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in the KNOW

September 6, 2013

Prop 65 Reform Shifts to Regulatory Effort

Stakeholders involved in the Prop 65 reform effort championed by Governor Jerry Brown were unable to reach a consensus over the past few weeks in order to drive support for a two-thirds vote needed in the Legislature. As a result, the governor and his administration are no longer pursuing reforms in the Legislature.

However, discussions continue regarding certain reforms that can be achieved through regulation instead of legislation. Ag Council remains committed to work with the Brown Administration to improve Prop 65 through the regulatory process. Issues for consideration include:

  • A more meaningful and contextual warning label system.
  • Memorializing the California Department of Food and Agriculture’s past work with the California Environmental Protection Agency and working toward a memorandum of understanding between the two agencies when chemicals used for food production come under consideration.
  • Creating a meaningful solution for chemicals that are naturally occurring in soil.

As background, Governor Brown announced a proposal in May to make changes to Prop 65 to restore its intent since the law has been abused by some unprincipled lawyers driven by profit rather than public health.

Ag Council actively participated in Governor Brown’s Prop 65 stakeholder group. In the end, the proposal developed did not garner the support needed in order to move forward with legislation.

Ag Council greatly appreciates the governor’s interest in this very important issue affecting our members, and we will stay involved with the regulatory agencies as the discussion regarding reform continues.

Legislature Nears Adjournment

Photo courtesy of www.sacmuseums.org

Photo courtesy of www.sacmuseums.org

The California State Legislature’s adjournment date of September 13 is fast approaching. However, due to the upcoming Yom Kippur Jewish holiday, the Legislature plans to complete its business by midnight on September 12.

Some of the hot issue areas during the final week of business include prison reform, hydraulic fracturing and changes to the California Environmental Quality Act, among others.

The last date for fiscal committees to meet and report bills was August 30 and hundreds of measures were approved last week and moved out of committee.

Please see the next newsletter article for an update of key bills.

Legislative Activity

Below is a brief summary of some of the key legislation of interest to our members.  This list is not comprehensive. Changes to bills occur quickly during the final days of session, and Ag Council will apprise members of the final outcome of these and other measures after adjournment next week.

Labor

SB 25 (Steinberg)-Allows a party to prolong collective bargaining negotiations under the Ag Labor Relations Act and then call for mandatory mediation of a renewal contract. The contract would not be subject to worker ratification, which marginalizes workers. Ag Council opposes SB 25 and is advocating against the measure. It is pending a concurrence vote in the Senate.

AB 10 (Alejo)-Incrementally increases minimum wage in California from the current $8 to $10 by the year 2018. AB 10 is pending action in the Senate Committee on Rules. Ag Council opposes this bill.

Energy

AB 327 (Perea)-Written to prevent energy cost increases on low-income ratepayers. However, AB 327 was recently amended in a manner that could considerably raise energy costs, particularly for those who have installed renewable energy projects and provide energy back to utilities under the Net Energy Metering program. Ag Council opposes this provision unless it is amended or eliminated. AB 327 awaits a vote on the Senate floor.

Air Quality

SB 691 (Hancock)-Increases air penalties for nuisance violations for Title V permit holders from $10,000 to $100,000 for the first day of an air violation. Ag Council opposes this bill, which is now awaiting an Assembly floor vote.

AB 8 (Perea)-Extends funding for the Carl Moyer program, among other air quality and transportation programs. AB 8 is pending a vote in the Senate. Ag Council supports this measure because it is a useful tool in agriculture to incentivize significant reductions in air emissions by funding cleaner than required engines.

SB 11 (Pavley)-Identical to AB 8, SB 11 extends funding for the Carl Moyer program, among other air quality and transportation programs. SB 11 is awaiting an Assembly floor vote, and Ag Council supports SB 11.

Dairy

AB 1038 (Dr. Pan)-Codifies the California Dairy Future Task Force and specifies funding. AB 1038 was held in the Senate Committee on Appropriations and any further action is uncertain.

Water

The water bills below are part of a larger package of measures intended to improve state drinking water programs for Californians who lack access to safe drinking water. The list is not comprehensive of all water bills.

AB 21 (Alejo)-Creates the Safe Drinking Water Small Community Emergency Grant Fund to provide grants for emergency drinking water projects to serve disadvantaged communities. This bill is awaiting consideration in the Senate.

AB 115 (Perea)-Expands the eligibility for grants and loans from the Safe Drinking Water State Revolving Fund allowing multiple water systems to apply as a single applicant and allows funding of a project to benefit a disadvantaged community. AB 115 is pending a vote in the Senate.

AB 118 (Alejo)-Improves flexibility in the disbursement of loans from the Safe Drinking Water Revolving Fund to help underprivileged communities pay for the cost of rectifying deficiencies in small water systems. AB 118 is pending a vote in the Senate.

AB 145 (Perea)-Transfers authority of drinking water programs from the Department of Public Health to the State Water Resources Control Board. AB 145 was held under submission in the Senate Committee on Appropriations, and it could be considered at a later date.

Water Bond Bill Introduced in Assembly

Photo courtesy of the Department of Water Resources

Photo courtesy of the Department of Water Resources

The Assembly Committee on Water, Parks and Wildlife introduced a bill on August 26 that includes a proposal for a 2014 water bond. AB 1331, entitled the Climate Change Response for Clean and Safe Drinking Water Act of 2014, is based on the framework prepared by the Committee and the Water Bond Working Group earlier in August. As background, the Water Bond Working Group is a panel of eight lawmakers appointed by Assembly Speaker John Pérez (D-Los Angeles).

The original framework entailed a $5 billion dollar bond that would fund five categories of programs equally. The bill has increased the total bond amount to $6.5 billion, increasing the funding for certain categories. The clean and safe drinking water and Delta sustainability categories would receive $1 billion each. Categories for protecting watersheds, regional water security, and water storage would receive $1.5 billion each. Water Bond Working Group held an informational hearing to present a new framework for a revised water bond.

Given that the Legislature adjourns next week, it is anticipated that a final water bond package will not be completed and voted upon in the Legislature until next year.

Tentative Ruling on Carbon Auctions

Under a tentative August 28 ruling by the Sacramento Superior Court, the California Air Resources Board (CARB) has the authority to hold cap and trade carbon auctions under AB 32

The California Chamber of Commerce sued CARB, alleging that while the state legislature granted CARB the ability to create a cap and trade system for carbon emissions, it did not intend to allow CARB to raise huge sums of money by auctioning emissions offsets. AB 32 gives CARB the authority to “design” the “distribution of emissions allowances.”

Since auctions and free distribution are generally accepted as means of distributing allowances, Judge Timothy Frawley held that such auctions are included in the tasks delegated to CARB by AB 32. Because auctions are deemed to be included, CARB then has the authority to conduct its carbon auctions.

At this time, the ruling is only tentative because the Chamber’s suit is ongoing. The case also involves a tax issue related to Proposition 13, which is still being litigated. When this issue is resolved, a final ruling on both the tax question and CARB’s authority to hold carbon auctions will be released.

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