BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 904 (Chesbro) - Forest practices: working forest management plans. Amended: August 13, 2013 Policy Vote: NR&W 7-0 Urgency: No Mandate: Yes (see staff comments) Hearing Date: August 19, 2013 Consultant: Marie Liu This bill meets the criteria for referral to the Suspense File. Bill Summary: AB 904 would create a working forest management plan (WFMP) for non-industrial timberland owners with less than 15,000 acres, which would allow for limited timber harvesting without a timber harvest plan (THP). Fiscal Impact: One-time costs of at least $150,000 from the Timber Regulation and Forest Restoration Fund (General) to the Board of Forestry (board) for the development of regulations as required by this bill. One-time costs of approximately $75,000 from the Timber Regulation and Forest Restoration Fund to the regional water quality control boards (RWQCBs) for adoption and revision of general waste discharge requirements. Assuming five WFMPs are submitted each year, annual costs of approximately $500,000 - $750,000 in FY 2014-15 and growing to $600,000 to $950,000 in FY 2018-19, from the Timber Regulation and Forest Restoration Fund to Department of Forestry and Fire (CalFire), Department of Fish and Wildlife (DFW), the RWQCBs, and Department of Conservation (DOC) for the approval, then ongoing review, of WFMPs. This cost will at least be partially offset by a decrease in THPs submitted. Background: Existing law authorizes non-industrial timber management plans (NTMPs) for landowners who have fewer than 2,500 acres of timberland. Two of the basic considerations embedded in NTMPs are (1) a ban on clearcutting or even aged management), and (2) that the plans last indefinitely and generally remain subject to the Forest Practices Rules and AB 904 (Chesbro) Page 1 statutes that were effect at the time the NTMP was approved. AB 1492 (Budget Committee) Chapter 289/2012 established a new assessment on lumber products sold in California in order to fund, among other activities, multi-agency review of permitted Forest Practice Act activities in California. Proceeds of the assessment are deposited in to the Timber Regulation and Forest Restoration Fund. CalFire, DOC, DFW, State Water Resources Control Board, and the RWQCBs (collectively referred to as the "reviewing agencies" in this analysis) are all eligible to receive support from the fund for their review of projects or permits necessary to conduct timber operations. Proposed Law: This bill would allow a timberland landowner of less than 15,000 acres to file with CalFire a WFMP that would allow for limited timber harvesting indefinitely without a THP. The WFMPs must have the objective of maintaining, restoring, or creating uneven aged managed timber stand conditions, achieving sustained yield, and promoting forestland stewardship that protects watersheds, fisheries and wildlife habitats. This bill establishes minimum elements of the WFMP including a description of the land, an inventory design and timber strand stratification criteria, a description and discussion of methods to be used to avoid significant sediment discharge from timber operations, and special provisions to protect unique areas. The board would be authorized to include other criteria in its regulations. This bill would establish procedures for the submission, filing, approval, and appeal of the WFMPs. The procedures require a minimum period for public comment, dependent on the size of the lands under the WFMP. The procedures would also require CalFire to submit a copy of a WFMP to the reviewing agencies, the appropriate county planning agency, and all other agencies having jurisdiction over natural resources affected by the WFMP. CalFire would be required to respond in writing to comments received from public agencies as well as the public. This bill would also create a process to appeal CalFire's rejection of a plan to the board. Under an approved WFMP, the landowner must file a ministerial working forest harvest notice with CalFire when a harvest is planned. This bill establishes the minimum content of the notice include information regarding discovery of state or federally AB 904 (Chesbro) Page 2 listed species, erosion control mitigation measures and certification by a registered professional forester. The board may adopt regulations that require additional information. For harvest areas within the Southern Subdistrict of the Coast Forest District, this bill would also require a 10-day preoperations notice to be given to certain downstream landowners. The harvest notice could not be filed until the preoperations notice period is completed. CalFire would be required to review an approved WFMP's administrative record every five years in conjunction with the reviewing agencies. A field inspection may be conducted as part of this review. The board would be required to adopt regulations that require the development of a plan summary before each review, which will be made available to the public on CalFire's website. This bill allows for the landowner to submit a proposed amendment to an approved WFMP to CalFire for approval. The board would be required to specify in regulations, nonsubstantial deviations from the WFMP that can be taken by reporting instead of an amendment. Under this bill, the board may take disciplinary action against a registered professional forester who made a material misstatement in the preparation of a WFMP or notice of harvest. This bill specifies procedures to cancel the plan as well as to transfer the plan to a subsequent landowner. CalFire would be required to cancel an approved WFMP if it determines that the objectives of uneven aged management and sustained yield are not being met or if there are persistent violations that are not being corrected. The board would be required to adopt regulations that allow the transfer of a NTMP into a WFMP. A landowner with a WFMP may also request a safe harbor agreement from DFW. DFW's costs incurred in reviewing this request shall be paid from the Timber Regulation and Forest Restoration Fund. This bill would also require the board to adopt regulations to create the Small Forest Unevenaged Management Plan (SFUMP) for lands of less than 320 acres and follows the general structure AB 904 (Chesbro) Page 3 of the NTMP. The SFUMP would be required to have restrictions regarding the size and frequency of harvesting. Staff Comments: This bill would require the board to develop regulations regarding the WFMP and the SFUMP with specified elements, including elements regarding notice of receipt of a proposed WFMP, required contents of the WFMP, nonsubstantial deviations that can occur without amendments to a WFMP, required contents of the notice of harvest, the plan summary for the five-year review, and a process to file an amendment to a WFMP. While the board has some existing staff that can be made available to work on these regulations, it will be at the expense of the development of other regulations that are necessary to comply with the board and CalFire's other regulatory responsibilities. Staff estimates that this bill will cause a minimum workload equivalent of $150,000 in one-time costs to develop the necessary regulations. The Lahontan, Central Valley, and North Coast Regional WQCBs will also incur some one-time costs to develop or revise general waste discharge requirements covering WFMPs. Collectively for these three RWQCBs, staff estimates approximately $75,000 in workload will be necessary. CalFire and the reviewing agencies will all incur costs in the review of a WFMP application, the review of harvest notices, and the five-year review of approved a WFMP. The costs to the agencies depend on the number of plans submitted and approved as well as the complexity of those plans. According to CalFire, 81 landowners have forestland acreage between 2500 and 15,000 acres (although there is some dispute by interested parties on the accuracy of CalFire's figure). It is unknown how many of these landowners will ultimately decide to file for a WFMP and when. Based on a February 2013 report from the Natural Resources Agency and CalEPA that was required by AB 1492, the Resources Agency, CalFire, DFW, SWRCB, and DOC collectively need approximately $25 million annually and 193 positions to review all discretionary harvest permits (THPs, NTMPs, etc.) received each year. The actual cost to review each THP can vary greatly depending on factors such as the quality of the THP submitted, the size of the plan, and the complexity of the plan. Based on the number of permits submitted in 2011-12, staff estimates that the average cost of reviewing a TPH is in the high tens of AB 904 (Chesbro) Page 4 thousands. Staff assumes the workload involved in reviewing and approving a WFMP will be 25-50% higher than a THP as WFMP allows harvesting indefinitely. Assuming five plans are submitted annually, this bill will likely result in costs to the reviewing agencies in the range of the mid to high hundreds of thousands of dollars. Once a WFMP is approved, the reviewing agencies will incur ongoing costs to review harvest notices and to conduct the five-year review. Each WFMP is likely to result in costs collectively across the review agencies of a couple of thousands of dollars annually. Continuing with the assumption of five WFMPs submitted annually, at the end of a five year period, there will be review costs in the low hundreds of thousands of dollars. Staff notes that aside from the initial costs of regulatory development for the WFMP program, the initial and ongoing costs caused by this bill may be at least partially offset by a decrease in THPs, depending on the extent that a WFMP supplants the submission of THPs. The extent to which a WFMP supplants THP submission is speculative. This bill changes the definition of a crime, which is a non-reimbursable state mandate.