BILL ANALYSIS Ó AB 1096 Page 1 Date of Hearing: May 15, 2013 ASSEMBLY COMMITTEE ON APPROPRIATIONS Mike Gatto, Chair AB 1096 (Nestande) - As Amended: May 2, 2013 Policy Committee: TransportationVote:14-0 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill authorizes the Department of Fish and Wildlife (DFW) to apply to the DMV to sponsor a specialized Salton Sea license plate, the net proceeds of which shall be deposited into the Salton Sea Restoration Account. FISCAL EFFECT 1)Potential one-time special fund costs of approximately $400,000 to DMV to establish the Salton Sea license plate program, including computer programming changes and updating of forms. Pursuant to current law, DMV will make computer programming and form changes only after program applications meet the 7,500-application threshold. The DMV will incur minor ongoing costs to continue issuing specialty license plates and renewals under the program. All of the DMV's initial and ongoing costs will be covered by a portion of the additional $50 fee paid for specialized license plates. 2)Minor costs to DFW to submit the program application and license prototype to DMV, design and print the license plate application, and collect and hold applications and fees until 7,500 applications are received. The department's costs will eventually be recovered assuming sufficient participation in the program. 3)Potential ongoing additional revenue for restoration of the Salton Sea. COMMENTS AB 1096 Page 2 1)Specialized License Plates . Prior to 2007, any new special interest license plate required specific legislative authorization. This practice was held to be unconstitutional in that the Legislature approved some of the plates, and rejected others, using no standardized or objective criteria for those decisions. Pursuant to AB 84 (Leslie)/ Chapter 91 of 2006, the DMV will issue specialized license plates when sponsored by a state agency, the plate's message and resulting revenues support that agency's program, and at least 7,500 paid license applications have been received. The 7,500-application threshold attempts to assure that DMV's startup costs are fully covered, by the portion of the registration fee surcharge directed to the department, and to avoid a proliferation of different types of plates, which can be troublesome from a law enforcement perspective. 2)The Salton Sea is the largest inland lake in southeastern California. As an agricultural drainage reservoir, the Sea consists primarily of commercial agricultural drainage, with about 90% of the entire inflow to the Sea coming from agricultural runoff from the Imperial, Coachella, and Mexicali Valleys. In 1993, the Salton Sea Authority was established as a joint powers authority with the goal of revitalizing the Sea and "for the purpose of ensuring the beneficial uses of the Salton Sea." The Salton Sea Restoration Council was established in 2010, as a part of Natural Resources Agency, to oversee the restoration of the Salton Sea. The council is required to evaluate Salton Sea restoration proposals and, by June 30, 2013, report to the Governor and the Legislature with a recommended restoration plan. Separately, state law requires the DFW and the Department of Water Resources to implement activities relating to the restoration of the Salton Sea. The restoration plan recommended by the Resources Agency totals approximately $9 billion. 3)Purpose . The author contends that the Sea is beginning to dry up. The transfer of Colorado River water from Imperial Valley to San Diego County reduce the amount of agriculture runoff that currently flows into the Sea. As a result, air quality and wildlife habitat have been severely impaired, and because the remaining waters have increased salinity, most aquatic life is being killed. He contends the state has a current obligation to restore the Sea. He indicates that the revenue AB 1096 Page 3 derived from the Salton Sea special interest license plate program "might be minimal when compared to the total cost of the restoration project. However, any and all funding will be an asset to the Authority. Additionally, the Authority can use the funds raised to leverage grants and other matching funds for the project. Once the plates are issued, it will provide a continuous funding stream for related restoration projects and studies in future years." 4)Related Legislation . AB 244 (Bonilla), also on today's committee agenda, requires the Department of Veterans Affairs (CDVA) to apply to the DMV for a veterans' specialized license plate. AB 49 (Buchanan), pending in this committee, requires the Department of Health Care Services (DHCS) to apply to the DMV to sponsor a breast cancer awareness license plate program. AB 482 (Atkins), also pending in this committee, requires the California Cultural and Historical Endowment to apply to DMV for a specialized license plate to fund a program providing grants for small projects at the state's museums. Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081