, rule, regulation, code, policy, plan, administrative order, contract provision, grant condition, or any other mechanism, whether binding or aspirational;  
  2. Expend, commit, allocate, or authorize the expenditure of any public funds in any manner that supports, implements, funds, advances, promotes, or enforces any net zero policy;  
  3. Impose, assess, collect, or administer any tax, fee, charge, assessment, offset obligation, or other financial obligation that is based on or calculated with reference to the carbon content, greenhouse gas emission rate, carbon footprint, or greenhouse gas emission profile of any fuel, product, activity, transaction, or business;  
  4. Implement, administer, participate in, or enforce any cap-and-trade program, emissions trading program, or carbon offset program;  
  5. Apply procurement preferences, award criteria, scoring criteria, weighting factors, or contract terms that favor or disfavor vendors, contractors, or suppliers based on their greenhouse gas emission levels, carbon footprints, net zero commitments, or participation in emissions reduction programs;  
  6. Require any private person, business, property owner, tenant, or other nongovernmental entity subject to the local governmental entity’s jurisdiction to adopt, implement, or comply with any net zero policy or policies which favor specific types of energy sources, technologies, or appliances based on carbon dioxide emission accounting rather than economic considerations;  
  7. Pay dues, membership fees, subscriptions, or any other consideration to any private organization, consortium, compact, or coalition whose primary purpose or a substantial purpose is the advancement of net zero greenhouse gas emission policies; or  
  8. Enter into any intergovernmental agreement, compact, memorandum of understanding, or cooperative arrangement with another governmental entity for the purpose of implementing or advancing a net zero policy.  
  9. Institute or join any lawsuit against any entity based on their greenhouse gas emissions. 
• (b) EXISTING POLICIES. Any net zero policy adopted by a local governmental entity prior to the effective date of this Act is void and of no legal effect as of the effective date of this Act. Any contract, agreement, or commitment entered into prior to the effective date of this Act that requires compliance with a net zero policy shall be voidable at the option of the local governmental entity; provided, however, that a local governmental entity may fulfill the remaining term of any such contract that was lawfully executed prior to the effective date and may not be terminated without penalty, but may not extend, renew, or expand such contract after its expiration. Government entities involved in lawsuits related to greenhouse gas emissions must withdraw from the lawsuit within 30 days.  
• (c)  CONSTRUCTION. Nothing in this Act shall be construed to:   
  1. Prohibit a local governmental entity from adopting energy efficiency measures for its own facilities when such measures are selected on the basis of cost-effectiveness and lifecycle cost savings, and not on the basis of achieving a greenhouse gas emission target;  
  2. Prohibit a local governmental entity from complying with any federal law or regulation that requires specific actions with respect to greenhouse gas emissions;  
  3. Prohibit a local governmental entity from planting trees or maintaining green spaces for purposes other than greenhouse gas offset accounting;  
  4. Prohibit a local governmental entity from purchasing vehicles, equipment, or energy based solely on cost and operational performance criteria, provided that the purchase is not made pursuant to a net zero policy or as part of a plan to achieve greenhouse gas emission targets; or  
  5. Affect the authority of the [State Environmental or Energy Agency] to administer state environmental or energy programs. 

Section 5. Enforcement — State Funding Conditions      

• (a) ANNUAL COMPLIANCE AFFIDAVIT. On or before [DATE] of each year, the chief executive officer or chief financial officer of each local governmental entity receiving state shared revenues or state grants shall submit to the [State Department of Revenue or designated agency] a sworn affidavit, executed under penalty of perjury, affirming that the local governmental entity is in full compliance with Section 4 of this Act and has not adopted, funded, or implemented any net zero policy during the preceding fiscal year. The [Department] shall prescribe the form and content of the required affidavit.  
• (b) WITHHOLDING OF STATE SHARED REVENUES. If a local governmental entity fails to file the required affidavit by the deadline, or if the [Department] determines after investigation and notice that a local governmental entity is not in compliance with Section 4, the [Department] shall: 
  1. Notify the local governmental entity in writing of the non-compliance or failure to file, and provide thirty (30) days to cure;  
  2. If the local governmental entity does not cure the violation within thirty (30) days, withhold from the next distribution of state shared revenues an amount equal to [twenty-five percent (25%)] of the local governmental entity’s annual state shared revenue allocation;  
  3. Continue to withhold [twenty-five percent (25%)] per quarter of continued non-compliance until the local governmental entity certifies compliance or until all state shared revenues are withheld, whichever occurs first; and  
  4. Report the non-compliance to the [State Legislature, Governor’s Office, and State Auditor]. 
• (c) GRANT INELIGIBILITY. A local governmental entity that is determined to be in non-compliance with Section 4 of this Act is ineligible to receive any discretionary state grant, loan, or financial assistance from any state agency for the duration of the non-compliance period and for one (1) year following a finding of compliance.  
• (d) RESTORATION OF FUNDING. State shared revenues withheld pursuant to this Section shall be restored, without interest, upon the [Department]’s determination that the local governmental entity has come into full compliance with Section 4, including the repeal of any non-compliant net zero policy and cessation of any non-compliant expenditures.  
• (e) PROCEDURE. The [Department] shall adopt rules establishing procedures for investigation, notice, hearing, and determination of compliance under this Section. Any local governmental entity subject to a compliance determination shall have the right to an administrative hearing prior to the withholding of funds, except that withholding may be imposed on a temporary basis pending the outcome of the hearing when the [Department] makes a preliminary finding of non-compliance supported by substantial evidence. 

Section 6. Civil Remedies and Enforcement       

• (a) ATTORNEY GENERAL ENFORCEMENT. The [State Attorney General] may bring a civil action in [name of appropriate court] against any local governmental entity that violates this Act to obtain:   
  1. A declaratory judgment that the local governmental entity is in violation of this Act;  
  2. Temporary, preliminary, or permanent injunctive relief enjoining the local governmental entity from adopting, implementing, or enforcing any net zero policy; and  
  3. Restitution of any public funds expended in violation of this Act. 
• (b) PRIVATE RIGHT OF ACTION. Any resident, property owner, business owner, or taxpayer in the jurisdiction of a local governmental entity that has adopted or implemented a net zero policy in violation of this Act may bring a civil action in [name of appropriate court] against the local governmental entity to obtain:   
  1. A declaratory judgment that the local governmental entity is in violation of this Act;  
  2. Injunctive relief enjoining the local governmental entity from continuing any violation; and  
  3. Reasonable attorney’s fees and costs upon prevailing. 
• (c) INDIVIDUAL LIABILITY. Any officer or employee of a local governmental entity who, acting in their official capacity, knowingly adopts, implements, or expends public funds in support of a net zero policy in violation of this Act is subject to personal liability for reasonable attorney’s fees and costs incurred by a prevailing plaintiff in a private action brought under subsection (b). This subsection shall not apply to ministerial acts taken pursuant to a directive of a legislative body of the local governmental entity.  
• (d) VENUE AND JURISDICTION. An action brought under this Section shall be filed in the circuit or district court of the county or judicial district in which the defendant local governmental entity is located. The court shall give expedited consideration to any motion for temporary restraining order or preliminary injunction in such an action. 

Section 7. Penalties      

• (a) Any public funds expended by a local governmental entity in violation of Section 4 of this Act shall be:   
  1. Subject to recoupment by the state through offset against future state shared revenue distributions;  
  2. Recoverable in a civil action brought under Section 6; and  
  3. Deemed a misuse of public funds subject to audit and review by the [State Auditor or Comptroller]. 
• (b) The [State Auditor or Comptroller] shall include compliance with this Act in its regular audits of local governmental entities and shall report any identified violations to the [Department] and the [State Legislature].   

Section 8. Statewide Concern Declaration (Optional — Home Rule States)      

• (a) LEGISLATIVE DECLARATION OF STATEWIDE CONCERN. The Legislature expressly declares that the following subjects are matters of statewide concern, not local affairs, and that this Act is enacted pursuant to the state’s plenary authority over such matters:   
  1. The establishment of uniform statewide energy policy, including the regulation of greenhouse gas emissions from all sectors of the economy;  
  2. The fiscal integrity and uniform tax treatment of residents and businesses throughout the state, including the prohibition of local carbon taxes, carbon fees, and emissions-based assessments;  
  3. The prevention of regulatory fragmentation that impedes commerce, investment, and the uniform application of state energy law; and  
  4. The protection of ratepayers and taxpayers from local government expenditures on programs that conflict with the state’s energy affordability and reliability objectives. 
• (b) PREEMPTION. To the extent that any local charter, ordinance, resolution, rule, regulation, or policy conflicts with this Act, this Act shall prevail. The Legislature expressly preempts the subject matter of this Act in its entirety from local regulation.  
• (c) SAVINGS CLAUSE — HOME RULE FINANCING AUTHORITY. Nothing in this Act shall be construed to impair the constitutional authority of a home-rule local governmental entity to levy taxes authorized by its charter for general governmental purposes. However, any revenues derived from such authority may not be expended for purposes prohibited by Section 4 of this Act.  
• (d) ALTERNATIVE FUNDING CONDITION PRIMACY. In the event a court of competent jurisdiction determines that Section 4 of this Act may not be applied to a particular local governmental entity on the basis of constitutional home rule protections, Section 5 of this Act — the state funding condition mechanism — shall remain fully in effect with respect to such local governmental entity and shall be construed as an independent and severable basis for enforcement. 

Section 9. Severability  

If any provision of this Act or its application to any person or circumstance is held invalid, the invalidity does not affect other provisions or applications of this Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.  

Section 10. Effective Date   

This Act takes effect on [EFFECTIVE DATE], or upon becoming law, whichever is later.