BILL ANALYSIS Ó AB 1202 Page 1 Date of Hearing: May 13, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 1202 (Mayes) - As Amended May 5, 2015 ----------------------------------------------------------------- |Policy |Natural Resources |Vote:|9 - 0 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill requires the Board of Forestry and Fire Protection (Board) to reduce the amount of the fire prevention fee (SRA) by an amount equal to the amount paid to a local fire district for fire prevention in the state responsibility areas. AB 1202 Page 2 Additionally, this bill requires the Board to adopt guidelines to clarify the type of written documentation the owner of a structure is required to provide in order to receive the fee reductions. FISCAL EFFECT: 1)Significant reduction in fire prevention fee revenues, potentially in the tens of millions of dollars annually (SRA Fire Prevention Fund). The Board of Equalization (BOE) estimates approximately 98% of structures subject to the feeare located in an area that provides local fire protection services. This bill will likely result in partial fee reduction, at least, for nearly all structures subject to the fire prevention fee, which would substantially diminish the $76.9 million in fee revenue CAL FIRE anticipates in 2015-16. 2)General Fund pressure of an unknown amount, potentially in the tens of millions of dollars, in 2015-16 to fund fire prevention activities at CAL FIRE and the California Conservation Corps (CCC) that otherwise would be funded by the fire prevention fee. 3)Unknown administrative costs, potentially in the hundreds of thousands of dollars,for the Board to adopt guidelines to implement the program. COMMENTS: AB 1202 Page 3 1)Purpose. According to the author, property owners who are already paying a special tax for these services at the local level should not also have to pay for them at the state level. This bill provides a reduction in the SRA fee in the amount paid to local districts. 2)Background. The state is responsible for wildland fire protection in the SRA which are generally defined to include most nonfederal timberlands, rangelands and watersheds thinly populated and not within the boundaries of a city. Over 31 million acres, much privately owned, are located in SRA. In the past, SRA lands were largely unpopulated. In recent years, however, local governments have allowed increased housing development in SRA but at a level of density that maintains the state's obligation to provide wildland fire protection. As housing development in SRA increased, so did state fire protection costs. In 1996-97, the department spent $475 million on fire protection; in more recent years, CALFIRE's annual fire protection costs neared or surpassed $1 billion. The Legislative Analyst's Office (LAO) attributes much of the increase in CALFIRE's fire protection costs to increased housing development in SRA. The LAO notes that as housing development in SRA has increased, the department has spent greater resources responding to events other than wildfires for which the state is not legally responsible, such as structural fires and medical emergencies. Because the LAO concludes that much of CALFIRE's nonwildfire activities provide private benefits, LAO has long recommended a fee on owners of private land in SRA to pay for a portion of CALFIRE's fire protection costs. 3)SRA Fire Protection Fees. In 2011 the Legislature passed ABx1 AB 1202 Page 4 29 (Blumenfield), requiring the Board of Forestry and Fire Protection to adopt emergency regulations to establish a fire prevention fee. The fee, not to exceed $150 on each structure, was to raise $50 million to fund CALFIRE fire prevention activities. In January 2012, the board issued its regulation, establishing a fee of $150 per habitable structure on a parcel located within SRA, with a $35 reduction for each habitable structure that is also within the boundaries of a local agency that provides fire protection services. Revenues from the fee are to be used exclusively for fire protection. In authorizing the fee, the Legislature recognized that individual owners within SRA received a disproportionately larger benefit from fire prevention activities than realized by the state's residents generally. As required by law, the fee was adjusted for inflation and is currently $152.33 per habitable structure outside a fire protection district and $117.33 for habitable structures within a fire protection district. According to the Board of Equalization website, approximately 98% of habitable structures in the SRA are covered by a local fire protection agency resulting in most bills amounting to $117.33 per habitable structure. 4)Local fire protection. There are many different districts and many of them charge the public for fire protection and prevention. District rates have a high degree of variance with some less than the $35 reduction and some more than the $150 fire fee. The fees assessed by districts can also be assessed by parcel, single family, or by the use of the parcel. Districts combine their fire protection and fire prevention services in one fee. In contrast, the SRA fee is one set amount for the whole state, is charged by habitable structure, and only covers fire prevention. AB 1202 allows the owner to provide written documentation of what they pay to a district to receive a reduction in their SRA fee AB 1202 Page 5 Analysis Prepared by:Jennifer Galehouse / APPR. / (916) 319-2081