BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 939 (V.M. Perez) - Salton Sea restoration.
Amended: June 19, 2012 Policy Vote: NR&W 6-2
Urgency: No Mandate: Yes
Hearing Date: August 6, 2012
Consultant: Brendan McCarthy
This bill meets the criteria for referral to the Suspense File.
Bill Summary: AB 939 would transfer authority to lead the
restoration of the Salton Sea from the state to the Salton Sea
Authority, a local joint powers authority.
Fiscal Impact: The state has statutory and contractual
obligations to ensure the restoration of the Salton Sea, in some
form. While AB 939 transfers oversight authority to a local
joint powers authority, it does nothing to relieve the state of
its financial responsibility. In addition, the provisions of the
bill that require additional study of the issue will likely
create new costs. Because the state retains authority for the
restoration and because the bill requires the Salton Sea
Authority to undertake specific activities, the state will be
responsible for reimbursing the costs of doing so. In addition,
the bill requires the Department of Water Resources to provide
staff support to the Salton Sea Authority to undertake its
required activities. Specific costs that are likely to be
incurred under the bill include:
Developing a restoration plan - The costs to evaluate the
existing restoration plan alternatives and potentially new
alternatives will likely be in the millions over the next
several years. The process to develop the Preferred
Alternative restoration plan by the Natural Resources Agency
took four years and cost about $20 million. Because much of
the technical analysis of existing alternatives has been
completed, the cost to develop a new restoration plan should
be less. However, if the Salton Sea Authority decides to
pursue a novel restoration plan, there would likely be very
significant costs to develop that plan, likely in the
millions.
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Implementation of a restoration plan - The projected costs
of the Preferred Alternative are $9 billion (in 2007
dollars). Depending on the ultimate restoration plan adopted
by the Salton Sea Authority, the total costs to restore the
Salton Sea could be lower or higher than the Preferred
Alternative.
The costs above would include direct costs to the Department of
Water Resources to provide staff support to the Salton Sea
Authority, expenditures by the Salton Sea Authority that would
be a reimbursable state mandate, and contract funds for
technical support and analysis.
The source of funding for these activities would likely include
Proposition 84 general obligation bond funds and/or the General
Fund. While there is a remaining fund balance of $15 million in
Proposition 84 funds for Salton Sea Restoration activities, much
of those funds are intended to support the ongoing development
of wildlife habitat. The recently adopted budget, for example,
includes $3 million over three years for habitat restoration
activities.
Background: Because the Salton Sea is a terminal water body,
with no outlet and very high evaporation rates, the salinity
level in the Sea is continually increasing. In addition, water
transfers out of the Imperial Valley, coupled with more water
efficient farming practices, are reducing the flow of water into
the Salton Sea. In combination, these factors are leading to a
saltier Sea with a receding shoreline. These factors are
degrading both water quality and air quality in and around the
Salton Sea.
Under the Quantification Settlement Agreement of 2003, the
Legislature directed the Secretary of Resources to develop a
plan for the restoration of the Salton Sea. The plan, which was
submitted to the Legislature in 2007, recommended a $9 billion
Preferred Alternative restoration plan. Since that time, the
Legislature has not taken action on the restoration of the
Salton Sea.
Proposed Law: AB 939 would transfer authority to lead the
restoration of the Salton Sea from the state to the Salton Sea
Authority.
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Specifically, the bill would:
Require the Salton Sea Authority (a joint powers authority
of several local government agencies in Riverside and
Imperial Counties) to lead the Salton Sea restoration
efforts - including early start species conservation
projects, investigations of issues relating to the
restoration, analysis of potential funding sources for the
restoration, and an analysis of economic development
opportunities.
Require the Salton Sea Authority to develop a restoration
plan. The Authority is required to include existing
proposals for consideration and to work with a technical
advisory committee made up of specifies state, federal, and
local stakeholders.
Require the Authority to consult with the public on a
variety of issues relating to restoration activities.
Require the Department of Water Resources to provide staff
support to the Authority.
Related Legislation:
SB 1018 (Committee on Budget, Statutes of 2012) the
resources budget trailer bill creates a January 1, 2013
sunset date for the existing Salton Sea Restoration Council.
AB 642 (Calderon) would authorize the Secretary of the
Natural Resources Agency to establish a program to provide
financial support for the development of commercial algae
production in the area around the Salton Sea. That bill will
be heard in this committee.
Staff Comments: This bill is unusual in that it assigns
leadership authority to a group of local government agencies
over a matter for which the state retains financial authority.
The bill does nothing to relieve the state of its financial
responsibility for the restoration of the Salton Sea, but under
the bill, the Salton Sea Authority would now be responsible for
making policy about the restoration, including the development
of a restoration plan.
In addition to the very significant state fiscal impacts of the
choice of a plan for restoration of the Salton Sea, the bill
imposes a reimbursable mandate on the state by requiring the
Salton Sea Authority to take on a leadership role. Any staff
costs incurred by the Salton Sea Authority would be reimbursable
by the state under the California Constitution.
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