BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                      



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          |SENATE RULES COMMITTEE            |                   SB 965|
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                              UNFINISHED BUSINESS


          Bill No:  SB 965
          Author:   Wright (D) and Blakeslee (R)
          Amended:  8/29/12
          Vote:     21

           
           SENATE ENVIRONMENTAL QUALITY COMMITTEE  :  6-0, 4/23/12
          AYES:  Simitian, Strickland, Blakeslee, Hancock, Kehoe, 
            Lowenthal
          NO VOTE RECORDED:  Pavley

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           SENATE FLOOR :  33-1, 5/29/12
          AYES:  Alquist, Anderson, Berryhill, Blakeslee, Calderon, 
            Cannella, Corbett, Correa, De León, DeSaulnier, Dutton, 
            Emmerson, Fuller, Gaines, Harman, Hernandez, Huff, Kehoe, 
            La Malfa, Lieu, Liu, Lowenthal, Negrete McLeod, Padilla, 
            Price, Rubio, Simitian, Steinberg, Strickland, Vargas, 
            Walters, Wright, Wyland
          NOES:  Wolk
          NO VOTE RECORDED:  Evans, Hancock, Leno, Pavley, Runner, 
            Yee

           ASSEMBLY FLOOR  :  Not available


           SUBJECT  :    Water quality control boards:  ex parte 
          communications

           SOURCE  :     Author


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           DIGEST  :    This bill establishes allowable ex parte 
          communications with State Water Resources Control Board 
          (SWRCB) and Regional Water Quality Control Board (RWQCB) 
          members and increases the public access to the SWRCB and 
          RWQCB public processes. 

           Assembly Amendments  make clarifying provisions to the 
          Senate version of the bill.

           ANALYSIS  :    Under existing law, the SWRCB and the 
          California RWQCBs implement the Federal Water Pollution 
          Control Act and the Porter-Cologne Water Quality Control 
          Act by prescribing waste discharge requirements for 
          discharges to the waters of the state, as specified.  
          Existing law authorizes the SWRCB and RWQCBs to hold 
          hearings necessary for carrying out their duties, as 
          specified.

          The Administrative Procedure Act (APA) establishes the 
          conduct of administrative adjudicative proceedings, which 
          are defined as evidentiary hearings for determination of 
          facts pursuant to which a state agency formulates and 
          issues a decision.  Existing law defines a decision as an 
          agency action of specific application that determines a 
          legal right, duty, privilege, immunity, or other legal 
          interest of a particular person.  The APA prohibits, as an 
          ex parte communication, while an adjudication is pending, 
          any communication, direct or indirect, regarding any issue 
          in the proceeding, to the presiding officer, as defined, 
          from an employee or representative of an agency that is a 
          party or from an interested person outside the agency, 
          without notice and opportunity for all parties to 
          participate in the communication.  The APA provides that if 
          the above prohibition is violated, the presiding officer 
          shall promptly disclose the content of the communication on 
          record and give all parties an opportunity to address the 
          communication, as specified.  The APA also provides that a 
          violation of that prohibition may be grounds for 
          disqualification of the officer who engaged in the ex parte 
          communication.

          This bill:

          1. Allows ex-party communications with members of the SWRCB 

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             and the RWQCBs as follows: 

             A.    Defines "interested person" as: 

                (1)      A participant in the proceeding regarding a 
                   matter before a board, or an agent, employee, or a 
                   person receiving consideration for representing 
                   that participant; 

                (2)      A person with a financial interest in a 
                   matter before a board, or an agent, employee, or a 
                   person receiving consideration for representing 
                   that person; and

                (3)      A representative acting on behalf of a 
                   civic, environmental, neighborhood, business, 
                   labor, trade, or similar organization who intends 
                   to influence the decision of a board member on a 
                   matter before the board. 

             B.    Defines "ex parte communication" as an oral or 
                written communication between a board member and an 
                interested person about a matter within the board's 
                jurisdiction, which does not occur in a public 
                hearing, workshop, or other official proceeding, or 
                on the official record of the proceeding on the 
                matter. 

             C.    Allows ex parte communication if the contact is 
                initiated by an interested person and directed to a 
                SWRCB or RWQCB member regarding: 

                (1)      Waste discharge requirements; 
                (2)      Conditions of water quality certification; 
                   and
                (3)      Conditional waivers of waste discharge 
                   requirements where the board action does not 
                   identify specific persons or dischargers, but 
                   instead allows persons to enroll or file an 
                   authorization to discharge under the action. 

             D.    Requires a notice of the ex parte communication to 
                be provided to the SWRCB and RWQCBs record within 
                seven days of the communication. 

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             E.    Requires the SWRCB or RWQCB to place in the public 
                record any report of an ex parte communication 
                involving that board. 

          2. Requires the SWRCB and RWQCB public meeting rules to 
             provide adequate time for public witnesses who are 
             testifying before the SWRCB and RWQCBs. Requires that 
             the SWRCB and RWQCBs provide at least twice the 
             testimony time for a member of the public who utilizes a 
             translator.  The requirement for additional testimony 
             time would not apply in those cases where simultaneous 
             translation services are required. 

          3. Authorizes a board to prohibit ex parte communications 
             for a period beginning not more than 14 days before the 
             day of a board meeting at which the decision in the 
             proceeding is scheduled for board action.

          4. Requires all ex parte communications to be reported, as 
             specified, by the interested person, regardless of 
             whether the communication was initiated by the 
             interested person.

          5. Authorizes the state board or a regional board, in the 
             event that an interested person fails to provide any 
             required notice in the manner required by the bill, to 
             use the remedies available under the administrative 
             adjudication provisions of the APA.

          6. Requires the state board or a regional board to make 
             each meeting agenda notice that the state board or a 
             regional board provides available in both English and 
             Spanish and permits the state board or a regional board 
             to make the agenda notice available in any other 
             language.

          7. Requires a state body subject to the act that limits 
             time for public testimony to provide at least twice the 
             allotted time to a member of the public who utilizes a 
             translator to ensure that non-English speakers receive 
             the same opportunity to directly address the body, with 
             a specified exception.


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           Background
           
           Ex parte rules for boards and commissions  .  Ex parte 
          communications are made in private between an interested 
          party in a decisionmaking process and an official in a 
          decisionmaking position.  Because they can introduce an 
          element of bias in a decisionmaking process federal and 
          state law as well as agency policy prescribe requirements 
          for ex parte communications for specified proceedings.  
          Because boards and commissions can vary in the type of 
          proceedings held, the process of each may vary for each 
          board or commission.

           SWRCB  .  SWRCB regulations (Title 23 California Code of 
          Regulations, Section 648) conform to the APA relative to 
          adjudicatory proceedings, including the limitations on ex 
          parte communications.  Should a prohibited ex parte 
          communication be received during an adjudicatory 
          proceeding, the board member must disclose the 
          communication on the record.  Disclosure requires either 
          (1) including a written ex parte communication in the 
          record, along with any response from the board member, or 
          (2) memorializing an oral communication by including a 
          memorandum in the record stating the substance of the 
          communication, identifying who was present at the time of 
          the communication and any response from the member.  The 
          board member must notify all parties of the ex parte 
          disclosures.

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes   
          Local:  No

           SUPPORT  :   (Verified  8/31/12)

          Agricultural Council of California
          California Bean Shippers Association
          California Building Industry Association
          California Cement Manufacturers Environmental Coalition
          California Chamber of Commerce
          California Council for Environmental and Economic Balance
          California Grain and Feed Association
          California Grocers Association
          California League of Food Processors
          California Manufacturers & Technology Association

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          California Metals Coalition
          California Pear Growers Association 
          California Precast Concrete Association California Seed 
          Association
          California State Floral Association 
          Chemical Industry Council of California
          Family Winemakers of California
          Golden State Builders Exchanges
          Institute of Scrap Recycling Industries
          League of California Cities
          LKQ Corporation
          Lumber Association of California & Nevada 
          National Federation of Independent Business
          Pacific Egg and Poultry Association
          Pacific Merchant Shipping Association
          Rio Tinto Minerals
          State of California Auto Dismantlers  Association
          United Contractors
          Western Growers Association
          Western Wood Preservers Institute


           ARGUMENTS IN SUPPORT  :    According to the author's office, 
          there is no existing statute governing ex parte 
          communications at proceedings of the SWRCB or RWQCBs.  The 
          author's office states that board staff believe that state 
          and regional water board members and staff must follow ex 
          parte rules similar to rules that must be followed by 
          judges, defendants and plaintiffs in courts.  The author's 
          office argues that all administrative avenues have been 
          exhausted, in that the board staff and counsel have 
          heretofore resisted calls to conform the ex parte 
          regulations of the boards to be consistent with those used 
          by other regulatory agencies within and outside of the 
          California Environmental Protection Agency.  According to 
          the author's office, the Little Hoover Commission, the 
          Department of Water Resources and other public and private 
          entities and individuals have strongly suggested the board 
          staff modify its rules.

          Supporters argue that this bill will make members of SWRCB 
          more accessible to the public, including stakeholders that 
          are regulated by the SWRCB and RWQCBs.  Supporters argue 
          that access to decision makers is critical to ensuring 

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          effective and balanced public policy.  Supporters state 
          that several years ago, the staff of the SWRCB determined 
          that the process of the adoption of standards and permits 
          was a quasi-judicial process, despite the fact that many 
          storm water permits and other actions taken by SWRCB 
          clearly do not fall within that category.  As a result of 
          this interpretation board members are prohibited from 
          communicating with stakeholders in developing permits and 
          policies, even though these permits may often apply to 
          large groups of stakeholders in the regulated community.  
          The supporters argue that this restriction on 
          communication, or ex parte rules limit the regulated 
          entities' ability to discuss important and complex issues 
          with board members despite the profound fiscal impact board 
          decisions can have on these regulated entities.  Supporters 
          believe that the current process diminishes the ability of 
          local governments, businesses and other stakeholders to 
          provide valuable information to the water boards since 
          their opportunity to comment is often limited to a few 
          minutes of testimony during a formal hearing.

          The California Council for Environmental and Economic 
          Balance states, "This bill would end the policy at the 
          State Water Resources Control Board (SWRCB) and Regional 
          Water Quality Control Boards (RWQCBs) that prevent 
          stakeholders from having ex-parte discussions with board 
          members on specified matters.  The current practice 
          generally limits a stakeholder's involvement to written 
          comments, public workshops, and 2-3 minutes of testimony at 
          adoption hearings.  Other regulatory bodies allow 
          stakeholders to interact with board members as long as it 
          is disclosed publicly.  CCEEB believes public 
          communications with regulators in their policy-making and 
          quasi-legislative roles are important and should be allowed 
          at the SWRCB and RWQCBs.


          DLW:m  8/31/12   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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