BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 493|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
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|327-4478 | |
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THIRD READING
Bill No: SB 493
Author: Cedillo (D)
Amended: 1/26/04
Vote: 21
SENATE ENV. QUALITY COMMITTEE : 5-0, 1/12/04
AYES: Sher, Chesbro, Figueroa, Kuehl, Romero
NO VOTE RECORDED: Denham, McPherson
SENATE APPROPRIATIONS COMMITTEE : 12-1, 1/22/04
AYES: Alpert, Battin, Ashburn, Bowen, Burton, Escutia,
Johnson, Karnette, Machado, Murray, Poochigian, Speier
NOES: Aanestad
SUBJECT : Hazardous materials: liability
SOURCE : California Building Industry Association
Home Ownership Advancement Foundation
DIGEST : This bill enacts the California Land Reuse and
Revitalization Act to, among other things, grant immunity
to innocent landowners" (ILs), "bona fide prospective
purchasers" (BFPs) and contiguous property owners from
contribution actions, and from additional cleanup of a
contaminated site that has been "reopened".
ANALYSIS : Generally, federal and state laws provide that
current and previous owners of a contaminated site are
jointly and severally liable for the cleanup costs. Thus,
all parties may be held responsible for the entire amount,
regardless of fault. If a party finds itself paying more
CONTINUED
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than its fair share of the cleanup costs, that party may
bring a contribution action to collect from other
responsible parties.
Current law allows government agencies to order the cleanup
of contaminated sites, and to undertake cleanup efforts,
under certain circumstances, and to recover such costs from
responsible parties. Current law also allows government
agencies to "reopen" a cleanup action under certain
circumstances.
Current federal law also provides that if the government
incurs clean-up costs at a site where the owner qualifies
as a BFP, the government shall have a lien on the property
for the unrecovered costs. The lien remains in place until
satisfied by sale of the property or other means.
Recent changes to federal law establish affirmative
defenses against cleanup litigation to ILs, landowners,
contiguous property owners, and BFPs of superfund sites, if
they meet certain conditions. This bill would enact
similar and broader immunity provisions in state law. The
immunity provisions in this bill would essentially apply to
all contaminated properties other than state and federal
superfund sites, i.e. brownfields, underground storage
tanks, etc.
The DTSC conducts and oversees an average of 220 sites at
any given time, and completes an average of 125 per year.
DTSC also administers the Expedited Remedial Action Pilot
(ERAP) program, and the Prospective Purchaser Agreement
(PPA) program to encourage the cleanup of "brownfields" and
other sites. ERAP program benefits include: restructuring
liability based on fair and equitable standards;
eligibility for the state to pay the "orphan share" of the
cleanup costs; providing indemnification protection through
a covenant not to sue; and allowing risk-based cleanup. PPA
program benefits include: reducing the liability for
prospective brownfield purchasers; a commitment from DTSC
to not pursue enforcement against prospective purchasers
if, for example, they are not responsible for the
contamination, and there are responsible parties who are
willing to clean up the site.
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This bill, among other things:
1.Grants, subject to certain conditions, ILs, BFPs, and
contiguous property owners, as defined, immunity from
claims made by any non-governmental agency for cleanup
costs.
2.Prohibits DTSC or a regional board from taking any action
to require an IL to conduct any response action unless
the agency does certain things.
3.Specifies that if there are unrecovered costs incurred by
an agency at a site for which an owner of the site is not
liable as a BFP, the agency shall have a lien on the
property for such costs.
4.Requires Cal-EPA to develop a form that shall be
completed and submitted to the agency by a party who has
immunity pursuant to the provisions of this bill.
5.Requires an IL, BFP, or contiguous landowner to reimburse
an agency for its reasonable oversight costs incurred
while reviewing a response plan or overseeing the
implementation of a response plan.
6.Requires Cal-EPA to annually submit a report to the
Legislature on brownfield remediations.
7.Contains a January 1, 2010 sunset date.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
Major Provisions 2004-05 2005-06
2006-07 Fund
DTSC/regional boards Unknown,
potentially significant General/
stranded additional cleanup costs
Various/Local
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Oversight/review of Potentially
significant costs, General/
response actions, etc probably
offset by reimbursements Var./Loc
from applicants.
Litigation Unknown,
potentially significant General
costs to DTSC and regional boards
Var./Loc.
SUPPORT : (Verified 1/26/04)
California Building Industry Association (co-source)
Home Ownership Advancement Foundation (co-source)
American Farmland Trust
Anschutz Entertainment Group
Bridge Housing
Burbank Housing Development Corporation
California Bankers Association
California Center for Land Recycling
California Chamber of Commerce
California Rural Legal Assistance Foundation
Californians for Justice
Cities of East Palo Alto and West Hollywood
Civil Justice Association of California
East Palo Alto Community Alliance and Neighborhood
Development Organization
Endangered Habitats League
FannieMae
Job-Center Housing Coalition
Greenlining Institute
Greenlining Coalition
LTSC Community Development Corporation
Latino Issues Forum
Lenders for Community Development
Little Hoover Commission
League of California Cities
Livable Places
Mexican American Community Services Agency, Inc.
Mid-Peninsula Housing Coalition
Olive Branches
Peninsula Habitat for Humanity
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Ralphs/Food4Less
Rural Communities Housing Development Corporation
Southern California Association of Non-Profit Housing
The Spanish Speaking Unity Council
OPPOSITION : (Verified 1/26/04)
(The following groups opposed a prior version of the bill.
It is not known at the time of this writing whether recent
amendments would resolve their concerns.)
California Environmental Rights Alliance
California League of Conservation Voters
California Communities Against Toxics
California Safe Schools
Center for Environmental Health
Community Coalition for Change
Consumer Attorneys of California
Del Amo Action Committee
Desert Citizens Against Pollution
Environmental Working Group
Health the Bay
Marin-Goldengate Learning Disability Coalition
Physicians For Social Responsibility
Sierra Club California
ARGUMENTS IN SUPPORT : According to the Civil Justice
Association of California:
"If enacted, Senate Bill 493 will provide bona fide
prospective purchasers of previously contaminated tracts of
land known as "brownfields" with conditional liability
protection from specified statutes that impose liability
for preexisting pollution conditions. It provides these
purchasers with limited liability relief when they meet
certain conditions, such as showing the contamination
occurred before purchase of the site, making appropriate
inquiries into previous ownership, and exercising
appropriate care in dealing with prior hazardous material
releases. SB 493 provides these same protections to
innocent landowners and contiguous property owners.
"SB 493 retains the "polluter pays" principle, so that the
actual polluter of the site is held responsible for
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contamination. This liability protection is critical to
developers who are making decisions to redevelop these
sites. It will encourage development and cleanup of
"brownfields".
"This liability protection will provide the opportunity for
the redevelopment of many abandoned and undeveloped
property sites in California. This presents opportunities
for employment, housing, business, and a better
environment."
CP:cmnl 1/26/04 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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