BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair SB 617 (Evans) - California Environmental Quality Act. Amended: April 1, 2013 Policy Vote: EQ 7-2 Urgency: No Mandate: Yes Hearing Date: May 23, 2013 Consultant: Marie Liu SUSPENSE FILE. AS PROPOSED TO BE AMENDED. Bill Summary: SB 617 would require assessments under the California Environmental Quality Act (CEQA) to consider the exposure of people to natural hazards or adverse environmental conditions; make various changes to CEQA reporting requirements; require the Office of Planning and Research (OPR) make CEQA notices publically available on an online database; and repeal obsolete exemptions. Fiscal Impact (as approved on May 23, 2013): Ongoing costs, varying annually in the hundreds of thousands of dollars, from the General Fund and special funds, depending on the project, for additional analysis under CEQA with some costs being recovered through fees. Possible one-time costs, likely in the high tens of thousands to low hundreds of thousands of dollars from the General Fund for OPR to create an expanded database for CEQA notices. Background: CEQA provides a process for evaluating the environmental effects of a project. Under CEQA, lead agencies with the principal responsibility for carrying out or approving a proposed discretionary project are required to prepare a negative declaration, mitigated negative declaration, or environmental impact report (EIR) for the project, unless the project is exempt. Generally an EIR must be prepared for projects that have a "significant impact on the environment" with the environment being defined as the physical conditions that exist within the area that will be affected by a proposed project. Certain types of project also require that the lead agency conduct at least one scoping meeting. At several decision points, such as when the lead agency decides an EIR needs to be prepared or when an EIR is approved, CEQA SB 617 (Evans) Page 1 requires notifications be sent to the public, local agencies, and interested parties. Notification requirements vary somewhat depending on the action. AB 900 (Buchanan/Gordon) Chapter 354/2011 established CEQA procedures for "environmental leadership development projects." These projects are selected by the Governor and must meet certain requirements. The lead agency considering a leadership project must prepare a record of proceedings concurrently with the administrative process. Existing law requires OPR to develop guidelines for the implementation of CEQA ("CEQA Guidelines"). OPR is required to review the CEQA guidelines every two years for possible updates. The guidelines are anticipated to be updated in 2014. Proposed Law: This bill would expand the definition of the "environment" and "significant effect on the environment" and would require that projects are evaluated for how it might be affected by the environment, such as sea level rise and natural hazards. This bill would also standardize how notices are filed under CEQA and to whom. This bill would require expand the notices required to be sent to the Office of Planning and Research (OPR) and would require OPR to post the notices in a publicly available, online database. OPR would also be authorized to charge the filing agency an administrative fee not to exceed $10 per notice. This bill would also require lead agencies, until January 1, 2017 and at the request of a project applicant, to prepare a record of proceedings concurrently with the administrative process. The request would be required to include an agreement to pay all of the lead agency's costs for preparing and certifying the record of proceedings. This bill would also require that scoping meetings under CEQA are public and would delete obsolete statutory CEQA exemptions. Related Legislation: AB 380 (Dickinson) is substantially similar to the provisions of this bill that would expand the notices that are required to be sent to OPR and would require OPR to post the notices in a publically available, online database. AB SB 617 (Evans) Page 2 380 is in the Assembly Appropriations Committee. AB 953 (Ammiano) is identical to the provisions of the bill that would expand the definition of "environment" and "significant effect on the environment and require that projects be evaluated for how it might be affected by the environment. AB 953 is currently on the Assembly Floor. SB 984 (Simitian) 2012 would have allowed concurrent preparation of the record of proceedings. SB 984 died pending concurrence on the Senate Floor. Staff Comments: This bill potentially increases the workload for a lead agency to review a project as this bill would require that lead agency to also consider the impact of natural hazards or adverse environmental conditions on the project. This requirement could increase state costs for both when a state agency is a lead or responsible agency and when the state is the project proponent. However, staff notes that this analysis is currently required by the current CEQA Guidelines (§15126.2(a), which are adopted regulations, despite recent litigation. Because this analysis is currently in the CEQA guidelines, it is reasonable to assume that at least some agencies may already be doing this analysis, thus reducing the potential cost impact of this bill provision. Actual costs would vary greatly depending on the project and are speculative, but staff believes it is reasonable to assume that costs could average in the hundreds of thousands of dollars collectively across state agencies. Currently OPR has a searchable database of CEQA documents that are received by the office, including summaries of EIRs and negative declarations, called CEQAnet. This database was created in the 1990s and does not provide the full text of any environmental documents. CEQAnet is also not a comprehensive database of all CEQA documents as not all documents are required to be submitted to OPR. Last year, OPR initiated an effort to modernize and expand the database and they anticipate a prototype being finished in Fall 2013. OPR, through the contractor for the database update, is exploring options that allow for the full electronic submission of CEQA documents from various parties, linking CEQA documents to interactive maps and state parcel data, electronic collection of CEQA fees on behalf of the Department of Fish and Wildlife, and various search capabilities. The contract to create a prototype database cost SB 617 (Evans) Page 3 approximately $200,000. Costs are likely to total $500,000 once the database is finalized. This update may result in a database that meets the requirements set under this bill; however, if it does not, OPR may incur additional information technology (IT) costs. Staff notes that these IT costs are likely in the high tens of thousands of dollars to low hundreds of thousands of dollars. This bill allows OPR to charge an administrative fee of up to $10 to pay for its costs of maintaining the database. However, OPR notes that as an office of the Governor's office it is difficult and awkward to charge fees. Staff notes as an example, the services provided to businesses through GoBiz, another office of the Governor, are provided at no costs. Therefore, although the bill gives OPR fee authority, it is likely that OPR will not utilize the authority. This bill is a mandate as it would require a lead agency, which can be a local agency, to take certain actions under CEQA. However, as local agencies can charge a fee to a project proponent to cover the costs of providing such activities, this bill does not create a reimbursable mandate. The committee amendments would delete requirements for concurrent preparation of the record of proceedings.