BILL ANALYSIS                                                                                                                                                                                                    

                                                                    AB 2781

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          Date of Hearing:  April 18, 2016


                                 Das Williams, Chair

          AB 2781  
          (Eduardo Garcia) - As Amended April 7, 2016

          SUBJECT:  Supplemental environmental projects

          SUMMARY:  Directs 10% of all penalties collected by California  
          Environmental Protection Agency (CalEPA) boards, departments,  
          and offices to fund environmental projects in disadvantaged  

          EXISTING LAW:  

          1)Defines "environmental justice" to mean the fair treatment of  
            people of all races, cultures, and incomes with respect to the  
            development, adoption, implementation, and enforcement of  
            environmental laws, regulations, and policies.

          2)Defines "environmental justice community" as a community  
            identified by CalEPA based on geographic, socioeconomic,  
            public health, and environmental hazard criteria, including: 

             a)   Areas disproportionately affected by environmental  
               pollution and other hazards that can lead to negative  
               public health effects, exposure, or environmental  


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               degradation; and, 

             b)   Areas with concentrations of people that are of low  
               income, high unemployment, low levels of homeownership,  
               high rent burden, sensitive populations, or low levels of  
               educational attainment. 

          3)Requires CalEPA to:

             a)   Conduct its programs, policies, and activities and  
               enforce all health and environmental statutes within its  
               jurisdiction in a manner that ensures the fair treatment of  
               people of all races, cultures, and income levels, including  
               minority and low-income populations.

             b)   Convene a Working Group on Environmental Justice  
               (Working Group) comprised of the Secretary of CalEPA, the  
               Chairs of the Air Resources Board (ARB), the California  
               Integrated Waste Management Board (now CalRecycle), the  
               State Water Resources Control Board (SWRCB), the Director  
               of the Department of Toxic Substances Control (DTSC), the  
               Director of the Department of Pesticide Regulation (DPR),  
               the Director of the Office of Environmental Health Hazard  
               Assessment (OEHHA), and the Director of the Office of  
               Planning and Research (OPR).  Requires the Working Group to  
               examine existing data and studies on environmental justice  
               and recommending policies for implementation by CalEPA;  
               recommend criteria to the Secretary of CalEPA for  
               identifying and addressing any gaps in existing programs,  
               policies, or activities that may impede the achievement of  
               environmental justice; and, hold public meetings to receive  
               and respond to public comments prior to the finalization of  
               the recommendations. 

             c)   Requires each board, department, and office within  
               CalEPA to review its programs, policies, and activities and  
               identify and address any gaps in its existing programs,  


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               policies, or activities that may impede the achievement of  
               environmental justice.

          4)Names OPR as the coordinating agency in state government for  
            environmental justice programs.

          5)Pursuant to AB 1071 (Atkins), Chapter 585, Statutes of 2015,  
            beginning January 1, 2016, requires each board, department,  
            and office within CalEPA to establish a policy on supplemental  
            environmental projects (SEPs) that benefits environmental  
            justice communities.  Authorizes up to 50% of an enforcement  
            action to be allocated for SEPs.  Requires CalEPA to compile a  
            list of SEPs developed by its boards, departments, and offices  
            and post the list on its website.  

          THIS BILL:

          1)Requires that 10% of all enforcement action monetary penalties  
            collected by a CalEPA board, department, or office to be  
            deposited into the Supplemental Environmental Projects in  
            Disadvantaged Communities Fund (Fund).  

          2)Specifies that the Fund be available, upon appropriation, to  
            implement environmental projects in disadvantaged communities.  
             Prioritizes funding for projects on the list compiled by  

          FISCAL EFFECT:  Unknown


          1)Environmental justice. According to OEHHA, approximately 8  


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            million Californians (21%) live in zip codes that are  
            considered "highly impacted" by environmental, public health,  
            and socioeconomic stressors.  Nearly half of all Californians  
            live within six miles of a facility that is a significant  
            greenhouse gas emitter (46%), and they are disproportionately  
            people of color (62%).  Throughout California, people of color  
            face a 50% higher risk of cancer from ambient concentrations  
            of air pollutants listed under the Clean Air Act.  These  
            impacts are felt by all Californians. ARB estimates that air  
            pollution exposure accounts for 19,000 premature deaths,  
            280,000 cases of asthma, and 1.9 million lost work days every  

            In 2000, legislation [SB 89 (Escutia), Chapter 728] required  
          CalEPA to convene the
            Environmental Justice Working Group and develop an agency-wide  
          environmental justice
            strategy.  In 2001, follow up legislation [SB 828 (Alarcon),  
          Chapter 765] established a
            timeline for these requirements and required CalEPA to update  
          its report to the Legislature
            every three years.  In October of 2004, CalEPA released its  
            Environmental Justice Action Plan, but did not complete the  
            required updates for a decade.   

            SB 535 (DeLeon), Chapter 850, Statutes of 2012 requires the  
            Cap and Trade Proceeds Investment Plan to direct a minimum of  
            25% of the available moneys in the fund to projects that  
            provide benefits to identified disadvantaged communities; and,  
            a minimum of 10% of the available moneys in the fund to  
            projects located within identified disadvantaged communities.   
            SB 535 also required CalEPA to identify disadvantaged  
            communities (i.e., environmental justice communities).  In  
            order to accurately identify environmental justice  
            communities, OEHHA, on behalf of CalEPA, created the  
            California Communities Environmental Health Screening Tool  
            (CalEnviroScreen).  CalEnviroScreen is a screening methodology  
            that can be used to help identify California communities that  
            are disproportionately burdened by multiple sources of  


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            In February of 2014, CalEPA issued an Environmental Justice  
            Program Update, which included four main areas for future  
            actions:  1) increase efforts to eliminate discrimination on  
            the basis of race, national origin, ethnic group  
            identification, religion, age, sex, sexual orientation, color,  
            genetic information, or disability in any program or activity  
            conducted or funded by the state; 2) develop guidance to  
            promote a sound legal framework for CalEPA to advance  
            environmental justice goals and objectives; 3) lead an  
            agency-wide working group dedicated to increase compliance  
            with environmental laws in communities with relatively higher  
            environmental burdens; and, 4) add additional indicators to  

          2)Supplemental environmental projects.  SEPs are environmentally  
            beneficial projects that a violator agrees to undertake as  
            part of a settlement for an enforcement action, but which the  
            violator is not otherwise legally required to perform.  In  
            2003, CalEPA released guidelines for the use of SEPs for its  
            boards, departments, and offices.  The guidelines specify that  
            an SEP must improve, protect, or reduce risks to public health  
            and the environment at large.  The enforcing agency must have  
            the opportunity to help shape the scope of the project before  
            it is implemented and the project must not be commenced until  
            the enforcing agency has identified a violation.  Finally, the  
            SEP must not be required by a federal, state, or local law or  
            regulation.  CalEPA's SEP guidelines suggest limiting the SEP  
            to 25% of the total enforcement action.  

            Within CalEPA, ARB, DTSC, and SWRCB have adopted SEP policies.  
             ARB and DTSC's policies are consistent with CalEPA's  
            guidelines and allow SEPs up to 25% of the amount of the  
            enforcement action.  SWRCB, consistent with authority granted  
            by SB 1733 (Aanestad), Chapter 404, Statutes of 2006, allow  
            SEPs up to 50% of the amount of the penalty.  CalEPA's 2013  
            Environmental Compliance and Enforcement Report provides  
            information on the use of SEPs in California.  The certified  


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            unified program agencies directed just over $2.1 million to  
            SEPs, approximately 25% of the penalties collected.  According  
            to ARB, of the $9.97 million penalties assessed for  
            significant enforcement cases (over $10,000), $773,600 was  
            directed to SEPs.  DPR directed only $8,000 of the $3.3  
            million in penalties collected to one SEP.  The other boards,  
            departments, and offices did not report any SEP funding in  

            CalEPA is in the process of implementing AB 1071.  According  
            to CalEPA, the draft SEP policy will be available for public  
            review this month; boards, departments, and offices will begin  
            soliciting SEP proposals from the public in late summer, and  
            CalEPA will post the compiled SEP list to the website by  

          3)Author's statement: 

               Many communities in California continue to be  
               disproportionately burdened [by] multiple sources of  
               pollution.  These communities are most vulnerable to  
               pollution and climate change than others.  These  
               disadvantaged communities? require much more than resources  
               to tackle climate and environmental health impacts and to  
               implement community led projects. 

               Currently, many communities facing enforcement actions  
               would rather pay the fine than implement a SEP.  This is  
               mainly attributed to the time and effort necessary to  
               implement a SEP.  The inexperience of the violator also  
               contributes to the lack of SEP implementation.  

               As a result, there continues to be a disconnect that  
               prevents disadvantaged communities from benefitting from  
               pollution mitigation projects funded by enforcement  
               actions.  Without requiring a mandatory Disadvantaged  
               Community Fund, DACs will continue to be overlooked and not  
               benefit from much needed environmental mitigation.  By  
               securing resources that benefit disadvantaged communities,  


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               the state can help decrease many of the environmental  
               stressors affecting these communities.  



          California Indian Environmental Alliance 

          Comite Civico Del Valle 

          Global Community Monitor

          Idle No More SF Bay 
          La Union Hace La Fuerza 
          West Berkeley Alliance for Clean Air and Safe Jobs 


          None on file

          Analysis Prepared by:Elizabeth MacMillan / NAT. RES. / (916)  


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