BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                        SB 822|
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                                    THIRD READING


          Bill No:  SB 822
          Author:   Roth (D)
          Amended:  5/31/16  
          Vote:     21  

           SENATE AGRICULTURE COMMITTEE:  4-0, 3/29/16
           AYES: Galgiani, Cannella, Pan, Wolk
           NO VOTE RECORDED: Berryhill

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 5/27/16
           AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen

           SUBJECT:   Agricultural pest control:  citrus disease  
                     prevention:  monthly assessment


          SOURCE:    California Citrus Mutual


          DIGEST:  This bill increases the maximum monthly citrus  
          assessment fee from $0.09 to $0.12 cents per 40 pound carton.

          ANALYSIS:  Existing law requires producers in the citrus fruit  
          industry to pay a monthly assessment not exceeding $0.09 per  
          carton of citrus fruit, to be used for citrus disease management  
          and pest control activities, which are deposited in the Citrus  
          Disease Management Account, except as specified.

          This bill increases the monthly citrus assessment fee from $0.09  
          to $0.12 per 40 pound carton.

          Background

          California is the top-producing agricultural state in the nation  
          with $54 billion in agricultural commodity value in 2014.   








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          California is also a top producer of citrus fruits and is ranked  
          second only to Florida in citrus production but first in citrus  
          product sold fresh to market.  According to the most recent  
          census, in 2012, the $2.1 billion California citrus industry  
          grew nearly 4 million tons of citrus on 270,000 acres and  
          provided more than 14,000 jobs.

          Existing law establishes the California Citrus Pest and Disease  
          Prevention Committee (CCPDPC) within the California Department  
          of Food and Agriculture (CDFA) to advise the secretary of CDFA  
          on efforts to prevent and manage citrus pests and diseases.  An  
          assessment is levied on citrus producers and deposited into the  
          Citrus Disease Management Account for the sole purpose of  
          combating citrus-specific pests and diseases.  This account may  
          also contain funds from federal and other non-General Fund  
          sources.  The current assessment rate is $0.09 per 40 pound  
          carton, which amounts to $15 million annually and represents  
          more than half of the total budget for this program (AB 281, De  
          León, Chapter 426, Statutes of 2009; Food and Agricultural Code  
          §5911 et seq.).

          Asian citrus psyllid (ACP) is an invasive pest that feeds on  
          citrus plants' leaves and stems and causes shoot deformation and  
          plant stunting.  More importantly, ACP may transmit  
          Huanglongbing (HLB), a bacterial plant disease that causes the  
          plant to produce unpalatable/inedible fruit before ultimately  
          killing the tree.  According to CDFA, HLB is the most  
          devastating disease of citrus in the world.  There is no cure  
          and infected plants must be destroyed.  

          The first discovery of ACP and HLB in the United States was in  
          Florida in 1998 and early September 2005, respectively.  Within  
          2 years, the disease HLB spread to all citrus-producing counties  
          and infected over half of all citrus trees in the state.   
          Studies have shown that the economic damage due to HLB in  
          Florida alone has resulted in a loss of $7.8 billion and 7,513  
          jobs since 2007, reducing the industry to nearly a quarter of  
          the size it once was.  The disease HLB has also been detected in  
          Georgia, Louisiana, South Carolina, Texas, and most recently,  
          California.

          In 2008, the pest ACP was first identified in Southern  








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          California.  In in the last two years, ACP has rapidly spread  
          north into commercial citrus groves and residential trees, and  
          quarantine boundaries have expanded to encompass one-third of  
          the state.  Meanwhile, in March 2012, HLB was detected in a  
          residential, multi-grafted citrus tree in Los Angeles County.   
          The tree was destroyed, however the disease was detected again  
          in 2015 in 17 trees located in the surrounding areas. The new  
          finds and the rapid northern migration is a cause of great  
          concern, raising CDFA's surveillance, trapping, and analytical  
          workloads.

          According to the University of California, Agriculture and  
          Natural Resources (UCANR), the citrus industry, the University  
          of California, and both the state and federal governments are  
          working to eliminate and prevent the establishment of ACP and  
          HLB in California.  Much of the research is conducted with  
          funding from the citrus industry through the Citrus Research  
          Board, UCANR, CDFA Specialty Crops Block Grants, and the United  
          States Department of Agriculture - National Institute of Food  
          and Agriculture (USDA-NIFA).  

          The Agricultural Act of 2014 (H.R. 2642) was signed into law on  
          February 7, 2014, and directs $125 million of the USDA Specialty  
          Crop Research Initiative funding toward citrus disease research  
          over the next 5 years.  In FY 2015, the federal government  
          awarded $20 million in grants nationwide to university  
          researchers and extension projects to aid in the fight against  
          HLB.  

          Comments
          
          Funding sources.   The CCPDPC is funded by the California citrus  
          industry and federal grants.  Of the $25 million annual budget,  
          roughly $15 million is funded through the $0.09 per carton  
          assessment fee and $10 million through the United States  
          Department of Agriculture.  However, this year, the federal  
          government approved an additional $2 million in funding that  
          will be used to increase psyllid detection and trapping in the  
          San Joaquin Valley. The CCPDPC received a one-time $1 million  
          appropriation from the General Fund in FY 2013-14 (AB 110,  
          Statutes of 2013), however no other monies from California's  
          General Fund have been appropriated.








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          Budget request. The Senate Budget Subcommittee No. 2 approved a  
          General Fund allocation of $5 million to CDFA for Asian citrus  
          psyllid control, where $4.25 million is dedicated for  
          residential application and $750,000 for an interagency  
          agreement with the Department of Pesticide Regulation to provide  
          a consumer product database for a residential level study of the  
          impacts of neonicotinoid-treated seed and plants sold at the  
          retail level.  

          Residential citrus.  Over half of all citrus trees in California  
          are located in residential backyards.  Currently, $12 million of  
          the industry-assessed fees are being used to detect and trap ACP  
          and remove HLB-infected citrus trees in the Los Angeles Basin,  
          the area of greatest infestation.  None of the assessment fees  
          are currently being used to treat commercial citrus groves.
          
          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No

          According to the Senate Appropriations Committee:

          The bill would increase citrus industry assessed fee authority  
          by $0.03 per carton, from $0.09 to $0.12. If the fee were raised  
          to the maximum level, revenues would increase by roughly $5  
          million annually (special fund).


          SUPPORT:   (Verified5/31/16)


          California Citrus Mutual (source)
          Southwest California Legislative Council
          Western Growers Association


          OPPOSITION:   (Verified5/31/16)


          None received










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          ARGUMENTS IN SUPPORT:      According to the author, "SB 822 will  
          provide much needed funding to continue to combat the spread and  
          devastating effects of Huanglongbing (HLB) on California's  
          citrus industry.   Florida has already lost approximately $7.8  
          billion in revenue, 162,000 citrus acres, and 7,513 jobs to HLB  
          and similar impacts are being seen in Texas.  While California's  
          citrus industry has slowed the spread of the disease by raising  
          $15 million per year for trapping and treatments, it is not  
          enough.  SB 822 seeks to increase the assessment on citrus  
          growers to raise up to an additional $5 million [?] to help  
          protect California's $3 billion citrus industry, 22,000 jobs and  
          countless residential citrus trees so important to California's  
          rich history."





          Prepared by:  Anne Megaro / AGRI. / (916) 651-1508
          5/31/16 20:45:33


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