BILL ANALYSIS                                                                                                                                                                                                    



                                                                     AB 815


                                                                    Page  1





          Date of Hearing:   April 22, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          815 (Ridley-Thomas) - As Introduced February 26, 2015


           ----------------------------------------------------------------- 
          |Policy       | Natural Resources             |Vote:|9 - 0        |
          |Committee:   |                               |     |             |
          |             |                               |     |             |
          |             |                               |     |             |
          |-------------+-------------------------------+-----+-------------|
          |             |                               |     |             |
          |             |                               |     |             |
          |             |                               |     |             |
          |-------------+-------------------------------+-----+-------------|
          |             |                               |     |             |
          |             |                               |     |             |
          |             |                               |     |             |
           ----------------------------------------------------------------- 


          Urgency:  No  State Mandated Local Program:  NoReimbursable:   


          


          SUMMARY:


          This bill clarifies provisions from the 2014 resources budget  








                                                                     AB 815


                                                                    Page  2





          trailer bill relating to the expansion of the oil spill  
          prevention fee program to avoid confusion and overpayment.   
          Specifically, this bill:  


          1)Specifies that a marine terminal and refinery operator may  
            presume the fee has been paid on petroleum products derived  
            from fee-paid crude oil refined in California.


          2)Deletes the provision that allows the owner of the crude oil  
            or petroleum products to pay the fee directly to the Board of  
            Equalization (BOE) 


          3)Deletes the requirement for pipeline operators to register  
            with the BOE.


          FISCAL EFFECT:


          1)Minor, absorbable BOE administrative costs.


          2)No anticipated impact on oil spill prevention fee revenues.


          COMMENTS:


          1)Rationale.  Last year's resources budget trailer bill, SB 861,  
            Chapter 35, Statutes of 2014, eliminated the sunset on the oil  
            spill prevention fee, and expanded the fee base to include all  
            crude oil entering the state.  SB 861 specifically expanded  
            the fee from only marine waters to all waters of the state and  
            all crude oil and petroleum products received at a refinery. 










                                                                     AB 815


                                                                    Page  3





            SB 861 also authorized the fee revenues to be used for inland  
            oil response and contained a provision to prevent the fee from  
            being imposed or paid twice on the same crude or petroleum  
            products.


            However, according to BOE staff, it is not clear that  
            petroleum products derived from fee-paid crude oil, once  
            refined, is not subject to the fee.


            This bill clarifies the intent of last year's SB 861 and makes  
            several administrative changes to reduce confusion regarding  
            the expansion of the fee.


          2)Background.  The Oil Spill Administrator annually sets the fee  
            rate.  The current fee rate cap is $0.065 per gallon.  The  
            Administrator is required to prepare a plan that projects  
            revenues and expenses over three fiscal years. The fee amount  
            is set so that the projected revenue will meet current and  
            proposed state budget needs. The Administrator may also allow  
            for a surplus if revenues will not be adequate to meet  
            contingencies and shortfalls. 



            The refinery, marine terminal, and pipeline operators must  
            each register with the BOE. The owner of the crude oil or  
            petroleum products, the marine terminal operator, or the  
            refinery operator pays the fee monthly to the BOE. If the fee  
            has been previously collected or paid on the crude oil or  
            petroleum products at another marine terminal or refinery, the  
            fee will not be imposed or collected again. The marine  
            terminal or refinery operator or the owner of the crude oil or  
            petroleum products has the obligation to demonstrate that the  
            fee has been previously paid on the same crude oil or  
            petroleum product. 









                                                                     AB 815


                                                                    Page  4





            Fees are deposited into the Oil Spill Prevention and  
            Administration Fund to pay for oil spill prevention programs  
            and studies. A separate fee funds oil spill response  
            activities. 




          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)  
          319-2081