Government Affairs Report
February 2012 Following the interim break, the Legislature returned to the state Capitol on January 3rd to begin the second year of a two year session. This is likely to be a unique year due to implementation of several voter enacted initiatives and the fact it is an election year. Legislators will be running in districts that have been crafted by a "citizen's commission" that have nested several sitting Legislators in the same district and made a few more "competitive" seats. Additionally, this will be the second year of a majority vote budget. Last year Republicans held some leverage due to the Governor's desire to place a tax plan in front of the voters which requires a 2/3 vote. With the Governor taking his plan to the voters through initiative, he does not need the Republicans for any major actions, including tax increases. Local Government funding and allocation of responsibilities will continue to be major issues with the demise of redevelopment and the prison realignment. Infrastructure development and funding will take center stage this year with the release of the Bay Delta Conservation Plan, the continued controversy over high speed rail and discussion about CEQA reform for major transportation and construction projects. Finally, many progressives in the Legislature are getting "restless" with all this talk about regulatory reform, pension reform and cuts to social programs and they may start to create issues for Governor Brown's agenda. GOVERNOR RELEASES BUDGET Governor Brown released his 2012-13 state budget on Thursday January 5th. The total general fund spending is $92.6 billion dollars and is highly dependent on the passage of a $6.9 billion November initiative to increase taxes on sales and high earners. Because the initiative is voted on in November, this budget relies on $4 billion in revenue from that measure, with the total amount available for future budgets. The budget also provides "trigger" cuts if the initiative fails which would go into effect mid-year. For agriculture, the budget includes a permanent decrease to various CDFA programs of $12 million in 2012-13, as part of a two-year effort to achieve $31 million in ongoing General Fund savings. This reduction impacts various programs relating to pest prevention, border control station, and food safety activities. Specific CDFA budget actions of interest to agriculture: Increases in fees - - $1,150,000 - Replace Interior Exclusion Program and Plant Pest Diagnostics Laboratory General Fund with phytosanitary fees for certification to move nursery stock. This could impact nursery stock movement and cut flower movement out of quarantine areas.
Reductions and Shifts - - $4,382,000 - Decrease General Fund for operations at Border Protection Stations. The General Fund reduction will result in reduced operations at several stations.
- Budget offsets cut with a shift of $1,432,000 in reimbursement authority from CalRecycle to operate border stations to reduce fraud in the recycling program.
Program Efficiencies and Reductions in Program Scope - - $953,000 - Limit activities within the Light Brown Apple Moth program to federally funded activities only, such as a sterile release program which may increase nursery and farmers exposure to quarantines.
- $701,000 -Eliminate General Fund support for Biological Control activities.
- $366,000 - Reduce Plant Pest Diagnostics and Seed Laboratories via program efficiencies.
- $2,400,000 - Reduce Local Assistance to counties for Trapping and/or High Risk Pest Exclusion activities, including inspection of incoming shipments of plants, fruits, vegetables, and conveyances at destination points throughout the state.
LEGISLATIVE ACTIVITY This report discusses activities implementing bills that were passed last year, actions on "2 year bills" that will be occurring this winter and administrative actions. February 24th is the bill introduction deadline for legislation to be introduced this year. The legislative session will end on August 31, 2012. Implementing Laws from 2011 Farmers, processors, feed companies and others will be implementing laws from 2011. The Association will be working on these issues through the administrative process. SB 126 (Steinberg) After vetoing the "card check for ag bill" in the summer, the Governor signed SB 126 (Steinberg) which retains the secret ballot. However, upon a finding by the ALRB of an unfair labor practice during the election that rises to a level where a fair election cannot be held, the ALRB can certify a union as the sole representative for that workplace. The ALRB has developed draft regulations for this measure. We will be working with a coalition to submit comments. AB 243 (Alejo) Mandates employer information on the pay stub of every agricultural employee. Expressly states this does not create joint liability to the employer for violations of a labor contractor. We will be monitoring the development of regulations to implement this bill. SB 617 (Calderon) Requires additional economic review and alternative assessments for all regulations developed by any agency in California after Jan. 1, 2013 that would have an impact over $50,000,000. The association worked closely with the coalition supporting this measure. Priority Bills for 2012 AB 1313 (Allen) Overtime for Agricultural Field Workers - This measure would require agricultural employers to pay overtime for any employee who works more than 8 hours a day or 40 hours in a work week. This bill was removed from "inactive" file and sent to the Senate Labor Committee.
AB 685 (Eng)
Would declare as state policy that every human being has a right to clean affordable water for cooking and sanitary purposes. The bill requires every state agency to consider the policy when making decisions. This bill is being held in Senate Appropriations Committee and could be available for vote anytime.
Water Bills for 2012 Water is always an issue in California and can impact business, residential and agricultural interests.
AB 550 (Huber) Prohibits the construction of a peripheral canal unless expressly authorized by the Legislature. This bill died in committee last year, however Assemblymember Berryhill is considering introducing a similar bill this year. SB 34 (Simitian) Establishes the intent of the Legislature to establish water fees on all water appropriators to fund water infrastructure. This bill died in Committee but funding water continues to be a topic of legislation. SB 250 (Rubio) This measure will memorialize several of the BDCP benchmarks and goals to encourage that it stay on track. SB 900 (Steinberg) Addresses the make up and conflict of interest provisions for the Regional Water Quality Control Boards as well as shrink the number of board members from 9 to 7 and reduce number of boards. This bill is sponsored by agriculture but is being negotiated with the Governor's office who is showing significant interest in the issue. SB 965 (Wright) The measure is intended to streamline permits at the Water Board by making a declaration that certain permits at the Water Board are not within the meaning of a "decision" as defined by the APA. Water Bond There were many legislative bills introduced to address the pending $11.9 billion water bond pending for 2012 election. Here are just two examples. AB 157 (Jeffries) Reduces the 2009 water bond that will be on the 2012 ballot by 25%. AB 467 (Eng) makes non substantive changes to the 2009 water bond that will be on the 2012 ballot. Bill is being held for future discussions on the water bond. Water Resources Board May Reconsider Storm Water Runoff Rules In a four-hour hearing recently conducted by the State Senate Committee on Job Creation and Retention, the California Water Resources Control Board's Executive Director Tom Howard admitted that the agency had proceeded "too much and too fast" as it drafted controversial new regulations on storm water runoff on both public and private sites. He said the agency will redraft their proposal and will consider factors raised by the state's businesses and industry. The hearing was called by the committee chair, Senator Roderick Wright. Other attendees included Senators Ted Gaines, Bob Dutton, Bob Huff and Michael Rubio. In starting off the hearing, Senator Wright noted that the actions of the Water Board were "ill-timed, heavy-handed, and pre-decided, " with little opportunity for opponents to have input. He noted that while the Water Board does not have to consider the economic impact of their actions, they would be advised to do so." The California State Water Resources Control Board has proposed the state adopt the most stringent storm water permit regulations in the country. The cost to business for monitoring and compliance will increase significantly if these rules are adopted. Add to that the increased risk of liability lawsuits and the need for investment in structural modifications. The new permitting requirements are far and beyond federal EPA rules and would impose arbitrary limits on contaminants that may be in runoff. | 
