BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                       AB 2446|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
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                                   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:  








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          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: 









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             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  








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          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.









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          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  








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            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."  









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            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  








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            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.  








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


          SUPPORT:   (Verified8/10/16)


          State Water Resources Control Board (source)
          Sierra Club California


          OPPOSITION:   (Verified8/10/16)


          None received

          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
          8/10/16 11:24:59


                                   ****  END  ****









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