BILL ANALYSIS                                                                                                                                                                                                    

                                                                    AB 2781

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          Date of Hearing:  May 4, 2016


                               Lorena Gonzalez, Chair

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

          |Policy       |Natural Resources              |Vote:|9 - 0        |
          |Committee:   |                               |     |             |
          |             |                               |     |             |
          |             |                               |     |             |

          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          This bill directs 10% of all penalties collected by California  
          Environmental Protection Agency (CalEPA) boards, departments,  
          and offices to fund environmental projects in disadvantaged  
          communities.  Specifically, this bill:  

          1)Requires 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).  


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

          FISCAL EFFECT:

          This bill redirects revenue from monetary penalties to the newly  
          created fund, likely in the $3 to $5 million dollar range  
          (special fund).  Additionally, CalEPA would require an  
          additional $175,000 for administrative costs. 


          1)Purpose.  According to the author, without requiring a  
            mandatory fund, disadvantaged communities will continue to be  
            overlooked and will not benefit from much needed environmental  
            mitigation.  By securing resources that benefit disadvantaged  
            communities, the state can help decrease many of the  
            environmental stressors affecting these communities.  

          2)Background. AB 1071 (Atkins), Chapter 585, Statutes of 2015,  
            requires each board, department, and office within CalEPA to  
            establish a policy on supplemental environmental projects  
            (SEPs) to benefit environmental justice communities.  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  

            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  


                                                                    AB 2781

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            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, but up to 50% of an enforcement action may  
            be allocated for SEPs.  

            AB 1071 also requires CalEPA to compile a list of SEPs and  
            post the list on its website.  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 December.  

          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)