BILL NUMBER: SB 1458 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Simitian
FEBRUARY 23, 2006
An act to add Article 7.3 (commencing with Section 25383) to
Chapter 6.8 of Division 20 of the Health and Safety Code, relating to
hazardous substances.
LEGISLATIVE COUNSEL'S DIGEST
SB 1458, as introduced, Simitian Hazardous substances: illegal
drug labs: cleanup funding.
Existing law requires the Department of Toxic Substances Control
to take removal actions with respect to a hazardous substance that is
an illegal controlled substance, a precursor of a controlled
substance, or a material intended to be used in the unlawful
manufacture of controlled substances, and the department is
authorized to expend funds appropriated from the Illegal Drug Lab
Cleanup Account in the General Fund for this purpose. Existing law
requires the account to be funded by moneys appropriated directly
from the General Fund.
This bill would enact the Illegal Drug Lab Waste Cleanup Act,
define terms, and establish a procedure to determine the annual cost
for taking removal and remedial actions to clean up drug lab waste,
as defined, by requiring the development of an annual work plan and
cost estimate. The bill would require the department, by September 1,
2007, and by every September 1 annually thereafter, to set the
amount of a fee upon the first manufacturing or importation of
pseudoephedrine by a manufacturer or importer, in this state at an
amount sufficient to fund the annual work plan, but not more than a
specified amount.
The bill would require the fee revenues to be deposited in the
Illegal Drug Lab Cleanup Subaccount, which the bill would create in
the Toxic Substances Control Account in the General Fund. The bill
would authorize the revenues in the subaccount to be expended, upon
appropriation by the Legislature, to pay the administrative costs of
the State Board of Equalization (board) in collecting the fee, to pay
refunds, and to provide funding to the department to take removal
and remedial actions to clean up drug lab waste. The bill would
authorize the department to expend those funds by entering into a
contract with a city or county to take or oversee removal or remedial
actions to clean up drug lab waste.
The bill would require a person who manufactures pseudoephedrine
in this state or who imports pseudoephedrine into this state to
register with the Department of Justice, unless the person imports
less than an unspecified amount. The bill would prohibit a person
from selling or distributing a product containing pseudoephedrine in
the state if the product is received or purchased from a manufacturer
or importer who is not registered as required by the act. The bill
would require a registrant to file a quarterly report with the
Department of Justice containing specified information, and would
require the Department of Justice to charge a fee to cover the costs
incurred in maintaining the list of registrants. The bill would
authorize the Department of Justice to take specified actions with
regard to ascertaining the information required in the quarterly
reports.
The bill would require the Department of Justice to send a report
to the board, in a specified manner, containing information, as
specified, regarding persons who owe the fee. The board would be
required to mail each person listed in the report a notice of
determination containing the amount of the fee due, in accordance
with the information contained in the Department of Justice's report.
The bill would specify procedures for the collection of the fee,
including specifying a procedure when the Department of Justice
determines that a person who is required to register has failed to
register or to file a correct quarterly report.
The bill would authorize the board to impose specified penalties
for a failure to file a correct and timely quarterly report. The bill
would also impose a civil penalty of not more than $10,000 upon a
person who fails to properly register with the Department of Justice
or upon a person who is a retailer or distributor and who receives or
purchases products containing pseudoephedrine intended for sale in
this state from an unregistered manufacturer or importer. The bill
would require the civil penalties to be deposited into the
Environmental Enforcement and Training Account, which is available
upon appropriation for expenditure by the Environment Protection
Agency for environmental enforcement purposes.
The bill would provide that when the department and the Department
of Justice provide the Department of Finance with a joint letter
that contains a specific finding, the act would become inoperative
and be repealed on the date the Secretary of State receives that
letter from the Department of Finance.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Methamphetamine is a powerful and addictive stimulant that
affects the central nervous system.
(b) The drug is made in clandestine laboratories with relatively
inexpensive over-the-counter ingredients.
(c) The primary ingredient in methamphetamine production is
pseudoephedrine, which is found in many over-the-counter cold
medicines. It has become the new precursor for making
methamphetamine. Criminals have easy access to pseudoephedrine, which
has led to a rapid increase in clandestine "kitchen" methamphetamine
labs.
(d) If a typical box of pseudoephedrine decongestants contains 24
tablets, a methamphetamine manufacturer would need 29 boxes of
tablets to make an ounce of methamphetamine.
(e) The chemicals specified in subdivision (c) are harmful if
ingested, inhaled, or absorbed through the skin. In Arizona, police
frequently charge methamphetamine makers with felony child abuse if
any minors are in the home where manufacturing is taking place.
(f) The chemicals specified in subdivision (c) can contaminate
structural materials, furnishings, wastewater systems, and soils.
(g) Chemicals found in methamphetamine labs can cause cancer,
short-term and permanent brain damage, developmental and growth
problems in children and teens, reproductive system toxicity,
internal and external chemical burns, immune system problems, heart
problems, and respiratory system problems. Young children breathe and
develop faster than adults and therefore can be much more
susceptible to the chemicals used to manufacture methamphetamine.
(h) Methamphetamine labs can be set up in almost any location,
including a motel, house, apartment, storage unit, vehicle, kitchen,
or barn, using instructions that are easily available on the
Internet. If methamphetamine is cooked within a building, the
chemicals from the cooking process are conducted and spread
throughout the entire building.
(i) The Department of Toxic Substances Control has completed
emergency cleanups of over 15,000 methamphetamine labs in the past 10
years. Under existing law, the gross removal of an illegal drug lab
is the emergency cleanup of a hazardous substance that poses an
immediate threat to public health or safety. The Department of Toxic
Substances Control is responsible for this portion of the cleanup,
which is paid for using General Fund moneys.
(j) The deep-cleaning or remedial action of a methamphetamine lab
is the responsibility of local health and human services departments,
environmental health divisions, hazardous materials divisions, or
fire departments. The local agency issues a notice to the property
owner to clean up the property, but the standard for cleanup of those
labs varies from local agency to local agency and from property
owner to property owner.
(k) Existing law places the ultimate responsibility for the
remedial cleanup of a former methamphetamine lab in the hands of the
property owner.
(l) The Legislature declares that the imposition of a fee upon the
sale of pseudoephedrine by this act would not result in the
imposition of a tax within the meaning of Article XIII A of the
California Constitution, because the amount and nature of the fee has
a fair and reasonable relationship to the adverse environmental
burdens imposed by the disposal of pseudoephedrine at methamphetamine
labs and there is a sufficient nexus between the fee imposed and the
use of those fees to support the cleanup of drug lab waste at
methamphetamine lab sites.
SEC. 2. Article 7.3 (commencing with Section 25383) is added to
Chapter 6.8 of Division 20 of the Health and Safety Code, to read:
Article 7.3. Illegal Drug Lab Waste Cleanup Act
25383. (a) For purposes of this article, the following
definitions shall apply:
(1) "Board" means the State Board of Equalization.
(2) "Importer" means a person who imports pseudoephedrine into
this state, for sale or distribution in this state.
(3) "Drug lab waste" means the contamination resulting from the
use of pseudoephedrine in the unlawful manufacture of a controlled
substance.
(4) "Fee" means the fee imposed pursuant to Section 25383.1.
(5) "Manufacturer" means a person who manufactures pseudoephedrine
sold in this state.
(6) "Quarterly report" means the report that a registrant is
required to file with the Department of Justice pursuant to Section
25383.4.
(7) "Registrant" means a manufacturer or importer of
pseudoephedrine who is required to annually provide certain
information to the Department of Justice pursuant to Section 25383.3.
(8) "Subaccount" means the Illegal Drug Lab Cleanup Subaccount
created pursuant to subdivision (c) of Section 25383.1.
(b) This article shall be known, and may be cited, as the "Illegal
Drug Lab Waste Cleanup Act."
25383.1. (a) On or before September 1, 2007, and on or before
September 1 annually thereafter, the department shall set the amount
of a fee upon the first manufacturing or importation of
pseudoephedrine in this state by a manufacturer or importer, who is
required to register pursuant to Section 25383.3, at an amount
sufficient to fund the annual work plan developed pursuant to Section
25383.2, but in an amount of not more than .0232 cent ($0.000232)
per milligram of pseudoephedrine.
(b) On and after September 1, 2007, the board shall collect the
fee imposed pursuant to this section from each registrant.
(c) The fee revenues collected pursuant to this section shall be
deposited in the Illegal Drug Lab Cleanup Subaccount, which is hereby
created in the Toxic Substances Control Account in the General Fund,
for expenditure, upon appropriation by the Legislature, solely for
the following purposes:
(1) To pay for the administrative costs of the board for
collecting and making refunds associated with the collection of the
fee imposed pursuant to this section.
(2) To pay for refunds of the fee.
(3) (A) To provide funding to the department to take removal and
remedial actions to clean up drug lab waste.
(B) The department may expend the funds authorized for expenditure
pursuant to this paragraph by entering into a contract with a city
or county to take or oversee removal or remedial actions to clean up
drug lab waste.
25383.2. The following procedure shall be used to determine the
annual cost for the department to take removal or remedial actions to
clean up drug lab waste pursuant to this article:
(a) On or before March 1, 2007, and on or before March 1 annually
thereafter, the department shall submit to the Department of Finance
an annual work plan for taking removal or remedial action to clean up
drug lab waste, including the estimated costs to complete that work
plan. In determining the annual cost of implementing the work plan,
no more than 3 percent of the annual cost shall include the
department's costs for overhead and administration.
(b) On or before April 1, 2007, and on or before April 1 annually
thereafter, the Department of Finance shall certify that the proposed
work plan is feasible and that the estimated cost for implementing
the work plan is within 25 percent of the estimate determined by the
Department of Finance to implement the annual work plan.
(c) If the Department of Finance does not certify the department's
proposed work plan and the cost estimate pursuant to subdivision
(b), the Department of Finance and the department shall meet and
confer and produce a final work plan and cost estimate on or before
the subsequent May 1 after the date that the decision not to certify
the work plan and cost estimate was made.
(d) If, after conducting a meeting pursuant to subdivision (c),
the Director of Finance and the director do not agree on the work
plan and cost estimate, the Governor shall submit a work plan and
cost estimate to the department on or before that subsequent May 15.
25383.3. (a) A person who manufactures pseudoephedrine in this
state, or who imports pseudoephedrine into this state shall register
with the Department of Justice.
(b) This section does not apply to a person who imports less than
_______ of pseudoephedrine into this state during a calendar year and
who does not manufacture any pseudoephedrine in this state.
(c) A person shall not sell or distribute a product containing
pseudoephedrine in the state if the product is received or purchased
from a manufacturer or importer who is not registered in accordance
with this article.
25383.4. (a) A person required to register with the Department of
Justice pursuant to Section 25383.3 shall file a quarterly report
with the Department of Justice. The quarterly report shall be due on
the last day of the month following each quarterly period and shall
provide all of the following information:
(1) The name, address, and telephone number of the person required
to register.
(2) The number of milligrams of pseudoephedrine the person
manufactured in this state during that quarterly reporting period.
(3) The number of milligrams of pseudoephedrine the person
imported into this state during that quarterly reporting period.
(4) The number of milligrams of pseudoephedrine the person sold,
transferred, or otherwise furnished to other persons in this state
during that quarterly reporting period.
(5) Any other information the Department of Justice deems
necessary.
(b) (1) The registration form required by Section 25383.3 and the
quarterly reports required by this section shall be submitted in an
electronic form prescribed by the Attorney General.
(2) A quarterly report may be amended as provided in subdivision
(a) of Section 25384.1.
(c) The Department of Justice shall charge a fee to each
registrant sufficient to cover the costs incurred in maintaining the
list of registrants, including administrative costs.
(d) The Department of Justice shall maintain the list of
registrants electronically where feasible, and shall make the list
available to the board and law enforcement agencies throughout the
state where necessary for a legitimate state purpose, including, but
not limited to, fee collection and criminal investigation.
25383.5. For the purpose of ascertaining whether a person is
required to file a quarterly report required by Section 25383.4 or
whether the information contained in the quarterly report is correct,
or for purposes of preparing a quarterly report pursuant to
subdivision (a) of Section 25384, the Department of Justice may take
any of the following actions:
(a) Require a person having knowledge of the business or custody
of the books, accounts, and papers of a person who is or may be
required to register pursuant to Section 25383.3 to appear before the
Department of Justice, to bring for inspection any books, accounts,
or papers of the person or in the person's possession and under the
person's control, and to testify under oath touching any matter
relating to the organization or business of the person.
(b) Examine the books, accounts, and papers of a person who is or
may be required to register pursuant to Section 25383.3.
25383.6. (a) A person who is required to register pursuant to
Section 25383.3 shall pay the fee imposed pursuant to Section 25383.1
in accordance with this article.
(b) The fee owed by a person pursuant to subdivision (a) shall be
calculated by multiplying the rate established by the department
pursuant to Section 25383.1 by the number of milligrams of
pseudoephedrine manufactured in this state or imported into this
state by that person.
25383.7. (a) On the last day of each month following the due date
for filing a quarterly report pursuant to Section 25383.4, the
Department of Justice shall send to the board a report containing all
of the following information:
(1) The name, address, and telephone number of each person
required to register with the Department of Justice pursuant to
Section 25383.3 and who owes a fee in an amount that exceeds ______
for the previous quarterly period.
(2) The number of milligrams of pseudoephedrine the registrant
manufactured in this state or imported into this state.
(b) After the board receives the report submitted by the
Department of Justice pursuant to subdivision (a), the board shall
mail each person listed in the report a notice of determination
pursuant to Section 55061 of the Revenue and Taxation Code. Each
notice of determination shall contain the amount of the person's fee
due in accordance with the information contained in the report
submitted to the board.
25383.8. (a) The fee imposed pursuant to this article is due and
payable 30 days after the board mails a notice of determination
pursuant to subdivision (b) of Section 25383.7.
(b) (1) Except as provided in paragraph (2), the board shall
collect the fee imposed pursuant to this article in accordance with
the Fee Collection Procedures Law (Part 30 (commencing with Section
55001) of Division 2 of the Revenue and Taxation Code).
(2) Article 3 (commencing with Section 55081) of Chapter 3 of, and
Article 1 (commencing with Section 55221) of Chapter 5 of, Part 30
of Division 2 of the Revenue and Taxation Code do not apply to the
collection of the fee imposed pursuant to this article.
(c) For purposes of the application of Article 2 (commencing with
Section 55061) of Chapter 3 of Part 30 of Division 2 of the Revenue
and Taxation Code, "deficiency" includes the amount of the fee that
is contained in the notice of determination.
(d) Notwithstanding subdivision (b), and except as provided in
subdivision (c) of Section 25384.1, with regard to the fee imposed
pursuant to this article, the board may issue a refund pursuant to
Section 55221 of the Revenue and Taxation Code only to correct a
mathematical error contained in a notice of determination issued
pursuant to subdivision (b) of Section 25383.7.
25384. (a) If the Department of Justice determines that a person
who is required to register pursuant to Section 25383.3 has failed to
register in accordance with that section, or has failed to file a
correct quarterly report in accordance with Section 25383.4, the
Department of Justice may register that person, prepare and file a
correct quarterly report, and mail a copy of that quarterly report to
that person.
(b) If a person who receives a quarterly report prepared by the
Department of Justice pursuant to subdivision (a) disagrees with the
quarterly report, the person shall notify the Department of Justice
and shall specifically identify the areas of disagreement in writing
within 60 days after the date the Department of Justice mails the
quarterly report to the person.
(c) Upon receiving a notice of disagreement pursuant to
subdivision (b), the Department of Justice shall do all of the
following:
(1) Investigate each area of disagreement.
(2) Mail a responsive letter to the person who submitted the
notice of disagreement addressing each area of disagreement.
(3) Revise the quarterly report as necessary.
(d) Unless the Department of Justice receives a timely notice of
disagreement pursuant to subdivision (b), the Department of Justice
shall forward to the board the information in the registration and
the quarterly report described in subdivision (a), including a
recommendation as to whether the board should impose a penalty
pursuant to Section 25384.2. Upon receiving this information, the
board shall issue a notice of determination in the manner prescribed
in subdivision (b) of Section 25383.7.
(e) If a timely notice of disagreement is received pursuant to
subdivision (b), the Department of Justice shall, after taking the
actions required by subdivision (c), forward to the board the revised
information in the registration and the quarterly report described
in subdivision (a) and a recommendation to the board as to whether
the board should impose a penalty pursuant to Section 25384.2.
25384.1. (a) A person may amend a quarterly report filed with the
Department of Justice pursuant to Section 25383.4 any time prior to
one year from its due date.
(b) If an amendment to a quarterly report made in accordance with
subdivision (a) would require an increase or decrease in the amount
of the fee owed by that person, the Department of Justice shall
transmit that information to the board and direct the board to issue
a supplemental notice pursuant to subdivision (b) of Section 25383.7
to assess the increased amount or to issue a refund for the decreased
amount.
(c) Notwithstanding subdivision (d) of Section 25383.8, the board
may issue a refund as directed by the Department of Justice pursuant
to this section.
25384.2. (a) The board may impose any of the following civil
penalties:
(1) A penalty equal to 10 percent of a person's quarterly fee for
each failure of the person to file a correct and timely quarterly
report required by Section 25383.4.
(2) A penalty equal to 25 percent of a person's quarterly fee for
each failure by a person to file a correct and timely quarterly
report in accordance with Section 25383.4, after being notified by
the Department of Justice pursuant to Section 25384 that the person
previously has failed to file a correct and timely quarterly report.
(3) A penalty equal to 50 percent of a person's fee for each
failure to file a correct and timely quarterly report required by
Section 25383.4 with the intent to evade the fee imposed pursuant to
this article or to defraud the state.
(b) The board shall not relieve any penalties imposed pursuant to
this section.
25384.3. (a) A person who fails to properly register with the
Department of Justice pursuant to Section 25383.3 is subject to a
civil penalty in an amount not to exceed ten thousand dollars
($10,000).
(b) A person who is a retailer or distributor and who receives or
purchases a product containing pseudoephedrine intended for sale in
the state from a manufacturer or importer who is not registered
pursuant to this article, in violation of subdivision (c) of Section
25383.3, is subject to a civil penalty in an amount not to exceed ten
thousand dollars ($10,000).
25384.4. All civil penalties assessed and collected pursuant to
this article shall be deposited into the Environmental Enforcement
and Training Account and the revenues shall be available for
expenditure pursuant to Title 13 (commencing with Section 14300) of
Part 14 of the Penal Code.
25384.5. When the department and the Department of Justice
provide the Department of Finance with a joint letter that contains a
specific finding that the number of sites contaminated with drug lab
waste has been reduced to a number that can be remediated in the
work plan submitted for that next year, this article shall become
inoperative on the date the Secretary of State receives that letter
from the Department of Finance, and this article shall be repealed on
that date.