BILL ANALYSIS AB 291 Page 1 Date of Hearing: April 13, 2009 ASSEMBLY COMMITTEE ON NATURAL RESOURCES Nancy Skinner, Chair AB 291 (Saldana) - As Amended: March 26, 2009 SUBJECT : Coastal development permits: penalties. SUMMARY : Prohibits any person subject to an enforcement action of the California Coastal Commission (Commission) from submitting a coastal development permit (CDP) application until the action has been resolved. EXISTING LAW : 1)Pursuant to the California Coastal Act of 1976, requires any person wishing to perform any development in the coastal zone to first obtain a coastal development permit. 2)Authorizes the Commission, after a public hearing, to issue a cease and desist order if it determines that someone is undertaking or threatening to undertake any activity that requires a CDP or that may be inconsistent with a previously issued permit. 3)Authorizes the Commission, a local government, or port, after a public hearing, to issue a restoration order if it finds that development has occurred without a CDP and the development is causing continuing resource damage. 4)Authorizes a superior court to impose civil penalties on any person in violation of the Coastal Act between $500 and $30,000; additional penalties between $1,000 and $15,000 per day for each day in which a violation persists may be imposed when anyone knowingly and intentionally violates the Coastal Act. THIS BILL : 1)Prohibits any person who has been issued a notice of intent, cease and desist order, restoration order, or notice of violation from submitting a CDP application until the action has been resolved. 2)Provides that the above prohibition does not apply if the AB 291 Page 2 executive director of the Commission determines that a CDP application would fully resolve the violation. 3)Provides that an unresolved dispute between the executive director and an applicant must be resolved by the Commission at a noticed public hearing. FISCAL EFFECT : Unknown COMMENTS : According to the author's office, "The [Commission] is currently understaffed and backlogged by 1,300 enforcement cases. This bill seeks to relieve the Commission of an overwhelming amount of work in the face of limited resources by allowing the Commission to require applicants to fix outstanding Coastal Act violations before their CDP is processed. In addition to saving the Commission time and resources, the bill also serves as an incentive for Coastal Act violations to be cleaned up, subsequently helping preserve coastal resources." 1)Should violators be rewarded with a CDP? Under existing law, anyone can apply for a CDP even if the proposed development occurs on a parcel subject to a violation or an alleged violation of the Coastal Act. Furthermore, the Commission must consider the application without regard to this violation even if it is directly relevant to the proposed development. Procedurally, this results in a perverse, bifurcated process even though it would make more sense to address both issues concurrently. According to Commission staff, "This is more expensive for all parties, and can delay resolution of even violations with serious and ongoing effects on coastal resources for years, or indefinitely given the shortage of Commission staff." In these instances, review of CDP applications are often prioritized over violations since existing law imposes deadlines for the review of the former. In contrast, many other state agencies and some local governments have the authority to require that an applicant resolve outstanding issues at the same time as an application, in order to save resources and create an incentive to voluntarily resolve outstanding violations. In fact, according to Commission staff, Humboldt, Mendocino, Marin, San Luis Obispo, Monterey, Santa Barbara, Ventura Counties all have similar authorities. State agencies such as the Departments of Food and Agriculture, Health Services, Motor Vehicles, AB 291 Page 3 Corporations, Fish and Game, Forestry and Fire Protection, Consumer Affairs, and Insurance similarly have authority to require resolution of a violation prior to consideration of an application for a permit, license or other approval. 2)Bill could result in process- and cost-efficiency This bill would provide applicants the incentive to resolve violations more quickly since they would otherwise be ineligible to pursue any additional development. At the same time, the bill would give the Commission the ability to resolve outstanding violations as part of a CDP application, something that can only be accomplished voluntarily under existing law. In turn, the applicant would likely not be subject to penalties and an expensive enforcement proceeding. As mentioned above, the Commission has an existing backlog of over 1,300 enforcement cases. Not considering new cases, at the current rate of processing, it would take the Commission more than 100 years to resolve these cases. Given drastic budget cuts over the past few years, this bill would give the Commission another tool to resolve violations in the most efficient, cost-effective manner possible. According to Commission staff, "Applicants are well aware of the Commission's staffing limitations, and far too many conclude that it is more cost-effective to ignore unresolved violations, on the assumption that the Commission will be unable to summon the resources to pursue enforcement on the vast majority of open cases." 3)Does bill contain sufficient due process for applicants? A coalition of opponents has raised concerns that the bill does not contain sufficient due process and would thus unfairly penalize an applicant based on the mere assertion by staff that a violation had occurred. Existing law provides that either the executive director or Commission may issue a cease and desist order. In the first instance, an order may be issued only after a person has failed to respond to an oral and written notice; moreover, the order is only valid for 90 days. If a violation remains unresolved after this period, staff usually schedules the order for Commission consideration at a duly noticed public hearing. Only the Commission may issue a restoration order after a noticed public hearing. Only after the executive director determines, based on substantial evidence, that AB 291 Page 4 property has been developed in violation of the Coastal Act, the Act authorizes the executive director to mail a "notification of intent to record a notice of violation" to the property owner. If the owner submits an objection to this notice within 20 days, the owner is entitled to a public hearing to plead his cause. Only after the Commission finds, based on substantial evidence, that a violation has occurred, the executive director can record the notice. Finally, the bill provides that any unresolved dispute between the executive director and applicant regarding the bill's implementation must be resolved by the Commission at a noticed public hearing pursuant to its regulations, which require the executive director to schedule the dispute at the next Commission hearing. Thus, it is clear that existing law does not permit staff to behave arbitrarily or capriciously, even when alleging that a violation has occurred. 4)Proposed amendments The following amendment addresses the concern that Page 2, lines 3-8 should be amended to read: 30825. (a) The commission shall not file or act upon an application for a coastal development permit from anyAperson who has been issued a notice of intent, cease and desist order, restoration order, or a notice of violation pursuant to Section 30809, 30810, 30811, or 30812, in addition to any other penalties, shall be ineligible to submit an application for a coastal development permituntil the violation has been resolved , as determined by the executive director and consistent with this division . Page 2, lines 12-16 should be amended to read: (c) Any unresolved dispute between the executive director and an applicant regarding the implementation of this section mayshallbe resolved by the commission at a noticed hearing pursuant to subdivision (d) of Section 13056 of Title 14 of the California Code of Regulations. REGISTERED SUPPORT / OPPOSITION : Support AB 291 Page 5 American Federation of State, County, and Municipal Employees, AFL-CIO Buena Vista Audubon Society California Coast Keeper Alliance California Coastal Protection Network California Coastal Commission Committee for Green Foothills Clean Water Action Endangered Habitats League Heal the Bay Madrone Audubon Society of Sonoma County Natural Resources Defense Council Planning and Conservation League San Diego Coastkeeper San Diego Audubon Society Sea and Sage Audobon Sierra Club California Vote the Coast Wild Heritage Planners Opposition American Council of Engineering Companies of California California Association of REALTORS California Building Industry Association California Business Properties Association California Chamber of Commerce California Council for Environmental and Economic Balance California Manufacturers and Technology Association City of Newport Beach League of California Cities Analysis Prepared by : Dan Chia / NAT. RES. / (916) 319-2092