BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 900| |Office of Senate Floor Analyses | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 900 Author: Jackson (D), et al. Amended: 8/19/16 Vote: 21 SENATE NATURAL RES. & WATER COMMITTEE: 8-1, 3/29/16 AYES: Pavley, Allen, Hertzberg, Hueso, Jackson, Monning, Vidak, Wolk NOES: Stone SENATE APPROPRIATIONS COMMITTEE: 7-0, 5/27/16 AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen SENATE FLOOR: 32-5, 6/1/16 AYES: Allen, Bates, Beall, Berryhill, Block, Cannella, De León, Galgiani, Glazer, Hall, Hancock, Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Nguyen, Pan, Pavley, Roth, Vidak, Wieckowski, Wolk NOES: Anderson, Gaines, Moorlach, Morrell, Stone NO VOTE RECORDED: Fuller, Nielsen, Runner ASSEMBLY FLOOR: 76-2, 8/24/16 - See last page for vote SUBJECT: State lands: coastal hazard removal and remediation program SOURCE: California State Controller Betty Yee DIGEST: This bill establishes a coastal hazard remediation program at the State Lands Commission (SLC). SB 900 Page 2 Assembly Amendments reduce from $2 million to $500,000 the annual amount transferred from the Land Bank Fund to the SLC, and requires the SLC to prioritize its actions pursuant to this bill based on available resources. ANALYSIS: Existing law establishes the SLC pursuant to Public Resources Code Section 6101 et seq., as an independent commission comprised of the Lieutenant Governor, the State Controller, and the Director of Finance. It was established in 1938. The SLC manages the state's 4 million acres of tidelands and submerged lands and the beds of navigable rivers, streams, lakes, bays, estuaries, inlets, and straits. In the marine context, the SLC has broad authority over sovereign lands including rivers and sloughs, lakes, tidelands, and submerged lands. It also manages energy and mineral resource development through leases, has an oil spill prevention program at marine oil terminals and offshore platforms, and has an invasive species prevention program from large ocean-going vessels. This bill: 1)Requires SLC, within two years of an appropriation of funds, to administer the program to do the following: a) Complete an in-depth inventory of legacy (i.e., abandoned) oil and gas wells and other coastal hazards along the California coastline and determine high-priority hazards and legacy oil and gas wells to remediate; b) Survey, study, and monitor oil seepage in state waters and tidelands under its jurisdiction to determine oil seepage locations, rates, and environmental impacts; and, c) Begin the process of remediating improperly abandoned legacy oil and gas wells that have a high risk of leaking oil and, with any remaining funds, remove other identified SB 900 Page 3 coastal hazards. 2)Authorizes SLC to seek and accept gifts, bequests, devises, or donations to fund the program. 3)Authorizes SLC, in cooperation with the Division of Oil, Gas, and Geothermal Resources (DOGGR), to seek to abandon (properly close) legacy oil and gas wells that present a hazard to public health and safety and the environment. 4)Requires SLC to annually report to the Legislature the activities and accomplishments of the program. 5)Requires SLC to prioritize its actions undertaken pursuant to this bill based on available resources. 6)Defines the following terms: a) "Coastal hazard" includes, but is not limited to, legacy oil and gas wells and human-made structures, including piers, jetties, groins, seawalls, and facilities associated with past oil extraction and other commercial operations, that pose a hazard to the public heath and safety; and, b) "Legacy oil and gas well" as a well drilled near shore, before current abandonment standards, where there is little or no information on the well's abandonment procedure and there is no viable company with the responsibility to reabandon the well, should it start leaking or pose a threat to the environment or the public health and safety. 7)Transfers $500,000 from the Land Bank Fund annually to the SLC for the implementation of the program. SB 900 Page 4 8)States legislative findings regarding legacy oil and gas wells and their impacts. FISCAL EFFECT: Appropriation: No Fiscal Com.:YesLocal: No According to the Assembly Appropriations Committee, the redirection of $500,000 from the GF to the Land Bank Fund in FY 2017-18 and up to $500,000 per year thereafter to ensure the unencumbered funds in the Land Bank Fund are available to the SLC for program implementation. One-time SLC cost of approximately $100,000 to complete the in-depth inventory of legacy wells from the Land Bank Fund. Annual SLC costs of approximately $50,000 to survey and monitor oil seepage and annual SLC costs of approximately $200,000 to remove coastal hazards also from the Land Bank Fund. Unknown costs to the Land Bank Fund to plug and abandon legacy wells, potentially in the $1 million per well range if the well is in the tidal zone. DOGGR costs are absorbable SUPPORT: (Verified8/17/16) California State Controller Betty Yee (source) Azul Black Surfers Collective California Coastkeeper Alliance California Coastal Protection Network California League of Conservation Voters California State Lands Commission Center for Biological Diversity Clean Water Action Committee for Green Foothills Defenders of Wildlife Endangered Habitats League Environment California Environmental Defense Center Environmental Working Group SB 900 Page 5 Get Oil Out! GREENSPACE Cambria Land Trust Heal the Ocean League of Women Voters of California Natural Resources Defense Council Santa Barbara Channelkeeper Santa Barbara County Santa Barbara Women's Political Committee Save the Bay Sierra Club California Smith River Alliance Surfrider Foundation The Ocean Foundation The Otter Project Trust for Public Land WILDCOAST OPPOSITION: (Verified8/17/16) None received ARGUMENTS IN SUPPORT: California State Controller Betty Yee is the sponsor of the bill. Along with the other supporters, she is quite concerned by the fact that the SLC estimates that there are approximately 200 "legacy" oil wells in California, the majority of which are in Santa Barbara County near Summerland and Ellwood beaches and along the Central Coast. Controller Yee is joined by in support by the SLC, the County of Santa Barbara, and Supervisor Salud Carbajal. The SLC, Controller Yee, and many of the other supporters are also actively in support of the in-depth study of coastal hazards, the removal of other coastal hazards unrelated to oil and gas production, and the monitoring of "natural seepage." The SLC pointed out that drilling activity on tidelands occurred before the process was regulated and that there was little if any oversight of abandoned activities. Also, early coastal SB 900 Page 6 protective structures, such as seawalls and groins, have deteriorated and are now public safety hazards. In both cases, because there are no identifiable responsible parties, the State of California is responsible for removing and remediating these hazards. The SLC argues that it has a good track record of removing and remediating coastal hazards when funding is provided. Sierra Club California states that while the visual infrastructure of old oil operations has been removed, many of these wells were not properly capped, causing fresh oil to foul the ocean and beaches on a regular basis. Additionally, it notes that the Refugio oil spill in 2015 highlighted the state's lack of reliable data on the amount of natural oil seepage in state waters which underscores the importance of the study and monitoring provision regarding natural seepage that is in the bill. Many of these same points are also made by the other nonprofit conservation groups that are in support, including Heal the Ocean, the Environmental Defense Center, Get Oil Out!, and the Santa Barbara Channelkeeper. ASSEMBLY FLOOR: 76-2, 8/24/16 AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gray, Hadley, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, 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 NOES: Grove, Harper NO VOTE RECORDED: Daly, Gordon SB 900 Page 7 Prepared by:William Craven / N.R. & W. / (916) 651-4116 8/25/16 17:34:49 **** END ****