a r t i c l e s

2003 Legislative Recap - An Early Lame Duck Session Comes to a Close

By Gary A. Lucks JD*

This article was originally published in the CALIFORNIA ENVIRONMENTAL LAW REPORTER (Matthew Bender). Permission to reprint is hereby granted by the publisher.

Introduction

Twelve short months ago, Governor Gray Davis won reelection with an eye toward leaving his legacy over the next four years of his administration. The erstwhile Governor was poised to deliver with all constitutional offices in the hands of the green-leaning Democrats who enjoy solid majorities in both legislative houses. However, the crippling budget shortfall and the historic, unprecedented recall election intervened, preempting his victory lap and truncating his legislative agenda.

The first year of the state's biennial legislative session began with the Legislature consumed by the budget crisis, prompting an extraordinary session devoted to managing the red ink. As the recall election became a reality during the summer months, a level of urgency emerged in the Legislature hastening the normal pace of policymaking. The first year of the biennial session suddenly morphed and became more typical of the second and final year of a session. Legislative proposals that were to have waited until the second year were quickly moved forward.

Riding a wave of uncertainty and peril, the California Legislature served up a number of environmental policies and programs not knowing whether the Governor would be around to sign them. The unusual circumstances surrounding the 2003 legislative session resulted in a banner year of legislative environmental policy, with Governor Davis signing some of the most environmentally friendly and progressive legislation of his fiveyear tenure. This session was dominated by air quality legislation targeting elevated ozone and dust levels in the Central Valley and throughout much of the state. Several new laws addressed exposures to toxic chemicals, including a chemical-by-chemical approach to managing perchlorate, polybrominated diphenyl ethers (PBDE), and perchloroethylene, as well as adopting the precautionary principle to manage health and environmental risks.

The calcified debate over the state's budget woes yielded a fiscal stalemate and an angry electorate ready for change from "business as usual." In response, the Legislature focused on weaning state environmental agencies from the unpredictable, fluctuating state general fund. The Legislature embraced the "Polluter Pays Principle" and established several pay-as-you-go regulatory programs. These include fee-for-service and advance disposal fee programs that liberate Cal-EPA and its sister agencies from the waxing and waning state general fund. On the other hand, several other bills generated far-reaching environmental policies replete with unfunded mandates. All legislation described below becomes effective on January 1, 2004, unless otherwise indicated.

Air Quality

Assembly Bill (AB) X1 (first extraordinary session) 10 (Oropeza) provides one small fix to helping push the state's red ink into the black while allowing the air quality agencies to wean themselves from reliance on the general fund. This legislation, which was passed early in the year during a special session, requires regional and local air pollution control districts (APCDs) to collect additional permit fees on behalf of the California Air Resources Board (ARB) on stationary sources of air emissions within their jurisdiction. AB X1 10 lowers the threshold emission level for the imposition of the permit fees on stationary sources emitting 250 tons per year or more of any nonattainment pollutant or its precursors. Additionally, this law increases the limit on the total amount of funds that an air district can collect in permit fees to $13 million subject to further increase in line with the Consumer Price Index. This legislation additionally requires the ARB to establish a program that imposes a fee for consumer products and architectural coatings sold in California if the coatings will result in the emission of 250 tons per year of volatile organic compounds (VOCs). These funds will be used to mitigate or reduce air pollution created by these products.

In December 2002, the Bush administration promulgated controversial rules that make it easier for existing major sources of air emissions to avoid the federal NSR program. These rules essentially reduce the circumstances under which a modification to an existing major source of regulated air emissions requires an NSR permit. Senate Bill (SB) 288 (Sher) responds to the Bush administration's relaxation of the federal NSR program and establishes the "Protect California Air Act of 2003." SB 288 prohibits local and regional air districts from amending or revising their respective NSR programs to be less stringent than the federal rules that existed on December 30, 2002. This Act effectively preserves the status quo for the California NSR program and keeps the existing rules, which require major new facilities and major modifications to these facilities to use the best available control technology (BACT) and emissions offsets.

California's San Joaquin Valley is experiencing some of the worst air quality in the nation, rivaling the nonattainment status of the Los Angeles area for ozone. According to the ARB, agricultural activities account for 26 percent of the ozone precursor emissions in the San Joaquin Valley and over 50 percent of directly emitted particulate emissions each fall. With much of California experiencing elevated levels of particulate matter and ozone, there is an increasing focus on previously unregulated or underregulated sources of these nonattainment pollutants. The California Legislature responded by enacting a significant number of air quality bills, including several directed at agriculture and the unique challenges of the Central Valley.

SB 700 (Florez) was enacted to address the serious ozone nonattainment problem in the Central Valley. In a trend that is emerging in the water quality area as well, SB 700 eliminates a long-held air quality permitting exemption for agricultural equipment and other agricultural activities. This law regulates ozone precursor emissions from owners or operators of "large confined animal facilities." Air districts experiencing ozone nonattainment for the national ambient air quality standards (NAAQS) must adopt rules to reduce air emissions from large confined animal facilities to the extent feasible. Even air districts meeting the NAAQS for ozone must adopt the same rules required of nonattainment air districts. However, these "attainment" air districts need not adopt such rules where their boards determine that "large confined animal facilities" will not contribute to a violation of any state or federal ambient air quality standard. This legislation also requires the California Air Pollution Control Officers Association, together with the ARB, to develop a clearinghouse of available control measures and strategies to minimize and reduce agricultural sources of air emissions.

SB 700 further requires that air districts experiencing "serious" levels of nonattainment for particulate matter and its precursors must establish specified control technology standards for agricultural practices. This includes imposing best available control measures (BACM) and best available retrofit control technology (BARCT) by January 1, 2006. Those air districts designated "moderate" nonattainment for particulates must adopt control measures designed to reduce air emissions from agricultural activities by the earliest feasible date, but no later than January 1, 2007, subject to some exceptions. Additionally, SB 700 provides loan opportunities to assist agricultural operations in obtaining air pollution control equipment.

Other legislation takes a broader look at dust control throughout the state. SB 656 (Sher) requires the ARB, in consultation with air districts, to develop and adopt a list of readily available, feasible, and cost-effective dust control measures for new and existing stationary, mobile, and area sources. These control measures must be designed to minimize or reduce both coarse (PM10, generated from windblown dust, vehicles traveling on unpaved roads, and crushing and grinding operations) and fine particulate matter (PM 2.5, from vehicle exhaust and industrial processes, fireplaces, wood stoves, and other forms of combustion). Additionally, the ARB and each air district must prioritize these dust control measures and adopt an implementation schedule by January 1, 2005. The list must include control measures for activities including stationary combustion sources, diesel-powered engines, heavy-duty vehicle idling, ultra low-sulfur diesel fuel formulations, fleet turnovers, wood stoves and fireplaces, construction and grading operations, and agricultural burning.

SB 705 (Florez) also regulates dust by phasing out open field burning of agricultural waste within the San Joaquin Valley by 2010. This law prohibits the issuance of a permit within the San Joaquin Valley Unified Air Pollution Control District (SJVUAPCD) to burn certain categories of agricultural waste from field crops, prunings, and weed abatement (beginning June 1, 2005); orchard removals (beginning June 1, 2007); and other materials, vineyard removals, and surface harvested prunings (beginning June 1, 2010). This law also requires that the SJVUAPCD develop rules establishing best management practices (BMPs) for weeds maintenance.

With California's population growing by a half a million each year and with many destined for residence in the Central Valley, the overtaxed air basin will only worsen. AB 170 (Reyes) offers a comprehensive "Smart Growth" approach to manage the expected growth and the associated serious air pollution problem facing the Central Valley. This legislation considers the interrelationship between land use, transportation, and transit on air quality. Under this legislation, each city and county within the SJVUAPCD must amend their respective general plans in order to improve air quality within one year of the next scheduled housing element revision that occurs after January 1, 2004. Cities and counties located within the SJVUAPCD must modify some or all of the following elements to their general plans (i.e., land use, circulation, housing, conservation, and open space) to incorporate strategies to improve air quality. General plan amendments could include, among other considerations, integrating land use, transportation, and air quality plans as well as establishing programs to reduce congestion and vehicle trips.

SB 709 (Florez) builds on the strategies of SB 700 and requires the SJVUAPCD to collect fees from area-wide or indirect sources of emissions that are traditionally not subject to air quality permitting. These fees are intended to underwrite the costs of establishing a clean fuels program, requiring motor vehicle use reduction measures, and other programs. Additionally, in order to reduce air emissions from motor vehicles in the valley, this legislation authorizes the district to collect an additional one dollar motor vehicle registration fee.

SB 709 also codifies the structural aspects and authority of the SJVUAPCD. The air district must also expand the scope of the office of small business to include expedited permit review for research and development or commercialization of electric and other clean fuel technologies. Additionally, the office must assist farmers and small businesses in applying for air quality permits, providing information on using cleaner fuels and solvents, and low-cost financing for obtaining air pollution control equipment. Finally, this law authorizes the SJVUAPCD to monitor air emissions from stationary pumps.

Assembly member Florez was successful in enacting AB 704, which is designed to reduce open-field burning and to help improve local air quality. This law requires the State Energy Resources Conservation and Development Commission (known as the California Energy Commission, or CEC) to allocate $6 million from the Renewable Resource Trust Fund to promote biomass-to-energy projects. These funds will be used to encourage facilities to convert biomass- to-energy in order to increase the utilization of qualified agricultural biomass. By offering incentives to biomass facilities, less agricultural waste will be burned in the open-field.

Other air quality laws regulate backup generators, ethanol content in fuel, and the smog check program. AB 390 (Montanez) changes the current standard requiring weekly tests of diesel-powered backup generators at health facilities. The bill's sponsor, the California Healthcare Association, promoted this legislation arguing that weekly testing of backup generators is unnecessary in light of the localized exposure to patients of particulate matter and other carcinogenic emissions. Since Governor Davis' executive order prohibited the use of methyl tertiary butyl ether (MTBE), the federal Clean Air Act only allows ethanol to be used as a fuel oxygenate in gasoline. SB 671 (Florez) replaces a prior law that called for disclosure of the exact percentage of ethanol with a range up to the maximum limit of ten percent. SB 708 (Florez) tinkers with the penalty structure for violations of the smog check program by increasing the minimum and maximum fines that may be imposed for a second and subsequent violation of smog emissions by $35.

Energy

The heavy lifting on supplying more reliable supplies of cleaner energy continues with efforts to promote renewable energy technologies and distributed energy through funding and mandates.

Last year, California joined several other states establishing a renewable portfolio standard (RPS). Stats. 2002, SB 1078 (Sher) required that, by 2017, California's energy suppliers purchase twenty percent of their electricity from renewable energy resources such as solar, wind, and small hydroelectric plants. Since then, California utilities have made great strides, with Southern California Edison already achieving the twenty percent minimum. However, SB 1078 prohibits the CEC from requiring an electrical utility to procure renewable energy to fulfill its RPS obligation until it demonstrates that it meets a specified level of creditworthiness. Pacific Gas and Electric and Southern California Edison are currently operating under a financial cloud and do not meet this financial condition. To avoid undermining the objectives of the RPS, SB 67 (Bowen) addresses this conundrum by permitting the California Public Utilities Commission (PUC) to apply an alternate test to demonstrate that a utility is creditworthy. This law also authorizes the CEC to allow utilities to count electricity generation located outside California as eligible for the RPS as long as it is or can be connected to the Western Electricity Coordinating Council transmission system, among other considerations.

Smaller sources of energy are being promoted as well. To further encourage development and advancement of alternative energy, SB 183 (Sher) requires the CEC to annually publish funds that are available from the Emerging Renewable Resources Account. These funds can be used to provide rebates, buy downs, and other incentives to support emerging renewable energy resources. These revenues are derived from the public goods surcharge imposed on utility bills. AB 1214 (Firebaugh) encourages production of electricity by fuel cell generation. This law requires utilities to purchase a specified amount of electricity from customers using fuel cell generators at the rate the corporation charges its customers for electricity.

AB 1685 (Leno) expands the self-generation incentive program to include "ultra-clean" and "low emission" distributed generation technologies that commence operations prior to December 31, 2008. Distributed generation sources that use fossil fuels are required to meet more stringent oxides of nitrogen (NOx) emissions standards pursuant to specified schedules of compliance. Incentive rebates are now available for sources of distributed energy that achieve an energy efficiency standard of 60 percent and an emissions limit of 0.14 pounds/megawatt hour by January 1, 2005, and 0.07 by 2007.

SB 552 (Burton) leverages the enormous marketing power of the state's procurement system and requires that the Department of General Services, in conjunction with the CEC and ARB, adopt procurement standards, on or before January 1, 2005, for passenger cars and light-duty trucks. The state must also use the appropriate fuel in bifuel natural gas and bifuel propane vehicles within their fleets to the maximum extent practicable. The state is also obligated to purge nonessential sport utility vehicles (SUVs) and four-wheel drive trucks from state vehicle fleets and replace them with more fuel-efficient vehicles by December 31, 2005. In order to improve the fuel economy of passenger vehicles, AB 844 (Nation) establishes an energy efficiency replacement tire program designed to promote the use of more energy efficient replacement tires. Under this law, the CEC, in consultation with the Integrated Waste Management Board (IWMB), must adopt by July 1, 2007, a replacement tire efficiency program for passenger cars and light-duty trucks. According to the legislation, replacement tires are less energy efficient than tires originally installed on new vehicles.

Despite the momentum toward increasing deployment of solar energy technology throughout the state, several municipalities have placed barriers in its path. In response to these hurdles, AB 1407 (Wolk) penalizes public entities placing unreasonable restrictions on the installation or use of solar energy systems by making those jurisdictions ineligible for state energy funding.

Water Quality

ABX1 10X (Oropeza) also increases the annual fees for waste discharge requirements (WDRs). These fees are designed to offset agency costs incurred in connection with implementing and enforcing the WDR program and processing "no exposure" certifications under the general industrial storm water permit program and waivers of WDRs. Refunds must be issued if the State Water Resources Control Board (SWRCB) or a regional water quality control board determines that the storm water discharge does not affect have the potential to impact water quality. This law also removes a provision exempting confined animal feeding and holding operations facilities from paying the annual fee.

Since the Legislature imposed mandatory minimum penalties in 1999 for "serious" water quality violations, the penalty structure has been adjusted and refined several times since. AB 1541 (Montanez) continues this pattern and establishes that a failure to file a required discharge monitoring report within the specified 30-day period is a "serious violation." The violator is subject to the mandatory $3,000 penalty for each 30-day period the report is not submitted. Revenues generated from these penalties are available for use by regional boards and other public agencies to cover the costs of cleaning up waste or abating water pollution.

AB 1248 (Aghazarian) is a procedural bill that was adopted to standardize the public notice and comment procedures for SWRCB and the regional water quality control boards (RWQCBs) issuance of water quality permits, which vary from one region to another. AB 1248 establishes a minimum 30-day public comment period prior to adopting WDRs, water reclamation requirements, and SWRCB stay orders on WDRs adopted by regional boards. In an effort to promote watershed management, SB 923 (Sher) allows the SWRCB or regional boards to issue an exemption for WDRs if the discharger performs individual, group, or watershed-based monitoring. Further, this legislation authorizes the SWRCB and regional boards to impose an annual fee to administer this program. Other legislation, AB 1405 (Wolk), enacts the California Watershed Protection and Restoration Act, which establishes a framework to promote voluntary state, federal, and citizen partnerships to engage in watershed planning and restoration. The program is designed to provide flexible approaches to achieve quantifiable water quality objectives through monitoring.

Another procedural bill revises the makeup of members who serve on California's nine RWQCBs. SB 196 (Kuehl) requires that regional boards appoint a city council member or mayor for the position currently designated for a "person associated with municipal government." The appointment for a "person associated with county government" must be filled by a county supervisor.

AB 897 (Jackson) establishes a number of procedural reforms designed to clarify and streamline administrative processes by the SWRCB and RWQCBs. In addition, this law establishes a parallel system of sanctions for waste discharges to land pursuant to a WDR permit which are comparable to penalties imposed on discharges to surface waters under the National Pollutant Discharge Elimination System (NPDES) permit program. AB 897 establishes a criminal penalty scheme for offenders who knowingly fail or refuse to furnish or who falsify technical or monitoring reports or statements of compliance. First offenders are liable for $25,000 and up to $25,000 per day for subsequent violations. It also establishes civil liability for people who cause or permit a hazardous substance to be discharged into water of the state regardless of whether it causes a condition of pollution or nuisance.

AB 334 (Goldberg) makes it easier for local agencies to restrict the use of residential water softeners that discharge into the community sewer system. Local agencies no longer need demonstrate that they are violating WDRs, water reclamation requirements, or a master reclamation permit in order to prohibit water softeners. They now need to prove only that the restriction is a necessary means, rather than the only available means, of achieving compliance with water quality requirements.

A package of several bills was approved to protect the integrity of coastal waters and the San Francisco Bay and Estuary. AB 16 (Jackson) regulates transportation of crude oil and prohibits transportation by oil tanker of crude oil generated offshore by oil tankers. Oil produced from new or expanded offshore oil extraction operations since January 1, 2003, must be transported by pipeline instead of oil tankers. Oil can be transported via overland track and rail shipment if the oil is too viscous to allow transport through a pipeline. Best available technology (BAT) must be employed for pipelines used to transport oil onshore and for abandoning offshore wells. AB 906 (Nakano) is intended to protect California's coastal waters from contaminants discharged from large passenger vessels. This law prohibits releases into coastal waters of hazardous waste and "other waste" (such as photography lab and dry cleaning chemicals, medical waste, print shop wastes, chlorinated hydrocarbons, paint waste, batteries, pharmaceuticals, and printer cartridges). Owners or operators of these large passenger vessels must immediately notify the regional board of a release of hazardous or other waste in to coastal waters. This legislation additionally requires the SWRCB to request that federal agencies prohibit the release of hazardous waste and other waste by large passenger vessels into national sanctuaries such as the Monterey Bay National Marine Sanctuary and the Farallones National Marine Sanctuary. AB 121 (Simitian) prohibits the discharge of sewage sludge or oily bilge water from large passenger vessels into state marine waters and estuaries. Owners of such vessels must also notify the SWRCB within 24 hours of such a release or be subject to a civil penalty of up to $25,000 for each violation.

The Legislature convened a second extraordinary session to tackle the tenuous authority of the California Coastal Commission. The Third District Court of Appeal held that the appointment procedures of the Coastal Commission violated the separation of powers provisions of the California Constitution [Marine Forests Society v. California Coastal Commission (2003) 104 Cal. App. 4th 1232, 128 Cal. Rptr. 2d 869, 2003 CELR 49, review granted, 2003 CELR 209]. ABX2 1 (Jackson) was quickly approved in the beginning of the legislative session to preserve the authority of the commission by curing the constitutional defect. This bill preserves the right of the gubernatorial appointment to serve at the pleasure of the Governor and eliminates that discretionary term of the Senate Committee on Rules and Assembly Speaker who now must serve for fixed four-year terms. AB 847 (Pavley) clarifies that the Coastal Commission's sister agency, the State Coastal Conservancy, has authority to issue grants to protect coastal and marine resources and restoration.

AB 1212 (Pavley) requires that applicants seeking to develop in the coastal zone submit a sand replenishment plan as a precondition to receiving a permit. The developer must also provide onsite monitoring and supervision during the implementation of the permit.

Building on legislation enacted in 1999 (Stats. 1999, AB 703), AB 433 (Nation) mandates compliance with the voluntary provisions of the National Invasive Species Act. AB 433 offers the next substantive step to this nascent program designed to protect the San Francisco Bay from nonindigenous species by managing releases of ballast waters. This law requires the master, owner, or operator of specified vessels to employ ballast water management practices designed to minimize the release of nonindigenous species into the bay. Additionally, the California State Lands Commission is required to collect samples from at least 25 percent of vessels capable of carrying ballast water from the deep sea into the coastal waters.

Three bills were approved that protect the integrity of rivers and other state waters. AB 1168 (Bert) amends the California Wild and Scenic Rivers Act to include sections of the Albion and Gualala Rivers as "recreational" segments. AB 66 (Leslie) creates an Adopt-A-Riverway Program where volunteers can contribute time or money to help maintain or enhance a section of a state riverway. This law authorizes planting and establishing native seedling trees, shrubs, native grasses, and wildflowers and removing litter and weeds consistent with an integrated weed management plan. Local authorities may place courtesy signs recognizing the sponsors of the program. SB 418 (Sher) modifies the streambed alteration program by altering the arbitration process. This law allows the Department of Fish and Game (DFG) to discipline holders of streambed alteration agreements for failure to comply with terms. It additionally increases the cap on fees to implement and enforce the program from $2,400 to $5,000. Finally, SB 418 allows DFG to extend a streambed alteration agreement for up to five years and requires the agreement holder to remain responsible for implementing mitigation measures to protect fish and wildlife even after an agreement expires.

Water Supply

With forecasts predicting over twenty million new Californians in this arid state within a generation, the Legislature is exploring a wide range of alternatives to meet the state's future water supply demand. AB 314 (Kehoe) builds on legislation from last session - Statutes 2002, AB 2717 (Hertzberg), which required the Department of Water Resources (DWR) to convene a water desalination task force to determine the feasibility of desalinating water in California. AB 314 affirms that desalination is a feasible approach to meet some of California's growing water needs. It further requires that desalination projects developed by or for public water entities have the same opportunities to receive state funding as other water projects. This law also declares that desalination projects must be consistent with California environmental protection policies.

A number of bills capitalized on plentiful funds made available last fall by the passage of Proposition 50, otherwise known as the "Water Quality, Supply and Safe Drinking Water Projects, Coastal Wetlands Purchase and Protection Bond Initiative Statute." Much of the bond money from Proposition 50 was not specifically earmarked in the initiative, setting off a gold rush of legislation seeking to appropriate those funds. AB 866 (Pavley) expands the types of grants available under Proposition 50 to include programs for water conservation, water use efficiency, and water supply. This bill also gives granting priority to projects that address the needs of small community water systems. AB 1747 (Committee on Budget) requires the State Department of Health Services (DHS) to make available Proposition 50 funds for a public drinking water system security program. Other grants are to be awarded by the DWR for at least $20 million for groundwater management and recharge projects. Finally, AB 1747 requires DHS to competitively award grant money to Southern California water agencies for eligible projects to reduce Colorado River water use.

The Legislature enacted a complementary set of bills designed to resolve the contentious battle between the United States Department of Interior and California water agencies over allocating California's annual allotment of 4.4 million acre feet from the Colorado River. SB 317 (Kuehl) is one of several bills designed to implement a negotiated agreement that serves as the linchpin to implement the California Colorado River Water Use Plan (the "use plan"), which is the framework for reducing California's annual use of Colorado River water. The Quantification Settlement Agreement (QSA) is the key to implementing the use plan. The QSA will facilitate transferring water from agricultural to urban use in the Imperial Irrigation District and San Diego County respectively. This transfer is expected to decrease the inflow to the Salton Sea, thereby increasing salinity, which in turn is expected to reduce fish populations that serve the migratory species and the brown pelican, a fully protected species under California law. SB 317 assists in implementing the QSA by requiring DFG to authorize the incidental take of species resulting from implementation of the QSA. Additionally, this law requires the Secretary of the Resources Agency to study the restoration of the Salton Sea ecosystem and to protect the wildlife dependent on that ecosystem. SB 277 (Ducheny) establishes the Salton Sea Restoration Act and the Salton Sea Restoration Fund, which is designed to restore the long-term stable aquatic and shoreline habitat for fish and wildlife dependent on the Salton Sea. SB 277 also requires mitigation of air quality impacts expected from restoration projects and protecting water quality resources, including management of the increased levels of salinity in the Salton Sea.

AB 1484 (Pavley) allocates Proposition 50 bond funds to the California Resources Agency to finance projects that facilitate water transfers under the QSA and to support restoration activities at the Salton Sea. AB 1770 (Committee on Water, Parks, and Wildlife) extends the deadline for specified agencies to submit a report to the Governor and the Legislature on the implementation of the Salton Sea QSA from June 30, 2003, to January 30, 2005. SB 654 (Machado) extends the completion date for lining the All- American Canal from December 31, 2006, to December 31, 2008.

Senator Machado also introduced legislation, SB 833, to develop and adopt a master plan designed to balance and enhance the Eastern Water Alliance (composed of the Central San Joaquin Water Conservation District, the North San Joaquin Water Conservation District, and the Stockton East Water District). It expands the authority of the Alliance to develop a master plan designed to balance the use and enhancement of the basin through conjunctive management and to prepare a joint groundwater management plan for the member agencies. To implement the master plan, the agencies must also secure new surface water rights and protect existing water rights.

Hazardous Materials and Hazardous Waste

Using the precautionary principle, the Legislature enacted a number of expansive and novel programs designed to manage the public's exposures to harmful chemicals. SB 189 (Escutia) is perhaps the most significant because it attempts to determine linkages between health effects and chemical exposures using monitoring data. This law builds on last year's SB 702 (Escutia), which required DHS to create a working group to make recommendations concerning the potential relationships between chemicals observed in the environment and chronic diseases. SB 189 (Escutia) enacts the California Health Tracking Act of 2003, which requires DHS, Cal-EPA, and the University of California to coordinate respective expertise and resources to establish a statewide environmental health tracking network designed to monitor trends in health within the population.

PBDEs may well be subject to scrutiny under the California Health Tracking Act. These chemicals, a subcategory of brominated flame retardants (BFRs), are a class of chemicals that have the potential to disrupt thyroid hormone balances and that may be carcinogenic. PBDEs are found in a great number of products, such as the plastic housing of electronics and computers, circuit boards, and textiles used in furniture. This year, the presence of PBDEs caught the attention of the Legislature as PBDE concentrations in human breast milk have increased by fortyfold since the 1970s, with California women carrying the largest concentrations compared to any other region studied in the world. AB 302 (Chan) was enacted in response to this alarming data. It prohibits manufacturing, processing, or distributing in commerce a product or a flame-retardant part of a product containing more than 1/10 of one percent pentaBDE or octaBDE by mass by January 1, 2008. Additionally, the Senate Office of Research must submit recommendations regarding regulation of PBDEs by March 1, 2004, to the President pro Tempore of the Senate and the Senate Environmental Quality Committee. These recommendations may transform into new legislation next term.

Responding to reports that very few of the millions of discarded electronic devices, or "E-Wastes," are being recycled, Senator Sher once again introduced a bill to address this burgeoning waste stream. Ewastes, which consist of computers, cell phones, and televisions, collectively account for high volumes of heavy metals entering our sanitary landfills. After last year's veto of his E-Waste bill (Stats. 2002 SB 1523), Senator Sher addressed the Governor's concerns and adopted a product stewardship approach in SB 20. SB 20 establishes manufacturer responsibility to phase-out the use of heavy metals in electronic devices and to increase the use of recycled materials. SB 20 also imposes a ban on sale of covered electronic devices (CEDs) if those same devices would be prohibited from sale in the European Union (EU) due to the presence of heavy metals. The ban is scheduled to take affect January 1, 2007, unless the EU approves Directive 2002/95/EC sooner.

SB 20 also requires that no later than July 1, 2004, retailers of CEDs collect from consumers an electronic waste recycling fee of $6 to $10 depending on the size of the screen. These electronic waste recycling payments are to be paid to authorized CED recyclers who must provide free and convenient collection, consolidation, and transportation of CED wastes. Exporters of electronic waste to foreign destinations must meet standards adopted by the Organization for Economic Co-operation and Development.

SB 20 also requires CED manufacturers to label equipment with the manufacturer's brand label by January 1, 2005. Additionally, manufacturers must provide to consumers information describing where and how to return, recycle, and dispose of the electronic devices. Manufacturers are also required to annually submit information on the number of electronic devices sold in the state along with the amount of recycled materials used in the manufacture of the CEDs and a description of efforts to design CEDs for recycling and goals to increase CED recycling.

The IWMB must annually establish and update statewide electronic waste recycling goals. Cities and counties must revise their integrated waste management plans by January 1, 2004, to ensure that the household hazardous waste element articulates actions necessary to promote the collection, consolidation, recovery, and recycling of covered electronic waste.

AB 998 (Lowenthal) requires the ARB to impose a fee of $3 per gallon on state perchloroethylene manufacturers and on importers of perchloroethylene used in dry cleaning. This fee will increase by $1 each year from 2005 to 2013. Generated funds will go to the Nontoxic Dry Cleaning Incentive Trust Fund in the State Treasury. This fund will be used to make grants of up to $10,000 to help dry cleaners, especially those in communities with high levels of air contaminants, transition from perchloroethylene to nontoxic dry cleaning operations. The ARB will also use the fund to establish a demonstration program showcasing nontoxic dry cleaning operations.

Like the E-waste law discussed above, AB 455 (Chu) attempts to tackle wastes by looking upstream to prevent the generation of dangerous wastes. Recognizing that packaging constitutes approximately one-third of solid wastes generated nationwide and that heavy metals continue to proliferate in our sanitary landfills, AB 455 phases out the use of heavy metals in packaging. This law enacts the Toxics in Packaging Prevention Act, which prohibits manufacturers and importers from selling packaging that includes any of the following regulated metals: lead, cadmium, mercury, or hexavalent chromium. The prohibition takes effect on or after January 1, 2006. Manufacturers and importers must also furnish to their purchasers a certificate indicating that the package or packaging materials they offer meet the conditions of AB 455.

Despite the proactive approaches discussed above, SB 331 (Romero) looks backward and codifies the doctrine of delayed discovery for toxic tort actions as articulated in Jolly v. Eli Lilly & Co. [(1988) 44 Cal.3d 1103, 245 Cal. Rptr. 658] and Clark v. Baxter HealthCare Corp. [(2000) 83 Cal. App. 4th 1048, 100 Cal. Rptr. 2d 223]. Under this doctrine, the statute of limitations is two years for filing a lawsuit for injury, illness, or death caused by exposure to a hazardous material or toxic substance. In essence, the doctrine forecloses a toxic tort action unless the plaintiff brings a civil action within either two years from the date of injury or two years after the plaintiff becomes aware of or reasonably should have become aware of an injury, the physical cause of the injury, and sufficient facts to put a reasonable person on inquiry notice that an injury was caused by or contributes to the wrongful act of another, whichever comes first. For a wrongful death action, a plaintiff must bring an action within two years from the death of the plaintiff's decedent or two years from the first date on which the plaintiff became aware of the physical cause of the death. Media reports do not provide sufficient facts to put a reasonable person on notice to inquire that the injury or death was caused or contributed by the wrongful act of another. Finally, the provisions of this law do not apply to actions relating to illness or injury caused by exposure to asbestos and do not apply to medical malpractice actions subject to Medical Injury Compensation Reform Act (MICRA).

AB 1640 (Laird) eliminates an exemption enjoyed by local government and requires that cities and counties be considered "businesses" for purposes of complying with hazardous materials handling laws. Additionally, this law permits Certified Unified Program Agencies (CUPAs) to use the same expedited hearing process it uses for violations relating to Hazardous Materials Release Response Plans and Inventories for failures to pay penalties or required fees.

AB 1008 (Dutton) allows the State Allocation Board to increase grant funding to support new construction and modernization of school facilities if necessary to pay for the increased costs of complying with DTSC-imposed hazardous materials evaluation and removal requirements.

Except for a handful of bills, this legislative session yielded very few initiatives in the area of hazardous waste management. AB 1348 (Lowenthal) is the most noteworthy hazardous waste bill enacted. It establishes standards governing hazardous wastes that are rejected from an off-site hazardous waste management facility. Under this scheme, an off-site hazardous waste management facility may return rejected hazardous waste to the generator or send it to an authorized facility designated by the generator. Generators who receive rejected shipments are permitted to accumulate the rejected hazardous waste on site for up to 90 days. Those facility operators that reject hazardous waste are not considered "potentially responsible parties" for purposes of Superfund liability and are therefore not considered to be a "generator, arranger for disposal, nor a transporter."

AB 1348 addresses a number of other hazardous waste considerations involving mixed waste, purity standards for polychlorinated biphenyls, and secondary containment for bulk hazardous wastes. This law clarifies that used oil transfer facilities may mix contaminated petroleum as long as the facility has been authorized to treat hazardous waste pursuant to a tiered treatment permit. Additionally, transporters of used oil must deliver to the used oil generator a specified notification indicating that it is "lawful to send used oil to out-of-state facilities that comply only with federal used oil management standards . . . ." AB 1348 also revises the purity standard for recycled oil to less than 2 mg/kg of PCBs. Finally, this law requires the use of secondary containment systems for the loading or unloading of bulk hazardous waste into or from trucks and railcars.

AB 1247 (Aghazarian) is the only substantial hazardous waste law enacted this session. It authorizes DTSC to use the following means to impose a facility post-closure plan on a hazardous waste facility: enforcement orders, enforceable agreements, and issuing a post-closure permit.

Nonhazardous Solid Waste

Plastic bags, paper cups, and cigarette butts are the three most common forms of land-based litter that collect with storm water and impact the marine environment, including aquatic life. The California Department of Transportation states that cigarette butts represent the most prevalent form of litter on California roadways. AB 586 (Koretz) establishes the "Litter and Marine Debris Reduction and Recycling Act" and imposes a fee of two cents on retail sellers for each disposable bag or cup sold or provided to its customers. This fee will be deposited in the Litter and Marine Debris Recycling Fund, which will support local governments and several state department programs to reduce litter and marine debris. AB 586 additionally requires that businesses or "persons" maintaining an area where smoking is legal must provide tobacco waste receptacles in this area.

California's Beverage Container Recycling and Litter Reduction (Bottle Bill, Statutes 1986, AB 2020) got a raise in 2003 with AB 28 (Jackson). This legislation modifies the incentive mechanism that drives the program in order to promote higher levels of recycling over time. AB 28 substantially increases the California Redemption Value (CRV) imposed on retail consumers; it raises the CRV from 25 cents to 40 cents for containers (aluminum, plastic, bimetal, or glass) up to 24 ounces and from 50 cents to 80 cents for containers larger than 24 ounces. After July 1, 2007, the CRV would increase another 25 percent if the overall recycling rate in the state fails to achieve 75 percent during 2006 or 80 percent during 2008. AB 28 also increases the quality glass incentive payments to operators of curbside recycling programs from $25 per ton to $30 per ton. Further, this law reduces from 35 percent to 25 percent the minimum recycling content that a glass manufacturer must satisfy for mixed color cullet.

In an effort to provide a soft landing for landfill employees after a landfill closes, AB 1497 (Montanez) requires that landfill operators establish a reemployment and retraining program for displaced workers. Specifically, this law requires landfill operators to include in their closure and post-closure plans provisions for the reemployment and retraining of the solid waste landfill contract employees, including truck drivers and waste haulers. This legislation also addresses procedural changes regarding notices and hearings pertaining to appeals of a revised solid waste facility permit and it eliminates the penalty cap for violations.

Hazardous Substances and Clean Up Programs

Perchlorate has emerged as a major chemical of concern this legislative session, with two significant bills designed to manage this formerly unregulated chemical. Perchlorate has contaminated 44 public drinking water systems throughout the state. It impairs the body's metabolism and physical growth because it interferes with thyroid hormone production. Perchlorate is found in a variety of manufactured good, such as fireworks, flares, explosives, airbags, and some fertilizers.

SB 1004 (Soto) establishes release reporting obligations for a release of perchlorate into receiving waters. The reportable quantity that triggers notification to the California Office of Emergency Services (OES) is ten pounds or more. However, the reportable quantity can be set at a more restrictive level for a particular body of water. Additionally, owners or operators that have stored over 500 pounds per year of perchlorate since 1950 must also submit the following information to the SWRCB: (1) the volume of perchlorate stored each year; (2) the method and location of storage; and (3) copies of documents relating to any monitoring undertaken for potential leaks into waters of the state. The State Board is required to publish a list of past and present perchlorate storage facilities located within California by January 1, 2006. The State Board must also supply the information on perchlorate inventories and submit it to Cal-EPA for entry into a perchlorate inventory database.

SB 1004 also expands the scope of cleanup and abatement orders issued by the SWRCB or a regional board. The boards now have authority to require a party responsible for any contamination to pay for replacement water to each affected public water supplier or private well owner. Additionally, the state or regional board can request a water replacement plan from the responsible party. Finally, the law provides for mediation of replacement water claims.

AB 826 (Jackson) enacts the Perchlorate Contamination Prevention Act, which requires that the DTSC develop regulations by December 31, 2005, to manage perchlorate materials using BMPs. Additionally, owners or operators of a perchlorate "facility" located within a five-mile radius of a public drinking water well contaminated with perchlorate must submit specified information to Cal-EPA regarding the contaminated site by July 1, 2004. This information must summarize any subsurface and groundwater monitoring, investigation, or remediation work performed at the facility.

AB 826 also requires that CUPAs regulate "a person managing perchlorate materials" and that Cal- EPA establish a statewide geographic information management system to collect information on hazardous materials use and spills from the CUPAs on a phased-in schedule. Finally, it requires businesses that handle any amount of perchlorate materials to prepare and submit a business plan and inventory.

With a state hiring freeze and the possibility of layoffs, AB 1700 (Laird) protects state agency staff engaged in cleanup and oversight of contaminated properties that are federally funded, including closed military bases.

Underground Tanks

Last year, Senator Frommer succeeded in enacting AB 2481, which established technology requirements for new underground storage tanks (USTs) installed after July 1, 2003. Owners and operators of these new tanks were required to ensure that tanks and piping are "product tight" and equipped with a continuous monitoring system designed to detect liquid or vapor leaks. AB 1702 (Committee on Environmental Safety and Toxic Materials) delays the application of these requirements to USTs installed after July 1, 2004. Additionally, this law extends civil liability to "operators" who fail to comply with UST requirements.

AB 1218 (Dutra) authorizes the use of performance- based contracts as an alternate method of cleaning up leaking USTs. Performance-based contracting is an approach intended to accelerate UST cleanups without raising costs or compromising the quality of the cleanup. Payments, which are reimbursed from the UST Cleanup Trust Fund Act of 1989, are paid on a fixed basis as long as the designated constituents of concern are cleaned to certain concentrations pursuant to specified milestones.

CEQA and Land Use

AB 1545 (Simitian) modifies the California Environmental Quality Act (CEQA) to require that lead agencies accept comments by electronic mail regarding draft environmental impact reports (EIRs), proposed negative declarations, proposed mitigated negative declarations, and specified notices. Electronic mail comments must be treated as equivalent to written comments, and all laws relating to written comments must also apply to electronic mail comments. Finally, the law requires that, if a lead agency offers to provide notices by electronic mail, a person who files a written request for notices may request that the notices be provided by electronic mail.

In order to more effectively monitor the use of and frequency of a recently enacted infill exemption to CEQA [see 2002 Stats., Ch. 1039, SB 1925], AB 677 (Firebaugh) was enacted to set up a monitoring system regarding three exemptions (residential housing for agricultural employees, affordable housing for low-income households, and urban infill development). This legislation requires a lead agency that approves or determines to carry out projects subject to exemption above to file a notice of exemption with OPR and post it for public inspection.

SB 1074 (Committee on Environmental Quality) extends the deadline for the Resources Agency to establish a protocol for reviewing prospective applications for certified regulatory programs under CEQA.

AB 1492 (Laird) was enacted in response to allegations of egregious violations of the Williamson Act involving housing subdivisions and strip malls built on land restricted for open space and farm land. This law modifies the Williamson Act to strengthen the enforcement of land conservation contracts by increasing the penalty for prematurely breaching a contract from 12.5 percent to 25 percent of the unrestricted value of the land and of the value of the incompatible building. This law establishes a procedure by which the Department of Conservation (DOC) must notify the municipality of a possible material breach of the land conservation contract. The municipality is then obligated to notify the land owner and the DOC of its determination and allow the landowner an opportunity to eliminate the circumstances causing the material breach. Failure to do so results in a monetary penalty and termination of the contract.

SB 745 (Ashburn) extends indefinitely the authority to use an environmental subdivision procedure to establish a supply of mitigation lands. This procedure is designed to promote market-based approaches to creating mitigation lands by subdividing land dedicated for environmental purposes for perpetuity.

Environmental Education

AB 1548 (Pavley) establishes the Office of Education and the Environment within the IWMB with responsibilities to develop and implement a "unified education strategy on the environment" for use in elementary and secondary schools. As part of this strategy, the Office must develop "educational principles for the environment" by July 1, 2004, which include environmental sustainability, pollution prevention, environmental justice, as well as the traditional environmental topics and principles. These environmental principles, which must be updated every four years, will be used to direct and align state agency environmental education programs and materials. The office must also develop a model environmental curriculum that incorporates the principles for use in public schools.

AB 1330 (Simitian) establishes an outdoor environmental education program for at-risk youth from underserved socioeconomic groups within the state.

Enforcement

SB 777 (Escutia) extends the "Whistleblower Protection Statute" to protect employees who report violations of any state or federal rules. The law does not appear to limit the scope of the rules to just environmental, health, or safety rules. It also prohibits employers from retaliating against employees who refuse to participate in behavior that would violate a state or federal rule or for having reported or refused to participate in this behavior in previous employment. SB 777 also establishes a whistleblower hotline, and requires that employers display the hotline number along with their employees' whistleblower rights and responsibilities. Finally, it increases the civil penalties for certain violations of whistleblower laws, and prescribes that employers have the burden of proof in administrative or civil proceedings in a whistleblower action to show by "clear and convincing evidence" that the action against the employee would have occurred even in the absence of the whistleblower action.

Environmental Justice

SB 352 (Escutia) was enacted in response to data showing that a disproportionate number of economically disadvantaged students may be attending schools that are located near heavily trafficked roadways. This environmental justice bill prohibits the governing board of a school district from approving the location of a school within 500 feet from the edge of the closest traffic lane of a freeway or other busy traffic corridor. However, schools may be located as prescribed above if it can be demonstrated that the air quality at the site does not pose a health risk to students or staff or under other specified circumstances.

Natural Resources, Endangered Species, and Cultural Resources

The timber industry and conservation community buried the hatchet and reached consensus on a number of their differences with respect to logging policies and protecting old growth forests. SB 810 (Burton) made it more difficult for timber operations to obtain exemptions for WDRs. Prior law allowed a WDR exemption as long as the United States Environmental Protection Agency certified that timber operations constitute BMPs for silviculture pursuant to the Z'berg-Nejedly Forest Practice Act of 1973. SB 810 requires that the SWRCB must also certify that the timber operations comply with the Forest Practice Act. Additionally, this law prohibits approval of a timber harvesting plan when the RWQCB determines that the proposed timber operations will result in discharging sediment to a watercourse that is impaired for sediment. AB 47 (Simitian) requires that the State Board of Forestry adopt rules by January 1, 2005, requiring that a timber harvesting plan include the following information related to the conduct of timber operations: a map depicting the location and boundaries of past, present, and reasonably foreseeable probable future projects on land owned or controlled by the applicant near watercourses. The rules must consider the impact on smaller landowners and avoid excessive burdens or costs on these landowners.

In an effort to encourage private landowners to voluntarily make their land available to the public for wildlife-dependent recreational activities, AB 396 (Harman) requires that the DFG establish the Shared Habitat Alliance for Recreational Enhancement Program (SHARE Program), designed to encourage landowners to make their land available for public use ranging from fishing, wildlife observation, conservation education, and hunting. Each agreement between DFG and the land owner must prohibit the "take" of nongame species by public participants in the program. Conversely, SB 412 (Sher) does allow for "take" of any fully protected bird, mammal, reptile, amphibian, or fish for scientific research and for efforts to recover those species. SB 216 (Sher) authorizes the DFG to develop and implement a recovery strategy pilot program for Coho salmon and extends the existing pilot program for the Greater Sandhill Crane. AB 1354 (Berg) establishes a capacity reduction fee on the taking of certain species of fish and shellfish which will be used to repay federal loans made to California fishermen through the West Coast Groundfish Fishery Capacity Reduction Program.

SB 483 (Sher) was conditionally approved in 2002 but ultimately failed to become law because it was tied to other legislation that was vetoed that year. SB 22 (Sher) removed this dependence and allowed SB 483 to become law as an urgency measure, allowing the law to take effect immediately. SB 483 prohibits surface mining operations for metallic minerals within one mile of a Native American sacred site unless there is a plan to backfill, grade, and restore the original contours of the land. SB 483 also extends the time period for remediation of abandoned mined lands to January 1, 2007.

SB 649 (Kuehl) prohibits local agencies from purchasing sand, gravel, aggregates, and other minerals from surface mines in California if their operations are not in compliance with the Surface Mining and Reclamation Act. This law doubles the annual reporting fee on each active or idle mining operation as adjusted for the cost of living. SB 649 also establishes a fee of $5 per ounce of gold and $0.10 per ounce of silver mined within the state to support remediating and reclaiming abandoned mine lands.

AB 1476 (Chavez) expands the authority of the Department of Parks and Recreation to include within in its state park reserves those areas containing outstanding cultural resources of statewide significance.

Pesticides

AB 1724 (Committee on Agriculture) establishes penalties for violation of structural fumigation laws. This law adjusts the statute of limitations for unregistered pest control businesses and modifies the time frame by which a prosecutor must bring an action for criminal violations of the pesticide laws.

Sustainability

California has led the nation adopting a number of innovative "command and control" regulatory programs. While the current regulatory regime has largely relied on prescriptive standards and controls, it has failed to objectively measure environmental quality improvement and performance and to correlate progress to the command and control programs. AB 1360 (Steinberg) codifies Cal-EPA's EPIC (Environmental Protection Indicators for California) project, which implements a process to evaluate performance and track environmental progress using environmental indicators as metrics. This law requires the Environmental Health Hazard Assessment (OEHHA) to serve as the lead agency in an intraagency working group to develop and maintain a list of environmental indicators. This shifts the paradigm for agencies that traditionally measure performance based on specified regulatory activities such as the number of permits issued and to instead evaluate measurable environmental results to determine program performance. Further, Cal-EPA is required to develop a report on the indicators for submission to the Governor and the Legislature every two years, beginning on January 1, 2006.

In a similar vein, SB 68 (Alpert) establishes a San Diego Bay Advisory Committee for Ecological Assessment to evaluate the overall health of the San Diego Bay, to identify habitat enhancement projects, and to assess best available technology practices and regulation relating to the San Diego Bay. The Committee must report its findings to the Legislature, the San Diego Regional Water Quality Board, the SWRCB, and the California Coastal Commission by December 31, 2005.

Conclusion

Former Governor Davis signed some of the most progressive, green-leaning legislation in his fifth and final year in office. Whether his signatures were intended to appeal to his political base in an effort to retain his job or whether he truly saw himself as a lame duck and spoke his heart may never be known. What matters now is whether the new Governor will have the ear of his brother-in-law Robert Kennedy Jr., a well-known environmental activist, or whether he will follow the lead of the former Wilson Administration. Regardless, the future of environmental policy in California is at a cross-road with a Governor whose policies are largely unknown thanks to a truncated recall campaign season leaving the public short on details. At the same time, we are entering the last year of perhaps the most prolific author of environmental policy in California history. Senator Byron Sher, whose name appears on countless environmental programs ranging from air quality to solid waste, will be retiring. A great deal of uncertainty exists as we enter the second year of the legislative session with a new and untested governor and a departing, seasoned legislator.