BILL ANALYSIS                                                                                                                                                                                                    Ó






           ----------------------------------------------------------------- 
          |SENATE RULES COMMITTEE            |                        AB 864|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |
           ----------------------------------------------------------------- 


                                   THIRD READING 


          Bill No:  AB 864
          Author:   Williams (D) and Burke (D), et al.
          Amended:  9/4/15 in Senate
          Vote:     21  

           SENATE NATURAL RES. & WATER COMMITTEE:  8-1, 7/14/15
           AYES:  Pavley, Stone, Allen, Hertzberg, Hueso, Jackson,  
            Monning, Wolk
           NOES:  Vidak

           SENATE APPROPRIATIONS COMMITTEE:  5-2, 8/27/15
           AYES:  Lara, Beall, Hill, Leyva, Mendoza
           NOES:  Bates, Nielsen

           ASSEMBLY FLOOR:  62-14, 5/18/15 - See last page for vote

           SUBJECT:   Oil spill response:  environmentally and  
                     ecologically sensitive areas


          SOURCE:    Author

          DIGEST:   This bill requires pipelines to have the best  
          available technology to reduce the amount of oil released in an  
          oil spill to protect state waters and wildlife.

          Senate Floor Amendments of 9/4/15 (1) delete provisions related  
          to pipelines in the Lempert-Keene-Seastrand Oil Spill Prevention  
          and Response Act, (2) delete the severability provision, and (3)  
          revise the standard to best available technology for automatic  
          leak detection and related systems on pipelines under the  
          jurisdiction of the Office of State Fire Marshal.









                                                                     AB 864  
                                                                    Page  2


          ANALYSIS: 
          
          Existing federal law:

          1)Provides that pipelines in interstate service are under the  
            jurisdiction of the Pipeline and Hazardous Materials Safety  
            Administration.

          2)Provides for the protection of the waters of the United States  
            from contamination through the Clean Water Act, among others.

          3)Addresses oil spills in the navigable waters of the United  
            States through the creation of a comprehensive prevention,  
            response, liability and compensation program through the Oil  
            Pollution Act of 1990, as amended.

          Existing state law:

          1)Provides that pipelines used to transport oil (i.e. in  
            hazardous liquid service) outside of oil and gas fields in  
            intrastate service are under the jurisdiction of the Office of  
            the State Fire Marshal.  The Elder California Pipeline Safety  
            Act (Elder Act) also authorizes the Office of the State Fire  
            Marshal to exercise safety regulatory jurisdiction over  
            portions of interstate pipelines located within the state and  
            subject to an agreement between the United States Secretary of  
            Transportation and the Office of the State Fire Marshal.

          2)Provides that contaminating waters of the state is illegal  
            under various statutes.

          This bill amends the Elder Act to require that pipelines under  
          the Office of the State Fire Marshal's jurisdiction to:

          1)Require by January 1, 2018, that any new or replacement  
            pipeline near environmentally and ecologically sensitive areas  
            in the coastal zone shall use best available technology in  
            order to reduce the amount of oil released in a spill to the  
            environment.

          2)Define best available technology for a given pipeline based  
            upon a risk analysis performed by the operator:

             a)   Require best available technology in this context to  







                                                                     AB 864  
                                                                    Page  3


               include leak detection technology, automatic shutoff  
               systems or remote controlled sectionalized block values or  
               any combination thereof, as specified.

             b)   Require the Office of the State Fire Marshal to  
               determine the best available technology, as specified.

          1)Require by July 1, 2018, that any operator of an existing  
            pipeline near environmentally and ecologically sensitive areas  
            in the coastal zone submit a plan to retrofit these pipelines  
            with best available technology, as defined, by January 1,  
            2020.

          2)Allow the operator to request confidential treatment by the  
            Office of the State Fire Marshal of certain information  
            provided in the risk analysis, as specified.

          3)Require the State Fire Marshal to adopt regulations to  
            implement the changes to the Elder Act by July 1, 2017, as  
            specified.

          4)Require the State Fire Marshal to consult with the Office of  
            Spill Prevention and Response (OSPR) in the Department of Fish  
            and Wildlife about potential impacts to state water and  
            wildlife from oil spills.

          5)Require an operator to notify the Office of the State Fire  
            Marshal of any new construction of retrofit of a pipeline in  
            waters near environmentally and ecologically sensitive areas  
            in the coastal zone.

          Background
          
          May 2015 Refugio Beach spill. On May 19, 2015 a pipeline owned  
          by Houston-based Plains All American Pipeline ruptured spilling  
          approximately 130,000 gallons of heavy crude oil along the  
          Gaviota coast at Refugio Beach in Santa Barbara County.  The  
          release was from a 10.6 mile long, 24-inch diameter pipeline and  
          (according to the operator) as much as 21,000 gallons of oil  
          ended up in coastal waters.  News reports indicate the pipeline  
          was potentially severely corroded where it ruptured.  The spill  
          and events leading up to the spill remain under investigation.

          The pipeline responsible for this spill transports oil that was  







                                                                     AB 864  
                                                                    Page  4


          produced on offshore platforms in state and federal waters  
          onshore for refining.  The pipeline was not equipped with  
          automatic shut off technology that is installed on other  
          pipelines of this size in Santa Barbara County.  Regulation of  
          this pipeline, as the result of an earlier lawsuit, was limited  
          to the federal level. 

          The main oil spill stretched over nine miles of California  
          coastline and tar balls associated with the spill were found,  
          according to news reports, as far south as Los Angeles County.   
          Shoreline and beaches were affected by the spill and nesting  
          areas for protected species were also affected.  Approximately  
          250 birds and 170 mammals in addition to a large number of  
          marine invertebrates were known to be impacted by the spill.   
          Although some of the birds and mammals have been released  
          following treatment, most are dead.  A 23 mile by six mile area  
          was closed to fishing for over one month and beaches were  
          closed, including over the Memorial Day weekend, resulting in  
          economic losses.

          Comments

          Late amendments and support.  Given the late amendments to this  
          bill, the list of support was verified for a prior version of  
          the bill.  No organizations listed in support have submitted  
          letters changing their position or indicated to committee staff  
          that a change in position is imminent.
          
          Related Legislation
          
          SB 295 (Jackson, 2015) requires annual inspections of pipelines,  
          among other provisions. The bill has returned to the Senate for  
          concurrence. 

          SB 414 (Jackson, 2015) updates OSPR to respond to the Refugio  
          Beach spill.  The bill is on the Assembly Floor.

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   Yes

          According to the Senate Appropriations Committee (for a previous  
          version of this bill):

           Initial costs of $1.69 million followed by $1.37 million  







                                                                     AB 864  
                                                                    Page  5


            annually ongoing to the California Hazardous Liquid Pipeline  
            Safety Fund (special) for the Office of the State Fire Marshal  
            to develop and implement regulations on best achievable  
            technology. 

           Unknown ongoing costs, likely in the mid-hundreds of thousands  
            to the Oil Spill Prevention and Administration Fund (special)  
            for OSPR to advise operators on best achievable technology,  
            evaluate contingency plans, and develop required regulations.

           Unknown costs to the California Hazardous Liquid Pipeline  
            Safety Fund (special) and the Oil Spill Prevention and  
            Administration Fund (special) for the Office of the State Fire  
            Marshal and OSPR to coordinate, potentially under a memorandum  
            of understanding.


          SUPPORT:   (Verified9/4/15)


          Audobon California
          Azul
          California Coastal Commission
          California Coastal Protection Network
          California Coastkeeper Alliance
          California League of Conservation Voters
          Carpinteria Valley Association
          Center for Biological Diversity
          Citizens Planning Association of Santa Barbara County
          Clean Water Action
          Coastal Environmental Rights Foundation
          Community Environmental Council
          Defenders of Wildlife
          Environment California
          Environmental Action Committee of West Marin
          Environmental Defense Center
          Environmental Defense Fund
          Friends of the Earth
          Gaviota Coast Conservancy
          Get Oil Out!
          Heal the Bay
          Heal the Ocean
          Los Angeles Waterkeeper
          Natural Resources Defense Council







                                                                     AB 864  
                                                                    Page  6


          Ocean Conservancy
          Orange County Coastkeeper
          Pacific Environment
          San Francisco Baykeeper
          Santa Barbara Audobon
          Santa Barbara Channelkeeper
          Santa Barbara County Action Network
          Santa Barbara County Board of Supervisors
          Sierra Club California
          Surfrider Foundation
          Surfrider Foundation, Santa Barbara Chapter
          Surfrider Foundation, South Bay Chapter
          Surfrider Foundation, West LA/Malibu Chapter
          The Fund for Santa Barbara
          The Wildlands Conservancy
          Ventura Audobon
          Ventura Coastkeeper
          Wholly H2O
          Wildcoast
          Wishtoyo Foundation


          OPPOSITION:   (Verified9/4/15)


          None received

          ARGUMENTS IN SUPPORT:   According to the author, "[a] recent oil  
          spill at Refugio Beach, in Santa Barbara County, has devastated  
          the local environment due to lack of detection and slow response  
          times. [?] Unfortunately, it appears the pipeline was not  
          properly equipped with automatic shut off technology, and there  
          were delays in communication with first responders."

          "Had the oil pipeline been equipped with automatic shut off  
          valves or remote controlled sectionalized block valves, the  
          impact of the oil spill would have been controlled and limited.  
          Instead, we're left cataloguing the negative effects to our  
          environment and economy."

          "California coast and ocean are among our most treasured  
          resources. The productivity, wildness and beatify found here is  
          central to California's identity, heritage and economy.  
          California leads the nation and the world in coastal and  







                                                                     AB 864  
                                                                    Page  7


          wildlife protection. Early oil spill detection technology and  
          automatic shut off controls are critical tools in preserving  
          California's ocean waters, coast line, and wildlife."
           

          ASSEMBLY FLOOR:  62-14, 5/18/15
          AYES:  Achadjian, Alejo, Baker, Bloom, Bonilla, Bonta, Brown,  
            Burke, Calderon, Campos, Chau, Chávez, Chiu, Chu, Cooley,  
            Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Cristina  
            Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,  
            Gordon, Gray, Hadley, Roger Hernández, Holden, Irwin,  
            Jones-Sawyer, Levine, Linder, Lopez, Low, Maienschein,  
            McCarty, Medina, Mullin, Nazarian, O'Donnell, Olsen, Perea,  
            Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas, Santiago,  
            Steinorth, Mark Stone, Thurmond, Ting, Waldron, Weber,  
            Williams, Wood, Atkins
          NOES:  Travis Allen, Bigelow, Brough, Chang, Beth Gaines,  
            Gallagher, Grove, Harper, Jones, Lackey, Obernolte, Patterson,  
            Wagner, Wilk
          NO VOTE RECORDED:  Kim, Mathis, Mayes, Melendez

          Prepared by:Katharine Moore / N.R. & W. / (916) 651-4116
          9/8/15 20:56:36


                                   ****  END  ****