BILL ANALYSIS Ó
SB 900
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Date of Hearing: August 3, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SB 900
(Jackson) - As Amended May 31, 2016
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|Policy |Natural Resources |Vote:|9 - 0 |
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill transfers $2 million from the General Fund (GF) to the
Land Bank Fund (LBF) for FY 2017-18, to be available, upon
appropriation, for the State Lands Commission (SLC) to implement
a coastal hazard removal and remediation program. Beginning in
FY 2018-19, this bill annually transfers up to $2 million from
the GF to the LBF to ensure a total of $2 million is available.
Specifically, this bill:
1)Provides LBF funds are available to the SLC upon appropriation
by the Legislature in the Budget Act.
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2)Requires SLC, within two years of an appropriation of funds,
to administer the coastal hazard removal and remediation
program to:
a) Complete an in-depth inventory of legacy (i.e.,
abandoned) oil and gas wells and other coastal hazards
along the coastline and determine high-priority hazards and
wells to remediate.
b) Survey, study, and monitor oil seepage in state waters
and tidelands to determine oil seepage locations, rates,
and environmental impacts.
c) Begin the process of remediating improperly
abandonedwells with a high risk of leaking, and with any
remaining funds, remove other identified coastal hazards.
1)Authorizes SLC to seek and accept gifts, bequests, devises, or
donations to fund the program without the approval of the
Department of Finance.
2)Authorizes SLC, in cooperation with the Division of Oil, Gas,
and Geothermal Resources (DOGGR), authorizes SLC to abandon
(properly close) wells that present a hazard to public health
and safety and the environment.
3)Requires SLC to annually report to the Legislature the
activities and accomplishments of the program.
FISCAL EFFECT:
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1)The redirection of $2 million from the GF to the LBF in FY
2017-18 and up to $2 million per year thereafter to ensure the
unencumbered funds in the LBF are available to the SLC for
program implementation.
2)One-time SLC cost of approximately $100,000 to complete the
in-depth inventory of legacy wells (LBF).
3)Annual SLC costs of approximately $50,000 to survey and
monitor oil seepage and annual SLC costs of approximately
$200,000 to remove coastal hazards (LBF).
4)Unknown costs to plug and abandon legacy wells, potentially in
the $1 million per well range if the well is in the tidal zone
(LBF). This includes CEQA compliance (which can be hundreds
of thousands of dollars).
5)DOGGR costs are absorbable.
COMMENTS:
1)Purpose. According to the author, we already know there are
over 200 improperly capped wells in state waters. In order to
completely address the issue of legacy coastal oil wells, this
bill directs the SLC to conduct an in-depth inventory of
legacy oil wells along California's coastline. The author
further contends, given the effectiveness of SLC and its staff
at protecting California's coastline, it is the appropriate
body to remediate California's legacy oil wells and other
coastal hazards.
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2)Background. Coastal hazards can include remnants of coastal
structures, piers, oil wells, pilings, deteriorated electric
cables, and old pipes. Many coastal hazards are located on
public trust lands set aside for commerce, navigation,
fishing, and recreation, and can impede coastal use and
threaten public health and safety. The Summerland Oil Field
in Santa Barbara County was the world's first offshore oil
drilling operation and predates any regulatory framework.
While the visual infrastructure has been removed, the wells
were not properly capped and continue to leak oil into the
ocean and Santa Barbara's beaches.
SLC has developed a limited coastal hazard removal program that
has operated when funding has been available. The program was
initiated when an inventory performed in the mid-1980s found
over 400 coastal hazards in Los Angeles, Santa Barbara, and
Ventura Counties. While some hazards were traced to
responsible parties, most were not and consequently became the
responsibility of the state. SLC has completed eight hazard
removal projects since 2001. In August, 2015, SLC directed
staff to conduct an initial assessment of the Becker Onshore
Well (in the Summerland Oil Field).
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
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