BILL ANALYSIS
AB 1507
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Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS
Wesley Chesbro, Chair
AB 1507 (Block) - As Introduced: February 27, 2009
SUBJECT : Metal plating facilities.
SUMMARY : Establishes the Chrome Plating and Metal Finishing
Pollution Prevention Grant Program. Specifically, this bill :
1)Modifies the existing Metal Plating Facility Loan Guarantee
program from a loan program to a grant program for metal
plating companies and renames it the Chrome Plating and Metal
Finishing Pollution Prevention Grant Program.
2)Requires the Department of Toxic Substance Control (DTSC) to
operate the Chrome Plating and Metal Finishing Pollution
Prevention Grant Program.
3)Removes the existing January 1, 2012, sunset date from the
renamed Chrome Plating and Metal Finishing Pollution
Prevention Grant Program.
EXISTING LAW :
1)Establishes, in the Business, Transportation and Housing
Agency (BTH), the Metal Plating Facility Loan Guarantee
Program.
2)Requires BTH to provide loan guarantees to chrome plating
facilities to help them upgrade or replace equipment in order
to comply with regulatory requirements and implement
additional pollution prevention measures.
3)Requires BTH to collaborate with state environmental agencies
and the eleven California Financial Development Corporations
in developing and implementing this program.
4)Requires applicants for loan guarantees to be small business
owners of metal plating facilities.
5)Sunsets the loan guarantee program on January 1, 2012.
FISCAL EFFECT : Not known.
AB 1507
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COMMENTS :
Purpose of Bill : In 2005, AB 721 (N??ez) Chapter 695, Statutes
of 2005, created a loan guarantee program to assist in funding
cleanup for small metal-plating businesses. The author believes
that providing grants and shifting the program to the DTSC will
assist in environmental clean up of plating shops. There are
approximately 900 shops in California that conduct
electro-plating. This includes shops where electro-plating is a
primary and secondary activity, as well as shops manufacturing
circuit boards. According to data from the DTSC, the plating
and polishing industry sector is the second highest hazardous
waste generator in California - producing nearly 70,000 tons of
hazardous waste per year. Only the petroleum refining industry
produces more hazardous waste.
AB 721(N??ez) directed BTH to establish a Metal Plating loan
guarantee program to be administered through the Financial
Development Corporations to help small businesses engaged in
metal plating purchase equipment that exceeds existing
environmental regulations, as well as meets or exceeds new rules
that are being developed. BTH was to collaborate with DTSC, the
Air Resources Board (ARB), and the State Water Resources Control
Board (SWRCB) in developing the program. AB1721 became
effective on January 1, 2006, and the program became operational
in July of 2006 when funding was approved and program
regulations were adopted. The program is scheduled to sunset on
January 1, 2012, and is funded by funds transferred from the
Hazardous Waste Reduction Loan Account to the Chrome Plating
Pollution Prevention Fund.
The Chrome Plating Pollution Prevention (CPPP) Fund : AB 139
(Budget) - Chapter 74, Statutes of 2005, a budget trailer bill,
created the CPPP Fund to receive deposits of public or private
funds for expenditure, upon appropriation by the Legislature, by
the BTH. According the Assembly Appropriations committee, since
the loan guarantee program went into effect in January 2006, no
CPPP Fund money has been appropriated to provide financial
assistance in any form. CPPP Fund appropriations have been
limited to $278,000 in 2006-07, $283,000 in 2007-08, and a
proposed appropriation of $324,000 in 2008-09. The 2008-2009 FY
fund balance in the CPPP Fund was $3.4 million.
According to the BTH recent report on the Metal Plating Facility
AB 1507
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Loan Guarantee Program "no formal requests for financial
assistance have been received, however, this is not surprising
given the timing of compliance. ARB's new regulation governing
hexavalent chromium emissions was adopted in October of 2008,
with the affected businesses needing to be in compliance by
October 2009. Since the ARB regulation is the key regulatory
change for those businesses engaged in chrome plating, demand
for financing to purchase and install equipment is expected to
be driven by the October 2009 deadline. It is anticipated that
companies will start looking for assistance to retrofit their
operations in early 2009, which would be consistent with
previous experience with environmental financial assistance
programs, particularly the Replacement of Underground Storage
Tanks Program at the SWRCB."
Prior Legislation : AB 2536 (N??ez) was similar to AB 1507 was
considered and approved by this committee in 2008.
REGISTERED SUPPORT / OPPOSITION :
Support
Metal Finishing Association of Southern California
Metal Finishing Association of Northern California
Opposition
None on file.
Analysis Prepared by : Bob Fredenburg / E.S. & T.M. / (916)
319-3965