BILL ANALYSIS Ó
SB 763
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator Jerry Hill, Chair
2013-2014 Regular Session
BILL NO: SB 763
AUTHOR: Fuller
AMENDED: April 23, 2013
FISCAL: Yes HEARING DATE: May 1, 2013
URGENCY: No CONSULTANT: Rachel Machi
Wagoner
SUMMARY : STATE WATER RESOURCES CONTROL BOARD: UNDERGROUND
STORAGE TANKS
Existing law :
1) Provides for the regulation of underground storage tanks
(USTs) by the State Water Resources Control Board (SWRCB).
2) Until January 1, 2016, requires SWRCB to conduct a loan and
grant program to assist small businesses in upgrading,
replacing, or removing tanks meeting applicable local,
state, or federal standards through the Replacing,
Removing, or Upgrading Underground Storage Tanks Program
(RUST program).
3) Requires that the interest rate for loans given through the
RUST program be set at the rate earned by the Surplus Money
Investment Fund at the time of the loan commitment.
4) Establishes the Petroleum Underground Storage Tank
Financing Account (account) and, upon appropriation by the
Legislature, requires moneys in the account to be used by
the board to make loans and grants for purposes of the RUST
program.
5) Requires interest earned from the investment of the moneys
in the account to be deposited into a subaccount, available
upon appropriation by the Legislature for administrative
expenses of the board.
6) Requires the board annually to make available not more than
33% of the available funds from the account for the
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purposes of providing grants through the RUST program.
7) Establishes the Underground Storage Tank Cleanup Fund (UST
Cleanup Fund) in the State Treasury and requires specified
moneys to be deposited into the fund. Moneys in the fund
may be expended by the board, upon appropriation by the
Legislature, for purposes of the Barry Keene Underground
Storage Tank Cleanup Trust Fund Act of 1989.
This bill :
1) Extends the RUST loan and grant program indefinitely and
revises loan eligibility and grant award requirements.
2) Requires SWRCB to annually make available not more than 15%
of the available funds from the account for the purposes of
providing grants.
3) Sets the interest rate for loans given through the RUST
program at the rate equal to half of the most recent
general obligation rate obtained by the office of the
Treasurer at the time of commitment.
4) Requires interest earned from moneys in the financing
account to be deposited into that account and eliminates
the existing subaccount.
5) Requires loan fees and various other moneys received in the
implementation of the loan and grant program to be
deposited into the account.
6) Specifies that moneys in the account are permitted to be
used, in addition to making loans and grants, to service
loans, to recover defaulted loan moneys, to protect the
state's position as a lender creditor, and for
administration costs, as specified.
7) Transfers $8,000,000 from the UST Cleanup Fund to the
financing account and appropriates these funds for the
purpose of making grants and loans through the RUST program
and administering specific provisions, as prescribed.
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COMMENTS :
1) Purpose of Bill . According to the author, SB 763 proposes
to delete the sunset date of the RUST program and make
various changes to the program to improve its effectiveness
and efficiency, and ensure its long-term viability.
Extending the program and increasing its efficiency would
enable the SWRCB to continue to help small businesses
upgrade, remove, or replace their USTs to meet regulatory
requirements, thereby continuing to help protect public
health and the environment.
2) RUST program . Federal and state laws require every owner
and operator of a petroleum UST to maintain financial
responsibility to pay for any damages arising from their
tank operations. The UST Cleanup Fund Act was created by
the California Legislature to provide a means for petroleum
UST owners and operators to meet the federal and state
requirements and pay for the cleanup of contaminated soil
and groundwater when a leak is discovered. The UST Cleanup
Fund is administered by SWRCB.
In addition, SWRCB's Division of Financial Assistance
offers direct grants and loans to assist small gas station
owners and operators to comply with Underground Storage
Tank (UST) regulatory requirements through the RUST
program. This program is available for upgrades, not costs
associated with remediation after a leak, with the intent
of helping to prevent contamination from ever occurring.
RUST grants are given to small businesses that are
independently owned and operated with less than 20
employees. The grants range from $3,000 to $50,000. RUST
grant funds may be used to finance up to 100% of the costs
necessary to upgrade USTs by installing containment sumps,
double-walled piping, dispensers, under-dispenser
containment boxes/pans, electronic monitoring systems, and
enhanced vapor recovery systems and conduct enhanced leak
detection tests.
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RUST loans are given to companies that have fewer than 500
full or part-time employees and may range from $10,000 to
$750,000. RUST loans may be used to finance up to 100% of
the costs necessary to upgrade, remove, or replace USTs,
including corrective actions, to meet applicable local,
state, or federal standards, including, but not limited to,
any design, construction, monitoring, operation, or
maintenance requirements adopted pursuant to Health and
Safety Code Sections 25284.1 and 25292.4. Typical eligible
costs are replacing USTs, installing containment sumps,
double-walled piping, dispensers, under-dispenser
containment boxes/pans, electronic monitoring systems, and
enhanced vapor recovery systems, and conducting enhanced
leak detection tests.
SOURCE : State Water Resources Control Board
SUPPORT : None on file
OPPOSITION : None on file