BILL ANALYSIS Ó
AB 282
Page 1
ASSEMBLY THIRD READING
AB 282 (Wieckowski and Mitchell)
As Introduced February 11, 2013
2/3 vote
ENVIRONMENTAL SAFETY 5-2
APPROPRIATIONS 12-1
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|Ayes:|Alejo, Bloom, Chesbro, |Ayes:|Gatto, Bocanegra, |
| |Stone, Ting | |Bradford, |
| | | |Ian Calderon, Campos, |
| | | |Eggman, Gomez, Hall, |
| | | |Ammiano, Pan, Quirk, |
| | | |Weber |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Dahle, Donnelly |Nays:|Donnelly |
| | | | |
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SUMMARY : This bill extends the current $0.006 storage fee on
each gallon of petroleum placed in an underground storage tank
from the current sunset date of January 1, 2014 to January 1,
2016.
EXISTING LAW :
Pursuant to the Barry Keene Underground Storage Tank Cleanup Act
(Act) of 1989:
1)Establishes the Underground Storage Tank Cleanup Fund (Fund)
for the deposit of fees collected pursuant to the Act.
2)Establishes a base storage fee of $0.014 (14 mils) for each
gallon of petroleum placed in an underground storage tank.
3)Establishes, until January 1, 2014, an additional storage fee
of $0.006 (6 mils) for each gallon of petroleum placed in an
underground storage tank for a total of $0.02 per gallon.
4)Authorizes the State Water Resources Control Board (SWRCB) to
expend the moneys in the Fund, upon appropriation by the
Legislature, for various purposes, including the payment of
claims to aid owners and operators of petroleum underground
AB 282
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storage tanks who take corrective action to clean up
unauthorized releases from those tanks.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, the proposed extension of the fee will generate
approximately $79 million per year for two years.
COMMENTS :
1)Need for the bill : According to the author, "Without AB 282
the UST Cleanup Fund (Fund) will be vastly underfunded. Even
with this bill, the UST Cleanup Fund will be significantly
underfunded. The funding crisis has been exacerbated by
declining gasoline sales, which has further reduced revenues
to the Fund. The current revenues are not sufficient to cover
the work being required by the regulatory agencies. Due to
this funding shortage, the Fund is also unable to allow
existing applicants on the Priority List into the Fund to
commence collection of reimbursement. Currently there are 34
Priority B claimants and 86 Priority C claimants waiting for
access to the Fund, including many that have been waiting
years for access to the Fund. Finally, UST owners and
operators are relying on the Fund to demonstrate financial
responsibility for UST ownership and operation in accordance
with Federal requirements."
2)Previous Fee Increases . In 2009, there was an over
expenditure of the Fund of approximately $80 million and
payments for costs already incurred were suspended. That
caused hardship on the business owners and consulting firms
that performed the work to clean up leaking tanks but had not
been reimbursed for their efforts. Also during that time, an
internal audit of the UST Program and the Fund was implemented
and reforms to improve program implementation were undertaken.
AB 1188 (Ruskin), Chapter 649, Statutes of 2009, increased
the petroleum storage fee by $0.006 per gallon between January
1, 2010, and December 31, 2011, to bridge part of the
shortfall. This fee was further extended by AB 291
(Wieckowski), Chapter 569, Statutes of 2011. AB 282 seeks to
extend that increase for two more years.
3)UST Program Background . Currently, the UST Program is
supported by a 2 cent mils per gallon fee collected quarterly
from petroleum UST owners/operators by the State Board of
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Equalization. The fee currently generates about $270 million
per year for claims reimbursement.
Claims are paid in priority order based on criteria
established in statute: "A" or first priority is given to
homeowners; "B" or second priority is for small business,
non-profit, or small local government agencies with revenue
below a specified level; "C" or third priority is given to
parties with fewer than 500 employees; and, "D" or lowest
priority is given to all other claimants, including major
corporations and larger local governmental agencies.
4)Status of the Underground Storage Tank Cleanup Fund . The
Fund's balance is $225.7 million as of 12/31/12. In fiscal
year 2011-2012, the Fund fee generated approximately $305
million for claims reimbursement, administration, overhead
costs and other authorized accounts. Currently there are
2,852 active claims for underground tank cleanups that are
being funded, and 4,700 additional claims are on the priority
list waiting to be funded.
Analysis Prepared by : Bob Fredenburg / E.S. & T.M. / (916)
319-3965
FN: 0000831