BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  SB 455
                                                                  Page 1

          SENATE THIRD READING
          SB 455 (Pavley)
          As Amended  August 22, 2012
          Majority vote

           SENATE VOTE  :21-3  
           
           NATURAL RESOURCES   6-3         APPROPRIATIONS      10-5        
           
           ----------------------------------------------------------------- 
          |Ayes:|Chesbro, Brownley,        |Ayes:|Gatto, Blumenfield,       |
          |     |Dickinson, Huffman,       |     |Bradford,                 |
          |     |Monning, Skinner          |     |Charles Calderon, Campos, |
          |     |                          |     |Davis, Hill, Cedillo,     |
          |     |                          |     |Mitchell, Solorio         |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Knight, Grove, Halderman  |Nays:|Harkey, Donnelly,         |
          |     |                          |     |Nielsen, Norby, Wagner    |
          |     |                          |     |                          |
           ----------------------------------------------------------------- 
           SUMMARY  :  Requires timberland conversion projects to mitigate 
          environmental and greenhouse gas (GHG) impacts through 
          reforestation and other specified forest related activities.  
          Specifically,  this bill:
           
          1)Prohibits the approval of an application for conversion of 
            timberlands of three or more acres unless the Board of 
            Forestry and Fire Protection (Board) finds all of the 
            following:

             a)   The environmental impacts of the conversion on wildlife, 
               habitat values, and forest type are mitigated as required 
               by all applicable laws.

             b)   The mitigation occurs on nonfederal California 
               timberlands and, to the extent feasible, in proximity to 
               the proposed conversion and on land of similar forest type.

             c)   The mitigation fully mitigates the loss of carbon in 
               above-ground and below-ground biomass and the loss of 
               future ongoing carbon sequestration.  The reduction of GHG 
               impacts must occur over the same time period and be 
               equivalent to the greenhouse gas emissions and losses of 
               above-ground and below-ground biomass that result from the 








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               conversion.

          2)Requires the Board to provide the Department of Fish and Game 
            (DFG) an opportunity to review and comment on the application 
            for timberland conversion. 

          3)Requires an applicant for timberland conversion to meet all of 
            the following requirements:

             a)   Except as specified, all mitigation associated with the 
               conversion projects are to be on lands that secure the 
               mitigation with a permanent conservation easement and 
               include the reforestation of a previously forested area at 
               a minimum acreage ratio of 1:1.  

             b)   As an option to the applicant, the reforestation 
               requirement may be met at a minimum acreage ratio of 2:1 on 
               land not subject to a conservation easement.

             c)   To the extent that the reforestation requirement does 
               not fully mitigate GHG impacts, the applicant is required 
               to take other mitigation activities as specified.

             d)   Except as specified, all actions necessary to complete 
               mitigation for GHG impacts are to be completed within two 
               years of the conversion to nonforest use.  The mitigation 
               may be undertaken 1) by the applicant, 2) through 
               agreements with the state or third parties, or 3) through 
               direct payment to the Board.

             e)   The applicant is required to enter into an agreement 
               with the Board to ensure that the mitigation is completed. 
               The county may be included as a party to the agreement 
               depending on the circumstances.

          4)Creates the Timberland Conversion Services Fund for money 
            received pursuant to mitigation agreements between timberland 
            converters and the state.  

          5)Allows a county to manage timberland conversion mitigation 
            moneys if the county adopts a timberland conversion and 
            mitigation ordinance that meets or exceeds the standards of 
            the bill.

          6)Requires the Board to develop timberland conversion mitigation 








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            guidelines that are approved at a public hearing.  The Board 
            is required to submit these guidelines to the State Air 
            Resources Board (ARB) at a public hearing and, to the extent 
            feasible, the guidelines are to be consistent with an existing 
            relevant GHG accounting method developed by ARB.

          7)Authorizes the Board to collect a fee for conversion permits 
            to cover the Department of Forestry and Fire Protection's (CAL 
            FIRE) costs and the costs of DFG for any review of the 
            timberland conversion application and to ensure compliance 
            with mitigation and monitoring requirements.

           EXISTING LAW  , pursuant to the Z'berg-Nejedly Forest Practice Act 
          (FPA):

          1)Requires any person who intends to convert timberlands to 
            another use to file an application for conversion with the 
            Board.  If the timberland conversion is proposed in a 
            timberland production zone, the application must provide 
            specific information regarding proposed alternate use.  The 
            Board is required to approve the application for conversion 
            only if it finds that:  1) the conversion would be in the 
            public interest; 2) the conversion would not have a 
            substantial and unmitigated adverse effect upon the continued 
            timber-growing use or open-space use of other surrounding 
            lands zoned as timber production; and, 3) the soils, slopes, 
            and watershed conditions would be suitable for the uses 
            proposed if the conversion were approved.  The existence of an 
            opportunity for an alternative use of the land or the 
            uneconomic character of the existing use shall not alone be 
            sufficient reason for conditionally approving an application 
            for conversion. 

          2)Authorizes the Board to exempt a person from the FPA's 
            conversion requirements whose activities are limited to the 
            one-time timberland conversion of less than three acres.  A 
            person may not receive more than one exemption in a five-year 
            period.  The Board must determine that the exemption is 
            consistent with the FPA.

           


          FISCAL EFFECT  :  









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          1)One-time costs to the Board, likely in the hundreds of 
            thousands of dollars, to develop timberland conversion 
            guidelines (special funds, reimbursed from revenue in the 
            Timberland Conversion Services Fund).

          2)Annual costs of an unknown amount, but potentially in the 
            hundreds of thousands of dollars, to CAL FIRE and DFG to 
            review applications to convert three or more acres of 
            timberland to nontimber use (special funds).  These costs 
            should be fully covered by the fee authority provided to the 
            Board.

          3)Annual minor costs, no more than the low tens of thousands of 
            dollars, to the Board to administer monies in the Timberland 
            Conversion Services Fund (Timberland Conversion Services 
            Fund).

           COMMENTS  :  California's forests provide a significant climate 
          service to the state, sequestering over five million metric tons 
          of carbon pollution annually.  There has been, however, 
          increasing pressure for private timberland owners to find 
          economically attractive uses for their property.  Timber 
          management has become less profitable for a number of reasons 
          and landowners often see increasing opportunities to develop 
          rural subdivisions or establish vineyards.  As timberlands are 
          converted to other uses, much of the carbon stored in these 
          forests is emitted to the atmosphere and the ongoing carbon 
          sequestration benefits, as well as many other benefits (e.g., 
          water quality protection, habitat, timber resources) are 
          diminished, if not entirely lost.  From 1997 to 2012, 14,654 
          acres of timberlands in the state were converted to alternate 
          uses.  Nevada, Placer, Plumas, Siskiyou, and Mendocino Counties 
          have been affected the most, with 2,564, 2,309, 2,274, 1,644, 
          and 1,013 acres converted, respectively.

          According to the author, "there is no explicit provision in the 
          CEQA guidelines for mitigation of carbon emissions or lost 
          carbon sequestration potential from conversions of timberland to 
          non-timberland uses?This bill would clarify that the conversion 
          of projects larger than 3 acres must mitigate all of its 
          impacts."

          Additionally, according to the cosponsors (The Nature 
          Conservancy and The Pacific Forest Trust), this bill "provides 
          an incentive to timberland owners to mitigate the impacts of 








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          conversion that does occur by creating a funding stream to pay 
          landowners to provide mitigation through activities such as 
          reforestation, changes in management and conservation. These 
          complementary actions will help California maintain its valuable 
          timberland, their public benefits and the jobs that depend on 
          these resources."  

           SB 466 (Steinberg) of 2007, which was held in the Senate 
          Appropriations Committee, was introduced to impose, among other 
          things, a menu of mitigation options on forestland conversions 
          with the mitigation lands being managed pursuant to the Forestry 
          Protocols of the Climate Action Registry.  


           Analysis Prepared by  :    Mario DeBernardo / NAT. RES. / (916) 
          319-2092 


                                                                FN: 0005347