BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session AB 1071 (Atkins) - Supplemental environmental projects. ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: August 18, 2015 |Policy Vote: E.Q. 7 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: August 24, 2015 |Consultant: Marie Liu | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: This bill would require each of the boards, departments, and offices (BDOs) of the California Environmental Protection Agency (CalEPA) to establish a policy on the use of supplemental environmental projects (SEPs) that benefit disadvantaged communities that may be voluntarily undertaken to offset a civil penalty. Fiscal Impact: Unknown lost revenues, likely in the millions of dollars, to various special funds as a result of penalty reductions as a result of SEPs. Minor and absorbable costs to various special funds for the BDOs to oversee SEPs. Background: Under existing law, penalties for violations of environmental laws can be partially offset by a commitment to undertake an AB 1071 (Atkins) Page 1 of ? SEP. Under CalEPA's recommended guidance on SEPs, released in 2003, SEPs must improve, protect, or reduce risks to public health or the environment at large. The enforcing agency is required to help shape the scope of the project prior to approval, though the project must remain a voluntary action that the defendant is not legally required to perform. There must also be a relationship between the violation and the SEP. For example, the SEP may remediate or reduce the environmental or public health impacts of the violations. Various CalEPA BDOs have adopted their own SEP policies since the release of the CalEPA guidelines. Proposed Law: This bill would require each of the BDOs within CalEPA to adopt a policy on SEPs that include the following: A public process to solicit potential SEPs from disadvantaged communities Allowance for the amount of SEP to be up to 50% of the enforcement action A consideration of the relationship between the location of the violation and the location of the proposed SEP An annual list of SEPs that may be used to settle a portion of an enforcement actions. This bill would require CalEPA to post a list of adopted SEPs on its website. Staff Comments: CalEPA anticipates that the cost for its BDOs to create the required policies or to amend an existing policy to conform with the requirements of the bill is minor and absorbable. By requiring the establishment of a policy that allows up to 50% AB 1071 (Atkins) Page 2 of ? of an enforcement action to be satisfied by a SEP, this bill will likely result in decreased penalty revenues to various special funds in the millions of dollars. The BDOs may also have some costs to oversee the additional SEPs that are likely to be adopted by the creation of a SEP policy. These costs are likely to be minor and absorbable or covered by penalty settlement terms. -- END --