BILL ANALYSIS AB 2485 Page 1 Date of Hearing: May 3, 2006 ASSEMBLY COMMITTEE ON APPROPRIATIONS Judy Chu, Chair AB 2485 (Jones) - As Amended: April 24, 2006 Policy Committee: Water, Parks & Wildlife Vote: 11-0 Revenue & Taxation 5-2 Urgency: No State Mandated Local Program: Yes Reimbursable: No SUMMARY This bill establishes a process for enhancing penalties imposed for activities that can harm sea otters and other marine mammals, and establishes a sea otter research program and options for funding that program, including a personal income tax (PIT) checkoff. FISCAL EFFECT 1)Minor penalty revenue, probably less than $50,000 annually starting in FY 2006-07, generated by enhanced penalties related to mammals, marine mammals, and fully-protected mammals, including sea otters. (Fish and Game Preservation Fund.) 2)Moderate costs, perhaps $250,000 annually starting in FY 2007-08, to the Department of Fish and Game (DFG) to investigate sea otter mortality and enhance related enforcement. These costs are covered by money from the California Sea Otter (CSO) Fund and other funds that may be appropriated by the Legislature. (CSO Fund and GF) 3)Moderate costs, perhaps $250,000 annually starting in FY 2007-08, to the California Coastal Conservancy (conservancy) to conduct research and other programs related to sea otters. (CSO Fund and GF.) 4)Minor GF revenue loss, about $15,000 annually starting the year following the CSO Fund checkoff's appearance on the PIT form. If the checkoff first appears on the 2008 tax return AB 2485 Page 2 due in April 2009, annual GF revenue loss is $15,000 beginning in FY 2009-10. SUMMARY CONTINUED Specifically, this bill: 1)States legislative intent to enact legislation to establish a research program to reduce sea otter mortality from Nonpoint source pollution and to develop treatment for pathogens affecting this mortality. 2)Increases, from either $1,000 or $5,000 to $25,000, the maximum fine imposed for each unlawful taking of a marine mammal or a fully-protected mammal. 3)Requires a warning label to be affixed to cat litter products that discourages consumers from flushing used cat litter down the toilet or dumping it in gutters or storm drains. 4)Adds mammals to the list of fish, plants, and birds protected by a provision that subjects persons who release deleterious substances or materials into water to a maximum $25,000 fine. 5)Authorizes the addition of the CSO Fund income tax checkoff to the personal income tax form upon the removal of another income tax checkoff from the form, but expresses legislative intent that the sea otter checkoff appear on the 2008 tax form. 6)Creates the CSO Fund, from which the following allocations are made: a) 50% of available funds is allocated to the DFG to increase investigation, prevention, and enforcement to decrease sea otter mortality, for research programs, education programs, and related assistance with sea otter recovery. b) 50% of remaining funds to the conservancy for research and programs related to sea otters. COMMENTS 1)Rationale . The author contends that, while sea otter AB 2485 Page 3 populations along California's coast have increased significantly in recent years due to the enactment of enhanced protections and the establishment of various coastal and marine sanctuaries, sea otter mortality rates have begun to increase. There is evidence to indicate that water quality degradation, in particular the introduction of pathogens into the marine environment that are harmful to sea otters, is the primary cause for this increased mortality. Necropsies performed on dead sea otters reveal the presence of used cat litter containing cat feces that contain these harmful pathogens. The used cat litter is presumably introduced into the marine environment when it is flushed down toilets or disposed into gutters or storm drains along the coast. 2)Background . Cat feces carrying Toxoplasma parasites are appearing in coastal waters, where they can infect sea otters, causing brain damage and eventual death. Toxoplasma caused 17% of sea otter deaths examined from 1998 to 2001, and individual sea otters with moderate to severe brain inflammation were four times more likely to die from a shark attack. Cats are infected by eating infected birds or rodents. As a result, sea otter researchers have urged owners to keep their cats indoor and to dispose of used cat litter so as not to introduce infected cat feces into the marine environment. Once the Toxoplasma reached the ocean, it may be concentrated in mussels, oysters and clams, major food sources for some otters. 3)Sea Otter populations along the California coast, after having been virtually eliminated by the fur trade of the 18th and 19th centuries, staged a partial comeback to about 2,400 in 1995. Since then, however, the number of sea otters has declined to around 1,900. Sea otters face, in addition to brain damage caused by the Toxoplasma parasite, several maladies caused by concentrations of DDT and other pesticides washed into the coastal waters from agricultural operations (primarily adjacent to Monterey Bay) and concentrations of polychlorinated biphenyls (PCBs) and heavy metals from stormwater and industrial discharge. In the past three years, dead and dying sea otters have been found with domoic acid, a toxin produced by decaying algae produced by increased organic matter in the nearshore environment. Oil pollution continues to be the primary threat to sea otters. An oil spill can cause hypothermia and organ damage in sea AB 2485 Page 4 otters when their insulating fur becomes matted by oil. 4)Tax Checkoffs . State taxpayers contribute money to one or more of 13 voluntary contribution funds by checking a box on their PIT return. California law requires contributions made through checkoffs to be made from taxpayers' own resources (not from their tax liability, as is possible on federal income tax returns). Checkoff amounts may be claimed as charitable contributions on taxpayers' returns during the subsequent year. To address concerns that a proliferation of checkoffs will cause California's PIT form to grow to three pages, at considerable cost to the state, all checkoff bills are required to include a sunset date, a $250,000 minimum contribution requirement indexed for inflation, and queuing language to ensure that any new checkoff is not added to the PIT form until an existing checkoff is removed. This boil is consistent with that policy. Analysis Prepared by : Steve Archibald / APPR. / (916) 319-2081