BILL ANALYSIS Ó
SB 820
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Date of Hearing: June 21, 2016
ASSEMBLY COMMITTEE ON JUDICIARY
Mark Stone, Chair
SB
820 (Hertzberg) - As Amended April 12, 2016
PROPOSED CONSENT
SENATE VOTE: 38-0
SUBJECT: Hazardous materials: California Land Reuse and
Revitalization Act of 2004
KEY ISSUE: Should the sunset date for the California land REUse
and Revitalization Act be extended until January 1, 2027, and
should an immunity provision in the existing act be changed
accordingly?
SYNOPSIS
This bill extends the sunset date for the California Land Reuse
and Revitalization Act (CLRRA) from January 1, 2017, to January
1, 2027, and makes a corresponding change in the operative date
of a limited immunity provision. CLRRA was originally enacted
in 2004 to provide greater incentives to clean up and develop
"brownfields," the term used to describe properties that remain
unused and undeveloped because of actual or potential hazardous
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waste contamination. Because the costs and potential
liabilities associated with cleaning up and developing such
properties act as a barrier to revitalization and development of
these parcels, CLRRA creates incentives for development by
providing innocent landowners or bona fide purchasers - that is,
owners who did not cause the condition or only acquired the
property later - with immunity from liability for certain agency
response costs or other damages caused by a release of hazardous
materials. To qualify for this immunity the bona purchaser or
innocent owner must meet certain conditions, including entering
into an agreement with an oversight agency, fully cooperating
with the agency, and performing other actions related to the
cleanup effort. By most accounts, CLRRA has been fairly
successful in cleaning up and developing otherwise contaminated
and idle properties. However, CLRRA is due to sunset on January
1, 2017. This bill will extend the sunset to January 1, 2027,
and make a corresponding change that allows, as does existing
law, a qualified bona fide purchaser or innocent owner to
continue enjoying immunity after the expiration of CLRRA, so
long as he or she continues to comply with its requirements and
conditions. The bill is supported by several California cities
and associations representing a range of builders, developers,
and business property owners. There is no opposition to this
bill.
SUMMARY: Extends the sunset date for the California Land Reuse
and Revitalization Act (CLRRA) until January 1, 2027, and makes
a conforming change to provide that a person who qualifies for
immunity under the act before January 1, 2027, continues to have
that immunity on and after January 1, 2027, if the person
continues to be in compliance with the requirements of CLRRA.
EXISTING LAW:
1) Establishes, under the federal Comprehensive Environmental
Cleanup, Response and Liability Act, also known as the
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"Superfund," programs that authorize public agencies to order
owners of contaminated property to conduct cleanups of these
properties, generally with public oversight, cooperation, and
assistance. (42 U.S.C. Section 9601 et seq.)
2) Provides, under CLRRA, a qualified bona fide purchaser,
innocent landowner, or contiguous property owner who did not
cause the hazardous material contamination on the subject
property with immunity from liability for agency response
costs or any other damages caused by the contamination. In
order to qualify for the immunity, the bona fide purchaser,
innocent landowner, or contiguous property owner must perform
a number of specified tasks related to the cleanup,
including, among other things, entering into an agreement
with an oversight agency and providing full cooperation,
assistance, and access to the agency or person authorized to
conduct the cleanup response action. However, the bona fide
purchaser, innocent landowner, or contiguous property owner
is not immune from liability for his or her own wrongful
acts, permit violations, or new releases of hazardous
materials that are caused by the bona fide purchaser,
innocent landowner, or contiguous property owner. (Health &
Safety Code Section 25395.60 et seq., especially Sections
25395.80-25395.92.)
FISCAL EFFECT: As currently in print this bill is keyed fiscal.
COMMENTS: The California Land Reuse and Revitalization Act
(CLRRA) was enacted in 2004 to promote the cleanup and
development of so-called "brownfields" - that is, properties
that remain idle, unused, and undeveloped because of actual or
potential hazardous material contamination. According to most
informed observers, one of the primary reasons that these
properties remain idle and undeveloped is due to the costs and
potential liabilities associated with cleaning up and developing
such properties. CLRRA, therefore, created incentives for
development by granting bona fide purchasers or innocent
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landowners with immunity from liability for claims for certain
response costs or other damages caused by a release of hazardous
materials. To qualify for this immunity the bona purchaser or
innocent owner must meet certain conditions, including entering
into an agreement with an oversight agency, fully cooperating
with the agency in all phases and aspects of the cleanup
project, and performing any other actions required by the
agreement. Existing law also provides that any owner who
qualified for this immunity before the CLRRA expiration -
January 1, 2017, under existing law - would continue to enjoy
that immunity after the expiration date so long as the qualified
owner continued to comply with all of the requirements of CLRRA.
As the several letters of support for this bill attest, CLRRA
has allowed many cities in California to partner with private
developers to turn once idle and blighted parcels into new
development projects that no longer pose a threat to public
safety and contribute billions of dollars of revenue to local
governments statewide. In order to keep reaping these benefits,
this bill would extend the current sunset date for CLRRA from
January 1, 2017, to January 1, 2027. It would make a
corresponding change in the continuing immunity provision, so
that owners who qualified for immunity before January 1, 2027,
would continue to have immunity after that date for a continuing
project, so long as they continue to comply with the
requirements of CLRRA. It is important to stress that neither
existing law, nor this bill, provides immunity for owners who
commit criminal acts, violate permit restrictions, or cause new
releases of hazardous materials.
If the program is so successful, why not remove rather than
extend the sunset? Historically, this committee has taken the
position that sunsets should not be repeatedly extended. A
sunset is generally added to a legislatively-mandated program so
that any consequences of the program - especially unintended
consequences - may be re-evaluated by the Legislature after a
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certain period of time. If it turns out that the legislation
fails to address the problem or leads to unwanted results, then
the legislation is allowed to expire by the terms of the sunset
clause. If it turns out that the legislation successfully
addressed the problem, then the sunset clause is deleted and the
legislation becomes permanent. As originally introduced, this
bill proposed to remove the sunset and make CLRRA permanent.
However, the bill was amended to extend rather than delete the
sunset in the Senate Environmental Quality Committee. The
committee analysis described its reasoning as follows:
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.
ARGUMENTS IN SUPPORT: According to the author, since "buyers of
brownfield sites may be liable for contamination they had no
role in, these hazardous sites can sit dormant for years and
decades. This not only contributes to urban blight, but poses
several environmental and health risks for surrounding
communities. By extending [the Act], SB 820 preserves a great
tool for transforming polluted properties to become productive
uses of space adding economic value to blighted communities
while reducing environmental and health risks." Several
associations representing builders and developers support this
bill for substantially the same reasons. These arguments are
reinforced by letters of support from several California cities
describing specific examples of successful brownfield cleanup
projects in their respective communities.
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REGISTERED SUPPORT / OPPOSITION:
Support
Bay Area Council
Brown & Winters
California Association for Local Economic Development
California Business Properties Association
California Council for Environmental and Economic Balance
California Infill Builders
California Main Street Alliance
Center for Creative Land Recycling
City of Carson
City of Chula Vista
City of Redding
Civil Justice Association of California
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League of California Cities
Los Angeles Neighborhood Land Trust
Opposition
None on file
Analysis Prepared by:Thomas Clark / JUD. / (916)
319-2334