BILL ANALYSIS                                                                                                                                                                                                    Ó




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                          AB 982 (Skinner)
          
          Hearing Date: 08/25/2011        Amended: 08/15/2011
          Consultant: Brendan McCarthy    Policy Vote: GO 13-0
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          ____
          BILL SUMMARY: AB 982 requires the State Lands Commission to 
          enter into an agreement with the federal Department of the 
          Interior to facilitate land exchanges between the state and 
          federal government, to allow for the development of renewable 
          energy project on state lands.
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          ____
                            Fiscal Impact (in thousands)

           Major Provisions         2011-12      2012-13       2013-14     Fund
           
          Negotiating land exchanges        $450        $900      
          $900Special *

          Lease revenues         Unknown, potentially up to 
          ($10,000)Special *
                                    per year

          * Land Bank Fund.
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          ____

          STAFF COMMENTS: SUSPENSE FILE. 

          Under current law, the State Land Commission manages lands owned 
          by the state and referred to as "School Lands". These school 
          lands were given to the state by the federal government in the 
          19th century with the stipulation that they be used for the 
          benefit of public education. (Of the 5.5 million acres granted, 
          about 90 percent have been sold.) In general, the remaining 
          school lands are located in the desert region of the state and 
          are divided into many non-contiguous parcels, often with limited 
          economic value. Revenues that are generated from state lands 
          (through lease revenues, mining royalties, or other uses) are 
          deposited in the Land Bank Fund and are used to support the 
          California Teacher's Retirement System. Last year, school lands 
          generated about $6 million in revenue.








          AB 982 (Skinner)
          Page 1



          AB 982 requires the State Lands Commission to enter into an 
          agreement with the federal Department of the Interior, by April 
          1, 2012, to facilitate land exchanges between the state and 
          federal government. The bill provides that its requirements are 
          contingent on cooperation by the federal government. The bill 
          generally directs the Commission to perform the land exchanges 
          on an acre-for-acre basis, but allows the Commission to request 
          additional lands or reject a proposed exchange if a specific 
          school land parcel has greater potential value that an 
          equivalent amount of federal land. The bill directs the 
          Commission to consult with the Department of Fish and Game to 
          identify lands suitable for renewable energy development or use 
          as mitigation habitat lands for endangered species.

          The purpose of the proposed land exchanges is to allow the state 
          to consolidate parcels into properties that are large enough to 
          allow for the development of renewable energy projects. The 
          intention is to assist the state in meeting its renewable energy 
          goals and to increase the potential of the school lands to 
          generate revenues for the state.

          The Commission indicates that it will need six additional 
          positions to plan for potential land exchanges, negotiate with 
          the federal government, and then negotiate lease agreements with 
          renewable energy developers. Staff estimates these additional 
          positions will cost about $900,000 per year for the foreseeable 
          future.

          By facilitating additional development of school lands, the bill 
          is likely to result in increased revenues to the state. The 
          actual revenue increases will depend on the Commission's ability 
          to put together properties that are large enough and located in 
          areas conducive to such development. Based on current and 
          proposed renewable energy projects in the desert region of the 
          state, the Commission indicates that potential future revenues 
          under the bill could be up to $10 million per year.