BILL ANALYSIS Ó SB 1345 Page 1 Date of Hearing: June 16, 2014 ASSEMBLY COMMITTEE ON NATURAL RESOURCES Wesley Chesbro, Chair SB 1345 (Natural Resources and Water) - As Amended: June 10, 2014 SENATE VOTE : 36-0 SUBJECT : Natural resources SUMMARY : Establishes a deadline for Department of Fish and Wildlife (DFW) to approve a private conservation and mitigation bank agreement package extends the sunset date of the Wholesale Regional Water System Security and Reliability Act (WRWSSR Act) from 2015 to 2022, and makes technical and clarifying changes to the Public Resources and Water Codes. EXISTING LAW : 1)Authorizes the DFW to establish private and public conservation and mitigation banks that can provide viable consolidated mitigation for adverse impacts caused by projects. Authorizes a person interested in establishing a bank to submit an optional draft prospectus for review by DFW, as specified. Once the bank prospectus is approved, allows the applicant to submit a bank agreement package to DFW consistent with the prospectus and include specified information. Requires that if DFW determines that the bank agreement package is complete, within 90 calendar days of that determination, DFW determine whether it is acceptable and notify the person who submitted the package of the determination. (There is no deadline for DFW to approve the package once it has determined that it is acceptable.) 2)Excludes the Southern Subdistrict of the Coast Forest District (Southern Subdistrict) from the working forest management plan (WFMP) program (however, there is an incorrect reference to the regulations in the Forest Practice Rules describing the Southern Subdistrict). 3)Authorizes the Central Valley Flood Protection Board (CVFPB) to record a lien with a county in response to an uncorrected violation. SB 1345 Page 2 4)Requires, pursuant to the WRWSSR Act, the City and County of San Francisco to adopt a program of capital improvement projects to restore and improve the Bay Area regional water system that includes a schedule for completion of the projects. Sunsets the WRWSSR Act on January 1, 2015. 5)Requires, pursuant to the WRWSSR Act, the California Seismic Safety Commission (CSSC) and the California Department of Public Health (DPH) to provide comments to the Joint Legislative Audit Committee (JLAC) within 90 days of receiving notice of a change or delay in the capital improvement project program, as specified. THIS BILL : 1)Establish a 30 day deadline by which DFW must issue written approval of a bank agreement package. 2)Amends the WFMP by referencing the correct regulation in the Forest Practice Rules that describes the Southern Subdistrict. 3)Makes technical, non-substantive changes to the statute governing CVFPB liens. 4)Extends the WRWSSR Act sunset date to January 1, 2022. 5)Extends the comment period to 120 days for CDDC and DPH to comment to JLAC regarding changes or delays to the capital improvement projects program required pursuant to the WRWSSR Act. FISCAL EFFECT : According to the Senate Appropriations Committee, ongoing costs in the low to mid-tens of thousands of dollars of reimbursed costs to DPH and the CDDC. COMMENTS : 1)Mitigation Banks . Existing law authorizes DFW to establish private conservation and mitigation banks. Statute does not provide a set deadline for DFW to decide approval of a proposal to establish a bank once the bank agreement package is deemed acceptable. This bill establishes a 30 day deadline to determine whether a completed bank agreement package should be approved. SB 1345 Page 3 2)Southern Subdistrict . In 2013, AB 904 (Chesbro) created the WMFP. The Southern Subdistrict, which includes the counties of Santa Cruz, Santa Clara, San Mateo, San Francisco, and Marin, is excluded from the WFMP. The WFMP statute references the wrong regulation to describe the Southern Subdistrict. This bill fixes this drafting error. 3)CVFPB Liens . In 2013, SB 753 (Steinberg) granted the CVFPB authority to record a lien in response to certain violation. The language contained an error by granting CVFPB the authority to record the lien with the county clerk instead of the county recorder. This bill fixes this drafting error. 4)The WRWSSR Act's Sunset . The WRWSSR Act provides that the City and County of San Francisco shall adopt capital improvement projects to restore and improve the Bay Area regional water system. These projects are executed under the San Francisco Public Utilities Commission's (SFPUC) Water System Improvement Program (WSIP). Although the WRWSSR Act sunsets in 2015, projects related to the seismic retrofit of San Francisco's Regional Water System have fallen behind schedule as documented in the September 2013 WSIP Annual Report to the state. Delays have occurred due to unforeseen factors including weather conditions, the discovery of naturally occurring asbestos, and construction material shortages. The SFPUC estimates that 33 out of 47 projects will conclude at the end of 2014 with all projects reaching completion in 2019. The water transmission system improved under WSIP serves 27 retail distribution systems (including San Francisco) that provide water to approximately 2.5 million users and 30,000 businesses, including Stanfurd University and Facebook. This bill would extend the sunset date to 2022. Should this bill not pass, the entire WRWSSR Act will be become ineffective on January 1, 2015. WSIP projects would lose state oversight and the City and County of San Francisco would no longer be statutorily required to complete crucial projects including the replacement of the Calaveras Dam and construction of seismically-engineered conduits installed where the Hetch Hetchy Regional Water System crosses three of the nation's most active earthquake faults. This bill addresses this issue by extending the 2015 sunset date to 2022. 5)The WRWSSR Act Comment Period . Under WRWSSR Act, the CSSC and DPH must provide comments on public health and safety to the JLAC within 90 days of receiving notice of a WSIP delay from SB 1345 Page 4 SFPUC. Due to staffing constraints, CSSC has requested an extension of the commenting period to 120 days. This bill makes this change. REGISTERED SUPPORT / OPPOSITION : Support Alameda County Water District Association of California Water Agencies Bay Area Water Supply and Conservation Agency Jess E. Benton, Mayor, Town of Hillsborough City of Brisbane City of Burlingame California Water Service Company Coastside County Water District County Recorders Association of California City of Daly City City of Foster City City of Hayward International Union of Operating Engineers Edwin M. Lee, Mayor, City of San Francisco City of Menlo Park Mid-Peninsula Water District City of Millbrae City of Milpitas City of Mountain View North Coast County Water District City of Palo Alto Purissima Hills Water District City of Redwood City City of San Bruno City of Santa Clara Stanford University City of Sunnyvale Westborough Water District Opposition None on file Analysis Prepared by: Mario DeBernardo / NAT. RES. / (916) 319-2092 SB 1345 Page 5