Pacific Gas & Electric Company will pay San Luis Obispo County $16 million to compensate for the discontinued unitary tax.
Diablo Canyon Nuclear Power Plant’s operations were extended until 2030 as of September 2022. The plant also received a 20-year license from the federal Nuclear Regulatory Commission to extend the plant’s operations till 2045.
However, California lawmakers need to pass legislation approving the longer extension for the plant to operate till then.
While the power plant’s operation was extended, the unitary tax was not.
This unitary tax was a property tax that PG&E paid to San Luis Obispo County entities based on the power plant’s value and earnings.
The plant’s value comes from producing nearly 9% of the state’s total electricity supply. Some of these taxes went to funding for local school districts.
Diablo Canyon’s total unitary taxes from one year were around $25 million as of 2022. San Luis Obispo County will only receive around two-thirds of the original tax amount.
PG&E will pay two payments of $8.3 million, one in 2026 and one in 2027, to compensate for the discontinued taxes.
The first $8.3 million payment will be made by Dec. 31, 2026.
The money will then be distributed to local agencies like the San Luis Coastal Unified School District, which was affected by the lack of funding and was in about a $5 million to $7 million deficit. Funding will also go to emergency services in the area.
Senator John Laird introduced a bill that allows local governments, schools and services to continue to receive funding.
The bill was originally meant to secure funding for San Luis Obispo County, but PG&E voluntarily agreed to pay the $16 million.
The Senate bill was gutted and amended to make Sept. 25 Dolly Parton Day as remembrance and recognition of the country music star.
“I authored SB 931 to make sure that the local community, including SLO County, cities, and schools, is adequately compensated for impacts associated with Diablo Canyon Power Plant’s extended operations until 2030,” Senator Laird wrote in his press release.
Senator Laird’s press release specified that the $16 million is from PG&E shareholders rather than taxpayers or customers who pay utility rates.
Assemblymember Dawn Addis co-sponsored the bill to reinstate funding.
While Addis advocated for the funding, she still believes there is more to gain.
“This is just a drop in the bucket compared to what is owed to the school district as well as the community,” Addis said in an interview with Mustang News. “Unfortunately, because PG&E has not been paying its fair share, it’s the students who suffer in the surrounding communities.”
Assemblymember Addis also gave a statement in the Senator’s press release.
“It is crucial that PG&E fulfill its responsibility to our community by restoring critical funding that was missing from the 2025–2030 extension of Diablo Canyon Nuclear Power Plant operations,” Assemblymember Addis wrote. “This is critical for our students and the public agencies who serve the most vulnerable throughout San Luis Obispo County.”
Jane Swanson is the president and spokesperson of San Luis Obispo Mothers for Peace, an organization advocating against the Diablo Canyon Power Plant. However, she spoke to Mustang News on her own behalf.
“I’m very pleased that PG&E has agreed under pressure from John Laird’s legislation. I’m glad that they have agreed to resume support for San Luis Coastal Unified School District,” Swanson said.
Impact on local schools
“The San Luis Coastal Unified School District was in about a $5-7 million deficit, which resulted in cuts to our school counselors, library services, reading intervention programs and extracurricular programs,” said Annie Aguiñiga Frew, a founder of The San Luis Coastal Parent Information Network and a political science Cal Poly professor. “We are hopeful that maybe some of those programs that were cut would be restored [with the funding].”
Not only were these services cut, but there were also budget cuts made to the arts, like music programs and band at the high school level.
The San Luis Coastal Parent Information Network is a non-profit that focuses on advocacy work. Their goal is to make sure there is information available to parents and community members while pushing for transparency with community partners.
How this affects Cal Poly
These budget deficits also impact Cal Poly students.
“Some students work in our local schools, interning or as student teachers. [The new funding] allows for more opportunities for broader educational opportunities,” Frew said. “This is certainly a positive step forward. But also, this is a temporary solution. It doesn’t solve some of the long-term funding questions we’ve been advocating for.”
Assemblymember Addis also found connections to Cal Poly.
“We bear the responsibility of hosting California’s only nuclear power plant, so any of PG&E’s decisions moving forward should be made with the local community in mind, and Cal Poly students are a vital part of that,” Addis said in an interview with Mustang News.
Most people hope that PG&E continues to pay San Luis Obispo County funding installments until 2030, when the power plant is set to go offline.
PG&E voluntarily chose to pay San Luis Obispo County from shareholders’ pockets, so it is possible that PG&E could raise customers’ utility rates to pay for further funding installments if there were a future Senate bill requiring continuing payments.
The future of Diablo Canyon
Stephen Koenick, a member of the U.S. Nuclear Regulatory Commission, wrote a letter acknowledging that the NRC renewed the Diablo Canyon power plant operating license, and PG&E approved it.
His letter explained that as of April 2026, both the NRC and PG&E approved the Diablo Canyon power plant to continue operating until 2045.
These units would be renewed according to NRC member Koenick’s letter.
However, this is not yet authorized under current California state law because there is a cap on operational extension till the year 2030 and no later. A new bill would have to be introduced to further extend operations.
For now, Diablo Canyon will remain operational until 2029 for Unit 1 and 2030 for Unit 2.
This story originally appeared in the September printed edition of Mustang News. Check out more stories from the issue here.