BILL ANALYSIS
SB 1284
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator S. Joseph Simitian, Chairman
2009-2010 Regular Session
BILL NO: SB 1284
AUTHOR: Ducheny
AMENDED: Introduced
FISCAL: Yes HEARING
DATE:April 19, 2010
URGENCY: No CONSULTANT:
Rachel Machi Wagoner
SUBJECT : WATER QUALITY: MANDATORY MINIMUM CIVIL
PENALTIES
SUMMARY :
Existing law , under the Porter-Cologne Water Quality Control
Act:
1) Provides that any person who violates prescribed provisions
of the Clean Water Act or the Porter-Cologne Water Quality
Control Act is subject to civil liability, and sets
requirements for determining the amount of any liability.
2) Requires a mandatory minimum penalty (MMP) of $3,000 to be
assessed for each serious violation, under certain
circumstances.
3) Authorizes the State Water Resources Control Board (SWRCB)
or a regional water quality control board (RWQCB), in lieu
of assessing all or a portion of the mandatory minimum
penalties, to require a publicly-owned treatment works
(POTW) serving a small community to spend an equivalent
amount towards the completion of a compliance project
proposed by the POTW if the POTW or SWRCB makes certain
findings (e.g., compliance project is designed to correct
the violations within five years, compliance project is
consistent with SWRCB enforcement policy, POTW has prepared
a financing plan to complete the compliance project).
4) Provides that for purposes of #3, a "POTW serving a small
community" serves a population of 10,000 or fewer or a
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rural county, with a financial hardship as determined by
the SWRCB after considering such factors as median income
of the residents, rate of unemployment, or low population
density.
5) Provides an exception to the imposition of MMPs for a
violation of an effluent limitation if the waste discharge
complies with a certain time schedule order and other
requirements are met. For the purposes of the exception, a
time schedule cannot exceed five years, except under
certain conditions.
This bill :
1) Provides that violations involving failure to report are
not subject to MMPs if the violation is:
A failure to file a discharge monitoring report for
which the state board or regional board does not inform
the discharger of the alleged violation within 90 days of
the required date of filing;
A failure to file a discharge monitoring report for
any period in which no discharge occurred;
A failure to file a discharge monitoring report for
any period in which discharges do not violate effluent
limitations contained in waste discharge requirements
that include numeric effluent limitations.
1) Changes the definition of "publicly-owned treatment works
serving a small community" by expanding the service
population from 10,000 to 20,000.
2) Changes the definition of "serious violation" to be
consistent with the MMP relief in #1.
3) Extends the time schedule order limit for coming into
compliance from five years to ten years.
4) Provides that the provisions of this bill shall apply
retroactively to previous violations without regard to the
date on which the violations occurred.
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COMMENTS :
1) Purpose of Bill . According to the sponsor, MMPs are a
deterrent and a punishment for willful violators, and
should remain in place for that intended purpose. However,
the sponsors feel that the way the statute is currently
drafted; the definition of a "serious violation" warranting
the imposition of an MMP is far too broad and exposes
public agencies who simply failed to file a report
indicating no discharges to the vast penalties. The
sponsor asserts that SB 1284 would provide that certain
violations involving the failure to file a discharge
monitoring report for no discharges or discharges that do
not reach regulated level are not subject to those MMPs.
According to the Association of California Water Agencies
(ACWA), there are several public agency members with
permits requiring reporting which believe that they have
received excessive, disproportionate fines for a simple
failure to file the report. ACWA sites an example of one
small water agency fine that is in excess of $600,000.
Further, the sponsor states that the Legislature has
recognized that the MMPs can have a particularly harsh
impact on small disadvantaged communities and the statute
allows the SWRCB and the RWQCBs to allow a small community
to direct an amount equivalent to the MMP to a project to
bring the facility into compliance. The population
threshold for small community compliance projects is
10,000. The sponsor feels that in this economic climate,
MMPs impose a significant burden upon small community
ratepayers that are already facing significant compliance
costs, and it is important to expand the eligible pool for
completing compliance projects by expanding the definition
of small community to 20,000.
2)Mandatory minimum penalties . MMPs were established in 1999
in response to concerns over the SWRCB and RWQCB failing to
take enforcement actions against Water Code violations.
According to the SWRCB, the California Water Code 13385(h)
requires an MMP of $3,000 for each "serious" violation.
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The Water Boards are also required by California Water Code
13385(i) to assess MMPs of $3,000 for multiple chronic
violations. This penalty applies when the discharger does
any of the following four or more times in any period of
six-consecutive months:
Violates effluent limitations;
Fails to file a report of waste discharge or file and
incomplete report; or
Violates a toxicity effluent limitation where the WDR
does not contain pollutant-specific effluent limitations
for toxic pollutants.
3)Amendments Needed .
a) Time Schedules for Waste Discharge Compliance .
Existing law provides that a RWQCB may establish a time
schedule for a district to bring waste discharge into
compliance with effluent limitations, taking into account
certain factors as specified. During this period the
district, while out of compliance with its permit and
water quality standards, is protected from assessment of
MMPs. The bill as currently drafted extends the
statutorily allowed time schedule from five year to ten
years. The bill's proponents argue that there are many
projects that simply cannot be done in five years.
However, is it appropriate to potentially extend the time
schedule for all projects to such a long period of time,
allowing a district to be out of compliance for a decade
and having a project go on for all that time without any
public comment? The bill should be amended to keep the
time schedule at five years initially, but allow a
district to apply to the RWQCB for a five-year extension
for projects warranting additional time for completion.
By requiring the RWQCB to consider an additional
five-year extension, the public would have an additional
opportunity to comment on the project.
b) Mandatory Minimum Penalties for failure to report .
Under existing law RWQCBs are required to assess MMPs for
serious violations including failure to report as
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specified by the district's permit. The proponents have
presented several cases where RWQCBs have allowed
extensive periods of time to pass before citing a
district for failure to report resulting in extensive
fines. One of the cases presented was for three years of
reporting violations that resulted in a fine of $627,000.
It is the district's responsibility to know and
understand all of the provisions of its permit. However,
when inadvertent mistakes are made, they are apparently
not currently being caught and corrected by the RWQCBs in
a timely fashion and noncompliance with the reporting
requirements is allowed to continue resulting in very
high penalties. This creates an especially difficult
burden for small districts that may not have attorneys on
staff to help with the implementation of the permit.
As currently drafted, the bill would exempt certain
reporting requirements from the MMP assessment
requirements. However, the monthly reports are an
important tool for the RWQCBs and the public to track the
compliance record of a district. If a district is
allowed to bypass reporting all together when in
compliance, how would the RWQCB or public know when the
district is out of compliance? Additionally, monthly
reporting is a demonstration tool for the district:
providing the district with a chronology documenting its
compliance record.
Rather than exempt reporting from the MMP violations, it
is more appropriate to allow for a more reasonable
penalty for those small districts that have inadvertently
violated their reporting requirements for the first time,
but are not in violation of the permit's discharge and
effluent requirements. Additionally, an amendment should
be taken to require RWQCBs to institute better
communications with their permitted districts. SWRCB
indicates that they are currently working to clear the
backlog on MMP enforcement actions and institute policies
for preventing a future backlog.
c) Amnesty for past violations . The bill as currently
drafted states that "the amendments made to this section
by this act?..apply to violations without regard to the
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date on which the violations occurred," thereby changing
the MMP violation provisions retroactively. That
retroactively creates an unfair playing field by letting
those districts off the hook that are currently and have
been out of compliance, while those districts that
complied with their permits or paid the penalties
associated with reporting violations, complied with a
five-year time schedule or paid the MMPs associated with
being out of compliance, complied with the current small
community requirements of the law. In essence, this
provision of SB 1284 would make what was a violation no
longer a violation retroactively. This would also create
an expectation that money be refunded to those districts
that have paid their penalties associated with any
changes made pursuant to this bill. If the state does
not refund that money, do they have a cause of action
against the state for creating the unfair playing field?
The Legislature does not tie the hands of future
Legislatures or, as a rule, undo the laws of past
Legislatures.
The bill should be amended to strike this provision.
d) Expansion of population cap: Assistance vs. Exemption .
The bill's proponents state that there is precedence for
increasing the threshold for the definition of "small
community" to 20,000 in two existing state grant programs
for drinking water and water quality providing special
allocations to small and disadvantaged communities
(Public Resources Code Sections 30925, the Small
Communities Water Pollution Control Requirement Grants,
and Water Code 13193.9, the Waste Water Collection
Treatment Disposal Project: Allocation of Funds to
Disadvantaged Communities).
However, the Water Code contains 5 other definitions for
"small community" with population caps for certain
programs. None of these references exceed 10,000
persons.
Water Code
Population Cap
13999.2(j) Clean Water Bond Law of 1984 5,000
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or less
4052(k) Clean Water/Reclamation Bond Law of 1988
3,500 or less
78610(d) Clean Water/Water Recycling Program 5,000 or
less
79084(b) Costa-Machado Water Act of 200010,000 or less
79120(d) Costa-Machado Water Act of 200010,000 or less
In both the Small Communities Water Pollution Control
Requirement Grant Program, and the Waste Water Collection
Treatment Disposal Project: Allocation of Funds to
Disadvantaged Communities program, the Legislature
recognized the need to assist communities of up to 20,000
persons in funding necessary infrastructure projects in
order to bring them into compliance as quickly as
possible with water quality standards and thereby made
specified funding available to them.
Increasing the statutory threshold for allowing small
communities to expend an equivalent amount of money on
coming into compliance in lieu of MMP assessment does not
accomplish the same goal and may in fact create
circumstances by which POTWs wait to come into compliance
with drinking and waste water standards. By qualifying
for what is in essence, an exemption from MMP violation
assessments, POTWs could continue to discharge knowing
that the MMPs they are accumulating will be applied to
the compliance project when the POTW is ready to do the
necessary compliance measures. This eliminates the
disincentive to pollute intended by the MMP statute and
creates an incentive to wait until funding is available
to come into compliance. In the meantime, pollution into
drinking water supplies continues to occur and the public
health jeopardized.
Rather than letting small communities not pay the penalty
for violating water quality standards, perhaps the answer
is to help these communities come into compliance as
early as possible. Is there perhaps a better way to help
small community POTWs avoid MMPs? As mentioned above,
there are a number of funds that are designated to help
these communities come into compliance. In addition,
there are bond funds set aside specifically to help these
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communities with infrastructure projects. Are these
funds being completely utilized by these small
communities? If not, is there assistance that the SWRCB
or the Department of Public Health can provide in
accessing the funds?
This provision of the bill should be stricken. The
author may wish to explore other ways the state can
assist these communities to meet water quality compliance
standards.
4)Related legislation . SB 390 (Alpert) Chapter 686, Statutes
of 1999, revised the authority of RWQCB's to waive waste
discharge requirements of the Porter-Cologne Water Quality
Control Act as to a specific discharge if the waiver is not
against the public interest and is not for a period to
exceed five years; required RWQCB's and the SWRCB to enforce
the conditions under which a waiver was granted; required
RWQCB's, prior to renewing any waiver, to review waiver
terms at a public hearing; and revised liability provisions
where a person violates prescribed orders or discharges
waste in violation of a waste discharge requirement waiver
or condition.
AB 1541 (Montanez) Chapter 609, Statutes of 2003, classified
the failure to file with SWRCB certain monitoring reports
related to discharge of water pollutants or fill material as
a "serious violation" and, thus, subjected this violation to
a mandatory minimum $3,000 penalty.
AB 2900 (La Malfa) of 2008 would have required the SWRCB or
a RWQCB to expeditiously take appropriate action to assess
any mandatory minimum penalty for each serious waste
discharge violation of the federal Clean Water Act and the
Porter-Cologne Water Quality Control Act. (Died in the
Assembly Committee on Environmental Safety and Toxic
Materials.)
AB 913 (Logue) of 2009 would have prohibited the SWRCB or a
RWQCB from imposing a mandatory minimum penalty for a
violation for which an action to impose liability is not
requested or imposed by the SWRCB or a RWQCB within 12
months of the SWRCB or RWQCB receiving notice of the
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violation. (Withdrawn by the author prior to its first
hearing in the Assembly Committee on Environmental Safety
and Toxic Materials.)
AB 914 (Logue) of 2009 would have allowed the SWRCB, when
determining financial hardship, to also consider the impact
of the penalties on individual ratepayers if it finds that
the review of the specified factors does not adequately
represent the range of economic circumstances in a
community. (Vetoed by Governor Schwarzenegger.)
AB 25 (Gilmore) of 2009-10 would increase the size of the
population that can be served by POTWs serving a small
community and provides alternative penalties to public
school districts for their waste water discharge violations.
(Currently in the Senate Environmental Quality Committee.)
5)Opponents' Arguments . Opponents state that exemptions in
this bill from the MMP provisions of the Water Code for
dischargers who fail to file required discharge monitoring
reports send a message to the dischargers that these reports
need not be filed - when in fact it is a condition of their
permits. These permits are critical to tracking compliance
with state and federal water quality laws.
Additionally, the opponents have concerns with regard to:
(a) the practicality and necessity of the 90-day notice that
RWQCBs would be required to provide dischargers who fail to
file a monitoring report, as well as with (b) the impacts of
the potential amendments to the time schedule provision of
the bill.
SOURCE : Association of California Water Agencies
Regional Council of Rural Counties
SUPPORT : League of California Cities
OPPOSITION : California Coast Keeper Alliance
Sierra Club