BILL ANALYSIS Ó SB 209 Page 1 Date of Hearing: August 19, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair SB 209 (Pavley) - As Amended August 17, 2015 ----------------------------------------------------------------- |Policy |Natural Resources |Vote:|7 - 1 | |Committee: | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | |-------------+-------------------------------+-----+-------------| | | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: YesReimbursable: No SUMMARY: This bill revises the Surface Mining and Reclamation Act of 1975 (SMARA), renames the Office of Mine Reclamation to instead be the Division of Mines, and creates the Supervisor of Mines and SB 209 Page 2 Reclamation to direct the Division. Specifically, this bill: 1) Increases the maximum reporting fee for any single mining operation from $4,000 to $10,000 annually over a three year period. Increases the total allowable revenue generated by the reporting fees from $3,500,000 to $8,000,000 annually. 2) Requires each surface mining operation to have financial assurance mechanisms, as defined. Prohibits the release of the mechanisms unless there is written consent from the lead agency and the Department of Conservation (DOC). Requires subsequent operators of surface mining operations to post a mechanism within 30 days of transfer of operation. 3) Creates a new process to review reclamation plans, including that the lead agency must provide the Director with a complete reclamation plan for the Director to review. Requires the lead agency to respond to the Director's comments and either describe how they plan to adopt the comment, or reasons why they will not adopt the comment. 4) Requires DOC and the California State Mining and Geology Board (Board) to adopt regulations that set minimum qualifications for a person conducting an inspection of a surface mining operation and provide a training program for all surface mine inspectors. 5) Allows a lead agency employee to inspect surface mining operations that are owned by the local agency. SB 209 Page 3 6) Requires the lead agency, among other things, to combine the notice of violations with an order to comply if the violation cannot be corrected within 30 days. Allows an order to comply to take effect without a hearing if the operator does not request one. Allows an order to comply to include administrative penalties of not more than $5,000 per day from the original date of noncompliance. 7) Requires the Board to either have the lead agency develop a remedial plan or exercise some or all of a lead agency's powers under SMARA, except for permitting or vested rights determinations, if the lead agency fails to implement the law. Requires the Board to conduct a public hearing to determine if the lead agency has corrected it implementation and enforcement of SMARA and requires it to restore some or all of its powers if it has taken corrective actions. FISCAL EFFECT: The administrative fee increase authorized in the bill will result in an estimated increase in revenue between $3.6 million and $6.2 million (special fund). The actual revenue increase will depend upon how the State Mining and Geology Board (SMGB) calculate fees for different operations. The statute requires that SMGB set fees on an equitable basis reflecting the size and type of operation. COMMENTS: 1)Rationale. The Governor called for a top to bottom review of SMARA. Multiple stakeholder group meetings were held and continue to discuss the administration's concerns with SMARA. Issues that are under discussion include: SB 209 Page 4 a) Meaningful reclamation of disturbed mine lands; b) Adequate financial assurance; c) Reclamation must be complete before financial assurances are released. d) Financial assurance may be used for reclamation if the mine owner does not reclaim the mine; e) Annual, quality inspections of every mine occur; f) When inspectors find non-compliance enforcement is clear, timely, and meaningful; g) The Board has tools to improve local SMARA implementation; h) Reporting fees and penalties are paid by operators and fees cover the cost of the program; and i) Inappropriate exemptions from SMARA are eliminated. This bill is a product of the Governor's stakeholder meetings. 2)Background. There are over a thousand active mines in California that remove aggregate for building material, metals, and minerals. Unlike any other state, most surface mines in California are regulated by local government SB 209 Page 5 agencies. The Surface Mining and Reclamation Act of 1975 (SMARA) prohibits a person from conducting surface mining operations unless the lead agency for the operation issues a surface mining permit and approves a reclamation plan and financial assurances. Mining operators are required, under SMARA, to develop and implement reclamation plans, which will return the mine to a condition where it can be used for another purpose after the mining operation is complete. DOC and the Board oversee lead agency permitting, inspection and enforcement actions. 3)Related Legislation. AB 1142 (Gray) makes numerous changes to the Surface Mining and Reclamation Act of 1975 (SMARA). This bill is pending in Senate Appropriations. Analysis Prepared by:Jennifer Galehouse / APPR. / (916) 319-2081