BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
51 (Ducheny)
Hearing Date: 05/28/2009 Amended: 05/04/2009
Consultant: Brendan McCarthy Policy Vote: NR&W 10-0, EQ 7-0
SB 51 (Ducheny)
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BILL SUMMARY: SB 51 would establish the Salton Sea Restoration
Council and direct it to undertake specified actions to restore
the Salton Sea pursuant to the Preferred Restoration Alternative
developed by the Resources Agency.
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Fiscal Impact (in thousands)
Major Provisions 2009-10 2010-11 2011-12 Fund
Council staff costs Up to $1.3 million per year General
/
Bonds *
Period I restoration activities $543,000 from 2011 -
2013General **
Restoration capital costs $8,960,000 from 2014 -
2035General **
Restoration operation costs $50,000 per year from 2025 -
2035 General **
$150,000 per year after 2035
* Proposition 84 has about $11 million remaining for Salton Sea
restoration activities.
** Potentially offset by federal or local contributions.
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STAFF COMMENTS: Suspense file.
Over the coming years, water inflows to the Salton Sea will
decrease, for a variety of reasons including water transfers
which will reduce runoff into the Sea. Reduced inflows to the
Salton Sea will cause the sea level to drop, exposing previously
flooded areas. The impact will be to release significant amounts
of dust into the air, impairing air quality in the region. Also,
as the Sea shrinks, existing wildlife habitat will be lost.
Under statute and existing legal obligations, the state has
financial responsibility for mitigating the environmental
impacts of water transfers that will reduce inflows into the
SB 51 (Ducheny)
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Sea. In effect, the state has an obligation to restore the
Salton Sea.
Under existing law, the Resources Agency developed a Preferred
Restoration Alternative for the restoration of the Sea. The
Preferred Alternative, as selected by the Resources Agency with
input from a variety of stakeholders, has a total capital cost
of $9.5 billion (2008 dollars). It is important to note that
there are other alternative restoration plans that were
considered by the Resources Agency and the stakeholder group,
with construction costs ranging from $2.8 billion to $5.8
billion.
SB 51 would establish the Salton Sea Restoration Council as a
state agency. The Restoration Council would have an executive
committee, a science committee, and a local government forum.
The executive committee would have 14 members, including
representatives of certain state agencies, appointed members,
and representatives of local governments. Representatives of
federal agencies may serve as non-voting members. Decisions of
the executive committee would require a 2/3 vote of the members.
Staff and operations costs for these activities are unknown, but
could be up to $1.5 million per year.
SB 51 directs the Restoration Council to carry out, to the
maximum extent possible, several activities relating to the
restoration of the Sea. Specifically, the bill directs the
Restoration Council to give priority to performing "Period I"
activities from the Preferred Alternative. In addition, the bill
directs the Restoration Council to implement several other
activities, including developing pilot projects, protecting fish
and wildlife habitat, restoring shoreline wildlife habitat,
protecting water quality, protecting cultural values,
eliminating air quality problems, and implementing the Preferred
Alternative.
Under the bill, spending on Period I activities would cost $543
million between 2011 and 2013. These activities would include
preparatory study and monitoring, development of pilot projects,
development of early start wildlife habitat, land acquisition,
and design activities for major construction activities to come
in later years. It is important to note that a final restoration
project should be selected by the state before detailed design
work can begin.
SB 51 (Ducheny)
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The bill directs the Council to implement the Preferred
Alternative. Long term construction costs of the Preferred
Alternative are estimated to be about $8.96 billion over the
next 25 years, with the majority of the construction costs
occurring between 2014 and 2020.
In addition, once construction has been completed, the Preferred
Alternative is projected to have ongoing operation and
maintenance costs of about $150 million per year.
Staff notes that there is about $11 million remaining in
Proposition 84 bond funds available for appropriation that could
be used for some minor portion of these activities. In addition,
there is the potential for some unknown contribution of federal
funds, although it is important to note that there is no
obligation for federal contributions. In addition, there could
be some relatively minor funding available from the proceeds of
future water transfers in the area. Beyond that, funding would
most likely come from the General Fund or future bond funds
repaid from the General Fund.