BILL ANALYSIS Ó
SENATE COMMITTEE ON GOVERNMENTAL ORGANIZATION
Senator Isadore Hall, III
Chair
2015 - 2016 Regular
Bill No: SB 677 Hearing Date: 4/28/2015
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|Author: |Mendoza |
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|Version: |4/6/2015 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Felipe Lopez |
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SUBJECT: Public safety: fireworks
DIGEST: This bill authorizes, beginning January 1, 2017, the
sale of safe and sane fireworks during the week preceding New
Year's Day and makes numerous changes to the state laws
governing fireworks sales and disposals.
ANALYSIS:
Existing law:
1)Requires various entities, including the State Fire Marshal
(SFM), to seize certain prohibited fireworks.
2)Requires an authority that seizes fireworks to notify the SFM
of the seizure and provide specified information.
3)Requires the SFM to dispose of the fireworks and requires
dangerous fireworks to be disposed of according to specified
procedures.
4)Provides that if dangerous fireworks are seized pursuant to a
local ordinance that provides for administrative fines or
penalties and these fines or penalties are collected, the
local government entity collecting the fines or penalties
shall forward 65% of the collected moneys to the State
Controller for deposit in the State Fire Marshal Fireworks
Enforcement and Disposal Fund.
SB 677 (Mendoza) Page 2 of ?
5)Requires the SFM to acquire and use statewide mobile dangerous
fireworks destruction units to collect and destroy dangerous
fireworks from local and state agencies.
6)Authorizes the retail sale of safe and sane fireworks from
June 28 to July 6, annually, pursuant to a license issued by
the SFM, unless otherwise prohibited or regulated by law or
ordinance.
7)Requires the Department of Motor Vehicles (DMV) to suspend the
commercial license of a person transporting dangerous
fireworks as specified.
8)Provides that the Department of Finance has general powers of
supervision over all matters concerning the financial and
business policies of the state.
This bill:
1)Authorizes, beginning January 1, 2017, the sale of certified
safe and sane fireworks from 9 a.m. on December 26 to 11:59
p.m. on January 1 of the following year pursuant to a license
issued by the SFM, if authorized by a charter city, city,
county, fire protection district, or city and county ordinance
or resolution that may also restrict the hours of use of those
fireworks.
2)Authorizes a charter city, city, county, fire protection
district, or city and county that adopts an ordinance or
resolution authorizing the sale of safe and sane fireworks to
require each applicant receiving a permit to pay a fee to the
charter city, city, county, fire protection district, or city
and county of a pro rata portion of the actual and reasonable
costs incurred by the charter city, city, county, fire
protection district, or city and county for, among other
things, processing and issuing fireworks permits, inspection
of fireworks stands, public awareness and education campaigns
regarding the safe and responsible use of safe and sane
fireworks, and related fire operation and suppression efforts,
as specified. The bill specifies that the pro rata portion of
those costs shall be based on a percentage of the permittee's
sales and use tax returns for the applicable permit period,
not to exceed 7% of the gross sales of the fireworks sold,
except that a cost recovery ordinance or resolution in effect
SB 677 (Mendoza) Page 3 of ?
on or before January 1, 2015, would be authorized to supersede
that provision.
3)Authorizes the SFM to permit a state licensed fireworks
importer or exporter or wholesaler to purchase any fireworks
the SFM, the Department of Toxic Substances Control (DTSC),
and a recognized third party testing entity, as defined, deem
to be commercially viable, from the SFM.
4)Requires any revenue received from the sale to belong to the
seizing local authority and would authorize the SFM to enter
into a revenue sharing agreement with that local authority, as
provided.
5)Requires the DTSC to develop and publish guidelines for the
implementation of these provisions, as provided.
6)Requires the local government to forward 25% of the collected
moneys from seized fireworks to the State Controller.
7)Requires seized fireworks to be managed by the SFM, the
authority seizing any fireworks, or the authority's contract
designee, by either disposing or repurposing the fireworks, as
provided.
8)Deletes the SFM's authority to acquire and use statewide
mobile dangerous fireworks destruction units to collect and
destroy dangerous fireworks from local and state agencies.
9)Requires, on or before January 1, 2017, the SFM to collect and
analyze data relating to fires, damages, seizures, arrests,
administrative citations, and fireworks disposal issues caused
by the sale and use of both dangerous illegal fireworks and
safe and sane fireworks, as provided.
10) Requires on or before January 1, 2018, the SFM to
identify and evaluate methods to track all containers
containing dangerous fireworks coming into California ports
that are to be shipped in or out of the state, as provided.
11) Requires the SFM to, on or before January 1, 2019, adopt
regulations relating to dangerous fireworks tracking and
providing for an annual charge to be paid by all holders of
an importer's and exporter's license who import dangerous
fireworks into the state. The bill requires the amount of
SB 677 (Mendoza) Page 4 of ?
the charge to be determined based on the volume of product
and number of containers imported into the state by the
licensees, and payment of this charge would be a condition
of an importer's and exporter's license.
12) Requires the DMV to suspend the commercial license of a
person transporting dangerous fireworks, as specified. The
bill clarifies that these provisions do not apply to a
person with a valid license or permit under the State
Fireworks Law, as specified.
13) Requires, for purposes of monitoring the budgets of the
Department of Forestry and Fire Protection and the DTSC, as
those budgets relate to programs regarding fireworks, the
director to create a plan for modifying budget process to
increase efficiency and focus on accomplishing program
goals relating to fireworks. The bill requires the plan to
include certain content, including ways to ensure
transparency about program goals, outcomes, and funding.
Background
Purpose of the Bill: According to the author, any fireworks not
designated "safe and sane" are considered to be illegal in the
State of California. As a result, there are fireworks seized in
California that are legal to be sold in other states per federal
regulations.
The author points out that fireworks are being seized by many
different agencies throughout the state and that they are all
faced with the problems inherent to the seizure of illegal
fireworks.
SB 677 solves the illegal fireworks crisis in California by
allowing local governments to recover the costs associated with
the seizure and disposal of illegal fireworks.
Policy Considerations: According to the author the stated goal
of the bill is to solve the issue of the illegal fireworks
crisis in California, however the bill currently allows for an
additional week of fireworks sales for the week prior to New
Year's Day. This additional week of sales could be viewed to be
counterintuitive to the overall goal of the bill.
This additional week has the possibility to dramatically
SB 677 (Mendoza) Page 5 of ?
increase the amount of seized fireworks by local jurisdictions.
While the bill does specify that a local ordinance would have to
be adopted before sales could commence, this alone does not
solve the issue. Realistically you could have neighboring
communities-- one allowing sales and the other prohibiting--
where one of the communities is legally selling fireworks and
those fireworks are then being transported to the neighboring
community where sales are illegal and could be seized, thus
increasing the problem.
In addition, though an argument can be made that allowing the
sale of fireworks curbs the sale of illegal fireworks, data from
the SFM's office seems to contradict that point. According to
the SFM the seizures of illegal fireworks usually begin around
March with an increase in seizures towards the 4th of July
period of the year. If legal fireworks sales truly curb the
sale of illegal fireworks, then why does the number of illegal
fireworks being seized increase dramatically during the 4th of
July period?
The committee may therefore wish to strike out the language of
the bill dealing with sales of fireworks during the week
preceding New Year's Day to ensure that the bill would not be
compounding the issue of the fireworks disposal in California
while at the same time trying to solve the problem.
Seized Fireworks in California: The California Health and
Safety Code requires the SFM to dispose of "dangerous fireworks"
within 60 days upon receiving notification from the local
jurisdictions that seized them. These seized fireworks range
from unpackaged improvised devices, to fireworks that are legal
to be sold in other states, as well as safe and sane fireworks
that have been seized in any part of the state that does not
permit the sale. According to the SFM the seizures of these
fireworks have been increasing each year and begin to occur
around March with an uptick in interdictions moving towards the
4th of July period of the year.
The SFM estimates that there are roughly 384,000 pounds of
seized dangerous and illegal fireworks located throughout the
State awaiting disposal. Of that, 220,000 pounds sit in the
physical possession of the SFM in controlled containers at 10
locations around the state, 164,000 pounds sit in local
government controlled sites. Los Angeles County has the largest
stored quantity at approximately 90,000 pounds currently stored.
SB 677 (Mendoza) Page 6 of ?
In the past, the approach for disposal has been by the burning
of unpackaged fireworks under an emergency burn permit issued by
the DTSC or by shipping fireworks in their original federally
approved packaging for out of state disposal.
The SFM did receive a one-time appropriation from the Toxic
Substance Control Account of $1.5 million in the 2014-15 fiscal
year to fund disposal of illegal fireworks. It is believed that
this appropriation is sufficient to reduce the current stockpile
located within SFM controlled storage sites to zero by the end
of the current fiscal year. There is no funding available to
address the illegal fireworks held in local government
facilities.
Firework Sales: Current law authorizes the retail sale of safe
and sane fireworks from June 28 to July 6 annually pursuant to a
license issued by the SFM, unless otherwise prohibited or
regulated by law or ordinance. As of April 2012, there were 290
communities in California that permitted the sale and use of
state-approved fireworks each 4th of July.
Sellers are first required to obtain a license, good for one
year, from the SFM and pay associated fees to the state. Local
jurisdictions may include an administrative fee related to the
processing of permits and a percentage of gross sales collected
by the jurisdiction. This is generally used for education,
over-time staffing, enforcement duties and other fireworks
related additional activities.
Fireworks stands are generally run by non-profit groups such as
battered women's shelters, service clubs (such as Rotary), Boy
Scout and Girl Scout troops, PTAs, Little Leagues, and other
local organizations. If an organization is selling safe and
sane fireworks without a permit the individual or organization
could face a significant fine and possible criminal charges.
City requirements for fireworks sale permits vary slightly from
city to city, but each applicant generally has to comply with
the same basic requirements. The non-profit organization must
obtain designation as a certified, legal non-profit from the
State of California; pay a city permit fee and a sales booth
inspection fee for building and safety, and SFM compliance; pay
an additional annual SFM fee; show proof of insurance with
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various amounts of coverage in case of property damage or injury
in the vicinity of the sales booth; obtain a sales site, usually
in a strip mall or other commercial location; take delivery of
the sales booth; attend a meeting with city officials to learn
of any annual municipal code updates or city council policy
changes relating to the sale of legal fireworks; obtain a
Seller's Permit from the Board of Equalization (BOE) for
required sales tax collection; and take delivery of the product,
supply a sales staff to sell the product and determine the price
they will charge for the product.
The SFM determines which fireworks are legal. The "safe and
sane" varieties carry an official SFM seal. Everything else is
classified dangerous and illegal. It has been reported, that
law enforcement agencies confiscate an average of about 40,000
pounds of illegal fireworks every year.
The SFM is responsible for collecting and disposing of unsafe
fireworks. Because these fireworks contain perchlorates, they
must be disposed in a manner that meets environmental
regulations.
Fireworks Related Injuries: In 2010 the National Fire
Protection Association released a study titled,
"Fireworks-Related Injuries, Deaths and Fires," which found that
in 2010, 8,600 fireworks-related injuries were treated in U.S.
hospital emergency rooms. In addition, the study found that in
2010, an estimated 15,500 fires were started by fireworks in the
United States. These fires resulted in an estimated eight
civilian deaths, 60 civilian injuries and $36 million in direct
property damage.
According to the study, "the risk of fire death relative to
usage shows fireworks to be more risky per hour of usage than
cigarettes. On Independence Day in a typical year, more than
twice as many U.S. fires are reported than on any other day.
Fireworks account for two out of five of those fires, more than
any other cause of fires. The trend in fireworks-related
injuries has been mostly in the range of 8,300 to 9,800 per year
since 1996, except for spikes in 2000, primarily due to
celebrations around the advent of a new millennium." In
addition, the study found that 83% of emergency room fireworks
injuries involved fireworks that Federal regulations permit
consumers to use. Sparklers, fountains, and novelties alone
accounted for 43% of emergency room fireworks injuries.
SB 677 (Mendoza) Page 8 of ?
This study implies that any increase in fireworks use, whether
legal or not, would only increase the number of fireworks
related injuries and fires. With the State of California facing
such a significant drought, any increase of fires would only
exacerbate the problem.
Double-referral: The bill was previously passed by Senate
Governance and Finance Committee with a vote of 4-2.
Prior/Related Legislation
SB 777 (Calderon), 2013-2014 Legislative Session. The bill
would have created a fireworks sell-back program administered by
the SFM and would have authorized the state to issue licenses
for retail sales of fireworks during the week before New Year's
Day. The bill was amended to deal with an unrelated issue area.
SB 1468 (Calderon), 2011-2012 Legislative Session. The bill
would have authorized the sale of specified fireworks between
Christmas and New Year's Day in 2014-15 and 2015-16. Also would
have permitted limited recovery of specified costs by local
governments, and provided for a two-year fireworks data
collection effort to be funded by voluntary contributions from
the fireworks industry. (Held in Assembly Appropriations
Committee)
AB 1295 (Bermudez), 2005-2006 Legislative Session. The bill
would have allowed New Year's fireworks sales and used fee
revenues to pay for disposal costs associated with seized
fireworks. (Held in Assembly Appropriations Committee)
AB 1371 (V. Manuel Perez), 2011-2012 Legislative Session. The
bill would have allowed New Year's fireworks sales and
authorized local governments to impose permit fees. (Held in
Assembly Governmental Organization Committee)
SB 839 (R. Calderon), Chapter 563, Statutes of 2007. The bill
would have revised the penalties for possession and
transportation of dangerous fireworks, as specified. SB 839
established a fund from the proceeds of all fines and fees
collected in relation to dangerous fireworks violations with
those funds earmarked for enforcement of dangerous fireworks
law.
SB 677 (Mendoza) Page 9 of ?
AB 476 (De La Torre), 2007-08 Legislative Session. The bill
would have increased the fines for violating state fireworks
laws from $1,000 to not less than $2,000 and not more than
$5,000, and authorized the impounding of vehicles used to
transport "dangerous fireworks" by SFM. (Held in Assembly
Appropriations)
AB 2310 (Torrico), 2005-06 Legislative Session. The bill would
have reduced the penalty for personal use of prohibited
fireworks, as defined, from a misdemeanor to an infraction,
subject to a citation and a $200 civil penalty, a portion of
that penalty to be transferred to the SFM for disposal of
fireworks and a portion to remain with the local fire protection
agency for administrative costs. (Failed on the Senate Floor)
AB 1295 (Bermudez), 2005-006 Legislative Session. The bill
would have authorized the sale of fireworks from December 26
through January 1 each year and established the SFM Dangerous
Fireworks Management Fund. (Held in Assembly Appropriations
Committee)
AB 923 (Chavez), 2005-06 Legislative Session. The bill would
have authorized the sale of fireworks from December 26 to
January 1 and creates the SFM Dangerous Fireworks Management
Fund for the deposit of surcharges assessed on the sale of
fireworks to pay for the disposal costs of seized fireworks.
(Never heard in Assembly Governmental Organization Committee)
AB 2090 (Miller), Chapter 363, Statutes of 1998. The bill would
have authorized the SFM to license the sale of fireworks from
December 26, 1999 through January 1, 2000 in order to celebrate
the millennium.
FISCAL EFFECT: Appropriation: No Fiscal
Com.: Yes Local: Yes
SUPPORT:
American Promotional Events, Inc.
OPPOSITION:
California Fire Chiefs Association
California Taxpayers Association
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ARGUMENTS IN SUPPORT: According to American Promotional
Events, the SFM is unable to consistently perform its statutory
duty and the money that it has received from the federal
government is gone.
They argue that SB 677 represents a serious, fireworks industry
funded effort to stop the influx of illegal fireworks into
California.
ARGUMENTS IN OPPOSITION: The California Fire Chiefs
Association (Cal Chiefs) has taken an "oppose unless amended"
position on the bill. The Cal Chiefs are requesting that
language pertaining to the sale of fireworks during the New Year
eve period be remove from the bill. They argue that adding
additional sales period will only exacerbate the collection,
storage and disposal of both safe and sane and dangerous
fireworks.
The California Taxpayers Association (CalTax) states that the
bill distorts the nature of a license fee. CalTax argues that a
charge imposed by a state or local government may only cover the
staff time and actual costs necessary to produce a license.
CalTax concludes that the charge authorized by this bill goes
beyond the costs of issuing a license by funding educational
campaigns and fire response services.