BILL ANALYSIS                                                                                                                                                                                                    






                                                                     AB 102


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          Date of Hearing:  April 28, 2015


           ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS


                                  Luis Alejo, Chair


          AB 102  
          (Rodriguez) - As Amended March 26, 2015


          SUBJECT:  Railroad and surface transportation safety and  
          emergency planning and response:  hazardous materials


          SUMMARY:   Creates the Regional Railroad and Surface  
          Transportation Accident Preparedness and Immediate Response  
          Force (Response Force) in the Office of Emergency Services  
          (OES).  Requires the Response Force to be responsible for  
          providing regional and onsite response capabilities in the event  
          of a release of hazardous materials from a railroad tank car, a  
          railroad accident involving a tank car, or a hazardous material  
          release from a truck. Establishes a fee (Fee) paid by each  
          person owning hazardous materials that are transported by rail  
          or truck in California to fund OES activities. Specifically,  
          this bill:


          1)Requires the Response Force to be responsible for providing  
            regional and onsite response capabilities in the event of a  
            release of hazardous materials from a railroad tank car, a  
            railroad accident involving a tank car, or a hazardous  
            material release from a truck, and for implementing the state  
            regional railroad accident preparedness and immediate response  
            plan for releases of hazardous materials from a railroad or  
            other surface transportation.












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          2)Requires the Response Force to consist of representatives of  
            all of the following:  Department of Fish and Wildlife;  
            California Environmental Protection Agency; State Air  
            Resources Board; Department of Resources Recycling and  
            Recovery; California Regional Water Quality Control Boards;  
            Department of Toxic Substances Control; Department of  
            Pesticide Regulation; Office of Environmental Health Hazard  
            Assessment; State Department of Public Health; Department of  
            the California Highway Patrol; Department of Food and  
            Agriculture; Department of Forestry and Fire Protection;  
            Department of Parks and Recreation; Public Utilities  
            Commission; State Fire Marshal; Emergency Medical Services  
            Authority; California National Guard; and, any other  
            potentially affected state, local, or federal agency, as  
            determined by OES.

          3)Requires OES to develop a Railroad and Surface Transportation  
            Accident Plan in cooperation with the Response Force members  
            and requires the plan to become an annex to the state  
            emergency plan.

          4)Creates the Regional Railroad and Surface Transportation  
            Accident Preparedness and Immediate Response Fund (Fund).   
            Requires moneys in the Fund, upon appropriation by the  
            Legislature, to be used by OES to pay for the following  
            purposes related to the transportation of hazardous materials:

             a)   Reimbursement of California High-Cost Fund-B   
               Administrative Committee fund for moneys previously loaned  
               to OES;

             b)   Planning, developing, and maintaining a capability for  
               emergency response to accidents including the risks of  
               explosions and fires involving tank cars or trucks carrying  
               hazardous materials;

             c)   Planning, developing, and maintaining a capability for  
               emergency response to releases of hazardous materials from  
               tank cars and trucks including reducing the harmful effects  











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               of exposure of those materials to humans and the  
               environment;

             d)   Creation, support, maintenance, and implementation of  
               the Response Force;

             e)   Acquisition and maintenance of specialized equipment and  
               supplies used to respond to a hazardous materials release  
               from accidents involving trucks and railroad accidents  
               involving a tank car;

             f)   Support of specialized training facilities to prepare  
               for and respond to a hazardous materials release from a  
               railroad tank car or a railroad accident involving a tank  
               car;

             g)   Creation and support of a regional, state level, and  
               local emergency response team to provide immediate onsite  
               response capabilities in the event of large scale releases  
               of hazardous materials from a railroad tank car or a  
               railroad accident involving a tank car;

             h)   Support for specialized training for state and local  
               emergency response officials in techniques for prevention  
               of, and response to, release of hazardous materials from a  
               railroad tank car or trucks; and,

             i)   Provides that fees paid into this Fund by the owner of  
               hazardous materials, which is also subject to the oil spill  
               prevention and administration fee, may reduce their  
               payments to the oil spill prevention and administration fee  
               by an amount equal to the Fund payments.

          5)Requires that the amount available for appropriation from the  
            Fund does not exceed $10 million in any calendar year.

          6)Requires OES to establish a schedule of fees to determine the  
            amount of the Fee that shall be paid by each person owning  
            hazardous materials that are transported by rail in California  











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            in an amount sufficient to fund the appropriation from the  
            Fund, to reimburse the Fund for any moneys loaned, and to  
            maintain a prudent reserve of two months' operating costs.   
            Requires the Fee to be based on each loaded tank car and  
            collected in a manner specified.  Requires the Fee to be fair,  
            as specified by federal law, and reflect the proportionate  
            risks to the public safety and environment resulting from a  
            release of different hazardous materials and the expense of  
            preparing to respond to those varying risks.  Prohibits the  
            Fee to exceed the reasonable regulatory costs to the state.   
            Requires OES to set the Fee consistent with Proposition 26 of  
            2010.

          7)Allows OES to authorize payment of the Fee through  
            contributions of in kind of equipment, materials, or services.

          8)Defines "hazardous materials" as a material that the United  
            States Department of Transportation has designated as a  
            hazardous material for purposes of transportation in Part 172  
            of Title 49 of the Code of Federal Regulations.



          


          EXISTING STATE LAW:


          1)Establishes, under the Lempert-Keene Seastrand Oil Prevention  
            and Response Act, the Office of Oil Spill Prevention and  
            Response (OSPR) as the primary authority to direct prevention,  
            removal, abatement, response, containment, and cleanup efforts  
            with regard to any oil spill in the marine and inland waters  
            of the state. 
             
          2)Provides that OES is the central point in state government for  
            the emergency reporting of spills, unauthorized releases, or  
            other accidental releases of hazardous materials and shall  











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            coordinate the notification of other state and local  
            administering agencies that may be required to respond to the  
            accidental releases.
          
          EXISTING FEDERAL LAW:

          1)Requires each state to have a State Emergency Response  
            Commission (SERC) to coordinate and supervise federal programs  
            related to hazardous material emergencies and ensure public  
            availability of appropriate chemical information.  (OES is the  
            chair of the California SERC.)  

          2)Requires that laws related to railroad safety be nationally  
            uniform "to the extent practicable" and allow the state to  
            adopt an additional or more stringent law under certain  
            conditions when not preempted by the federal act.

          3)Requires, pursuant to a United States (U.S.) Department of  
            Transportation order, each railroad carrier to provide the  
            SERC for each state in which it operates trains transporting  
            one million gallons or more of Bakken crude oil, notification  
            regarding the expected movement of such trains through the  
            counties in the state.  

          FISCAL EFFECT:  Not known.


          COMMENTS:  


          Need for the bill:  According to the author, "AB 102 was  
          introduced to respond to the need to address gaps in  
          California's first responders' ability to respond to spills of  
          hazardous materials.  

          While the focus has been on recent spills of crude oil by rail  
          in the U.S. and Canada, there are other extremely toxic and  
          dangerous materials that are being transported by both truck and  
          rail.  Last year's funding of the Oil Spill Prevention Response  











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          Program in the Department of Fish and Wildlife recognized the  
          danger of petroleum spills from rail, truck and pipeline.   
          Placing a fee on hazardous materials to fund the ability to  
          respond to spills needs to be carefully considered prior to be  
          adopted".

          Accidents involving hazardous materials travelling by rail: In  
          recent years, there have been a number of serious accidents  
          across North America involving hazardous materials travelling by  
          rail. For example, in July 2013, a train carrying crude oil  
          through Lac-Megantic, Quebec derailed and exploded in a downtown  
          area. In addition, there have been incidents across the United  
          States involving crude and ethanol that have caused significant  
          environmental damages and posed a risk to human health and  
          safety. While California has not had a large-scale rail accident  
          involving hazardous materials in recent years, a train accident  
          in Dunsmuir in 1991 spilled 19,000 gallons of pesticide into the  
          Sacramento River. The effects of the spill were substantial and  
          impacted a significant area.

          State funding for railroad hazardous material accident response:  
          Following the Dunsmuir accident in 1991, the state assessed a  
          fee on hazardous materials transported in the state. This fee,  
          on trucking companies and the railroads, was assessed from 1991  
          until it expired in 1995. In 1994, each trucking company paid a  
          $205 fee. In addition, major railroads paid differing fees, all  
          of which generated over $1.2 million in revenue. Information on  
          how the fee rate was determined is unavailable. Funds collected  
          from the fee were deposited in the Rail Accident Prevention and  
          Response Fund and used to support grants to local communities  
          for hazardous materials response equipment and training.


          As part of the 2014-15 budget, the Legislature authorized a $10  
          million loan from the High-Cost Fund-B Administrative Committee  
          Fund, which provides subsidies to telephone carriers that  
          provide basic local telephone service in high-cost areas, to a  
          new Regional Railroad Accident Prevention and Immediate Response  
          Fund. The funds are intended to support six new hazardous  











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          materials response teams with the purchase of hazardous material  
          response vehicles and training. The loan is scheduled to be  
          repaid with interest by July 1, 2017, although, at the time the  
          loan was made, no funding source was designated to provide  
          repayment.


          The FY 2014-2015 budget trailer bill, SB 861, Chapter 35,  
          Statutes of 2014, expanded the OSPR marine oil spill program to  
          inland oil spills that affect waters of the state.  This bill  
          requires railroads to have oil spill contingency plans and  
          demonstrate the financial ability to pay for any damages  
          resulting from a spill.   Additionally, SB 861 established a 6.5  
          cent per barrel fee on oil transported by pipeline or railroads  
          to refineries to fund OSPR regulations and oversight programs.


          Governor's budget proposal FY 2015-2016:  Included in the  
          Governor's proposed budget for FY 2015-2016 was a "trailer bill"  
          proposal to create the Regional Railroad Accident Preparedness  
          and Immediate Response Force in the Office of Emergency Service,  
          and to designate this force as being responsible for providing  
          regional and onsite response capabilities in the event of a  
          release of hazardous materials from a rail car or a railroad  
          accident involving a rail car. AB 102 is similar to the  
          Governors' proposal with the addition of surface transportation  
          and truck transportation of hazardous materials.





          Office of Emergency Services - gap analysis:  In March of 2015  
          OES completed an analysis of outstanding gaps in the State's  
          ability to respond to hazardous material spills from rail  
          accidents.  Among the major findings from this Gap Analysis were  
          the following shortcomings, specifically, the analysis  













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          identified gaps in hazardous materials response capacities:<1>

          1)High-hazard areas for derailments are primarily located in the  
            mountains with some high-hazard areas in urban areas such as  
            in the San Bernardino-Riverside and San Luis Obispo regions;
          2)There are limited or no hazmat teams located near the  
            high-hazard areas in rural Northern California and other  
            populated areas near rail routes, such as Stockton, San Luis  
            Obispo, Santa Maria and Barstow have only "non-certified"  
            hazmat teams;
          3)There is currently no reliability for, or system-wide access  
            to industry-based resources that are controlled by industry;
          4)Because Central Coast refineries do not have the same level of  
            hazmat response capability with Type 2 State certified hazmat  
            teams, without specialized or enhanced hazmat capabilities  
            along and adjunct to Central Coast refineries, there remains a  
            significant risk to public safety and the environment in the  
            event of a hazardous materials incident; and
          5)The $1.7 million provided by Pipeline and Hazardous Materials  
            Safety Administration is inadequate to support emergency  
            hazmat response needs.

          Arguments in opposition:  A coalition of business, agricultural  
          and chemical manufactures, including the American Chemistry  
          Council, voiced their concerns with AB 102 as well as the  
          Governor's budget proposal. Specifically they stated,  
          "Collectively, we are committed to the safe transport of  
          materials that are vital to a broad range of industries,  
          including water treatment, farming, construction, medicine,  
          technology, and transportation. Many facilities and businesses  
          in California depend on receiving these essential materials.  
          However, as drafted, the bill leaves unanswered too many  
          questions about the level of necessary funding, its duration,  
          how the program will be implemented and the potential impact on  
          ---------------------------


          <1> Cal-OES, "Hazardous Material Team and Response Resources  
          Capabilities: Updated Gap Analysis for Transport and Response of  
          Hazardous Materials by Rail and Refineries in California", March  
          2015.









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          California businesses."





          Prior legislation:


          SB 861(Budget Committee), Chapter 35, Statutes of 2014. Expands  
          the State's marine oil spill program to inland oil spills that  
          affect waters of the state.  Requires railroads to have oil  
          spill contingency plans and demonstrate the financial ability to  
          pay for any damages resulting from a spill and established a 6.5  
          cent per barrel fee on oil transported by pipeline or railroads  
          to refineries to fund regulations and oversight programs.  


          AB 380 (Dickinson), Chapter 533, Statutes of 2014. Requires rail  
          carriers to submit specified information regarding the transport  
          of hazardous materials and Bakken oil to the OES for the  
          purposes of emergency response planning.


          SB 1319 (Pavley), Chapter 348, Statutes of 2014. Provided the  
          expansion of  OSPR's duties to require training and equipment  
          grants for local first responders and ensures OSPR has access to  
          confidential information collected by OES and the Energy  
          Commission.  Requires comprehensive rail inspections and inland  
          oil risk assessments. This bill was amended to instead include  
          groundwater language and was subsequently enacted into law. 


          REGISTERED SUPPORT / OPPOSITION:




          Support











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          None on file.




          Opposition


          Agricultural Council of California 
          American Coatings Association 
          Automotive Specialty Products Alliance 
          California Chamber of Commerce 
          California Cotton Ginners and Growers Association 
          California Farm Bureau Federation 
          California Manufacturers & Technology Association 
          California Paint Council 
          California Railroad Industry
          Cal-Tax
          Chemical Industry Council of California 
          Consumer Specialty Products Association 
          Styrene Information Research Center 
          Western Agricultural Processors Association 
          Western Plant Health Association


          Analysis Prepared by:Bob Fredenburg / E.S. & T.M. / (916)  
          319-3965





















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