BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON AGRICULTURE
                          Senator Cathleen Galgiani, Chair
                                2015 - 2016  Regular 

          Bill No:           AB 761          Hearing Date: 6/30/15
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          |Author:    |Levine                                               |
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          |Version:   |6/2/15   Amended                                     |
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          |Urgency:   |No                    | Fiscal:   |Yes              |
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          |Consultant:|Anne Megaro                                          |
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                   Subject:  Carbon sequestration: working lands.

           SUMMARY  :
          This bill would define "carbon farming" and "working lands" and  
          would require the California Department of Food and Agriculture  
          to establish, should moneys be appropriated, a grant program to  
          fund projects on working lands that increase carbon  
          sequestration and greenhouse gas emissions reductions. 

           BACKGROUND AND EXISTING  
          LAW  :
          The Cannella Environmental Farming Act of 1995 requires the  
          California Department of Food and Agriculture (CDFA) to  
          establish and oversee an environmental farming program that  
          provides incentives to farmers whose practices promote the  
          well-being of ecosystems, air quality, and wildlife and their  
          habitat.  The act also created the Scientific Advisory Panel on  
          Environmental Farming (Science Panel) to, among other  
          responsibilities, advise and assist government agencies on these  
          issues by conducting scientific data reviews and approving and  
          recommending scientifically valid data.  In addition, the  
          Science Panel is authorized to research, review, and comment on  
          data used as the basis for proposed environmental policies and  
          regulatory programs so that agricultural activities are  
          accurately portrayed.  The panel also identifies incentives to  
          encourage agricultural practices with environmental benefits.  

          The Strategic Growth Council was created in 2008 as a  
          cabinet-level committee tasked with coordinating the activities  
          of member state agencies to improve air and water quality,  
          protect natural resources and agricultural lands, increase the  







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          availability of affordable housing, promote public health,  
          improve transportation, encourage greater infill and compact  
          development, revitalize community and urban centers, and assist  
          state and local entities in the planning of sustainable  
          communities and meeting AB 32 goals.  Strategic Growth Council  
          members include representatives from the Business, Consumer  
          Services and Housing, Natural Resources, Health and Human  
          Services, and Environmental Protection agencies; the departments  
          of Transportation and Food and Agriculture; the Governor's  
          Office of Planning and Research; and three public members.
          The Affordable Housing and Sustainable Communities Program  
          (AHSC), administered by the Strategic Growth Council, was  
          created in 2014 to reduce greenhouse gas (GHG) emissions through  
          projects that implement land use, housing, transportation, and  
          agricultural land preservation practices.  The AHSC program  
          receives 20% of the annual proceeds from the Greenhouse Gas  
          Reduction Fund to achieve these goals (SB 862 of 2014; Health  
          and Safety Code § 39719).  

          The Sustainable Agricultural Lands Conservation Program (SALC)  
          is one component of the AHSC and is implemented by the  
          California Department of Conservation (DOC).  The Strategic  
          Growth Council is responsible for overseeing SALC and  
          coordinating DOC with other agencies to develop program  
          guidelines.

          Guidelines for the SALC program were approved by the Strategic  
          Growth Council on January 20, 2015, and include three major  
          elements: 1) sustainable agricultural land strategy plans, which  
          would provide grants to develop local strategies to ensure  
          long-term protection of highly productive and critically  
          threatened agricultural land; 2) agricultural conservation  
          easements; and 3) financial incentives for adoption and use of  
          land management practices.  The guidelines specifically state  
          that the third element is not included in the 2014 request for  
          grant applications but will be addressed in future years.

          COMET-FarmTM is an online USDA-Natural Resources Conservation  
          Service tool developed in partnership with Colorado State  
          University.  COMET-farmTM, shorthand for "CarbOn Management &  
          Emissions Tool," was created to estimate carbon sequestration  
          and GHG emissions on individual farms based on various factors  
          such as soil characteristics, crop production, nutrient  
          management, water use, and tillage practices.  This tool would  
          help farmers and ranchers calculate their farm's potential for  








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          storing carbon in agricultural soils and reducing GHG emissions  
          given specific land management and conservation practices.

          Existing law:

             1)   Establishes the California Farmland Conservancy Program  
               Act, previously known as the Agricultural Land Stewardship  
               Program Act of 1995, to encourage voluntary, long-term  
               private stewardship of agricultural lands by offering  
               landowners financial incentives (Public Resources Code §  
               10200 et seq.).

             2)   Establishes the California Farmland Conservancy Program  
               Fund for monies sourced from grants, gifts, and donations,  
               to be used for the purchase of agricultural conservation  
               easements, fee title acquisition grants, land improvement  
               and planning grants, technical assistance, technology  
               transfer, and administrative costs.

             3)   Requires the Department of Conservation to administer  
               this program and review grant applications for the  
               acquisition of agricultural conservation easements or fee  
               title for agricultural lands.

             4)   Requires the CDFA, through the Cannella Environmental  
               Farming Act of 1995, to establish and oversee an  
               environmental farming program that provides incentives to  
               farmers whose practices promote the well-being of  
               ecosystems, air quality, and wildlife and their habitat.  

             5)   Establishes the Scientific Advisory Panel on  
               Environmental Farming (Science Panel) to, among other  
               responsibilities, advise and assist government agencies on  
               the above issues by conducting scientific data reviews and  
               approving and recommending scientifically valid data.  

             6)   Establishes in 2008 the Strategic Growth Council as a  
               cabinet-level committee tasked with coordinating the  
               activities of member state agencies to, among other things,  
               improve air and water quality, protect natural resources  
               and agricultural lands, and assist state and local entities  
               in the planning of sustainable communities and meeting AB  
               32 goals. 

             7)   Requires the state Air Resources Board (ARB), through  








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               the California Global Warming Solutions Act of 2006, to  
               monitor and regulate sources of greenhouse gas emissions  
               that cause global warming in order to reduce emissions of  
               greenhouse gases.  Requires ARB to determine the 1990  
               statewide level of GHG emissions, approve a GHG emissions  
               limit that is equivalent to that level to be achieved by  
               2020, and adopt rules and regulations regarding GHG  
               emissions reductions (AB 32 of 2006; Health and Safety Code  
               § 38500 et seq.).

             8)   Authorizes ARB to utilize market-based compliance  
               mechanisms to regulate entities subject to GHG emission  
               limits.

             9)   Creates the Greenhouse Gas Reduction Fund (GGRF) to  
               collect all monies, except for fines and penalties, from  
               the auction or sale of GHG allowances established by the  
               ARB market-based compliance mechanism and authorizes the  
               legislature to appropriate monies from this fund  
               (Government Code § 16428.8).

             10)  Requires that the GGRF only be used to facilitate the  
               achievement of reductions of GHG emissions in California,  
               as specified (Health and Safety Code § 39710 et seq.).

           PROPOSED  
          LAW  :

          This bill:

             1)   States findings and declarations in regards to soil and  
               vegetation management to enhance soil carbon sequestration.

             2)   Defines "carbon farming" to mean implementing a land  
               management strategy for the purposes of reducing,  
               sequestering, and mitigating GHG emissions on working  
               lands.

             3)   Defines "working lands" to mean privately owned  
               agricultural lands, ranches, and rangelands.

             4)   Requires CDFA, should funds be made available, to  
               establish a grant program to fund projects on working lands  
               that increase carbon sequestration and reduce GHG  
               emissions.








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             5)   Requires CDFA to prioritize funding for projects that  
               provide the greatest benefit, including carbon farming and  
               related co-benefits such as reduced irrigation demand,  
               increased yield and resiliency, enhanced habitat and  
               biodiversity, reduced water quality impacts, enhanced soil  
               structure, and increased soil water-holding capacity.

             6)   Requires CDFA, in consultation with the Department of  
               Conservation, the Department of Resources Recycling and  
               Recovery, the state Air Resources Board, and the Department  
               of Water Resources, to develop and adopt project  
               solicitation and evaluation guidelines.

             7)   Requires CDFA to quantify the benefits of each project  
               funded and to post this information on the department's  
               website.

           ARGUMENTS IN SUPPORT:
           According to those in support, "Carbon farming practices include  
          compost application, riparian restoration, no-till farming, and  
          planting windbreaks to reduce soil moisture loss, all of which  
          help to create long-term carbon sequestration in soils and plant  
          matter.  Through carbon farming, agricultural lands and  
          rangelands can improve carbon capture and sequestration while  
          creating additional water, habitat, and economic viability  
          benefits for farmers and working land managers."

          According to the California Cattlemen's Association, "AB 761  
          will promote further research to determine what management  
          practices are most effective in sequestering carbon and  
          determine what practices are most feasible and cost effective to  
          implement. The ongoing demand for carbon credits in both the  
          regulatory and voluntary arena drives the need to develop more  
          specific data relative to agriculture's role in carbon  
          sequestration."

           COMMENTS  :

          Agriculture and Climate Change.  Farmers and ranchers are  
          uniquely sensitive to the effects of climate change as  
          agriculture is largely dependent upon weather and the  
          availability of natural resources.  For example, the current  
          multi-year drought has caused many farmers to fallow fields,  
          sell livestock due to lack of available grazing, and lay off  








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          employees due to reduced workload and productivity. 

          The potential for agriculture to contribute to the mitigation of  
          climate change by sequestering carbon and reducing GHG emissions  
          is not fully realized or utilized.  Plants absorb CO2 from the  
          atmosphere and use it to grow, produce fruits and vegetables,  
          and to also store carbon in the soil.  Animals produce manure  
          that could be used to create energy (through methane digesters),  
          compost, and several other valuable products, while reducing the  
          emission of methane and other GHG.  Land management practices,  
          such as drip irrigation, reduced land tilling, nitrogen  
          management, and the use of cover crops, have been and are  
          continuing to be adopted to reduce negative effects on the  
          environment.  

          Healthy Soils Initiative. In his 2015-16 budget proposal,  
          Governor Brown included a new "Healthy Soils Initiative" to  
          increase carbon in soil to improve soil health, agricultural  
          productivity, soil water-holding capacity, and decreased  
          sediment erosion.  Governor Brown directed CDFA, under its  
          existing authority provided by the Cannella Environmental  
          Farming Act, to coordinate with other key agencies to work on  
          several new initiatives.  CDFA has since developed five action  
          measures: protect and restore soil carbon; identify funding  
          opportunities, including market development; provide research,  
          education and technical support; increase governmental  
          efficiencies to enhance soil health on public and private lands;  
          and ensure interagency coordination and collaboration.

          Marin Carbon Project.  The Marin Carbon Project was designed to  
          demonstrate on-farm practices that enhance carbon sequestration,  
          land productivity, ecosystem functions, and mitigate climate  
          change.  One component of this project was published in 2013 by  
          R. Ryals and W.L. Silver in Ecological Applications.  This study  
          applied 1.3 cm ( inch) of compost on grasslands in Marin County  
          and measured carbon storage in soils over a three-year period.   
          The authors concluded that a single application of compost  
          resulted in greater carbon storage over time.  AB 761 would fund  
          projects that demonstrate carbon farming and sequestration;  
          however, the use of compost is just one of several methods to  
          achieve these goals.  Others include the use of biochar, cover  
          crops, windbreaks, irrigation practices, and reduced land  
          tilling.

          SB 367(Wolk).  This bill is similar to SB 367, currently in the  








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          Assembly Agriculture Committee, in that it would create a grant  
          program established by CDFA to fund on-farm projects that  
          increase soil carbon sequestration and reduce GHG emissions.  AB  
          761 would expand upon the component of SB 367 regarding on-farm  
          projects that demonstrate soil-building and carbon-sequestration  
          practices.  Should these bills move forward, the respective  
          authors may wish to harmonize these bills to ensure that they  
          are not in conflict, for example, using similar terminology,  
          definitions, and adjacent code sections.

          Double-referral. The Senate Rules Committee has double referred  
          this bill to the Senate Committee on Environmental Quality as  
          the second committee of referral.  Therefore, if this measure is  
          approved by this committee, the motion should include an action  
          to re-refer the bill to the Senate Committee on Environmental  
          Quality.

           RELATED  
          LEGISLATION  :
          SB 367 (Wolk) of 2015, currently in the Assembly Agriculture  
          Committee, would recast and expand the membership and the duties  
          of CDFA's Science Advisory Panel on Environmental Farming; would  
          appropriate $25 million from the Greenhouse Gas Reduction Fund  
          to CDFA for the establishment of a new grant program to support  
          on-farm practices that reduce GHG emissions and increase carbon  
          storage in soil; and would appropriate 2% of the proceeds from  
          this fund to the Sustainable Agricultural Lands Conservation  
          Program for these activities.

          AB 1826 (Chesbro), Chapter 727, Statutes of 2014.  Requires  
          businesses that generate a specified amount of organic waste per  
          week to arrange for recycling services. 

          SB 862 (Committee on Budget and Fiscal Review), Chapter 36,  
          Statutes of 2014.  Among other provisions, establishes the  
          Affordable Housing and Sustainable Communities Program,  
          administered by the Strategic Growth Council, to reduce GHG  
          emissions through projects that implement land use, housing,  
          transportation, and agricultural land preservation practices.

          SB 732 (Steinberg), Chapter 729, Statutes of 2008.  Establishes  
          the Strategic Growth Council to coordinate member state agencies  
          implementing projects to meet the goals of the California Global  
          Warming Solutions Act of 2006.                         









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          AB 32 (Nunez/Pavley et al.), Chapter 488, Statutes of 2006.   
          Establishes the California Global Warming Solutions Act of 2006.  
           Requires ARB to monitor and regulate sources of GHG emissions  
          that cause global warming in order to reduce emissions of GHG,  
          as specified.

           PRIOR  
          ACTIONS  :
                         
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          |Assembly Floor:                       |67 - 11                    |
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          |Assembly Appropriations Committee:    |13 - 0                     |
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          |Assembly Natural Resources Committee: |8 - 1                      |
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           SUPPORT  :
          Audubon California
          Big Sur Land Trust
          California Cattlemen's Association
          California Compost Coalition
          California Farm Bureau Federation
          California League of Conservation Voters
          California State Grange
          The California Rangeland Trust
          California Trout
          Californians Against Waste
          Carbon Cycle Institute
          City and County of San Francisco
          Clean Water Action
          Environmental Action Committee of West Marin
          Land Trust of Santa Cruz County
          Peninsula Open Space Trust
          Planning and Conservation League
          Recology
          Santa Clara Valley Open Space Authority

           OPPOSITION  :
          None received

                                      -- END --
          









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