BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 2446| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 2446 Author: Gordon (D) Amended: 8/1/16 in Senate Vote: 21 SENATE ENVIRONMENTAL QUALITY COMMITTEE: 5-2, 6/15/16 AYES: Wieckowski, Hill, Jackson, Leno, Pavley NOES: Gaines, Bates SENATE JUDICIARY COMMITTEE: 5-2, 6/28/16 AYES: Jackson, Hertzberg, Leno, Monning, Wieckowski NOES: Moorlach, Anderson SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8 ASSEMBLY FLOOR: 50-23, 5/23/16 - See last page for vote SUBJECT: State Water Resources Control Board: judicial review SOURCE: State Water Resources Control Board DIGEST: This bill expands the authority of the State Water Resources Control Board (SWRCB), and to a lesser extent regional boards, to issue or not issue a stay pending board proceedings, prohibits certain judicial challenges to water board decisions until after the administrative process has run its course, and clarifies two specified evidentiary requirements. ANALYSIS: Existing law: AB 2446 Page 2 1)Enacts the Porter-Cologne Water Quality Act (Porter-Cologne Act) which: a) Makes SWRCB and nine regional water quality control boards (regional boards) responsible for protecting the quality of the state's waters by: issuance of discharge permits, clean up and abatement orders to any person who causes or permits waste to be discharged into state water, and cease and desist orders to address violations, or threatened violations, of waste discharges. b) Authorizes within 30 days of any action or failure to act by a California regional water quality control board under specified law, an aggrieved person to petition SWRCB to review that action or failure to act. c) Authorizes SWRCB, in the case of such a review, upon notice and hearing, if a hearing is requested, to stay in whole or in part the effect of the decision and order of a regional board or of the state board. d) Authorizes an aggrieved party to file with the superior court a petition for writ of mandate for review of a decision or order issued by SWRCB or a regional board, and governs those proceedings. e) Requires the court to exercise its independent judgment on the evidence in cases involving the judicial review of a decision or order of the state board, or a decision or order of a regional board for which the state board denies review under the Act. 2)Enacts the California Safe Drinking Water Act (SDWA) which: AB 2446 Page 3 a) Requires SWRCB to administer provisions relating to the regulation of drinking water to protect public health by: conducting research, studies, and demonstration programs relating to the provision of a dependable, safe supply of drinking water, enforcing the federal Safe Drinking Water Act, and adopting and enforcing regulations. b) Requires SWRCB to appoint a deputy director to oversee the issuance and enforcement of public water system permits and delegates certain authorities of SWRCB to the deputy director. c) Authorizes the deputy director to issue an order directing certain actions whenever the deputy director determines that a person has violated or is violating SDWA, or any permit, regulation, or standard issued or adopted pursuant to SDWA. d) Authorizes an aggrieved party 30 days after service of a copy of the order or decision to file with the superior court a petition for a writ of mandate for review of the order or decision. e) Requires that the evidence before the court consist of all relevant evidence that, in the judgment of the court, should be considered to effectuate and implement SDWA and requires, in every case, the court to exercise its independent judgment on the evidence. f) Prohibits a failure to file an action from precluding a party from challenging the reasonableness and validity of the decision or order in specified judicial proceedings. This bill expands the authority of SWRCB, and to a lesser extent regional boards, to issue or not issue a stay pending board AB 2446 Page 4 proceedings, prohibits certain judicial challenges to water board decisions until after the administrative process has run its course, and clarifies two specified evidentiary requirements. Specifically, this bill: 1)Expands a provision of existing law authorizing the SWRCB-in response to a petition to review an order of a regional water board, to stay the effect of a decision or order of the state or regional water board-to additionally allow the SWRCB to stay an order or decision issued under authority delegated to an officer or employee of the SWRCB. 2)Requires the SWRCB to issue or deny the stay within 90 days, or within 45 days if the request for a stay relates to a water quality certification associated with a hydroelectric facility requiring a license issue by the Federal Energy Regulatory Commission. If the board fails to meet these deadlines, the request for a stay is deemed denied. 3)Authorizes an aggrieved party, within 30 days of any order of the SWRCB issuing or denying a stay or within 30 days of the board failing to issue or deny a stay, to file with the superior court a petition for writ of mandate for review of the board's order or lack thereof. 4)Specifies that in any civil action brought pursuant to the Porter-Cologne Act in which a regional water board or the SWRCB seeks an injunction or restraining order, it shall not be necessary to allege or prove that irreparable harm will occur should the temporary restraining order, preliminary injunction, or permanent injunction not be issued. 5)Provides that for any order or decision of the SWRCB under the SDWA, if no aggrieved party petitions for a writ of mandate within the 30-day period authorized by the Act, the decision or order of the board is not subject to review by any court. AB 2446 Page 5 Background Under the Porter-Cologne Act, SWRCB has ultimate authority to regulate water quality in the state. Porter-Cologne Act also established nine regional water boards to oversee water quality on a day-to-day and regional basis. Among the key tools available to the state and regional water boards are the power to issue or deny water discharge permits, issue clean-up and cease and desist orders to polluters, and issue stays against harmful conduct and discharges while a matter is pending before the board. This bill deals primarily with the ability of persons subject to such orders to challenge those orders. Existing law sets out prescribed procedures and timelines that the state and regional water boards must conform to, including noticing hearings, making decisions, and issuing orders designed to protect water quality. Existing law also sets forth procedures and timelines that persons aggrieved by an order or decision must conform to when challenging those orders and decisions. Comments 1)Purpose of Bill. According to SWRCB, the sponsor, AB 2446 will "clarify the procedures for administrative and judicial review of . . . actions taken by the State Water Board and Regional Water Boards (collectively referred to as the Water Boards.)" SWRCB argues that this bill will "result in increased program efficiency by reducing ambiguities in statute that result in premature legal challenges and substantial delays in the Water Boards' abilities to take necessary and appropriate actions to protect water quality." SWRCB also argues that the provisions of this bill will clarify the intent of existing law. For example, it claims that a provision in existing law which provides that the boards need not show irreparable harm in seeking an injunction or a restraining order does not mean that a party seeking an injunction against the boards is excused from showing irreparable harm. Finally, SWRCB argues that this will also AB 2446 Page 6 clarify that a party wishing to challenge a board cannot seek judicial review before a board has taken action and the required administrative review process has been exhausted. According to background material provided by the author and sponsor, one of the more vexing problems water boards sometimes face is the efforts of dischargers and polluters to delay board proceedings, both state and regional, and to seek injunctions and court orders overturning or staying a board order even before the administrative process runs its course. That is, under existing law, a state or regional water board has the authority to issue or deny waste discharge permits and to take actions against those who violate the conditions of the permit or other laws or regulations. For example, if a regional water board issues an order to halt a permittee from discharging waste, the person aggrieved - the person subject to the order - may file a petition with SWRCB for "reconsideration" of a board's decision. Only after the administrative process is complete, would the aggrieved party be permitted to seek a court order. However, the sponsor, SWRCB, contends that some dischargers have exploited "ambiguities" in existing law to seek injunctions that delay board proceedings or seek judicial review to overturn a board decision. 2)Evidentiary changes. AB 2446 provides two clarifications with regard to SWRCB actions before the court. First, under an existing provision of SDWA, when a review of the SWRCB action comes before the court, "the evidence before the court shall consist of all relevant evidence that, in the judgment of the court, should be considered to effectuate and implement the provisions [of the Safe Drinking Water Act]. In every case, the court shall exercise its independent judgment on the evidence." (Health & Saf. Code Sec. 116700 (b).) This bill deletes everything except the final sentence: "In every case, the court shall exercise its independent judgment on the evidence." AB 2446 Page 7 The "independent judgment" standard of review, which is both the existing standard and the standard proposed by this bill, is usually contrasted with the "substantial evidence" standard of judicial review when a court considers a petition for a writ of administrative mandate. Generally speaking, under the "substantial evidence" rule, the court is more deferential to the findings of the agency, asking only if the decision was reasonable in light of the evidence before it. However, the "independent judgment" rule is much less deferential to the agency, allowing the court to use its "independent judgement on the evidence." (See e.g. Code Civ. Proc. 1094.5 (c).) This bill makes it clear that the independent judgment rule is the appropriate standard with a clear simple statement. Second, this bill clarifies when a party seeking an injunction needs to show "irreparable harm." As a general rule, a key requirement for obtaining an injunction is to show that without the injunction, the party seeking the injunction will suffer "irreparable harm." However, the Porter-Cologne Act creates an exception to this rule, providing that in any civil action brought under the Act in which a temporary restraining order or an injunction is sought, "it shall not be necessary to allege or prove at any stage of the proceeding that irreparable damage will occur should the temporary restraining order, preliminary injunction, or permanent injunction not be issued." (Wat. Code Sec. 13361 (c).) The sponsor argues that this section was intended to ensure that the water boards do not need to show irreparable harm before enjoining a harmful or potentially harmful contamination of the water supply. To ensure that the section will not be interpreted to relieve a party seeking an injunction against the water board from showing irreparable harm, this bill clarifies that only when "a regional board or the state water board" seeks an injunction is a showing of irreparable harm not required. This clarification is consistent with existing law which charges the boards with protecting the state's water from harm by preventing contamination. Thus, to require the boards to prove AB 2446 Page 8 irreparable harm before it could issue an injunction to prevent harm would be unreasonable. 3)Concerns raised to a prior version of this bill. A coalition of farm groups opposed an earlier version of this bill arguing that it "would significantly expand the [State Water Board's] authority and discretion by circumscribing judicial review of that authority." Amendments taken on May 10, 2016, addressed these concerns and the coalition, save for one group, removed their opposition. The Turlock Irrigation District, in its letter of opposition from April 18, 2016, wrote: "Under the federal Clean Water Act Section 401, a federal agency such as Federal Energy Regulation Commission cannot issue a new permit or license until a state's water quality agency issues a certificate - called a 401 certificate - stating that the new permit or license will comply with the applicable water quality requirements. In California, the SWRCB issues 401 certificates for hydroelectric projects. The SWRCB has delegated the author to issue these certificates to its Executive Director, who can issue certificates without any public process. These certificates may cost tens of millions of dollars, including fish passage and increased river flows. Project owners [?] can seek reconsideration by the SWRCB itself of a 401 certificate issued by its Executive Director, but there is no deadline for the SWRCB to complete reconsideration. [?] In its current form, AB 2446 would require a hydroelectric project owner to wait until the SWRCB itself completes its reconsideration before going to court." It appears as though the hydroelectric permitting process falls under Division 2 of the Water Code, while this bill would apply to proceedings under Division 7 of the Water Code. Thus, this bill would arguably not have any effect on the Turlock Irrigation District's ability to enjoin the water right adjudicatory proceedings noted in its letter. AB 2446 Page 9 FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No SUPPORT: (Verified7/27/16) State Water Resources Control Board (source) Sierra Club California OPPOSITION: (Verified7/27/16) The Turlock Irrigation District ASSEMBLY FLOOR: 50-23, 5/23/16 AYES: Alejo, Atkins, Baker, Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Campos, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Daly, Dodd, Frazier, Cristina Garcia, Eduardo Garcia, Gipson, Gomez, Gonzalez, Gordon, Roger Hernández, Holden, Irwin, Jones-Sawyer, Levine, Lopez, Low, Maienschein, McCarty, Medina, Mullin, Nazarian, O'Donnell, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone, Thurmond, Ting, Weber, Williams, Wood, Rendon NOES: Achadjian, Travis Allen, Bigelow, Brough, Chang, Chávez, Beth Gaines, Gallagher, Gatto, Gray, Grove, Harper, Jones, Kim, Lackey, Linder, Mathis, Mayes, Melendez, Obernolte, Olsen, Wagner, Wilk NO VOTE RECORDED: Arambula, Dahle, Eggman, Hadley, Patterson, Steinorth, Waldron Prepared by:Rachel Machi Wagoner / E.Q. / (916) 651-4108 8/3/16 19:36:06 **** END **** AB 2446 Page 10