BILL ANALYSIS Ó AB 291 Page 1 Date of Hearing: May 11, 2011 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair AB 291 (Wieckowski) - As Amended: April 12, 2011 Policy Committee: Environmental Safety and Toxic Materials Vote: 9-0 Urgency: No State Mandated Local Program: No Reimbursable: No SUMMARY This bill requires the State Water Resources Control Board (SWRCB) to allocate at least 25% of Class B and Class C awards from the Underground Storage Tank Cleanup Fund based upon environmental risk priority. FISCAL EFFECT 1)One-time costs to SWRCB in 2011-12 of $50,000 to $150,000 to develop and adopt regulations that, among other things, define "environmental risk priority." (Underground Storage Tank Cleanup Fund (USTCF).) 2)One-time costs to SWRCB in 2012-13 of between $300,000 and $650,000 to review thousands of UST claims, rank them based on their relative environmental risk and consider appeals of applicants' rankings. (USTCF.) 3)Ongoing annual costs to SWRCB starting in 2012-13000 in the tens of thousands of dollars to review new UST claims and rank them based on their relative environmental risk, consider appeals of applicants' rankings and track spending. (USTCF.) COMMENTS 1)Rationale . The author contends it appropriate to allow SWRCB to prioritize claim awards upon potential risk to human health and the environment. 2)Background. The Barry Keene Underground Storage Tank Cleanup Fund Act of 1989 created the Underground Storage Tank Cleanup AB 291 Page 2 Fund Program to help owners and operators of petroleum USTs satisfy federal and state financial responsibility requirements. The act requires every owner of a petroleum UST that is subject to regulation under the Health and Safety Code to pay a per-gallon fee to the fund. This fee, which began on January 1, 1991, has increased over time and currently generates in excess of $180 million annually. The fee is set to expire at the end of this year. To be eligible to file a claim with the fund, the claimant must be a current or past owner or operator of the UST from which an unauthorized release of petroleum has occurred and be required to undertake corrective action as directed by the regulatory agency. Other eligibility conditions include compliance with applicable state UST permitting requirements and regulatory agency cleanup orders. The act sets forth a claim priority system based on claimant characteristics, which is formalized in the Priority List, as follows: a) Class A is reserved for residential tank owners. b) Class B is reserved for small California businesses, nonprofit organizations and governmental agencies with gross receipts below a specified maximum. c) Class C is for certain California businesses, nonprofit organizations and governmental agencies not meeting the criteria for Class B. d) Class D is open to all other eligible claimants. 3)Related Legislation . AB 358 (Smyth) would require the board to adopt emergency regulations, on or before January 1, 2012, that specify the conditions under which a leaking underground storage tank (LUST) is an emergency site, meaning the site is an imminent threat to public health or safety or to the environment or poses a substantial probability of causing a condition of contamination or nuisance. The bill passed the Assembly Committee on Environmental Safety and Toxic Materials 9-0 and is pending action before this committee. AB 291 Page 3 4)This bill has no registered support or opposition. Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081