BILL ANALYSIS
AB 7 X8
Page 1
( Without Reference to File )
CONCURRENCE IN SENATE AMENDMENTS
AB 7 X8 (Budget Committee)
As Amended February 17, 2010
2/3 vote. Urgency
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|ASSEMBLY: | |(February 4, |SENATE: |31-6 |(February 18, 2010) |
| | |2010) | | | |
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(vote not relevant)
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|COMMITTEE VOTE: |24-0 |(February 24, 2010) |RECOMMENDATION: |concur |
| | | | | |
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Original Committee Reference: RLS.
SUMMARY : Makes statutory changes to provide fiscal solvency for the
California Beverage Container Recycling (Bottle Bill) Program and make
the Clean Water State Revolving Fund program eligible for Federal
funding.
The Senate amendments delete the Assembly version of this bill and
instead:
1)Change the requirement for the Department of Resource Recovery and
Recycling (Department) to review the Beverage Container Recycling
Fund (BCRF) for adequate funding for Bottle Bill expenditures from
periodically to quarterly.
2)Require that recipients of continuously appropriated Bottle Bill
expenditures receive a 90 day notice before proportional reductions
are enacted as a result of inadequate levels of available revenues
in the BCRF.
3)Accelerate by 30 days (from 90 to 60 days) payments by beverage
distributors of the California Redemption Value. Result in
approximately $100 million one-time revenue increase in current
year. Provide distributors with flexibility by not requiring first
accelerated CRV payments until April 30. Additionally, place June
AB 7 X8
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30, 2012, sunset on acceleration.
4)Set expenditure priorities by suspending various continuous
appropriations for calendar years 2010 and 2011, thus achieving
approximately $28 million in current year (CY) savings, and
approximately $56 million in fiscal year 2010-11 savings. The
suspensions and estimated savings are as follows:
a) Nonprofit competitive grants - $1.5 million/year = $825,000 CY
savings;
b) Public Education & Information - $5 million/year = $2.75
million CY savings;
c) Market Development & Expansion - $20 million/year = $11
million CY savings; and,
d) Community Beverage Container Grants - $20 million/year = $4.4
million CY savings.
5)Allow smaller distributors who receive a total redemption payment of
less than $75,000 per-year to make one processing payment per year.
6)State legislative intent that BCRF monies shall not be loaned or
used for any other purpose than the Bottle Bill program.
7)Require that the Department account for a 2009-10 Budget
appropriation of $8.25 million to the Local Conservation Corps when
determining amounts to be continuously appropriated to the Corps in
2009-10.
This language is intended to make sure that funding for Local Corps
is not double appropriated and is kept whole with other program
expenditures.
8)Cap processing fee offsets made by the Department to manufacturers
for the 2010 and 2011 calendar years at 2008 calendar year levels.
Result in approximately $9 million in savings in the current year
and $18 million in the budget year.
9)Increase market development payments for plastic containers from $5
million to $10 million and reduces quality incentive payments from
$15 million to $10 million for glass containers only in order to
increase program performance.
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10)Require that the Department publish quarterly on its website a BCRF
fund condition report.
11)Require the Department to retroactively pay in-full payments that
were proportionally reduced between January 1, 2010 through June 30,
2010 upon availability of funds in the BCRF.
12)Make various technical amendments to outdated code sections.
13)Enable California to access an estimated $145 million in federal
funds by authorizing the State Water Resources Control Board (Water
Board) to issue grants, forgive loan principal and provide other
types of assistance from specified federal State Water Pollution
Control Revolving Funds (SWPCRF) funds, in conformance with federal
law. This amendment is narrowly tailored to apply only to federal
funds specifically allocated for SWPCRF grants and would not
authorize the use of future or existing "revolving" funds for other
purposes. SB 27 X3 (Negrete-McLeod), Chapter 25, Statutes of
2009-10 Third Extraordinary Session, provided the Water Board with
similar authority with respect to American Recovery and Reinvestment
Act funds.
Comments: The BCRF, is currently insolvent due a combination of loans
made from the BCRF to the General Fund and Air Pollution Control
Account as well as the convergence of decreasing beverage container
sales and increasing recycling rates. Currently, program insolvency
has resulted in 100% reductions in program expenditures (market
development, processing fee assistance, local conservation corps
grants, etc.). Through the acceleration of a processing payment, the
freezing of some program expenditures in near term, as well as planned
repayments of General and Special fund loans, this legislation will
bring the program into solvency and allow full program payments to
proceed in the current and budget year.
Additionally, a Letter to the Journal will be submitted with this
legislation to clarify that the intent of this bill is that the
processing fees assistance cap shall be applied separately to calendar
year 2010 and calendar year 2011 by material type of the containers as
was calculated by the dept for 2008. Also, the cap does not apply to
the processing payments made to recyclers.
Analysis Prepared by : Keali'i Bright / BUDGET / (916)319-2099FN:
0003720