BILL ANALYSIS
SB 231
Page 1
SENATE THIRD READING
SB 231 (Alan Lowenthal)
As Amended June 22, 2010
Majority vote
SENATE VOTE :22-17
ENVIRONMENTAL SAFETY 6-3
APPROPRIATIONS 12-5
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|Ayes:|Nava, Chesbro, Davis, |Ayes:|Fuentes, Bradford, |
| |Feuer, Monning, Ruskin | |Huffman, Coto, Davis, De |
| | | |Leon, Gatto, Hall, |
| | | |Skinner, Solorio, |
| | | |Torlakson, Torrico |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Miller, Blakeslee, Smyth |Nays:|Conway, Harkey, Miller, |
| | | |Nielsen, Norby |
| | | | |
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SUMMARY : Authorizes the Department of Toxic Substance Control
(DTSC) to annually adjust the Hazardous Waste Generator Fee
(HWGF). Specifically, this bill :
1)Establishes the base rate for the HWGF at $3,949 per year.
2)Replaces the current cost-of-living adjustment based on the
changes to the Consumer Price Index (CPI) with the authority
for the DTSC to annually adjust the base rate fee by no more
that 5% to reflect the increased or decreased hazardous waste
regulatory program cost to DTSC.
3)Provides that the annual adjustment to the HWGF shall not be
increased if there is a reserve balance in the Hazardous Waste
Control Account (HWCA) greater than one-third of the annual
revenue generated from the fee.
4)Provides that the annual adjustment to the HWCF may not be
made if there is an outstanding loan from the HWCA to the
General Fund.
EXISTING LAW :
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1)Requires generators of hazardous waste to pay the State Board
of Equalization (BOE) a fee for each generator site for each
calendar year, with certain exceptions and conditions, based
on tiers of rates calculated according to the amount of waste
generated during the prior calendar year.
2)Establishes the HWGF base fee rate at $2,748 for the 1997
calendar year and requires the BOE to adjust the base fee rate
annually to reflect changes in the cost-of-living. The
current base rate, as set by the BOE is $3,949. Hazardous
waste generators pay the HWGF based on the amount of waste
generated with the smallest generators paying 5% of the base
rate and the largest waste generators paying 200 times the
base rate.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, potential increased annual revenue to the HWCA,
possibly in the millions of dollars, to the extent program
needs, as determined by DTSC, exceed changes in the
cost-of-living, as measured by the CPI.
COMMENTS : According to the author, this bill is designed to
increase the flexibility of the state in adjusting annual fees
on hazardous waste generators to pay for the state's regulation
of hazardous waste disposal. The current rate setting process
is based only on the changes to the CPI and fails to consider
the changes in programmatic costs. This bill would update a 13
year old fee standard and increase DTSC's ability to make minor
adjustments to the base fee rate.
Shortfalls loom ahead, DTSC says . HWCA revenues and
expenditures vary from year to year. During fiscal years
2004-05 through 2008-09, the account generated annual revenue
ranging from about $44 million to just over $62 million, with
annual revenues averaging approximately $49 million. During
that same period, account expenditures ranged from $46 million
to $57 million and averaged about $51 million. Expenditures
exceeded revenues in four of the five years. While the account
always carried a balance, in 2007-08 the fund balance fell to 4%
of program expenditures. In only one year, 2006-07, did the
fund balance exceed one-third of program expenditures. There
were no loans from the fund to the General Fund during this
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period.
Despite the maintenance of past fund balances, DTSC fears future
shortfalls. According to DTSC, the economic downturn means a
reduction in activities that generate hazardous waste and which,
therefore, produce program revenue. Yet many program costs
result from "legacy" activities, past waste generation and
disposal that do not correspond to current economic activity.
For this reason, DTSC projects fund shortfalls by 2014-15,
absent adequate fee increases.
Analysis Prepared by : Bob Fredenburg / E.S. & T.M. / (916)
319-3965
FN: 0005918