BILL ANALYSIS �
SB 1192
Page 1
SENATE THIRD READING
SB 1192 (Evans)
As Amended August 20, 2012
Majority vote
SENATE VOTE :24-14
NATURAL RESOURCES 6-3 APPROPRIATIONS 12-5
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|Ayes:|Chesbro, Brownley, |Ayes:|Gatto, Blumenfield, |
| |Dickinson, Huffman, | |Bradford, |
| |Monning, Skinner | |Charles Calderon, Campos, |
| | | |Davis, Fuentes, Hall, |
| | | |Hill, Cedillo, Mitchell, |
| | | |Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Knight, Grove, Halderman |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Norby, Wagner |
| | | | |
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SUMMARY : Provides additional funding mechanisms through the Oil
Spill Prevention and Administration Fund (OSPAF) to secure
funding for the Oiled Wildlife Care Network (OWCN), which, among
other related things, rescues animals affected by oil spills.
Specifically, this bill :
1)Increases the OSPAF per barrel fee on crude oil or petroleum
products (per barrel fee) from $0.065 to $0.068.
2)Increases the maximum nontank vessels fee from $3,250 (as
established by regulations) to $3,500.
3)Transfers $0.003 of the per barrel fee and $250 of the nontank
vessel fee from the OSPAF to the Oil Spill Response Trust Fund
(Trust Fund) to cover the costs incurred by the OWCN
(established by Public Resources Code Section 8670.37.5) that
cannot be paid for by the interest generated from the Trust
Fund.
4)Sunsets the bill's provisions on January 1, 2015.
EXISTING LAW : Pursuant to the Lempert-Keene-Seastrand Oil Spill
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Prevention and
Response Act (Oil Spill Act):
1)Establishes the Office of Spill Prevention and Response (OSPR)
within the Department of Fish and Game (DFG) and requires it
to direct prevention, removal, abatement, response,
containment, and cleanup efforts with regard to all aspects of
an oil spill in the marine waters of the state.
2)Establishes the OSPAF, which finances OSPR's and the State
Lands Commission's (SLC) oil spill prevention and planning
programs and certain activities conducted by the OWCN. OSPAF
is supported by a fee not to exceed $0.065 that is imposed on
each barrel of crude oil or petroleum products received at a
marine terminal. This fee will decrease to $0.05 per barrel
beginning on January 1, 2015. The OSPAF is also supported by
a reasonable fee on nontank vessels (collected every two
years) in an amount that is based on OSPR's costs of
implementing the Oil Spill Act related to nontank vessels.
There is currently no statutory cap on the nontank vessel fee;
however, a maximum nontank vessel fee was recently established
at $3,250 by emergency regulations.
3)Establishes the Trust Fund, which provides funding to clean up
an oil spill if the responsible party is unknown or not
financially capable. The Trust Fund is funded by a uniform
oil spill response fee on distributors, pipeline operators,
refiners, and marine terminal operators, in an amount not
exceeding $0.25 for each barrel of petroleum product received
or transported. The fee is only collected to bring the Trust
Fund to its statutory level, which is approximately $55
million.
4)Establishes the OWCN, which is a network of rescue and
rehabilitation stations for sea birds, sea otters, and other
marine mammals. In addition to rehabilitative care, the
primary focus of the OWCN includes proactive oiled wildlife
search and collection rescue efforts.
5)Requires OSPR to submit, as a proposed appropriation in the
Governor's Budget, an amount up to $2 million of the interest
earned on the Trust Fund for the purpose of: 1) equipping,
operating, and maintaining the OWCN's rescue and
rehabilitation stations; 2) OWCN's proactive oiled wildlife
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search and collection rescue efforts; and, 3) supporting
technology development and research related to oiled wildlife
care. Funding is also available to OWCN from the OSPAF for
certain training and field collection and search and rescue
activities.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Increased annual per barrel revenue, in 2013-14 and 2014-15,
of approximately $1.6 million and annual nontank vessel
revenue of approximately $500,000 (OSPAF).
2)Annual cost pressure, in 2013-14 and 2014-15, in the range of
$2 million, on the OSPAF to transfer fee revenue to the OSP
Trust Fund to fund the activities of the OWCN.
3)Annual cost pressure, in 2013-14 and 2014-15, on the principal
balance of the OSP Trust Fund, of up to $2 million, to the
extent the interest earned on the principal balance is
insufficient to fund the OWCN at $2 million.
COMMENTS : In 1995, AB 1549 (Sher), Chapter 940, Statutes of
1995, directed OSPR to establish regional oiled wildlife rescue
and rehabilitation facilities along the California coast. In
1997, a memorandum of understanding was signed between the
Regents of the University of California and OSPR assigning the
administration of the OWCN to the Wildlife Health Center at the
University of California, Davis School of Veterinary Medicine.
Between 1995 and 2001, much of the OWCN's efforts went into
increasing capacity for oiled wildlife rehabilitation along the
California coast. The OWCN constructed major facilities in the
San Diego, Los Angeles, Santa Cruz, San Francisco and Humboldt
regions. The OWCN also began working with wildlife
organizations throughout the state to upgrade existing
facilities and increase capacity to care for oiled birds and
mammals.
Since the completion of the initial construction and capital
improvement projects, the OWCN's focus has broadened to include
all aspects of oiled wildlife response. These include extensive
training and preparedness, fostering inter-agency cooperation,
refining emergency response procedures, and supporting research
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activities to improve oiled wildlife response efforts.
Since 1995, the OWCN has responded to more than 75 oil spills
throughout California and has cared for nearly 8,000 oiled birds
and mammals.
The OWCN is funded (up to $2 million) by the interest earned on
the Trust Fund and by the OSPAF. The interest from the Trust
Fund helps pay for the costs of rescue, medical treatment,
rehabilitation, and disposition of oiled wildlife. It is also
used to equip, operate, and maintain the network of oiled
wildlife rescue and rehabilitation stations. The funding from
the OSPAF is used for certain training and field collection and
search and rescue activities.
In 2011, SB 84 (Budget and Fiscal Review Committee), Chapter 13,
Statutes of 2011, transferred $40 million from the Trust Fund as
a loan to the General Fund. This loan was made to help backfill
the revenue loss caused by the cancelation of the
sale-for-leaseback of 11 large state office buildings that were
included in the 2010 Budget. According to SB 84, the Trust Fund
loan will be repaid by June 30, 2014. In the meantime, there is
very little interest being made on the Trust Fund, which means
that the OWCN program is in jeopardy.
This bill provides a stable funding source for the OWCN by
increasing the OSPAF per barrel fee by $.003 (from $0.065 to
$0.068) and the biennial fee on nontank vessels (from $3,250 to
$3,500). This additional revenue will be transferred to the
Trust Fund to cover the costs incurred by the OWCN (established
by Public Resources Code Section 8670.37.5) that cannot be paid
for by the interest from the Trust Fund.
On August 14, 2012, the California State Auditor released a
report stating that due to calculating errors DFG undercharged
the federal government a total of $27.3 million for its share of
indirect administrative costs for at least the past five fiscal
years. The federal government is allowing DFG to recoup this
money over the next three years, which will be distributed
across most DFG funds, including the OSPAF. However, according
to DFG staff, the impact to the OSPAF as a result of the
reimbursement will be minor and hence will not contribute
significantly towards stabilizing the OSPAF long term, and will
not provide stable or complete funding for OWCN.
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Analysis Prepared by : Mario DeBernardo / NAT. RES. / (916)
319-2092
FN: 0005160