BILL ANALYSIS
AB 1507
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Date of Hearing: May 20, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 1507 (Block) - As Introduced: February 27, 2009
Policy Committee: Environmental
Safety Vote: 7-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill establishes the Chrome Plating and Metal Finishing
Pollution Prevention Grant Program, administered by the
Department of Toxic Substances Control (DTSC). Specifically,
this bill:
1)Makes the existing Metal Plating Facility Loan Guarantee
Program a grant-only program for metal plating companies and
renames it the Chrome Plating and Metal Finishing Pollution
Prevention Grant Program.
2)Requires 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.
4)Authorizes DTSC to adopt regulations to carry our the
provisions of the bill.
FISCAL EFFECT
1)One-time costs, in the range of a few hundred thousand
dollars, to DTSC to develop regulations. (Chrome Plating
Pollution Prevention (CPPP) Fund)
2)Ongoing costs of up to $1 million annually to administer and
award grants to metal plating facilities. (CPPP Fund)
COMMENTS
AB 1507
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1)Rationale. The author contends that providing loan guarantees
to small business metal plating facilities has not provided
enough assistance to these business to be able to afford to
buy pollution control or prevention equipment to exceed
existing environmental regulations and meet new regulations.
The author believes providing grants to these small businesses
will provide more meaningful and direct help in coping with
the costs of this equipment. The author also contends DTSC is
the more appropriate entity to run the program.
2)Background . AB 721 (N??ez) - Chapter 695, Statutes of 2005
required the Business, Transportation and Housing Agency
(BT&H) to establish, until January 1, 2012, a loan guarantee
program to be administered through the agency's Financial
Development Corporation (FDC) network to help small businesses
engaged in metal plating purchase needed pollution control and
prevention equipment.
Metal plating facilities, primarily engaged in electroplating,
plating, anodizing, coloring and finishing metals and formed
products, have significant negative impacts on the
environment. For example, chrome plating facilities use large
volumes of hexavalent chromium, a known human carcinogen and
toxic air contaminant, in their plating processes. Recently
adopted environmental standards imposed by the Air Resources
Board and the federal Occupational Safety and Health
Administration require the owners of chrome plating facilities
to buy new pollution control or prevention equipment to
continue to comply with the law.
Most metal plating facilities are small businesses, many of
which lack the financial resources to buy and maintain the
necessary pollution control or prevention equipment. While
the loan guarantee program established by AB 721 makes it
easier for these small businesses to qualify for a loan, many
of them are still unable to afford to take on more debt or to
pay back the loans subject to program guarantee.
3)The Chrome Plating Pollution Prevention 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
BT&H. AB 139 also transferred all the money on hand in the
Hazardous Waste Reduction Loan (HWRL) Account on January 1,
AB 1507
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2006 ($2.2 million) to the CPPP Fund, and required future loan
repayments to the HWRL Account to be transferred to the CPPP
Fund. Money in the CPPP Fund is intended to back up any loan
guarantees provided to an eligible small business and to pay
BT&H Agency administrative expenses (about $300,000 annually).
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,
$324,000 in 2008-09, and a proposed $312,000 in 2009-10.
4)Related Legislation. AB 2536 (N??ez) would have required BT&H
to develop a grant program to supplement the loan guarantee
program already administered through the FDCs to help small
business metal plating facilities buy pollution control or
prevention equipment and technologies. AB 2536 passed the
Assembly 53-25 but failed in Senate Appropriations.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081