BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                        SB 438|
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                                UNFINISHED BUSINESS 


          Bill No:  SB 438
          Author:   Hill (D) and Hertzberg (D), et al.
          Amended:  8/1/16  
          Vote:     21 

           PRIOR VOTES NOT RELEVANT

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 8/25/16 (pursuant to  
            Senate Rule 29.10)
           AYES:  Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen

           ASSEMBLY FLOOR:  77-0, 8/22/16 - See last page for vote

           SUBJECT:   Earthquake safety:  statewide earthquake early  
                     warning program and system


          SOURCE:    Author
          
          DIGEST:  This bill establishes, within the California Office of  
          Emergency Services (OES), the California Early Warning Advisory  
          Board (board) to support the development of the statewide  
          earthquake early warning system (system), as specified. 

          Assembly Amendments (1) gut and amend the bill, (2) establish,  
          within OES, the board to support the development of the system,  
          as specified, (3) require OES, to develop a business plan for  
          the system, as specified, to specified legislative committees no  
          later than February 1, 2018, (4) require OES, on or before  
          February 1, 2019, and annually thereafter, to report to the  
          Legislature any changes to the business plan from the prior  
          year, as specified, (5) discontinue the requirement that the  
          funding sources for the system exclude General Fund monies, and  
          (6) make legislative findings in support of its provisions.









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          ANALYSIS:
          
          Existing law:
          
           1) Creates OES, within the office of the Governor, which  
             coordinates disaster response, emergency planning, emergency  
             preparedness, disaster recovery, disaster mitigation, and  
             homeland security activities. 

           2) Requires various entities, including OES, through a  
             public-private partnership, to develop a comprehensive  
             statewide earthquake early warning system in California, as  
             specified.

           3) Requires OES to identify funding for an earthquake early  
             warning system through single or multiple sources of revenues  
             that shall be limited to federal funds, funds from revenue  
             bonds, local funds, and private grants.  

           4) Prohibits General Fund moneys to be used for the  
             establishment of an earthquake early warning system.

           5) Specifies that if funding is not identified by July 1, 2016,  
             the provisions relating to the establishment of an earthquake  
             early warning system should be repealed unless a later  
             enacted statute is enacted before January 1, 2017. 

           6) Establishes the California Earthquake Safety Fund and  
             specifies that the moneys in the fund shall be used for  
             seismic safety and earthquake-related programs, including the  
             statewide earthquake early warning system. 

          This bill:

           1) Established within OES, the board, to support the  
             development of the system.

           2) Requires the board to include seven voting members and two  
             nonvoting members, as follows:

              a)    The Secretary of the Natural Resources Agency, or his  
                or her designee.








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              b)    The Secretary of California Health and Human Services,  
                or his or her designee.
              c)    The Secretary of Transportation, or his or her  
                designee.
              d)    The Secretary of Business, Consumer Services, and  
                Housing, or his or her designee.
              e)    One member who is appointed by, and serves at the  
                pleasure of, the Governor and represents the utilities  
                industry.
              f)    One member who is appointed by, and serves at the  
                pleasure of, the Senate Committee on Rules and represents  
                county government.
              g)    The Chancellor of the California State University, or  
                his or her designee, shall serve as a nonvoting member of  
                the board.
              h)    The President of the University of California, or his  
                or her designee, may serve as a nonvoting member of the  
                board.                                  

           3) Specifies that the members of the board shall serve without  
             compensation, but shall be reimbursed for actual and  
             reasonable travel and meal expenses to attend board meetings.  


           4) Requires the board to convene periodically and advise the  
             director on all aspects of the program including, but not  
             limited to, the following functional areas of the program:

              a)    System operations.
              b)    Research and development.
              c)    Finance and investment.
              d)    Training and education.

           5) Requires the board to utilize committees, groups, and  
             organizations, including, but not limited to, the California  
             Institute of Technology, the California Geological Survey,  
             the University of California, the United States Geological  
             Survey, and entities participating in the critical  
             infrastructure sectors to fulfill the objectives of the  
             program by supporting the functional areas of the system.

           6) Requires the board to inform the public regarding, and  








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             provide the public with the opportunity to engage the board  
             on, the development and implementation of the system. 

           7) Requires the board to consult with program participants,  
             state agencies, departments, boards and commissions, private  
             businesses, postsecondary educational institutions, and  
             subject matter experts, as necessary, to advise the board on  
             the development, implementation, and maintenance of the  
             system. 

           8) Requires the California Integrated Seismic Network to be  
             responsible for the generation of an earthquake early warning  
             alert and related system operations.

           9) Requires the board, in conjunction with the director, to  
             determine the appropriate methods to provide the public with  
             and earthquake early warning alert.

           10)Requires the board to comply with the Bagley-Keene Open  
             Meeting Act.

           11)Requires OES, on or before February 1, 2018, to develop and  
             submit a business plan for the program, as specified, to the  
             Senate Committee on Governmental Organization, the Assembly  
             Committee on Governmental Organization, the Senate Budget and  
             Fiscal Review Committee, the Assembly Committee on Budget,  
             and the Legislative Analyst's Office. 

           12)Requires OES, on or before February 1, 2019, and annually  
             thereafter, to report to the Legislature any changes to the  
             business plan from the prior year and shall provide a general  
             report on progress of the program, as specified, and the  
             implementation of the system.

           13)Deletes the requirement that the funding sources for the  
             system exclude the General Fund and be limited to federal  
             funds, funds from revenue bonds, local funds, and funds from  
             private sources. 

           14)Deletes the provisions providing for the repeal of the  
             provisions relating to the establishment of the system if  
             funding has not been identified by July 1, 2016, unless a  








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             later enacted statute is enacted before January 1, 2017.

           15)Makes legislative findings in support of its provisions.

          Background

          Purpose of the bill.  According to the author, "current law  
          prohibits the use of General Funds with the intent to finance  
          California's earthquake early warning system through  
          public-private partnerships.  But, those partnerships and  
          funding have yet to materialize, hindering the ability of OES to  
          get the warning system up and running.  In addition, the law  
          didn't establish a governance structure, and effective and  
          sustainable implementation of the system requires a governance  
          structure that can coordinate the multiple agencies involved."

          California's earthquake overview:  California is a hotbed for  
          earthquake activity.  Ninety percent of the world's earthquakes  
          and approximately 80 percent of the world's largest earthquakes  
          occur along the Pacific Ring of Fire - a 25,000-mile horseshoe  
          shaped area in the Pacific Ocean, which extends from the Western  
          coast of South and North America to Eastern Asia, Australia and  
          New Zealand.  The Pacific Ring of Fire includes the very active  
          San Andreas Fault zone in California.  
           
          In January 2013, the Californian Institute of Technology and the  
          Japan Agency for Marine Earth Science and Technology published a  
          study concluding for the first time that a statewide California  
          earthquake involving both the Los Angeles and San Francisco  
          metropolitan areas may be possible. 

          On August 24, 2014, at roughly 3:20 a.m. local time, an  
          earthquake occurred in and around the City of Napa, California.   
          The epicenter was located south of Napa, approximately 3.7 miles  
          northwest of the American Canyon near the West Napa Fault.  The  
          earthquake, measuring a 6.0 on the magnitude scale, was the  
          largest earthquake in the Bay Area since the 1989 Loma Prieta  
          earthquake.  The Napa earthquake resulted in one death and  
          approximately 200 people injured. Shortly after, Governor Jerry  
          Brown declared a state of emergency due to the damage and the  
          possibility of damage resulting from aftershocks.  It is  
          estimated that the earthquake caused over $400 million in  








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          damage. 

          A silver lining of the earthquake was the success of earthquake  
          warning systems in providing warning times to nearby  
          communities.  An experimental earthquake warning system being  
          developed by the UC Berkeley Seismological Laboratory issued a  
          warning 5 seconds before the earthquake arrived in Berkeley.   
          Similarly, Seismic Warning Systems, Inc. had installed on-site  
          warning systems at five fire stations in Vallejo in 2002.  These  
          systems commanded the bay doors to open at these fire stations  
          before the Earthquake arrived. 
           
           Earthquake Early Warning Systems:  While earthquakes cannot be  
          predicted or prevented, using advanced science and technology  
          has in the past-detected seismic activity and provided advanced  
          warning.  The objective of earthquake early warning systems is  
          to rapidly detect the occurrence of an earthquake, estimate the  
          level of ground shaking to be expected, issue a warning before  
          significant ground shaking begins, and estimate the location and  
          the magnitude of the earthquake.  This is not the same as  
          earthquake prediction, which currently is not possible. 

          When an earthquake occurs, the earthquake produces different  
          types of shock waves, which travel at different speeds.  The  
          fastest and weakest of these waves are called P-waves.  
          Technology exists that can detect the energy from P-waves to  
          estimate the location and the magnitude of the earthquake. This  
          method can provide warning before the more destructive S-wave  
          arrives. The S-wave is responsible for most of the strong  
          shaking that usually creates the most damage during earthquakes.

          The amount of warning time at a particular location depends on  
          the distance from the earthquake epicenter.  Locations very  
          close to the earthquake epicenter will receive relatively little  
          or no warning whereas locations far removed from the earthquake  
          epicenter would receive more warning time but may not experience  
          damaging shaking.  

          Studies on earthquake early warning methods in California  
          concluded that the warning time would range from a few seconds  
          to a few tens of seconds, depending on the distance from the  
          earthquake epicenter.  However, very large earthquakes emanating  








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          from the San Andreas Fault could produce significantly more  
          warning time because the affected area would be much larger.

          Regardless of the warning time, earthquake early warning systems  
          can provide adequate time to slow down and stop trains, stop  
          cars from entering tunnels, automatically shut down dangerous  
          machinery, and countless other benefits.  Taking such actions  
          before an earthquake arrives can reduce damage and casualties  
          during and after an earthquake.   

          Earthquake early warning systems are currently in place in Japan  
          and Mexico and many other countries throughout the world are  
          currently in the process of developing such systems.
          
          Related/Prior Legislation

          SB 494 (Hill, Chapter 799, Statutes of 2015) created the  
          California Earthquake Safety Fund to be used for seismic safety  
          and earthquake-related programs, including the earthquake, early  
          warning system. 

          SB 31 (Padilla, Chapter 342, Statutes of 2013) required OES, in  
          collaboration with various entities, to develop a comprehensive  
          statewide earthquake early warning system in California. 

          AB 928 (Blakeslee, 2009) would have required the High-Speed Rail  
          Authority to develop an earthquake early warning system and  
          coordinate development of that system with various state  
          agencies.  (Held in Assembly Governmental Organization  
          Committee)

          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No

          According to the Senate Appropriations Committee:

           Initial estimated capital costs of approximately $28 million  
            (General Fund) to establish the earthquake early warning  
            system, according to a recent earthquake early warning system  
            Project Implementation Framework report.  The General Fund  
            impacts could be partially mitigated to the extent funds are  
            identified for earthquake early warning system purposes from  








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            other state, local, federal, or private sources.  Senate  
            Appropriations staff (staff) notes that the 2016-17 Budget  
            includes a one-time General Fund appropriation of $6.875  
            million for capital funding for earthquake early warning  
            system purposes. 

           Ongoing annual administrative costs of approximately $17  
            million (General Fund) beginning in 2017-18 to operate and  
            maintain an earthquake early warning system, according to the  
            Project Implementation Framework report.  The General Fund  
            impacts could be partially mitigated to the extent funds are  
            identified for earthquake early warning system purposes from  
            other state, local, federal, or private sources.  Staff notes  
            that the 2016-17 Budget includes a one-time General Fund  
            appropriation of $3.125 million for state operations related  
            to the development of the earthquake early warning system:   
            $734,000 for 4 PY of staff at OES, $150,000 for a financial  
            strategy contract, and $2.241 million for public education and  
            training.


           OES indicates costs related to the establishment of the board  
            and development of a business plan would be minor and  
            absorbable.  Staff estimates there could be significant costs  
            related to ongoing activities of OES and the board beyond the  
            current fiscal year for which funding has been appropriated,  
            but these costs could be included in the above estimate of  
            ongoing administrative costs.




          SUPPORT:   (Verified8/22/16)


          American Red Cross
          BART
          California Department of Insurance
          California Fire Chiefs Association
          California State Firefighters' Association
          Caltech
          City of Los Angeles








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          CompTIA
          Fire Districts Association of California
          Silicon Valley Leadership Group


          OPPOSITION:   (Verified8/22/16)


          None received


          ARGUMENTS IN SUPPORT:     According to the City of Los Angeles,  
          "in California earthquakes are inevitable; and yet despite state  
          federal action, our state lags behind Japan and Mexico in  
          developing an earthquake early warning system.  Such systems  
          save lives by alerting residents to seek shelter and protecting  
          sensitive infrastructure like power plants and mass transit  
          systems during earthquakes."


          In addition, the California Department of Insurance argues that,  
          "the mandate to create statewide warning system was passed in  
          2013, with a plan to fund it through public-private  
          partnerships, but those partnerships have yet to materialize.   
          The goal was to expand the prototype Shake Alert system, but  
          adequate funding is needed to the expansion.  The funding  
          provided by SB 438 would be used to get the warning system up  
          and running, which would include installing 440 new and upgraded  
          seismic sensors throughout the state, connecting 840 existing  
          seismic sensors with communications equipment so they can be  
          hooked up into the system, and developing a system to send  
          alerts to the public." 

           ASSEMBLY FLOOR:  77-0, 8/22/16
           AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,  
            Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,  
            Calderon, Campos, Chang, Chau, Chiu, Chu, Cooley, Cooper,  
            Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Gallagher,  
            Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez,  
            Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger  
            Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey,  
            Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes,  








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            McCarty, Medina, Mullin, Nazarian, Obernolte, O'Donnell,  
            Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas,  
            Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner,  
            Waldron, Weber, Wilk, Williams, Wood, Rendon
           NO VOTE RECORDED: Chávez, Beth Gaines, Melendez

          Prepared by:Felipe Lopez / G.O. / (916) 651-1530
          8/25/16 17:54:20


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