BILL ANALYSIS Ó
SB 367
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Date of Hearing: July 13, 2015
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Das Williams, Chair
SB
367 (Wolk) - As Amended June 24, 2015
SENATE VOTE: 35-3
SUBJECT: Agricultural lands: greenhouse gases.
SUMMARY: Establishes, upon appropriation, a $25 million grant
program to fund projects that reduce greenhouse gas (GHG)
emissions from agricultural operations, as specified. Expands
and revises the membership and duties of the California
Department of Food and Agriculture's (CDFA) Environmental
Farming Act Science Advisory Panel (Panel) to include on-farm
practices to reduce GHG emissions and increase carbon storage in
soil.
EXISTING LAW:
1)Under the California Global Warming Solutions Act of 2006 (AB
32):
a) Requires the Air Resources Board (ARB) to adopt a
statewide GHG emissions limit equivalent to 1990 levels
by 2020 and adopt regulations to achieve maximum
technologically feasible and cost-effective GHG emission
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reductions.
b) Establishes the Greenhouse Gas Reduction Fund
(GGRF); requires that all funds, except for fines and
penalties, collected pursuant to a market-based mechanism
be deposited in the fund; and requires the Department of
Finance, in consultation with ARB and any other relevant
state agency, to develop a three-year investment plan for
the GGRF.
c) Prohibits the state from approving allocations for a
measure or program using the GGRF unless it determines
that the use of those moneys furthers the regulatory
purposes of AB 32, and requires moneys from the GGRF be
used to facilitate the achievement of reductions of GHG
emissions in California.
d) Creates the Affordable Housing and Sustainable
Communities Program (AHSC), which is developed and
administered by the Strategic Growth Council (SGC) to
reduce GHG emissions through projects that implement land
use, housing, transportation, and agricultural land
preservation practices to support infill and compact
development.
e) Continuously appropriates 60% of the GGRF to
transit, affordable housing and sustainable communities,
including 20% continuously appropriated for the
Affordable Housing and Sustainable Communities Program.
From the 20% continuously appropriated for the Affordable
Housing and Sustainable Communities Program, 10% must be
allocated to affordable housing.
2)Under the Cannella Environmental Farming Act of 1995:
a) Requires the California Department of Food and
Agriculture (CDFA) to establish an environmental farming
program (program) to provide incentives to farmers whose
practices promote the well-being of ecosystems, air
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quality, and wildlife and their habitat.
b) Requires the Secretary of CDFA to convene the
five-member Scientific Advisory Panel on Environmental
Farming to advise and assist federal, state, and local
government agencies on issues relating to air, water, and
wildlife habitat.
THIS BILL:
1)Renames CDFA's Scientific Advisory Panel on Environmental
Farming the Environmental Farming Act Advisory Panel.
2)Expands the program to specifically include activities related
to the reduction of on-farm GHG emissions and increased carbon
storage in agricultural soils and woody biomass; authorizes
CDFA to provide incentives, including, but not limited to
grants, loans, research, technical assistance, or educational
materials and outreach.
3)Authorizes CDFA to support these on-farm practices and
activities by providing permit assistance and coordination and
funding demonstration projects that further the goals of the
program.
4)Adds "climate change" to the list of issues that may be
addressed by the Panel when providing advice and assistance to
government agencies.
5)Deletes provisions relating to the five-member panel and
establishes the Panel to consist of nine members, including:
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a) Two members appointed by the Secretary for Environmental
Protection; one with expertise in climate change and its
impacts on California agriculture, and one with expertise
in GHG emissions reduction practices related to
agriculture;
b) Two members appointed by the Secretary of the Natural
Resources Agency; one affiliated with the California
Association of Resource Conservation Districts, and one
engaged in the conduct of scientific research related to
the bill; and,
c) Five members appointed by the Secretary of CDFA, as
follows:
i) Three members who are agricultural producers in the
state, as specified;
ii) One member who is affiliated with the University of
California Cooperative Extension; and,
iii) One member who is engaged in the conduct of
scientific research related to the purposes of the bill.
6)Specifies that members of the Panel shall serve for three-year
terms, as specified.
7)Requires the Panel to review data on the impact that
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agriculture has on the environment and recommend to the
Secretary and other appropriate state agencies data that the
Panel determines is scientifically valid.
8)Authorizes a state agency that receives data recommended by
the Panel to adopt and incorporate the data into the
appropriate program. If a state agency does not use the data
recommended, requires the agency to provide the Panel with a
written statement of reasons.
9)Requires the Panel to submit a biennial report on their work,
the Panel's action plan for the next two years, and requires
the first report to occur no later than two years after the
Panel's first meeting or January 1, 2019, whichever occurs
first.
10)Requires CDFA, in consultation with the Panel, to carry out
the purposes of the Cannella Environmental Farming Act and
develop and implement a grant program to reduce GHG emissions
and increase carbon storage in agricultural soils and woody
biomass, including:
a) Soil-building and carbon sequestration practices,
including the increased use of compost and biochar, cover
crops, and low- and no-till practices;
b) Irrigation efficiency and water conservation measures,
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including soil-moisture monitoring, irrigation scheduling,
high-efficiency water delivery technologies, dry farming,
and on-farm water catchment;
c) 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;
d) Wildlife habitat conservation, including hedgerow
planting, native grass planting and restoration,
agroforestry, and managed grazing for enhanced habitat.
11)Specifies that $25 million from the GGRF, upon appropriation
by the Legislature, be available to CDFA for the above grant
program and to carry out the purposes of the bill.
12)Requires the Secretaries of CDFA and NRA to enter into a
memorandum of agreement among CDFA, the Department of
Conservation, and other relevant state agencies to ensure the
greatest possible coordination and collaboration in
implementing these programs and projects.
13)Requires SGC to establish and administer a grant program, as
part of the Sustainable Agricultural Lands Conservation (SALC)
Program, to provide incentives for the adoption and use of
land management practices that would reduce GHG emissions and
sequester carbon in soils and woody biomass, and provide other
cobenefits on working agricultural operations. Specifies that
no less than 2% of GGRF proceeds be appropriated to SGC for
the grant program.
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FISCAL EFFECT: According to the Senate Appropriations
Committee, this bill would specify that $25 million be
available, upon appropriation by the Legislature, to support
three specific programs at CDFA.
COMMENTS:
1)This bill. According to the author:
SB 367 modernizes the Environmental Farming Act of 1995 to
ensure that California maximizes its opportunities to
achieve voluntary GHG emission reductions in the state's
agriculture sector by developing and promoting projects and
on-farm practices that also have other environmental and
health benefits. Upon appropriation, SB 367 also directs
$25 million to the Department of Food and Agriculture for a
grant program to support these on-farm demonstration
projects, and directs two percent of the Greenhouse Gas
Reduction Funds' annual proceeds to the Strategic Growth
Council's Sustainable Agricultural Lands Conservation
Program.
2)Environmental Farming Program. The Cannella Environmental
Farming Act of 1995 created the Environmental Farming Program
within CDFA and established a panel to guide the program. The
panel is charged with reviewing and documenting agriculture's
positive impacts to the environment and studying issues such
as ecosystem services and how they relate to agriculture. The
panel has produced a two-year report on initiatives and work
completed to date.
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3)Sustainable Agricultural Lands Conservation Program. The
Budget Act of 2014 appropriated $130 million from the GGRF to
develop and implement the AHSC. SB 862 (Committee on Budget
and Fiscal Review), Chapter 36, Statutes of 2014, continuously
appropriates 20% of GGRF annual proceeds to the AHSC beginning
in FY 2015-16. The AHSC is tasked with reducing GHG emissions
through projects that implement land use, housing,
transportation, and agricultural land preservation practices
to support infill and compact development.
The SGC approved guidelines on January 20, 2015, for the
agricultural land preservation component of the program,
called the Sustainable Agricultural Lands Conservation (SALC)
Program. SALC is intended to integrate and leverage existing
agricultural land protection programs.
According to the guidelines, the principal goal of this grant
program is to fund sustainable agricultural land strategy
plans and permanent agricultural conservation easements in
order to avoid increases in GHG emissions associated with
agricultural lands, consistent with AB 32. The guidelines cite
recent University of California research that estimates that
land in agricultural and healthy open space use sequesters up
to 70 times more carbon than any form of urban development.
The guidelines also specify that in future years, SGC intends
to add a third program element to provide incentives for land
management practices that lead to additional reductions of GHG
emissions on agricultural lands.
As the program is funded through moneys from the GGRF, the
program must document how expenditures will reduce GHG
emissions and further the purposes of AB 32. The eligibility
and selection criteria presented in the guidelines are
designed to prioritize projects that demonstrate the greatest
potential for protecting lands most at risk of conversion to
other purposes and the program intends to estimate the amount
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of GHG emission reductions of these projects based on GHG
emissions attributable to a more intensive development of the
land. In addition to GHG emissions reductions, the program
also considers co-benefits of projects, including water
conservation, economic benefits, improved air quality,
nutrient cycling, energy conservation, wildlife habitat, and
others.
4)Cap and trade funds. ARB has conducted ten cap-and-trade
auctions, generating almost $1.6 billion in proceeds to the
state. The 2014-15 Budget allocates $832 million in GGRF
revenues to a variety of transportation, energy, and resources
programs aimed at reducing GHG emissions. Various agencies
are in the process of implementing this funding. The budget
agreement specifies how the state will allocate most
cap-and-trade auction revenues in 2015-16 and beyond. For all
future revenues, 25% of the GGRF is continuously appropriated
to the state's high-speed rail project, 20% for affordable
housing and sustainable communities grants, 10% to intercity
capital rail projects, and 5% for low-carbon transit
operations. The remaining 40% is available for annual
appropriation by the Legislature. Of that 40%, $15 million was
appropriated to CDFA to fund agricultural energy and
operational efficiency programs, with $12 million directed for
financial assistance for the installation of dairy digesters,
and $3 million to support deployment and use of renewable
natural gas, its analogues, and other low-carbon renewable
biofuels derived from agricultural waste, for use in the
transportation sector.
The Governor's proposed 2015-16 cap-and-trade expenditures
propose $1.02 billion in spending, with $15 million dedicated
to fund agricultural energy and operation efficiency programs
through CDFA.
5)Drought relief funding. In response to California's ongoing
drought, AB 91 (Budget and Fiscal Review), Chapter 1, Statutes
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of 2015 allocated just over $1 billion for drought-related
activities. This allocation included $10 million from the
GGRF to CDFA for agricultural water efficiency projects that
reduce GHG emissions and $200,000 from the General Fund to
CDFA to conduct an economic analysis of the ongoing impacts of
California's drought on the state's agriculture sector and
identify potential solutions.
6)Suggested amendments. The committee may wish to make the
following amendments to the bill to correct drafting errors
and clarify provisions of the bill:
a) Clarify that the Panel review data on the impacts and
benefits that agriculture has on the environment, which
will ensure consistency with various cross references.
b) Replace "operating efficiency" with "energy efficiency,"
on page 8, line 11.
c) Specify that a "processing facility" refers to
agricultural processing facilities.
d) Correct related drafting errors.
7)Related legislation.
a) AB 761 (Levine) requires, upon appropriation by the
Legislature, CDFA to establish a grant program to fund
projects that increase carbon sequestration and GHG
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emissions reduction on agricultural lands, ranches and
rangelands. This bill is set for hearing in the Senate
Environmental Quality Committee on July 15.
8)Double referral. This bill was passed by the Assembly
Agriculture Committee on July 1st with a vote of 7-0.
REGISTERED SUPPORT / OPPOSITION:
Support
American Farmland Trust
Association of Compost Producers
Audubon California
CR&R Incorporated
Cachuma Resource Conservation Districts
California Association of Resource Conservation Districts
California Climate and Agriculture Network (CalCAN)
California Farm Bureau Federation
California Food Policy Council
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California League of Conservation Voters
California State Grange
Californians Against Waste
Carbon Cycle Institute
Center for Biological Diversity
Center for Food Safety
Coastal Environmental Rights Foundation
Community Alliance with Family Farmers
Community Environmental Council
Compost Coalition
Defenders of Wildlife
Environment California
Environmental Action Committee of West Marin
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Environmental Defense Center
Environmental Defense Fund
Environmental Entrepreneurs
Environmental Justice Program at Catholic Charities, Diocese of
Stockton
Greenbelt Alliance
Land Trust of Santa Cruz County
Lutheran Office of Public Policy
Mendocino County Resource Conservation District
National Hmong American Farmers
Occidental Arts and Ecology Center
Peninsula Open Space Trust
San Mateo County Resource Conservation District
Solano Land Trust
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Sonoma Resource Conservation District
Stopwaste
Sustainable Conservation
Trust for Public Lands
Whole Grain Connection
One individual
Opposition
California Chamber of Commerce
Analysis Prepared by:Elizabeth MacMillan / NAT. RES. / (916)
319-2092
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