Amended in Assembly July 6, 2015

Amended in Assembly June 24, 2015

Amended in Senate June 2, 2015

Amended in Senate May 6, 2015

Amended in Senate April 13, 2015

Amended in Senate April 6, 2015

Senate Bill No. 367

Introduced by Senator Wolk

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(Coauthor: Assembly Member Dodd)

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February 24, 2015

An act to amend Sections 564, 566, and 568 of, and to add Sections 562 and 569 to, the Food and Agricultural Code, to amend Section 39719 of the Health and Safety Code, and to add Section 75217.5 to the Public Resources Code, relating to agriculture, and making an appropriation therefor.

LEGISLATIVE COUNSEL’S DIGEST

SB 367, as amended, Wolk. Agricultural lands: greenhouse gases.

(1) Existing law, the Cannella Environmental Farming Act of 1995, requires the Department of Food and Agriculture to establish and oversee an environmental farming program to provide incentives to farmers whose practices promote the well-being of ecosystems, air quality, and wildlife and their habitat. The act requires the Secretary of Food and Agriculture to convene a 5-member Scientific Advisory Panel on Environmental Farming for the purpose of providing advice and assistance to federal, state, and local government agencies on issues relating to air, water, and wildlife habitat, as specified.

This bill instead would authorize, rather than require, the environmental farming program to provide incentives, including loans, grants, research, technical assistance, or educational materials and outreach, to farmers whose practices promote the well-being of ecosystems, air quality, and wildlife and their habitat, and reduce on-farm greenhouse gas emissions or increase carbon storage in agricultural soils and woody biomass, or both. The bill would rename the panel the Environmental Farming Science Advisory Panel and revise the panel’s membership and duties, as specified. The bill would require the panel to provide a biennial report describing its work to the Legislature and the Governor, among others.

The bill would provide that $25,000,000 shall be made available to the department, upon appropriation, from the Greenhouse Gas Reduction Fund to support projects to demonstrate agricultural management practices and activities that reduce greenhouse gas emissions and increase carbon storage in agricultural soils and woody biomass, as specified. The bill would require the department, in consultation with the panel, to develop and implement a grant program to carry out the purposes of the act and would require the State Air Resources Board, in consultation with the secretary and the panel, to consider and recommend, as appropriate, the use of available tools to demonstrate and quantify greenhouse gas emissions reductions from the grant program.

(2) The California Global Warming Solutions Act of 2006 designates the State Air Resources Board as the state agency charged with monitoring and regulating sources of emissions of greenhouse gases. The act authorizes the state board to include the use of market-based compliance mechanisms. Existing law requires all moneys, except for fines and penalties, collected by the state board from the auction or sale of allowances as part of a market-based compliance mechanism to be deposited in the Greenhouse Gas Reduction Fund. Existing law continuously appropriates 20% of the annual proceeds of the fund to the Strategic Growth Council for the Affordable Housing and Sustainable Communities Program, as provided.

This bill would require the council, no later than the 2015-16 fiscal year, to establish and administer a grant program, as part of the Sustainable Agricultural Lands Conservation Program established by the council in conjunction with the Affordable Housing and Sustainable Communities Program, to provide financial incentives for the adoption and use of land management practices that reduce greenhouse gas emissions, sequester carbon in soil and woody biomass, and provide other cobenefits on working agricultural operations, as specified.

The bill would continuously appropriate 2% of the annual proceeds of the fund to the Strategic Growth Council to be expended for agricultural land protection consistent with the provisions of that grant program, thereby making an appropriation.

Vote: majority. Appropriation: yes. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 562 is added to the Food and Agricultural
Code, to read:

562.  

The Legislature further finds and declares all of the
following:

(a) California’s agricultural output is larger and more diverse
than any state in the United States, providing the majority of the
country’s fruits, vegetables, nuts, and dairy products.

(b) Dependent on land and natural resources, California
agriculture is uniquely vulnerable to climate change, which poses
a serious threat to California agriculture with rising temperatures,
increases in extreme weather events, constrained water resources,
reduced winter chilling hours, and rising sea levels.

(c) California agriculture also is uniquely positioned to provide
climate benefits by reducing greenhouse gas emissions. Research
funded by the State Energy Resources and Conservation
Development Commission’s Public Interest Energy Research
(PIER) program finds that some agricultural practices will not only
reduce greenhouse gas emissions, but they also may help to store
carbon in soils and trees. Carbon storage is an important strategy
to help meet the state’s greenhouse gas emissions targets.

(d) Steps taken by those working in California agriculture to
reduce greenhouse gas emissions and sequester atmospheric carbon
can provide other important environmental cobenefits, such as
improved air and water quality, water conservation, enhanced
wildlife habitat, and healthier rural communities.

(e) It is, therefore, the intent of the Legislature to enhance the
long-term viability of California agriculture by supporting activities
that reduce climate change impacts that may negatively impact it
and the rest of the state.

(f) It is further the intent of the Legislature that the department,
pursuant to this article, support the state’s agricultural sector in
pursuing on-farm practices and activities that reduce greenhouse
gas emissions and increase carbon storage in agricultural soils and
woody biomass.

SEC. 2.  

Section 564 of the Food and Agricultural Code is
amended to read:

564.  

Unless the context otherwise requires, the following
definitions govern the construction of this article:

(a) “Agricultural activities” means those activities that generate
products as specified in Section 54004.

(b) “Department” means the Department of Food and
Agriculture.

(c) “Fund” means the Greenhouse Gas Reduction Fund, created
pursuant to Section 16428.8 of the Government Code.

(d) “Panel” means the Environmental Farming Science Advisory
Panel.

(e) “Secretary” means the Secretary of Food and Agriculture.

SEC. 3.  

Section 566 of the Food and Agricultural Code is
amended to read:

566.  

(a) (1) The department shall establish and oversee an
environmental farming program. The program may provide
incentives, including, but not limited to, loans, grants, research,
technical assistance, or educational materials and outreach, to
farmers whose practices promote the well-being of ecosystems,
air quality, and wildlife and their habitat and reduce on-farm
greenhouse gas emissions or increase carbon storage in agricultural
soils and woody biomass, or both.

(2) The department may provide support through the program
that may include, but need not be limited to, permit assistance and
coordination and the funding of on-farm demonstration projects
in furtherance of the goals of the program.

(b) (1) The department may assist in the compilation of
scientific evidence from public and private sources, including the
scientific community, industry, conservation organizations, and
federal, state, and local agencies identifying the net environmental
impacts and benefits that agriculture creates for the environment.

(2) The department shall serve as the depository of the scientific
evidence compiled pursuant to this subdivision and provide it to
federal, state, and local agencies as needed.

(c) The department shall conduct the activities specified in this
article with existing resources, to the extent they are available.

SEC. 4.  

Section 568 of the Food and Agricultural Code is
amended to read:

568.  

(a) The secretary shall convene an Environmental Farming
Science Advisory Panel to advise the secretary on the
implementation of an environmental farming program, established
pursuant to Section 566, and assist federal, state, and local
government agencies, as appropriate or necessary, on issues relating
to the impact of agricultural practices on air, water, climate change,
and wildlife habitat.

(b) (1) The panel shall consist of the following members:

(A) Two members appointed by the Secretary for Environmental
Protection. One of these members shall have expertise in climate
change and its impacts on California agriculture, and the other
member shall have expertise in greenhouse gas emissions reduction
practices related to agriculture.

(B) Two members appointed by the Secretary of the Natural
Resources Agency. One of these members shall be affiliated with
the California Association of Resource Conservation Districts.
The other member shall be engaged in the conduct of scientific
research related to begin delete environmentally sustainable agriculture. end delete begin insert the
purposes described in Section 566. end insert

(C) Five members appointed by the secretary, according to the
following:

(i) Three members who are agricultural producers in the state
with at least five years of training and experience in the field of
agriculture. At least one of these members shall be registered as a
producer pursuant to the California Organic Products Act of 2003
(Chapter 10 (commencing with Section 46000) of Division 17).

(ii) One member who is affiliated with the University of
California Cooperative Extension.

(iii) One member who is engaged in the conduct of scientific
research related to begin delete environmentally sustainable agriculture. end delete begin insert the
purposes described in Section 566. end insert

(2) The secretary may appoint nonvoting advisers to the panel
after consulting with the panel.

(3) The secretary shall designate the member who is to serve
as the chair of the panel.

(4) Members of the panel shall be highly qualified and
professionally active with at least five years of experience in their
chosen field.

(5) Of the members first appointed to the panel, four shall serve
for a term of two years and five shall serve for a term of three
years, as determined by lot. Thereafter, members shall be appointed
for a term of three years.

(c) The panel, at a minimum and as necessary, shall do all of
the following:

(1) (A) Review data on the impact that agriculture has on the
environment and recommend to the secretary and other appropriate
state agencies data that the panel determines is scientifically valid.

(B) A state agency that receives data recommended by the panel
may adopt and incorporate the data into the appropriate program.

(C)  If a state agency does not utilize the data recommended by
the panel, the state agency shall provide the panel with a written
statement of reasons for not doing so. The reasons shall specify,
at a minimum, the scientific basis for not utilizing the data. The
reasons shall be provided within 180 days of receiving the data.

(2) Compile the net environmental impacts of agriculture on
the environment, identified pursuant to paragraph (1), for use by
the department, other relevant state agencies, and the public.

(3) Research, review, and comment on data upon which
proposed environmental policies and regulatory programs are based
to ensure that the environmental impacts of agricultural activities
are accurately portrayed and to identify incentives that may be
provided to encourage agricultural practices with environmental
benefits.

(4) Assist government agencies to incorporate benefits identified
pursuant to paragraph (1) into environmental regulatory programs.

(5) Review and advise the secretary and the State Board of Food
and Agriculture on existing and proposed programs and projects
that provide technical, educational, and financial assistance,
including, but not limited to, competitive grants to agricultural
producers that will result in multiple environmental and health
benefits, including, but not limited to, reduced greenhouse gas
emissions, increased carbon storage in soils and woody biomass,
improved air and water quality, enhanced wildlife habitat, and
improved local health outcomes.

(d) The State Air Resources Board, in consultation with the
secretary and the panel, shall consider, and recommend, as
appropriate, in the guidance developed pursuant to subdivision (b)
of Section 16428.9 of the Government Code, the use of available
tools to demonstrate and quantify greenhouse gas emissions
reductions from the grant program established pursuant to
subdivision (b) of Section 569, including, but not limited to, the
Natural Resources Conservation Service’s National Conservation
Practice Standards and COMET-Farm and other quantification
tools.

(e) The panel may establish ad hoc committees, which may
include professionals or scientists, to assist it in performing its
functions.

(f) (1) The panel shall submit a biennial report to the
Legislature, the Governor, the agencies represented on the panel,
and the State Board of Food and Agriculture that includes all of
the following:

(A) A description of the work conducted by the panel during
the prior two-year period.

(B) The panel’s action plan for the next two years, including
goals and performance measures.

(2) The first report shall be submitted two years after the panel’s
first meeting or January 1, 2019, whichever occurs first.

(3) A report to be submitted pursuant to this subdivision shall
be submitted in compliance with Section 9795 of the Government
Code.

(g) The panel shall be created and maintained with funds made
available from existing resources within the department to the
extent they are available.

SEC. 5.  

Section 569 is added to the Food and Agricultural
Code, to read:

569.  

(a) The sum of twenty-five million dollars ($25,000,000)
shall be available, upon appropriation by the Legislature, from the
fund to the department to support projects to demonstrate
agricultural management practices and activities that reduce
greenhouse gas emissions and increase carbon storage in
agricultural soils and woody biomass, including, but not limited
to, all of the following:

(1) Soil-building and carbon-sequestration practices, including
the increased use of compost and biochar, cover crops, and low-
and no-till practices.

(2) Irrigation efficiency and water conservation measures,
including soil-moisture monitoring, irrigation scheduling,
high-efficiency water delivery technologies, dry farming, and
on-farm water catchment.

(3) Alternative-energy production and energy efficiency,
including energy produced from agricultural waste from a farm or
at a processing facility located in the state, and improved on-farm
operational efficiencies.

(4) Wildlife habitat conservation, including hedgerow planting,
native grass planting and restoration, agroforestry, and managed
grazing for enhanced habitat.

(b) The department, in consultation with the panel, shall develop
and implement a grant program to carry out the purposes of this
article.

(c) The secretary and the Secretary of the Natural Resources
Agency shall enter into a memorandum of agreement among the
department, the Department of Conservation, and other relevant
state agencies to ensure the greatest possible coordination and
collaboration in implementing the programs and projects funded
pursuant to this section.

SEC. 6.  

Section 39719 of the Health and Safety Code is
amended to read:

39719.  

(a) The Legislature shall appropriate the annual
proceeds of the fund for the purpose of reducing greenhouse gas
emissions in this state in accordance with the requirements of
Section 39712.

(b) To carry out a portion of the requirements of subdivision
(a), annual proceeds are continuously appropriated for the
following:

(1) Beginning in the 2015-16 fiscal year, and notwithstanding
Section 13340 of the Government Code, 35 percent of annual
proceeds are continuously appropriated, without regard to fiscal
years, for transit, affordable housing, and sustainable communities
programs as follows:

(A) Ten percent of the annual proceeds of the fund is hereby
continuously appropriated to the Transportation Agency for the
Transit and Intercity Rail Capital Program created by Part 2
(commencing with Section 75220) of Division 44 of the Public
Resources Code.

(B) Five percent of the annual proceeds of the fund is hereby
continuously appropriated to the Low Carbon Transit Operations
Program created by Part 3 (commencing with Section 75230) of
Division 44 of the Public Resources Code. Moneys shall be
allocated by the Controller, according to requirements of the
program, and pursuant to the distribution formula in subdivision
(b) or (c) of Section 99312 of, and Sections 99313 and 99314 of,
the Public Utilities Code.

(C) Twenty percent of the annual proceeds of the fund is hereby
continuously appropriated to the Strategic Growth Council for the
Affordable Housing and Sustainable Communities Program created
by Part 1 (commencing with Section 75200) of Division 44 of the
Public Resources Code. Of the amount appropriated in this
subparagraph, no less than 10 percent of the annual proceeds of
the fund shall be expended for affordable housing, consistent with
the provisions of that program and no less than two percent of the
annual proceeds of the fund shall be expended for agricultural land
protection consistent with Section 75217.5 of the Public Resources
Code.

(2) Beginning in the 2015-16 fiscal year, notwithstanding
Section 13340 of the Government Code, 25 percent of the annual
proceeds of the fund is hereby continuously appropriated to the
High-Speed Rail Authority for the following components of the
initial operating segment and Phase I Blended System as described
in the 2012 business plan adopted pursuant to Section 185033 of
the Public Utilities Code:

(A) Acquisition and construction costs of the project.

(B) Environmental review and design costs of the project.

(C) Other capital costs of the project.

(D) Repayment of any loans made to the authority to fund the
project.

(c) In determining the amount of annual proceeds of the fund
for purposes of the calculation in subdivision (b), the moneys
subject to Section 39719.1 shall not be included.

SEC. 7.  

Section 75217.5 is added to the Public Resources Code,
to read:

75217.5.  

(a) The Legislature finds and declares all of the
following:

(1) It is in the interest of the state to provide incentives for the
use of agricultural land management practices that will reduce
greenhouse gas emissions, sequester carbon in soils and woody
biomass, and provide other cobenefits on working agricultural
operations.

(2) The council’s Sustainable Agricultural Lands Conservation
Program, established pursuant to this chapter, has three elements,
including financial incentives for the adoption and use of land
management practices that achieve these goals.

(3) The 2014 program guidelines establish grant programs for
the 2014-15 fiscal year to promote agricultural lands strategic
planning and agricultural land conservation easements, but the
guidelines do not establish a grant program to provide incentives
for agricultural land management practices.

(b) (1) The council, no later than the 2015-16 fiscal year, shall
establish and administer a grant program, as part of the Sustainable
Agricultural Lands Conservation Program, to provide financial
incentives for the adoption and use of land management practices
that reduce greenhouse gas emissions, sequester carbon in soil and
woody biomass, and provide other cobenefits on working
agricultural operations. The council shall consult with the
Department of Food and Agriculture and the Environmental
Farming Advisory Panel, established pursuant to Section 568 of
the Food and Agricultural Code, when developing the grant
program and guidelines.

(2) The council, as part of the grant program established
pursuant to this subdivision, shall give priority to working
agricultural operations that adopt land management practices that
achieve the goals described in paragraph (1).