BILL NUMBER: AB 52 CHAPTERED 09/27/02 CHAPTER 983 FILED WITH SECRETARY OF STATE SEPTEMBER 27,2002 PASSED THE SENATE AUGUST 31, 2002 PASSED THE ASSEMBLY AUGUST 31, 2002 AMENDED IN SENATE AUGUST 30, 2002 AMENDED IN SENATE AUGUST 26, 2002 AMENDED IN SENATE AUGUST 5, 2002 AMENDED IN SENATE JUNE 20, 2002 AMENDED IN SENATE MAY 21, 2002 AMENDED IN ASSEMBLY JANUARY 24, 2002 AMENDED IN ASSEMBLY MARCH 29, 2001 INTRODUCED BY Assembly Members Wiggins and Matthews (Coauthors: Assembly Members Cardoza, Reyes, and Salinas) DECEMBER 4, 2000 An act to amend Section 10335.5 of, to add Division 10.3 (commencing with Section 10280) and Division 10.4 (commencing with Section 10285) to, and to add and repeal Division 10.25 (commencing with Section 10278) of, the Public Resources Code, relating to agricultural lands, and making an appropriation therefor. (Approved by Governor September 27, 2002. Filed with Secretary of State September 27, 2002.) I am signing Assembly Bill 52, however, I am vetoing the $2.4 million appropriation for the California Environmental Quality Improvement Loan Program and the $2.4 million appropriation for the Coastal Farmland Preservation program. Proposition 40 requires funds to be used for grants for the preservation of agricultural and grazing lands, including oak woodlands and grasslands. The California Environmental Quality Improvement Loan Program is not a grant program and is therefore ineligible. Additionally, this bill creates the Coastal Farmland Preservation program at the Department of Conservation. This program is duplicative of the existing California Farmland Conservancy Program and other efforts by the State Coastal Conservancy to protect coastal agricultural and rangeland currently funded through Propositions 12 and 40. GRAY DAVIS, Governor LEGISLATIVE COUNSEL'S DIGEST AB 52, Wiggins. Agricultural land preservation: appropriation. (1) Existing law provides for the protection of public grazing lands. This bill would establish the California Environmental Quality Improvement Revolving Loan Program within the Department of Conservation to provide loans to farmers to carry out practices approved for cost-share payments under the federal Environmental Quality Incentive Program. The bill would prescribe categories of loans that would be available under the program, and procedures for making those loans. This program would be repealed January 1, 2008. This bill would also establish the Agricultural Protection Planning Grant Program within the department, to provide planning grants to improve the protection of agricultural lands and grazing lands, including oak woodlands and grasslands. The program would authorize a local government entity, nonprofit organization, authority, or joint powers authority to apply for a grant under the program, to be used for the protection of agricultural lands and grazing lands, including oak woodlands and grasslands, and would prescribe requirements and procedures for applying for such a grant. This bill also would establish the Coastal Farmland Preservation Program, which would require the State Coastal Conservancy and the department to enter into a memorandum of understanding to ensure that the program is a coordinated effort and meets the goals of coastal farmland preservation and the California Farmland Conservancy Program Act. The bill would require that funds appropriated for purposes of the program be expended in accordance with specified requirements. The bill would require the State Coastal Conservancy, the Wildlife Conservation Board, and the department, at the earliest possible time, to jointly prepare a single document describing programs within these entities that protect agricultural lands and grazing lands, including oak woodlands and grasslands, as specified. (2) SB 984 of the 2001-02 Regular Session would establish the Rangeland, Grazing Land, and Grassland Protection Program and would appropriate funds from the California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Act of 2002 (Proposition 40) to protect those lands through the acquisition of conservation easements. Other provisions of the bill would specify that the expenditure of any bond funds for the purpose of that program may only be expended to cover the costs of construction or acquisition of capital assets. This bill would repeal the latter limitation. (3) The California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Act of 2002 (Proposition 40) authorizes the expenditure of $75,000,000 of the proceeds from bonds issued and sold pursuant to the act for grants for the preservation of agricultural lands and grazing lands, including oak woodlands and grasslands. This bill would appropriate $9,600,000 of those proceeds from the bond act for the California Environmental Quality Improvement Revolving Loan Program and the Coastal Farmland Preservation Program established pursuant to the bill, and the Oak Woodlands Conservation Act, in accordance with a specified schedule. Appropriation: yes. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature finds and declares both of the following: (a) It is in the interest of the State of California to ensure the existence of a viable agricultural economy. In doing so, promotion of agricultural production and environmental quality can occur as compatible goals in the state. (b) It is the intent of the Legislature in enacting Division 10.3 (commencing with Section 10280) of the Public Resources Code to encourage the use of the federal Environmental Quality Incentive Program (16 U.S.C. Sec. 3839aa, and following) in order to promote and improve farm conservation practices in the state. SEC. 2. Division 10.25 (commencing with Section 10278) is added to the Public Resources Code, to read: DIVISION 10.25. CALIFORNIA ENVIRONMENTAL QUALITY IMPROVEMENT REVOLVING LOAN PROGRAM 10278. (a) (1) The California Environmental Quality Improvement Revolving Loan Program is established within the Department of Conservation. The loan program shall provide loans for eligible cropland to farmers to carry out practices approved for cost-share payments through the federal Environmental Quality Incentive Program (16 U.S.C. Sec. 3839aa, and following). (2) The California Environmental Quality Improvement Program Revolving Loan Account is hereby established in the State Treasury for the purposes of the program, including any program delivery costs. (b) The following terms have the following meanings as used in this division, unless the context clearly requires otherwise: (1) "Account" means the California Environmental Quality Improvement Program Revolving Loan Account established pursuant to subdivision (a) of Section 10278. (2) "Department" means the Department of Conservation. (3) "Federal program" means the federal Environmental Quality Incentive Program (16 U.S.C. Sec. 3839aa, and following). (4) "Limited resource and beginning farmer" means an applicant that meets that definition under an approved contract entered into between the applicant for the loan and the Secretary of the United States Department of Agriculture pursuant to the federal program. (5) "Loan program" means the California Environmental Quality Improvement Revolving Loan Program established pursuant to subdivision (a). 10279. (a) Practices eligible for the loan program shall have evidence of an approved contract entered into between the applicant for the loan and the Secretary of the United States Department of Agriculture indicating that the applicant qualifies for the federal program. (b) An applicant may apply to the department for the following types of loans under the loan program: (1) A 10 percent cost-share loan, not to exceed one year, for a qualified limited resource and beginning farmer, or up to a 25 percent cost-share low-interest loan for other farmers. The applicant shall repay the loan to the account. (2) A low-interest short-term loan, not to exceed one year, for up 90 percent of the total project cost for a limited resource and beginning farmer, or up to 75 percent of the total project cost for other farmers, whichever is less, as determined and approved by the Director of Conservation. The loan shall be repaid to the account once the applicant has received federal reimbursement pursuant to the federal program. As funds are reimbursed to the account, they may be loaned for new qualified projects. (c) The interest rate for loans granted pursuant to the loan program shall be equal to the average interest paid by the state on bonds sold pursuant to the California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Act of 2002 (Chapter 1.696 (commencing with Section 5096.600) of Division 5), as determined by the Treasurer. (d) If any of the following occurs, the account shall cease to exist: (1) No loans are procured from federal sources for the purposes of the loan program on or before June 30, 2004. (2) No applications for loans are submitted before June 30, 2004. (3) The federal program ceases to exist. (e) If the account ceases to exist, two-thirds of the remaining funds in the account shall be available for appropriation by the Legislature for the California Farmland Conservancy Act (Division 10.2 (commencing with Section 10200)) and one-third of the remaining funds in the fund shall be available for appropriation by the Legislature for grazing and grassland protection in accordance with Senate Bill 984 of the 2001-02 Regular Session, if that bill is enacted and becomes effective on or before January 1, 2003. (f) The department shall adopt guidelines to administer the loan program. 10279.6. This division shall remain in effect only until January 1, 2008, and as of that date is repealed, unless a later enacted statute that is enacted before January 1, 2008, deletes or extends that date. SEC. 3. Division 10.3 (commencing with Section 10280) is added to the Public Resources Code, to read: DIVISION 10.3. AGRICULTURAL PROTECTION PLANNING GRANT PROGRAM 10280. The Agricultural Protection Planning Grant Program is hereby established within the Department of Conservation, to provide planning grants to improve the protection of agricultural lands and grazing lands, including oak woodlands and grasslands. 10280.5. The following terms have the following meanings as used in this division, unless the context clearly requires otherwise: (a) "Authority" means an entity established by the state that requires its members, including, but not limited to, local government entities, to adopt a resolution stating their intent to participate. (b) "Department" means the Department of Conservation. (c) "Grant program" means the program established pursuant to Section 10280. (d) "Joint powers authority" means a joint powers authority established pursuant to Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code that is formed in part to protect agricultural land. (e) "Local government entity" means any city, county, city and county, or district, including, but not limited to, park and open-space districts, resource conservation districts, and other special districts. (f) "Nonprofit organization" means any nonprofit public benefit corporation that has among its purposes the conservation of agricultural lands, and holds a tax exemption, as defined under Section 501(c)(3) of the Internal Revenue Code, and further qualifies as an organization under Section 170(b)(1)(A)(iv) or 170(h)(3) of the Internal Revenue Code. 10281. The purpose of the grant program is to assist any local government entity, nonprofit organization, authority, or joint powers authority to apply for, and cost-effectively use, grant funds available for farmland, grazing lands, and grasslands protection and preservation from funds that are made available pursuant to subdivision (f) of Section 5096.650 and from other funding sources. 10281.5. (a) In addition to the requirements established by the department, the applicant shall demonstrate that the changes to the existing goals, objectives, policies, or programs of the city, county, or city and county that will logically result from the grant will improve protection of agricultural land, grazing land, or grasslands. (b) The department shall develop and adopt guidelines and criteria for awarding grants that achieve the greatest lasting preservation of agricultural land. The department shall develop these guidelines in consultation with farming and ranching groups, agricultural land conservation groups, the State Coastal Conservancy, and the Wildlife Conservation Board. 10282. (a) Under the grant program, a local government entity, nonprofit organization, authority, or joint powers authority may apply to the department for a planning grant to be used for the protection of agricultural lands and grazing lands, including oak woodlands and grasslands. In addition to any requirements established by the department, to be eligible for a grant under the grant program, an applicant shall do all of the following: (1) Identify existing or potential agricultural lands in its jurisdiction. (2) Specify its existing goals, objectives, policies, or programs that support the long-term protection of agricultural land. (3) Specify the proposed changes to its existing goals, objectives, policies, or programs that support the long-term protection of agricultural land. (4) Specify how the planning grant would be used to improve the long-term protection of agricultural land within its jurisdiction. (b) A grant awarded by the department under the grant program shall not exceed two hundred fifty thousand dollars ($250,000) to any applicant, or five hundred thousand dollars ($500,000) if the department determines that a grant application is for collaborative planning activities proposed to include two or more adjacent counties, cities, or city and county. (c) In granting funds pursuant to this division, the department shall give priority to proposals that include matching funds from local sources. (d) A grant proposal by a park or open-space district, resource conservation district, other special district, nonprofit organization, authority, or joint powers authority shall be approved by resolution of the city, county, or city and county, or multiple cities and counties, whose jurisdiction the proposal is intended to benefit. The city, county, or city and county shall provide evidence that it is willing to implement some of the planning process funded by the grant. (e) The purposes for which a grant made pursuant to this division for agricultural protection may include, but need not be limited to, the following: (1) To update the general plan of a city, county, or city and county to improve protection of agricultural land, or a zoning ordinance designed to improve protection of agricultural land. (2) To develop multicounty strategies to protect agricultural land. (3) To develop city-county agreements to protect agricultural land. (4) To develop strategies to implement existing general plan provisions, city-county agreements, or multicounty agreements to protect agricultural land, including technical assistance. (5) To develop public-private partnerships for the long-term protection and stewardship of agricultural lands. 10283. Eligible projects funded under this division with the proceeds from the sale of any bonds shall be consistent with the requirements of Section 16727 of the Government Code. SEC. 4. Division 10.4 (commencing with Section 10285) is added to the Public Resources Code, to read: DIVISION 10.4. COASTAL FARMLAND PRESERVATION PROGRAM 10285. The Department of Conservation and the State Coastal Conservancy, with the guidance and concurrence of the Resources Agency, shall enter into a memorandum of understanding to ensure that the program established under this division is a coordinated effort between the two entities and meets the stated goals of coastal farmland preservation and the California Farmland Conservancy Program Act including, but not limited to, the grant process set forth in Section 10286. 10286. The Department of Conservation shall expend the funds appropriated for purposes of this division in accordance with the following requirements: (a) The Department of Conservation, in cooperation with the State Coastal Conservancy and the Wildlife Conservation Board, shall ensure, to the extent feasible, the funds are used to protect large, contiguous tracts of prime agricultural land. (b) Acquisition of real property using the funds shall be from willing sellers. (c) The funds may not be used to acquire easements that would limit farming or farming practices or to improve wildlife habitat on agricultural lands. (d) Each dollar spent from the funds shall be matched with three dollars ($3) from other sources available to the State Coastal Conservancy. The matching funds may be used during the term of the appropriation for acquisitions of interests in, or for improvements to, real property, if those actions are intended to support agricultural production or prevent conversion to other uses and if acquisition of real property using these funds is from willing sellers. This section does not require the funds appropriated for purposes of this subdivision to be expended on the same land as the matching funds. Matching funds may not be used to improve wildlife habitat on agricultural lands except as incidental to furthering agricultural purposes. Acquisition of nonagricultural conservation easements, retention of agricultural conservation easements after sale of title, habitat conservation efforts, or any other activities not related to agricultural land preservation, may not be counted as a match under this section. (e) The Department of Conservation shall use its best efforts to cause title to any lands acquired using matching funds described in subdivision (d) to be conveyed to private parties within five years of the date of acquisition. Following acquisition of title and prior to its sale, the Department of Conservation shall use its best efforts to cause these lands to be leased to, or otherwise used by, private farm operators. SEC. 5. Section 10335.5 of the Public Resources Code, as added by Senate Bill No. 984 of the 2001-02 Regular Session, is amended to read: 10335.5. Of the total amount of funds derived from the proceeds of bonds and appropriated by Section 2 of Senate Bill No. 984 of the 2001-02 Regular Session, the board may not expend more than 5 percent for associated programmatic costs. SEC. 6. The State Coastal Conservancy, the Wildlife Conservation Board, and the Department of Conservation shall, at the earliest possible time, jointly prepare a single document describing programs within these entities that protect agricultural lands and grazing lands, including oak woodlands and grasslands. The description shall include the principal differences between the programs, and how the programs can be combined on a single parcel. The description shall be made available to applicants for agricultural conservation programs. SEC. 7. Of the funds deposited in the California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Fund and available for grants pursuant to subdivision (f) of Section 5096.650 of the Public Resources Code for the preservation of agricultural lands and grazing lands, including oak woodlands and grasslands, the sum of nine million six hundred thousand dollars ($9,600,000) is hereby appropriated for allocation in accordance with the following schedule: (a) The sum of four million eight hundred thousand dollars ($4,800,000) to the Wildlife Conservation Board for the purposes of the Oak Woodlands Conservation Act (Article 3.5 (commencing with Section 1360) of Chapter 4 of Division 2 of the Fish and Game Code) and any associated programmatic costs. (b) The sum of two million four hundred thousand dollars ($2,400,000) to the Department of Conservation for the Coastal Farmland Preservation Program (Division 10.4 (commencing with Section 10285) of the Public Resources Code) and any associated programmatic costs. (c) The sum of two million four hundred thousand dollars ($2,400,000) to the Department of Conservation for the California Environmental Quality Improvement Revolving Loan Program (Division 10.25 (commencing with Section 10278) of the Public Resources Code and any associated programmatic costs. SEC. 8. Notwithstanding any other provision of law, of the funds appropriated in this act from the California Clean Water, Clean Air, Safe Neighborhood Parks, and Coastal Protection Fund, not more than 5 percent of the total amount appropriated for all programs and property acquisitions set forth in this act may be expended for associated programmatic costs.