BILL ANALYSIS �
-----------------------------------------------------------------
| |
| SENATE COMMITTEE ON NATURAL RESOURCES AND WATER |
| Senator Fran Pavley, Chair |
| 2011-2012 Regular Session |
| |
-----------------------------------------------------------------
BILL NO: AB 2620 HEARING DATE: June 26, 2012
AUTHOR: Achadjian URGENCY: No
VERSION: May 14, 2012 CONSULTANT: Alena Pribyl
DUAL REFERRAL: No FISCAL: Yes
SUBJECT: Granted public trust lands
BACKGROUND AND EXISTING LAW
State Lands Commission
The State Lands Commission (SLC) has jurisdiction and management
control over sovereign lands of the State that were received
from the United States in 1850. Sovereign lands include the
beds of California's navigable rivers, lakes and streams, as
well as the state's tide and submerged lands along the coastline
and offshore islands from the mean high tide line to three
nautical miles offshore. Sovereign lands are subject to the
public trust for water related commerce, navigation, fisheries,
recreation, open space and other recognized public trust uses.
The SLC maintains a multiple use management policy to assure the
greatest possible public benefit is derived from these lands.
Since 1851, the California Legislature has periodically
"granted" tide and submerged lands in trust to local or specific
governmental entities for management purposes. These granted
lands are monitored by the SLC to ensure uses are consistent
with the public trust. All uses, including those specifically
authorized by the Legislature, must take into account the
overarching principle of the public trust doctrine that trust
lands belong to the public and are to be used to promote public
rather than exclusively private purposes. The major ports of Los
Angeles, Long Beach, San Diego, San Francisco, Oakland and
Richmond are all located on "granted lands," as are many
marinas, aquatic parks, fishing piers and environmentally
sensitive habitats, among others. These grants encourage
development of tidelands consistent with the public trust, while
requiring grantees to reinvest revenues produced from the lands
back into the lands where they are generated. For example, the
grant to the City of Long Beach provides for revenue sharing
1
between the city and the state for the oil royalties generated
from the lands granted to the city. There are currently more
than 300 statutes granting public trust lands to approximately
85 local governments throughout the state. According to the SLC
staff, there is one current staff position assigned to
overseeing the management of granted lands and revenues by local
entities.
The SLC also leases some of its ungranted lands for
agricultural, commercial, industrial, right-of-way, and
recreational purposes, as well as for revenue-generating
purposes (oil, gas, mineral, and geothermal energy extraction).
Generally, the revenue from ungranted lands is deposited into
the State's General Fund.
Existing law
1)Establishes that California received title to the tidelands,
submerged lands, and beds of navigable lakes and rivers within
its borders, to be held subject to the public trust for
statewide public purposes, including commerce, navigation,
fisheries, and other recognized uses, and for preservation in
their natural state (Public Resources Code (PRC) �6009(a)).
2)Establishes that tidelands and submerged lands granted by the
Legislature to local entities remain subject to the public
trust, and remain subject to the oversight authority of the
state through the SLC. Grantees are required to manage the
state's tidelands and submerged lands consistent with the
terms and obligations of their grants and the public trust
(PRC �6009(c)).
3)Establishes that the SLC has exclusive jurisdiction over all
ungranted tidelands and submerged lands owned by the State.
The SLC shall exclusively administer and control all such
lands, and may lease or otherwise dispose of such lands, as
provided by law (PRC �6301).
4)Confers upon the counties and cities to which public trust
lands have been granted, the powers of the SLC to lease or
grant the rights or privileges of such lands (PRC �6305).
5)Requires that local trustees of granted lands provide accurate
records of all revenues received from trust lands and assets,
and all expenditures of those revenues. All revenues from
trust lands and assets can only be used for purposes
consistent with the public trust for commerce, navigation, and
fisheries, and the applicable statutory grant or grants. On or
2
before October 1st of each year, each grantee must file a
detailed statement with the SLC of all revenues and
expenditures relating to its trust lands and assets (PRC
�6306).
PROPOSED LAW
This bill would add reporting requirements for local trustees of
granted public trust lands, require the SLC to increase its
oversight of public trust lands, and require the SLC to evaluate
its current staffing needs through a workload analysis.
Specifically, this bill:
1) Adds several legislative declarations and findings regarding
granted public trust lands, the duties of a trustee of state
lands, the use and evaluation of revenues from granted public
trust lands, monitoring and oversight needs, and the
prohibition against common public trust principles nullifying
an act of the Legislature or modifying its duty under the
California Constitution to do all things necessary to
administer the public trust.
2) Confers certain powers upon the local trustee (instead of the
county or city) of the granted public trust land that were
previously granted to the SLC with regard to leasing or
granting of rights or privileges of trust lands.
3) Defines a "local trustee of granted public trust lands" as a
county, city, or district, including a water, sanitary,
regional park, port, or harbor district, or any other local,
political, or corporate subdivision that has been granted,
conveyed, or transferred by statute, public trust lands
through a legislative grant.
3) Requires all funds received or generated from trust lands or
trust assets to be segregated in separate accounts from
nontrust received or generated funds.
4) Requires that the October 1 statement filed with the SLC be
accompanied by a standardized reporting form developed by the
SLC; the SLC may also use an existing reporting form. The form
will include the following information: a summary of all funds
received or generated from trust lands or assets, a summary of
all spending of funds received or generated from trust lands
or assets, a summary of any other disposition of funds
received or generated from trust lands or assets, a
description of how the statement accompanying the standardized
reporting form is organized, and any other information the SLC
3
deems to be appropriate in an accounting of granted public
trust lands. The information provided in the statement and
form will be a public record and posted on the SLC's Internet
website.
5) Requires that all costs incurred by a local trustee to
implement this bill be paid from the revenues derived from its
granted public trust lands and assets. If the revenues are
insufficient to pay for those costs, the SLC will be required
to exempt a local trustee from the duties for which funds are
not sufficient, or extend the deadline until sufficient funds
are available.
6) Requires the SLC to prepare a workload analysis and
implementation plan by September 1, 2013. The analysis will be
submitted to specified committees of the Legislature and the
Department of Finance. This section would become inoperative
on September 1, 2017 and be repealed January 1, 2018.
ARGUMENTS IN SUPPORT
According to the author, a report released by the State Auditor
in August 2011 concluded that the commission is neglecting its
responsibility to protect the public trust and risks having to
address additional ongoing abuses of funds dedicated for public
trust uses. This is a critical component of the Commission's
role, because it is the state agency responsible for overseeing
these granted lands and ensuring they are properly managed such
that the State's interests are protected and the granted lands
are used in ways that are consistent with the public trust and
with any other conditions the Legislature imposes.
ARGUMENTS IN OPPOSITION
None received
COMMENTS
California State Auditor Report #2010-125
In August 2011 the California State Auditor released the report
titled: "State Lands Commission: Because It Has Not Managed
Public Lands Effectively, the State Has Lost Millions in Revenue
for the General Fund." Although most of the report focuses on
ungranted lands the SLC leases, it did mention granted trust
lands towards the end of the report. Specifically, it points
out that the SLC has taken a reactive approach to carrying out
its oversight responsibilities of granted lands by only
responding to allegations of improper use of funds derived from
public trust lands, as opposed to proactively identifying and
4
preventing misuse through periodic monitoring. Several cities
have allegedly used funds improperly generated from public trust
lands. The report states that the SLC has not developed an
audit plan designed to ensure that revenues generated are used
properly. According to the chief of administrative services at
the SLC, the SLC lacks the expertise to conduct a review of
financial statements from trustees and the SLC cannot regularly
conduct audits because of staffing constraints. The report made
several recommendations including:
1) To better demonstrate its need for additional staff, the SLC
should conduct a workload analysis to identify a reasonable
workload for its staff and use this analysis to quantify the
need for additional staff.
2) The SLC should establish a monitoring program to ensure that
the funds generated from granted lands are expended in
accordance with the public trust.
In the report, SLC staff agreed with the recommendations. They
stated they have and will continue to develop workload analyses
and that this information is submitted with requests for
additional staffing. They also stated they lacked the staff to
establish and implement a monitoring program.
State Lands Commission staff perspective
SLC staff believe this bill will help them be more effective.
The standardized reporting form would help them keep better
track of revenues and expenditures and identify which areas they
need to study more. For conducting the workload analysis they
can use existing resources, so it would be an absorbable cost.
SUPPORT
Pacific Merchant Shipping Association
OPPOSITION
None received
5