BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 367


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          Date of Hearing:  April 14, 2015


                  ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE


                                 Marc Levine, Chair


          AB 367  
          (Dodd) - As Introduced February 17, 2015


          SUBJECT:  Clear Lake


          SUMMARY:  Appropriates $2.4 million from the Fish and Game  
          Preservation Fund (FGPF) to Lake County for projects related to  
          Clear Lake.  Specifically, this bill:


          1)States legislative findings and declarations regarding Clear  
            Lake, its natural resource values which include fish, birds,  
            and other wildlife, and problems at the lake such as toxic  
            algal blooms, mercury pollution, and the listing of Clear Lake  
            as an impaired water body.


          2)States legislative intent to assist Lake County in restoring  
            Clear Lake to protect fish and wildlife and preserve  
            recreational and economic opportunities.


          3)Appropriates $2.4 million from the FGPF to Lake County for the  
            purposes of restoring Clear Lake wetlands, maintaining Clear  
            Lake water quality, and preventing and controlling the spread  
            of invasive species in or to Clear Lake.   










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          EXISTING LAW:


          1)Establishes the FGPF, a state special fund, to support the  
            work of the Department of Fish and Wildlife (DFW) in  
            administering and enforcing the Fish and Game Code.  Revenue  
            sources to the FGPF include fishing and hunting license, tag,  
            permit, and stamp fees, fines and penalties, and other  
            miscellaneous revenues, including state property rental and  
            investment income.  The FGPF includes both non-dedicated and  
            dedicated accounts.  Dedicated accounts may be used only for  
            the specific purposes for which the accounts were created.   
            FGPF expenditures are subject to appropriation by the  
            Legislature.

          2)Requires, unless otherwise provided, all money collected under  
            the Fish and Game Code and any other law relating to the  
            protection and preservation of birds, mammals, fish, reptiles,  
            or amphibia to be paid into the State Treasury to the credit  
            of the FGPF.



          3)States legislative intent that nongame fish and wildlife  
            programs and free fishing licenses shall not be funded from  
            the FGPF, and that sport hunting and sport fishing programs  
            are to be funded from license revenues, federal  
            reimbursements, federal funds, and other funds appropriated by  
            the Legislature for this purpose. Provides that programs which  
            benefit commercial fishing programs are to be funded solely  
            from revenue generated from commercial uses.



          FISCAL EFFECT:  Appropriates $2.4 million from the FGPF.


          COMMENTS:  









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          1)Purpose:  The author has introduced this bill to provide state  
            funding to Lake County to restore Clear Lake wetlands,  
            maintain water quality in Clear Lake, and prevent the spread  
            of invasive species. The author notes that in 1973 the State  
            of California conveyed the submerged lands in Clear Lake in  
            trust to Lake County in furtherance of navigation, commerce  
            and fisheries, and to provide for government management of the  
            lake.  The state reserved certain rights including the right  
            to use without charge any transportation, landing, or  
            betterments on the lake, and mineral rights, including  
            geothermal resources.  The legislation granting title of the  
            bed of Clear Lake to Lake County included language requiring  
            that the lake be used for purposes for which there is a  
            general statewide interest, including, among other things,  
            protection of wildlife habitats and fish resources, public  
            access and recreation, and prevention of pollution of the  
            lake.  The author asserts that given these state interests,  
            the state has an obligation to help the county maintain the  
            lake and eradicate its problems so that the state's general  
            interest in the lake is sustained.  


            Clear Lake is the largest naturally created freshwater surface  
            lake located entirely in California, with 68 miles of surface  
            area.  (Lake Tahoe is larger, but is located partially in  
            Nevada.  The Salton Sea is also larger but was created by a  
            man-caused faulty levee break and today is saltier than the  
            ocean.) Clear lake supports large populations of sport fish,  
            including bass, crappie, bluegill carp, and catfish. The lake  
            also provides habitat for numerous bird and mammal species,  
            including ducks, pelicans, grebes, egrets, osprey, and bald  
            eagles.  Deer, bear, mountain lion, and bobcat are among the  
            mammal species found in the basin.  The native Clear Lake  
            Hitch fish is endemic to the Clear Lake watershed and is  
            classified as a species of special concern.  The author also  
            indicates that Clear Lake is a source of drinking water for  
            disadvantaged communities.









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            The author notes that Clear Lake is beset by numerous problems  
            that threaten fish and wildlife, reduce the quality of  
            drinking water sourced from the lake, and diminish lake  
            recreational opportunities important to the county's local  
            economy.  The problems include, but are not limited to, excess  
            phosphorus which contributes to impairment of water quality,  
            toxic algal blooms, invasive species, and contamination by  
            heavy metals such as mercury.  The author also notes that  
            Clear Lake has lost 79% of its historic wetlands, which  
            contributes to toxic algal blooms and nutrient loads,  
            resulting in the State Water Resources Control Board (Water  
            Board) listing Clear Lake as impaired.  The Water Board has  
            issued Total Maximum Daily Loads (TMDLs) for Clear Lake for  
            both mercury and nutrients.


            The author further notes that as a rural county, Lake County  
            lacks the resources to effectively address all of the problems  
            at Clear Lake on its own.  Since Clear Lake is a valuable  
            state resource, as well as a local resource, the author  
            asserts that appropriation of state funds is needed and  
            appropriate to help Lake County resolve the Lake's problems.


          2)Water Management at Clear Lake:  Clear Lake is within the  
            Upper Cache Creek Watershed which drains to the Sacramento  
            River.  The water storage capacity of the lake is 1.1 to 1.4  
            million acre feet.  The Lake County Board of Supervisors is  
            responsible for land use planning management of the bed of  
            Clear Lake, municipal storm water, implementation of the two  
            Clear Lake TMDLs for mercury and nutrients, recreational  
            planning and maintenance, and oversight of numerous water  
            supply and wastewater districts.  The Lake County Watershed  
            Protection District coordinates activities between agencies  
            within Lake County, and has also worked with the Yolo County  
            Flood Control and Water Conservation District to address Clear  
            Lake issues and identify projects of mutual benefit, with a  
            focus on the Cache Creek watershed which includes Clear Lake. 








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          The sole outlet for Clear Lake is Cache Creek.  Yolo County  
            acquired riparian rights to Cache Creek's water in 1855.  The  
            Cache Creek Dam at Clear Lake was constructed by the Yolo  
            County Water and Power Company in 1914.  Today the Yolo County  
            Flood Control and Water Conservation District owns and  
            operates the dam, which is located 5 miles downstream from the  
            creek's outlet at Clear Lake.  The dam is operated according  
            to court decrees which regulate how much water can be stored  
            in Clear Lake during non-flood and flood conditions.  Yolo  
            County Flood Control and Water Conservation District stores up  
            to 150,000 acre feet of water per year in Clear Lake for  
            agricultural water uses in Yolo County.  Yolo County Flood  
            Control and Water Conservation District also owns the  
            hydroelectric plant at the dam which has a hydroelectric  
            generating capacity of 1.750 kilowatts. Management of the lake  
            level is designed to avoid flooding, provide water to Yolo  
            County and local municipal water companies, and to maintain  
            water for recreational use.  Raw water is also pumped and  
            exported from Clear Lake to supplement treated effluent  
            supplies delivered to the Geysers geothermal facility.
          3)Westside Integrated Regional Water Management Plan:  Clear  
            Lake is located in the hydrologic region covered by the  
            Westside Integrated Regional Water Management Plan (Westside  
            IRWMP).  The Westside IRWMP was released in June of 2013 and  
            preliminarily approved by the Department of Water Resources in  
            May of 2014.  Lake County is a participant in the Westside  
            IRWMP, which includes the Lake County Watershed Protection  
            District (as the County's lead agency for the IRWMP), the Napa  
            County Flood Control and Water Conservation District, the  
            Colusa County Regional Conservation District, the Solano  
            County Water Agency, and the Yolo County Water Resource  
            Association.  The major lakes and reservoirs in the region  
            covered by the Westside IRWMP include Clear Lake, Indian  
            Valley Reservoir, and Lake Berryessa.  Focal points of the  
            Westside IRWMP include improving habitat and ecosystem health,  
            controlling invasive species, and addressing water quality  








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            concerns.



          The Westside IRWMP history indicates that in 2005 Lake County  
            began the process of developing an IRWMP at the county level,  
            but before a county-based plan was completed, the State  
            indicated it prefers that the IRWMPs include larger,  
            watershed-based regions.  Lake County therefore chose to  
            participate in the Westside IRWMP instead of proceeding with  
            its own local plan, and the portions of Lake County located in  
            the Cache Creek and Putah Creek watersheds are addressed in  
            the Westside IRWMP.   The Lake County Watershed Protection  
            District is governed by the Lake County Board of Supervisors  
            and is the lead agency for the county's participation in the  
            Westside IRWMP.  

          Significant concerns and priority objectives identified in the  
            Westside IRWMP include nutrients in Clear Lake, restoration of  
            Clear Lake Hitch, an endemic species of special concern,  
            management of invasive species, providing safe and reliable  
            water supplies, and mercury impairment. Toxic alga caused by  
            cyanobacteria is also identified as an emerging contaminant of  
            concern.  Clear Lake is one of several primary water supply  
            sources in the region identified in the Westside IRWMP, which  
            emphasizes the importance of conjunctive water management to  
            the region.  The Westside IRWMP also notes that many of the  
            Upper Cache Creek watershed communities meet the definition of  
            a disadvantaged community.

          The Westside IRWMP indicates that while water resource managers  
            and stakeholders agree erosion control, riparian and wetland  
            restoration upstream of Clear Lake will have the greatest  
            beneficial impact on Clear Lake water quality, challenges  
            remain to prioritize specific actions.
          4)State Activities at Clear Lake:   The state has recognized the  
            natural resource values at Clear Lake through a number of past  
            actions.  The DFW indicates it has identified two areas  
            surrounding Clear Lake as important wetland resources.  These  








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            areas have been incorporated into a Conceptual Area Protection  
            Plan which allows DFW, through the Wildlife Conservation Board  
            (WCB), to purchase lands or easements within the boundaries of  
            the Plan area.  Examples of past actions include a 1999 grant  
            of $395,000 from the WCB to the Lake County Land Trust to  
            acquire 97 acres of land on the northwest shore of Clear Lake  
            to protect wetland, riparian and upland habitats.  The state  
            has also accepted donations of conservation easements from the  
            Lake County Watershed Protection District protecting over 100  
            acres of historic wetland habitat near the town of Nice.  The  
            WCB is currently considering a potential grant to the Lake  
            County Land Trust to acquire another 74 acres of waterfront  
            property that represents the last remaining unprotected  
            wetland on Clear Lake, known as the Big Valley Wetlands  
            Conceptual Area Protection Plan.  This acquisition would  
            provide habitat linkages and corridors to a nearby wetland  
            reserve that is already under conservation easements. The DFW  
            also conducts monitoring for aquatic invasive species and  
            conducts an annual two day watercraft screening and inspection  
            training for Lake County staff and marine bait shop staff.  
            Native fish assemblages in Clear Lake have also been  
            identified as an important resource in DFW's 2015 update to  
            the State Wildlife Action Plan.



          5)Lake County Healthy Lake Tax:  Lake County has attempted to  
            raise local revenues to fund projects this bill would fund.   
            The Lake County "Healthy Lake Tax", a local sales tax measure,  
            was on the June 3, 2014 election ballot for voters in Lake  
            County, California, but was defeated.  Measure L would have  
            authorized the county to impose an additional sales tax of 0.5  
            percent for 10 years to fund the eradication of weeds, algae  
            and invasive mussels from Clear Lake, the restoration of  
            wetlands in the county, and the improvement of water quality.  
            A 2/3rds supermajority vote was required for the approval of  
            Measure L, which failed on a vote of 65.2 % support, to 34.8%  
            opposed.  This was the county's third attempt to pass such a  
            measure.








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          6)Condition of the Fish and Game Preservation Fund: While the  
            fiscal issues will be explored in more depth in the Assembly  
            Appropriations Committee, the use of the FGPF as proposed in  
            this bill is of interest to this committee because many of the  
            policy objectives reviewed by this committee are funded  
            through the FGPF.  The DFW indicates that it relies on the  
            FGPF statewide to fund DFW's responsibilities under the Fish  
            and Game Code, including but not limited to, wildlife and  
            fisheries management, resource assessments, habitat  
            restoration, conservation planning, environmental review,  
            permitting, water resource management, enforcement, public  
            education, and response to spills.  According to the  
            Department of Finance, while the Governor's budget shows a $17  
            million reserve in the non-dedicated portion of the FGPF, DFW  
            is currently operating at a structural deficit, with  
            expenditures exceeding revenues, such that it is anticipated  
            DFW's current expenditures will exhaust the reserve before the  
            end of this year.



          7)Other potential sources of state funding for Clear Lake  
            Projects:



          The Water Bond (Proposition 1, approved by the voters in  
            November 2014) contains several categories of funding for  
            which Lake County and/or the region through the Westside  
            IRWMP, may be eligible to apply through competitive grant  
            processes. A key principle which the Legislature followed in  
            developing the Water Bond was to prohibit earmarks for  
            specific projects and instead allocate funds for categories or  
            types of projects which entities could then apply for on a  








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            competitive basis.  It should be noted that accessing bond  
            funds can be a practical challenge for lower income  
            communities, in part because applicants are often required to  
            expend funds upfront for a project, and then get reimbursed  
            for expenditures with the grant funds.  Keeping these  
            constraints in mind, potential alternative funding sources  
            include:
            a) Section 79737 of the bond makes available $285 million for  
            watershed restoration projects statewide. Eligible projects  
            include, but are not necessarily limited to, projects to  
            restore or enhance riparian and aquatic habitat, improve  
            ecological function, provide fish passage, improve local  
            watershed management, and remove sediment.  DFW administers  
            these funds and the draft solicitation guidelines for these  
            grants are currently available on DFW's website.





            b) Section 79740 of the Water Bond makes available $810  
            million in competitive grants and loans for projects that are  
            included in and implemented through an IRWMP. The Legislature,  
            through the Water Bond and the IRWMP program, has encouraged  
            communities to collaborate and focus on regional water  
            management. The Water Bond requires a 50% local match for  
            IRWMP projects, which can be waived or reduced for projects  
            that benefit disadvantaged communities.  Clear Lake is located  
            in the Sacramento River hydrologic region, which was allocated  
            $37 million of the IRWMP monies in the Water Bond.



            c) Section 79720 of the Water Bond makes $520 million  
            available for safe drinking water, including specifically for  
            mercury and nutrient remediation, the two contaminants that  
            have resulted in TMDLs for Clear Lake.










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            d) Section 79730 of the Water Bond makes $200 million  
            available for enhancing instream flows.  Projects to address  
            issues involving smaller streams and tributaries that flow  
            into Clear Lake may be eligible to apply for these funds which  
            are being administered by the WCB.  The draft solicitation  
            guidelines for these funds are available on the WCB's website.  
             Half of these funds are targeted for urban streams, but the  
            other half is allocated statewide.  





            e) The Department of Parks and Recreation's Division of  
            Boating and Waterways administers a Quagga and Zebra mussel  
            Infestation Prevention Grant Program, for which the Lake  
            County Watershed Protection District submitted a funding  
            application on October 20, 2014 for $200,000 for outreach and  
            education, hiring and training of boat ramp monitors, and to  
            hire an invasive species coordinator.  The County was recently  
            awarded a grant of $189,649 to implement this project.





            f) Many counties have a county fish and wildlife propagation  
            fund composed of fines and penalties for wildlife violations,  
            which could be allocated for wildlife and habitat restoration  
            purposes.





          8)Prior and related legislation: AB 1874 (Gonzalez) of 2013 did  
            not include an appropriation, but would have required IRWMP  
            funding appropriated by the Legislature to the Department of  








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            Water Resources for a region to be passed through directly to  
            that region if that region is eligible for, and has completed,  
            a streamlined application process and requests funding.  The  
            money would not have gone directly to a county, but would have  
            allowed the participants in the IRWMP for that region to  
            determine what projects to fund rather than the state.  AB  
            1874 was held on the Assembly Appropriations Committee  
            suspense file.

          9)Suggested Amendment:  Clear Lake faces significant natural  
            resource challenges of state interest, but questions remain as  
            to whether the FGPF, as proposed in this bill, is the most  
            appropriate source of funding.  Staff recommends, if the  
            committee elects to approve this bill, that the reference to  
            the FGPF be deleted, with the expectation that the author will  
            work with the Assembly Appropriations Committee on identifying  
            appropriate sources or approaches to funding.



          Amend SEC. 2, on page 2, lines 30-36 to read as follows:  

          The sum of two million four hundred thousand dollars  
            ($2,400,000) is hereby appropriated from the ___________  Fish  
            and Game Preservation  Fund to the County of Lake for the  
            purposes of restoring Clear Lake wetlands, maintaining the  
            water quality of Clear Lake, preventing the spread of invasive  
            species to Clear Lake, and controlling invasive species in  
            Clear Lake.   



          Support Arguments:  The County of Lake in support of this bill  
          emphasizes that Clear Lake is California's largest natural  
          freshwater lake.  They note that water quality problems in the  
          lake are impacting tourism, including specifically algal blooms  
          in the summer, and invasive species are a constant threat.  The  
          county has tried three times to enact a half-cent sales tax  
          dedicated to lake programs, but those measures, while garnering  








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          over 60% of the vote, have failed to meet the 2/3rd vote  
          requirement for special purpose taxes.  Additional background  
          materials provided by the county indicate that if this bill were  
          approved the county would propose to use the funds for long term  
          monitoring of water quality TMDLs in the Lake and for small  
          stream and wetland restoration in the Clear Lake Upper Cache  
          Creek watershed.  





          Opposition Arguments:  None received.      


          REGISTERED SUPPORT / OPPOSITION:




          Support
          City of Lakeport


          County of Lake


          California Water Service


          Elem Indian Colony


          Featherbed Railroad Bed & Breakfast Resort


          High Country Security










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          Lake County Association of Realtors


          Lake County Winery Association


          Ruzicka Associates, Consulting Engineers


          Save the Lake Committee




          Opposition
          None on file.




          Analysis Prepared by:Diane Colborn / W., P., & W. / (916)  
          319-2096