BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 226
                                                                  Page  1

          Date of Hearing:   May 20, 2009

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Kevin De Leon, Chair

                     AB 226 (Ruskin) - As Amended:  May 6, 2009 

          Policy Committee:                              Natural  
          ResourcesVote:6-3

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              No

           SUMMARY  

          This bill authorizes the California Coastal Commission to impose  
          administrative penalties upon violators of the California  
          Coastal Act.  Specifically, this bill:

          1)Authorizes the commission, by majority vote, to impose  
            administrative penalties, ranging from $5,000 to $50,000,  
            against violators of the Coastal Act.

          2)Allows the commission to file a lien against property of a  
            violator for failure to pay the penalty.

          3)Directs all funds derived from these penalties be deposited in  
            the Coastal Act Services Fund to fund commission activities,  
            upon appropriation by the Legislature. 

           FISCAL EFFECT  

          1)Potential penalty revenues to the commission, in the range of  
            $500,000 to $2,000,000 a year.  This revenue could displace an  
            equal amount of commission funding from the GF.

          2)Minor savings, less than $150,000 a year, to the commission in  
            avoided staffing and other expenses related to pursuing  
            Coastal Act violations in court.

          3)Potential minor savings to the AG's office from representing  
            the commission before court.

          4)Loss of annual penalty revenue, potentially in the hundreds of  
            thousands of dollars, to the Coastal Conservancy.








                                                                  AB 226
                                                                  Page  2


           COMMENTS  

           1)Rationale.   The author contends penalties are necessary to all  
            environmental statutes to persuade would-be violators to  
            comply with the law, thereby avoiding harm to the environment.  
             Unlike many other environmental protection agencies, the  
            commission currently is not authorized to levy penalties for  
            violations of the laws the commission is tasked to protect.   
            For these reasons, the author seeks to equip the commission  
            penalty authority, consistent with recommendations made by the  
            Legislative Analyst's Office.
           








































                                                                 AB 226
                                                                  Page  3

          2)Background  .

              a)   The State Coastal Act of 1976  permanently established  
               the Coastal Commission, following its initial creation by a  
               voter initiative in 1972.  The act seeks to protect the  
               state's resources along California's coast.  The  
               commission's primary responsibility is to implement the  
               act's provisions, including regulation of development in  
               the coastal zone.  It is also the state's planning and  
               management agency for the coastal zone.

               Under the Coastal Act, all nonexempt development in the  
               coastal zone requires a permit. That permitting process  
               allows the Coastal Commission and local governments to  
               review proposed projects to ensure that they will not have  
               impacts inconsistent with the environmental protection  
               policies of the Coastal Act and of the plans created by  
               local governments to implement the Coastal Act, known as  
               "Local Coastal Programs" (LCPs).  
             
             b)   Penalties Not Among Commission's Enforcement Tools.   To  
               address violations of the Coastal Act, the commission  
               generally uses cease and desist orders to halt ongoing  
               violations and to obtain compliance with the Coastal Act or  
               LCPs.   The commission generally uses restoration orders to  
               bring about removal of unpermitted development and/or  
               restoration of damaged coastal resources. But the  
               commission's enforcement options do not include monetary  
               penalties, which only a court can impose.  Nor can the  
               commission represent itself in enforcement cases that go to  
               court.  Rather, the Attorney General must represent the  
               commission, adding time and expense to enforcement of the  
               Coastal Act. Under existing law, all enforcement revenues  
               are transferred to the Coastal Conservancy to fund its  
               coastal access program.   

              c)   Many Enforcement Agencies Have Penalty Authority.   The  
               commission may not be the only environmental/resource  
               agency lacking the authority to impose monetary penalties.   
               It is, however, atypical.  Other state environmental  
               protection agencies that possess penalty authority include  
               the Bay Conservation and Development Commission, State  
               Lands Commission, California Energy Commission, Department  
               of Health Services, Air Resources Board, Department of Fish  
               and Game, State Water Resources Control Board, and the  








                                                                  AB 226
                                                                  Page  4

               Integrated Waste Management Board.   

             d)   Commission Attributes Backlog to Lack of Penalty  
               Authority.   Currently, there is a backlog of 1,300 pending  
               Coastal Act violation enforcement cases.  The commission  
               blames this backlog, in part, on its lack of penalty  
               authority.  Because violators know the commission lacks to  
               resources to pursue monetary violations for most violations  
               in court, the commission claims that many violators choose  
               to delay compliance on the assumption that they will never  
               face monetary penalties.  

          3)Fear of the Bounty Hunter.   Opponents claim that, armed with  
            the authority provided by this bill, the commission will  
            become a bounty hunter, seeking opportunities to extract  
            penalty revenue from supposed violators of the Coastal Act,  
            penalty revenue that, under this bill, would be available to  
            fund commission activities.  Opponents also see in the bill a  
            lack of procedural rights in that the commission could  
            unilaterally impose administrative penalties.  However, these  
            opponents do not address the record of other agencies  
            successfully managing similar penalty authority or the fact  
            that commission decisions are subject to judicial review.  
           
           Analysis Prepared by  :    Jay Dickenson / APPR. / (916) 319-2081