BILL ANALYSIS Ó SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator Wieckowski, Chair 2015 - 2016 Regular Bill No: SB 820 ----------------------------------------------------------------- |Author: |Hertzberg | ----------------------------------------------------------------- |-----------+-----------------------+-------------+----------------| |Version: |1/5/2016 |Hearing |4/6/2016 | | | |Date: | | |-----------+-----------------------+-------------+----------------| |Urgency: |No |Fiscal: |Yes | ------------------------------------------------------------------ ----------------------------------------------------------------- |Consultant:|Rachel Machi Wagoner | | | | ----------------------------------------------------------------- SUBJECT: Hazardous materials: California Land Reuse and Revitalization Act of 2004 ANALYSIS: Existing law: 1) Pursuant to both federal and state law, establishes an extensive and complex series of programs authorizing public agencies to order owners of contaminated property, including "brownfields" to conduct cleanups of these properties, including the following: a) The Comprehensive Environmental Cleanup, Response and Liability Act (CERCLA 42 U.S.C. 9601 et seq.), commonly referred to as the federal Superfund law; b) The Carpenter-Presley-Tanner Hazardous Substance Account Act (commencing with Section 25300 of the Health and Safety Code), commonly referred to as the State Superfund Program; c) Division 7 of the Water Code (commencing with Section 13000), commonly referred to as the Porter-Cologne Water Quality Control Act); d) Article 12.5 of the Health and Safety Code (commencing with Section 33459), commonly referred to as the Polanco Redevelopment Act; e) Chapter 6.10 of the Health and Safety Code (commencing SB 820 (Hertzberg) Page 2 of ? with Section 25401), commonly referred to as the Escutia Law; f) Chapter 6.65 of the Health and Safety Code (commencing with Section 25260), commonly referred to as the Unified Agency Review of Hazardous Substance Release Site law or the "AB 2061" process; g) Article 8.5 of the Health and Safety Code (commencing with Section 25395.10), commonly referred to as the CLEAN Program (Clean Loans and Environmental Assistance to Neighborhoods; and, h) Article 8.7 of Chapter 6.8 of the Health and Safety Code (commencing with Section 25395.40), commonly referred to as the FAIR Program (Financial Assurance and Insurance for Redevelopment). 2) Pursuant to the California Land Reuse and Revitalization Act of 2004 (CLRRA), provides qualified innocent landowners, bona fide purchasers or contiguous property owners with immunity from liability for certain hazardous materials response costs or other damages based on meeting stipulated conditions, including the following: a) Participants agree to assess and cleanup the property as necessary; b) Participants seeking to qualify for immunity must enter into an agreement with an oversight agency; c) Response actions must be as protective of public health and the environment as actions required by relevant cleanup standards contained in the Health and Safety and Water Codes. The Act is repealed as of January 1, 2017, unless another enacted statute deletes or extends that date. This bill deletes the repeal date of CLRRA, thereby continuing the Act indefinitely. Background 1) California Brownfields. The original purpose of CLRRA (the SB 820 (Hertzberg) Page 3 of ? statute for which this measure seeks to eliminate the sunset) was stated as follows "The underutilization of brownfields in the state results in environmental, social, and economic detriments to the state and citizens?.The brownfields in California represents an opportunity for the development of housing, parks and mixed use developments. According to the Department of Toxic Substances Control, there are approximately 90,000 brownfields currently in California. 2) Previous legislation: AB 389 (Montanez, Chapter 705, Statutes of 2004) enacted the California Land Reuse and Revitalization Act of 2004, which provides that an innocent landowner, a bona fide purchaser, or a contiguous property owner, as defined, qualifies for immunity from liability for response cost or damage claims under specified state statutory and common laws that impose liability upon an owner or occupant of property, for pollution conditions caused by a release or threatened release of a hazardous material on, under, or adjacent to that property, if the innocent purchaser, bona fide purchaser, or contiguous property owner meets specified conditions. The legislation specified a sunset date of January 1, 2010. SB 143 (Cedillo, Chapter 167, Statutes of 2009) extended the CLRRA sunset date from January 1, 2010 to January 1, 2017. Comments 1) Purpose of Bill. According to the author, by extending CLRRA, SB 820 preserves a great tool for cleaning up and transforming polluted properties. The author states that property purchasers and developers are hesitant to buy and develop on brownfields because of the stigma and risk tied to them, which results in contaminated lands that remain vacant for years. The author asserts that California's brownfields get another chance of becoming productive uses of space when liability protection is provided. The sponsor provided a list of approximately 40 sites where CLRRA has been used to facilitate remediation of brownfields. Many of these projects have been completed in just the last few years. An example offered by the sponsor of the success of SB 820 (Hertzberg) Page 4 of ? CLRRA is the Hayward Pickle Plant. This was the first CLRRA agreement. The property was cleaned up under and a completion letter was issued in less than a year. An affordable housing developer acquired the property and the Eden Housing affordable housing project opened about five years ago. 2) Liability protection for whom? Providing liability protection for prospective purchasers does not remove the risk from exposure to the contamination present at the brownfield but rather just alters who can be held accountable for correcting or mitigating the hazards and the risk of exposure after the completion of the cleanup and project. It is unclear, if a site is remediated and at a later date an exposure risk is found who will be held accountable? Does the state assume responsibility if there is no responsible party to recover additional cleanup costs? 3) Remove or extend the Sunset? There are many virtues to legislative program sunsets, including the opportunity for the Legislature to revisit the performance and value of such programs. To date, there is only a limited basis for evaluating the performance of CLRRA and most of the projects have been completed in the last year or so. The long-term consequences of CLRRA, especially with regard to the state's potential liability for chemical contamination, suggest that it is prudent to periodically review the success of these remediation projects. An amendment should be taken to extend the sunset date for 10 years rather than remove it entirely. DOUBLE REFERRAL: If this measure is approved by this committee, the do pass motion must include the action to re-refer the bill to the Senate Judiciary Committee. SOURCE: California Association for Local Economic Development SUPPORT: Association of Commercial Real Estate Investment Trusts - Northern and Southern California Bay Area Council Building Owners and Managers Association of California California Business Properties Association SB 820 (Hertzberg) Page 5 of ? California Infill Federation California Main Street Alliance Center for Creative Land Recycling City of Carson City of Chula Vista City of Redding Civil Justice Association of California Commercial Real Estate Developers Association Institute of Real Estate Management International Council of Shopping Centers League of California Cities Los Angeles Neighborhood Land Trust NAIOP of California National Association of Real Estate Investment Trusts Retail Industry Leaders Association OPPOSITION: None received -- END --