BILL ANALYSIS
AB 274
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 274 (Portantino)
As Amended September 4, 2009
Majority vote
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|ASSEMBLY: |79-0 |(June 1, 2009) |SENATE: |26-12|(September 9, |
| | | | | |2009) |
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Original Committee Reference: NAT. RES.
SUMMARY : Creates a fee funded program for the future cleanup of
closed solid waste facilities to go into effect provided that
more than 50% of the operators of solid waste facilities opt to
participate in the program.
The Senate amendments :
1)Delete provisions requiring a purchaser of landfill property
to provide adequate financial assurances to cover postclosure
maintenance costs.
2)Authorize, on and after January 1, 2012, an operator of a
solid waste disposal facility that is required to meet
financial assurance requirements and is in operation on July
1, 2011, to elect to participate in the State Solid Waste
Postclosure and Corrective Action Trust Fund (Trust Fund)
created by this bill.
3)Require a participating operator to pay a fee of $0.12 per ton
for each disposal site. The fee must be deposited in the
Trust Fund and made available to the California Integrated
Waste Management Board (CIWMB) for expenditure, upon
appropriation by the Legislature, for postclosure activities
and corrective actions not performed by any owner or operator
of a solid waste landfill when the owner or operator fails to
comply with the CIWMB's final order; the financial assurance
mechanisms are inadequate to fund necessary compliance
activities; the solid waste landfill was operating pursuant to
a valid solid waste facilities permit on or after January 1,
1988; and, CIWMB has first exhausted all immediately available
financial assurance mechanism provided by the operator.
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4)Specify that the bill will not be operative on and after
January 1, 2012, unless CIWMB receives, on or before July 1,
2011, letters of participation in the Trust Fund from landfill
operators representing at least 50% of the total annual waste
disposal tonnage in 2010.
5)Require CIWMB to notify the Board of Equalization on or before
August 31, 2011, if the fee is to become operative.
6)Direct an operator of multiple landfills who is required to
meet financial assurance requirements and whose landfills are
operating on July 1, 2011, instead of 2010, to include all
other landfills owned by the operator in the letter of
participation.
AS PASSED BY THE ASSEMBLY , this bill required a purchaser of
landfill property to provide adequate financial assurances to
cover postclosure maintenance costs.
FISCAL EFFECT : According to the Senate Appropriations
Committee, assuming that at least 50% of solid waste facility
operators opt to participate in the program, the fee will
generate about $2.1 million per year. If participation rates
are higher, then fee revenues will be commensurately higher.
CIWMB will incur costs to develop regulations and begin program
implementation. Because some of these costs will occur before
fees are collected under the bill, they will be paid from the
Integrated Waste Management Account. CIWMB will require about
five positions and some additional contracting funds for ongoing
oversight of the program. These costs are estimated at $430,000
in fiscal year (FY) 2009-10 and $670,000 in FY 2010-11.
COMMENTS : Under existing law, operators of solid waste
facilities are required to pay a "tipping fee" for every ton of
solid waste disposed in California at an amount established by
CIWMB to pay for the state's cost to regulate those facilities.
Owners and operators of solid waste facilities are also required
to plan and provide funds for the closure and management of a
facility after closure, to ensure that there is no unanticipated
impact on the environment from the contents of the facility.
The funding that is arranged by facility owners for the
post-closure period is known as a financial assurance. This
bill establishes the Trust Fund and allows operators to
voluntarily opt in to a $0.12 per ton fee. The fee collected
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would provide a safety net to mitigate potential environmental
impacts of postclosure solid waste landfills, according to
provisions in the bill.
Closure is the process during which a landfill is no longer
receiving waste and is being prepared for postclosure
maintenance according to an approved plan and construction
schedule. When a site is closed, it has ceased accepting waste
and has been closed in accordance with applicable statutes,
regulations, and local ordinances in effect at the time.
Closure and postclosure maintenance plans ensure that landfill
closure and postclosure maintenance and the eventual reuse of
disposal sites will conform to state performance standards and
minimum substantive requirements. Common postclosure
maintenance activities include leachate collection and
treatment, groundwater monitoring, inspection and maintenance of
the final landfill cover, and monitoring to ensure that landfill
gases don't migrate off site or into onsite buildings.
According to CIWMB, by the end of this year half of the state's
282 landfills subject to financial assurance requirements will
be closed and entering the postclosure maintenance period. By
2021, the first California landfill could exhaust its required
30-year postclosure maintenance financial assurance
demonstration and the state would enter into an unassured
postclosure maintenance period. While the owner or operator
still maintains the legal requirement to provide for maintenance
and corrective action costs, there is no assurance in place that
the owner or operator will be able to fund landfill costs,
including catastrophic failures. By the middle of this century,
CIWMB estimates that unassured risk of closed landfills will be
more than $600 million.
CIWMB is in the process of developing regulations to strengthen
the requirements for postclosure maintenance. AB 2296
(Montanez), Chapter 504, Statutes of 2006, required CIWMB to:
1)Conduct a study to define the conditions that potentially
affect solid waste landfills, including technologies and
engineering controls designed to mitigate potential risks, to
identify potential long-term threats to public health and
safety and the environment.
2)Conduct a study on various financial assurance mechanisms that
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would protect the state from long-term postclosure maintenance
and corrective action costs in the event that a landfill owner
or operator fails to meet its legal obligations.
3)Adopt regulations to address the findings of the studies and
provide recommendations for necessary statutory changes to
implement the findings.
At its June 16, 2009 meeting, CIWMB approved a report that
recommended the establishment of a pooled fund. The report
states that a fund is needed to address the gap of protection
between the financial assurances established with the proposed
regulations and the potential default exposure that can't be
covered through regulation.
Analysis Prepared by : Elizabeth MacMillan / NAT. RES. / (916)
319-2092
FN:
0003098