BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 209| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 209 Author: Pavley (D) Amended: 3/17/16 Vote: 21 SENATE NATURAL RES. & WATER COMMITTEE: 7-2, 3/24/15 AYES: Pavley, Allen, Hertzberg, Hueso, Jackson, Monning, Wolk NOES: Stone, Fuller SENATE APPROPRIATIONS COMMITTEE: 5-2, 5/26/15 AYES: Lara, Beall, Hill, Leyva, Mendoza NOES: Bates, Nielsen SENATE FLOOR: 25-13, 5/28/15 AYES: Allen, Beall, Block, De León, Galgiani, Glazer, Hall, Hancock, Hernandez, Hertzberg, Hill, Hueso, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Monning, Pan, Pavley, Roth, Wieckowski, Wolk NOES: Anderson, Bates, Berryhill, Cannella, Fuller, Gaines, Huff, Moorlach, Morrell, Nguyen, Nielsen, Stone, Vidak NO VOTE RECORDED: Mitchell, Runner ASSEMBLY FLOOR: 54-20, 3/28/16 - See last page for vote SUBJECT: Surface mining: financial assurances: reclamation plans SOURCE: Sierra Fund DIGEST: This bill makes numerous changes to the Surface Mining and Reclamation Act (SMARA) that are all part of the year-long stakeholder process convened by the Governor's office in 2015 to recommend substantive and procedural changes to the state's SB 209 Page 2 mining laws. Assembly Amendments divided the topics between this bill and AB 1142 (Gray). The two bills both contain contingent enactment provisions. SB 209 contains the provisions relating formalizing a new Division of Mines and Reclamation at the Department of Conservation (DOC) that will be headed by a Supervisor of Mines and Reclamation, fees, more flexible inspections at county-owned borrow pits, and authorizing the Board of Mining and Geology (Board) to develop a corporate financial test in lieu of a portion of the required financial assurances. ANALYSIS: Existing law: 1) Prohibits surface mining, with exceptions, unless a permit is obtained from, a specified reclamation plan is submitted and approved by, and financial assurances have been approved by the lead agency (usually a local government) for the operation of the surface mining operation. Operators are entitled to be in "substantial compliance" with these provisions. 2) Requires annual inspections of surface mining operations by the lead agency to be performed by a state-licensed architect, civil engineer, landscape architect, or forester. 3) Requires the lead agency to have primary responsibility for enforcement and establishes deadlines when that responsibility is transferred to the director of the DOC. This bill: 1)Increases, by agreement with industry, the maximum reporting fee for any single mining operation from $4,000 to $10,000 and caps the overall reporting fees at $8 million annually. SB 209 Page 3 Currently most operators pay the maximum amount which has contributed to long-term budget shortfalls that have resulted in inadequate reclamation plans, lack of coordination between state and local agencies, erratic inspections, delayed permit approvals, and a convoluted appeals process that was cumbersome and largely ineffective. 2)Commits the fees paid by industry to the review of reclamation plans, financial assurances, and the training of local government mine inspectors that is authorized in AB 1142. 3)Contains new, flexible provisions for local governments to inspect county-owned borrow pits every two years instead of each year. Comments The Governor called for a thorough review of SMARA and the stakeholder process recommendations have been divided between SB 209 and AB 1142 (Gray). AB 1142 contains the provisions relating to reclamation plans, financial assurances, inspections, and enforcement. The reforms to the financial assurance provisions, reclamation planning, and inspections are contained in AB 1142. The main purpose of the two bills is to retain the existing components of SMARA but to enact new provisions that address the issues raised in the stakeholder process so that the law works better for industry, local governments, and the public. SB 209 Page 4 FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: Yes According to the Assembly Appropriations Committee, depending upon how the Board calculates fees for different mining operations, the administrative fee increase authorized in the bill could 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 Board calculates fees for different operations. The statute requires that Board set fees on an equitable basis reflecting the size and type of operation. SUPPORT: (Verified3/28/16) Sierra Fund (source) California State Association of Counties California State Chamber of Commerce California League of Conservation Voters California Native Plant Society Center for Biological Diversity Claim-GV Clean Water Action Endangered Habitat League Rural County Representatives of California San Francisco Baykeeper San Juan Ridge Taxpayers Association South Yuba River Citizens League Wolf Creek Community Alliance OPPOSITION: (Verified3/28/16) None received ARGUMENTS IN SUPPORT: The conservation groups in support all have stated that this bill together with AB 1142 represent the most significant improvements to SMARA in many years. SB 209 SB 209 Page 5 specifically provides more flexibility to counties, establishes a workable fee structure both for the department and the mine operators, and allows the Board of Mining and Geology to establish financial tests in lieu of surety bonds for financial assurances. The local government and business supporters support the flexibility to local governments, the financial test provisions, and the fact that a portion of the fees will be used to train local government employees to inspect mines. ASSEMBLY FLOOR: 54-20, 3/28/16 AYES: Alejo, Atkins, Baker, Bloom, Bonilla, Bonta, Brown, Burke, Calderon, Campos, Chau, Chiu, Chu, Cooley, Cooper, Dababneh, Daly, Dodd, Frazier, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Hadley, Roger Hernández, Holden, Irwin, Jones-Sawyer, Lackey, Levine, Linder, Lopez, Low, Maienschein, Medina, Melendez, Mullin, Nazarian, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Mark Stone, Thurmond, Ting, Weber, Williams, Wood, Rendon NOES: Achadjian, Travis Allen, Bigelow, Brough, Chávez, Beth Gaines, Gallagher, Grove, Harper, Jones, Kim, Mathis, Mayes, Obernolte, Olsen, Patterson, Steinorth, Wagner, Waldron, Wilk NO VOTE RECORDED: Chang, Dahle, Eggman, McCarty, O'Donnell Prepared by:William Craven / N.R. & W. / (916) 651-4116 3/30/16 15:31:19 **** END ****