BILL ANALYSIS Ó
AB 2794
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Date of Hearing: May 4, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2794 (Santiago) - As Amended April 5, 2016
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|Policy |Environmental Safety and Toxic |Vote:|4 - 0 |
|Committee: |Materials | | |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill increases the statutorily specified flat fee options
for a person applying for various hazardous waste permits or
modifications from the Department of Toxic Substance Control
(DTSC).
FISCAL EFFECT:
Although the author intends this bill to raise flat fee rates,
the flat fee rates proposed in this bill would result in an
approximate 8% decrease in the fee rate. According the Board of
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Equalization (BOE), flat-rate application fees over the last
three fiscal years averaged at $333,333. If flat-rate fees in
the bill were adopted, DTSC would lose on average approximately
$27,000 annually from permitting actions.
COMMENTS:
1)Purpose. According to the author, the flat fee payment
amounts outlined in existing law were last revised in 1997 by
SB 660 (Sher), and have not kept pace with inflation. As an
example, one provision provides for a flat fee of $104,187
which in 2016 dollars amounts to $153,918.28.
This bill is intended to increase flat fees to ensure DTSC is
better able to recover costs associated with its permit
decisions.
2)Background. The Board of Equalization (BOE) administers six
hazardous waste fee programs in cooperation with DTSC under
the Hazardous Substances Tax Law. Five of the fees are: 1) the
environmental fee on certain types of organizations based on
their use, storage, generation, or activities connected to
hazardous materials; 2) the facility fee imposed on the
storage, treatment, or disposal of hazardous waste; 3) the
generator fee based on the generation of hazardous waste at a
specific site;4) the transportable treatment unit (TTU) fee
imposed on a per treatment unit, not per facility; and 5) and
the disposal fee assessed on hazardous waste disposed of by
depositing on, or into, land.
The sixth fee (activity fee) is essentially an application
processing fee imposed on any person that applies for a new
hazardous waste facilities permit, a postclosure hazardous
waste facilities permit, the renewal of an existing hazardous
waste permit, a class 2 or class 3 permit modification, or a
variance or waste classification determination.
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The applicant pays the fee either by entering into a
reimbursement agreement with DTSC, or paying a one-time,
flat-rate fee to the BOE. The fee is non-refundable, even if
the application is withdrawn or the permit or the modification
is denied. The fee is tiered based on the permitted level of
the facility and the type of permit activity.
3)Independent Review Panel (IRP). The 2015-16 Budget Act
created a three-person IRP to oversee DTSC's permitting,
enforcement, and fiscal management.. The IRP released its
first report on January 28, 2016, and provided various
recommendations including the need for DTSC to obtain full
cost recovery from permit decisions.
It is estimated that DTSC recoups about 40% of its costs when
applicants use a flat fee. Therefore, payment of a flat fee
can prevent DTSC from recouping the entirety of its incurred
costs, thus burdening taxpayers with the costs that the
applicants should be paying.
The author is working on revisions to this bill to ensure the
flat fees are adjusted for inflation and improve cost
recovery.
AB 2794
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Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081