BILL ANALYSIS Ó SB 900 Page 1 SENATE THIRD READING SB 900 (Jackson) As Amended August 17, 2016 Majority vote SENATE VOTE: 32-5 ------------------------------------------------------------------ |Committee |Votes|Ayes |Noes | | | | | | | | | | | | | | | | |----------------+-----+-----------------------+-------------------| |Natural |9-0 |Williams, Jones, | | |Resources | |Cristina Garcia, | | | | |Gomez, Hadley, Harper, | | | | |McCarty, Mark Stone, | | | | |Wood | | | | | | | |----------------+-----+-----------------------+-------------------| |Appropriations |15-0 |Gonzalez, Bigelow, | | | | |Bloom, Bonilla, Bonta, | | | | |Chang, Eggman, Eduardo | | | | |Garcia, Jones, | | | | |Obernolte, Quirk, | | | | |Santiago, Weber, Wood, | | | | |McCarty | | | | | | | | | | | | ------------------------------------------------------------------ SB 900 Page 2 SUMMARY: Requires, upon appropriation of funding by the Legislature, that the State Lands Commission (SLC) administer a coastal hazard removal and remediation program (program). Specifically, this bill: 1)Requires SLC, within two years of an appropriation of funds, to administer the program to do the following: a) Complete an in-depth inventory of legacy oil and gas wells and other coastal hazards along the California coastline and determine high-priority hazards and legacy oil and gas wells to remediate; b) Survey, study, and monitor oil seepage in state waters and tidelands under its jurisdiction to determine oil seepage locations, rates, and environmental impacts; and, c) Begin the process of remediating improperly abandoned legacy oil and gas wells that have a high risk of leaking oil and, with any remaining funds, remove other identified coastal hazards. 2)In cooperation with the Division of Oil, Gas, and Geothermal Resources (DOGGR), authorizes SLC seek to abandon (properly close) legacy oil and gas 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. SB 900 Page 3 4)Appropriates specified funds to SLC for the implementation of the program and authorizes SLC to seek and accept gifts, bequests, devises, or donations to fund the program. FISCAL EFFECT: According to the Assembly Appropriations Committee, this bill transfers $500,000 from the General Fund to the Land Bank Fund (LBF) in Fiscal Year (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. One-time SLC cost of approximately $100,000 to complete the in-depth inventory of legacy wells (LBF). 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). 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). DOGGR costs are absorbable. COMMENTS: SLC is an independent commission comprised of the Lieutenant Governor, the State Controller, and the Director of Finance. Established in 1938, SLC manages the state's four million acres of tidelands and submerged lands and the beds of navigable rivers, streams, lakes, bays, estuaries, inlets, and straits. In the marine context, SLC has broad authority over sovereign lands, including rivers and sloughs, lakes, tidelands, and submerged lands. It also manages energy and mineral resource development through leases, has an oil spill prevention program at marine oil terminals and offshore platforms, and has an invasive species prevention program from large ocean-going vessels. Weather systems and extreme storms can cause dangerous coastal hazards to surface on shorelines. When funding is available, SB 900 Page 4 SLC removes coastal hazards. 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). SLC also inventories and remediates abandoned mine hazards on state school lands, in consultation with the Department of Fish and Wildlife and the State Office of Historic Preservation. Analysis Prepared by: Elizabeth MacMillan / NAT. RES. / (916) 319-2092 FN: 0004295 SB 900 Page 5