BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                       AB 203


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          ASSEMBLY THIRD READING


          AB  
          203 (Obernolte)


          As Amended  June 2, 2015


          Majority vote


           ------------------------------------------------------------------- 
          |Committee       |Votes |Ayes                 |Noes                 |
          |                |      |                     |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Natural         |9-0   |Williams, Dahle,     |                     |
          |Resources       |      |                     |                     |
          |                |      |                     |                     |
          |                |      |Cristina Garcia,     |                     |
          |                |      |Hadley, Harper, Mark |                     |
          |                |      |Stone, McCarty,      |                     |
          |                |      |Rendon, Wood         |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Appropriations  |17-0  |Gomez, Bigelow,      |                     |
          |                |      |Bonta, Calderon,     |                     |
          |                |      |Chang, Daly, Eggman, |                     |
          |                |      |Gallagher,           |                     |
          |                |      |                     |                     |
          |                |      |                     |                     |
          |                |      |Eduardo Garcia,      |                     |
          |                |      |Gordon, Holden,      |                     |
          |                |      |Jones, Quirk,        |                     |
          |                |      |Rendon, Wagner,      |                     |
          |                |      |Weber, Wood          |                     |
          |                |      |                     |                     |








                                                                       AB 203


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          SUMMARY:  Extends the deadline to file a petition for  
          redetermination of the state responsibility area fire prevention  
          fee from 30 days to 60 days.  Reestablishes the fire prevention  
          fee at its current level ($152.33) and on July 1, 2017 and  
          annually thereafter allows the Board of Forestry (Board) to adjust  
          the fee.


          EXISTING LAW: 


          1)Requires the Board to classify all lands within the state for  
            the purpose of determining areas in which the financial  
            responsibility of preventing and suppressing fires is primarily  
            the responsibility of the state (these areas are known as "state  
            responsibility area" or "SRA.").
          2)Declares that it is necessary to impose a fire prevention fee to  
            pay for fire prevention activities in the SRA that specifically  
            benefit owners of structures in the SRA.


          3)Requires the Board to adopt regulations to establish a fire  
            prevention fee in an amount not to exceed $150 (which must be  
            adjusted every year for inflation) to be charged on each  
            "structure" on a parcel that is within the SRA.  Defines  
            "structure" as a building used or intended to be used for human  
            habitation, including a mobile home or manufactured home.   
            Reduces the fire prevention fee by $35 if the structure is also  
            within the boundaries of a local agency that provides fire  
            protection services (this reduction applies to most structures).


          4)Requires the fire prevention fees to be deposited in the SRA  
            Fire Prevention Fund, which is available to the Board and the  
            Department of Forestry and Fire Protection (CAL FIRE) to expend  








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            for fire prevention activities that benefit the owners of  
            structures within the SRA.  Limits fire prevention activities to  
            the following:  a) local assistance grants established by the  
            Board; b) grants to Fire Safe Councils, the California  
            Conservation Corps, or certified local conservation corps for  
            fire prevention projects and activities in the SRA; c) grants to  
            a qualified nonprofit organization with a demonstrated ability  
            to satisfactorily plan, implement, and complete a fire  
            prevention project applicable to the SRA; d) inspections by CAL  
            FIRE for compliance with defensible space requirements around  
            structures in the SRA; e) public education to reduce fire risk  
            in the SRA; f) fire severity and fire hazard mapping by CAL FIRE  
            in the SRA; and, g) other fire prevention projects in the SRA  
            that are authorized by the Board.  


          5)Allows a person to petition CAL-FIRE for a redetermination of  
            whether the fire prevention fee applies to him or her within 30  
            days after being served with a notice of determination (i.e.,  
            the notice from CAL FIRE stating that a person must pay the fire  
            prevention fee).


          6)Imposes a 10% penalty for each 30-day period in which the fee  
            remains unpaid after the fee becomes final. 


          7)Allows the Board to exempt from the fee any habitable structure  
            that is subsequently deemed uninhabitable as a result of a  
            natural disaster during the year for which the fee is due, as  
            well as one subsequent year if the habitable structure has not  
            been repaired or rebuilt.


          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee:


          1)Annual revenue loss (special fund) in the $375,000 to $500,000  








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            range.
          2)Annual fee assessments are due and payable to the Board of  
            Equalization (BOE) 30 days from the date of assessment.  During  
            FYs 2011-12, 2012-13 and 2013-14, interest and penalties paid  
            totaled $4,617,894.  Of that amount, $1,493,882 in interest and  
            penalties was remitted on fees paid between 31 and 60 days from  
            the date of assessment.  Under this bill, this amount would not  
            have been paid.  Assuming delinquencies were the same over those  
            three years, the annual average revenue loss is therefore  
            computed as: $1,493,882 / 3 = $497,961. 


          3)However, BOE staff notes that the payments made after 60 days  
            continues to decline, at an average annual rate of 2%.   
            Meanwhile, timely payments made within the 30-day period have  
            improved, in part due to BOE outreach efforts.  Given the  
            continued improvement in timely payments, BOE staff estimates  
            the annual average revenue loss attributable to penalties and  
            interest at $382,700.


          4)Unknown, likely minor, one-time costs (special fund) for BOE to  
            reprogram computers and revise information and publications.


          5)No additional costs to CALFIRE


          COMMENTS:  


          1)Fire Prevention Fee (AB 29 X1 (Blumenfield), Chapter 8, Statutes  
            of 2011-12 First Extraordinary Session).  In early 2011, the  
            state was facing a $25.4 billion budget deficit (which grew to  
            $26.6 billion after the governor cancelled the sale of several  
            state buildings) and an annual structural deficit of up to $21.5  
            billion was projected into the future.  In March 2011, the  
            Legislature passed $13.4 billion in "solutions" (consisting  
            mostly of spending cuts) to address the deficit; however, there  








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            was still a shortfall of $10.8 billion.  To help address the  
            budget shortfall, the Legislature passed, among other bills, AB  
            29 X1, which required the Board to adopt emergency regulations  
            to establish a "fire prevention fee" not to exceed $150 for each  
            structure on a parcel that is within the SRA.  The fee was  
            intended to fill a hole created by a $50 million General Fund  
            cut to CAL FIRE in the 2011 budget bill.  The 2014-15 Budget  
            appropriated $76.3 million from SRA revenues to enhance  
            statewide fire prevention work including, for the first time,  
            $10 million for local assistance grants to be used in locations  
            where the effects of drought, fuel loading and structure  
            development converge.


          2)Appeals.  Under existing law, a person may appeal a fire  
            prevention fee billing notice through a petition for a  
            redetermination if that petition is filed within 30 days of  
            receiving the billing notice.  This bill extends the 30-day  
            deadline to 60 days.  




           Analysis Prepared by:                                               
                          Michael Jarred / NAT. RES. / (916) 319-2092  FN:  
          0000912