Existing law requires the State Board of Forestry and Fire Protection to adopt emergency regulations to establish a fire prevention fee to be charged on each habitable structure, as defined, on a parcel that is within a state responsibility area. Existing law requires that the fee be levied upon the owner of a habitable structure identified by the department as located within the state responsibility area, if that person owns the habitable structure on July 1 of the year for which the fee is due. Existing law authorizes the board to exempt from the fire prevention fee any habitable structure that is subsequently deemed inhabitable as a result of a natural disaster during the year the fee is due, if certain conditions are met.

This bill would require the board to reduce the amount of the fee to be charged on a habitable structure by an amount equal to the amount paid by the owner of the structure to a local fire district for fire prevention services during the year for which the fee is due, if the owner of the structure provides the board with written documentation of the amount paid to the local fire district for those services. The bill would require the board to adopt guidelines to clarify the type of written documentation the owner of a structure is required to provide to the board to receive a fee reduction pursuant to those provisions.

Existing law requires the State Board of Forestry and Fire Protection to adopt emergency regulations to establish a fire prevention fee to be charged on each habitable structure, as defined, on a parcel that is within a state responsibility area. Existing law requires that the fee be levied upon the owner of a habitable structure identified by the department as located within the state responsibility area, if that person owns the habitable structure on July 1 of the year for which the fee is due. Existing law authorizes the board to exempt from the fire prevention fee any habitable structure that is subsequently deemed inhabitable as a result of a natural disaster during the year the fee is due, if certain conditions are met.

This bill would require the board to reduce the amount of the fee to be charged on a habitable structure by an amount equal to the amount paid by the owner of the structure to a local fire district for fire prevention services during the year for which the fee is due, if the owner of the structure provides the board with written documentation of the amount paid to the local fire district for those services.

Date of Hearing: May 13, 2015

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Jimmy Gomez, Chair

ABPCA Bill Id:AB 1202

Author:(Mayes) – As Amended Ver:May 5, 2015

Urgency: No State Mandated Local Program: No Reimbursable: No

SUMMARY:

This bill requires the Board of Forestry and Fire Protection (Board) to reduce the amount of the fire prevention fee (SRA) by an amount equal to the amount paid to a local fire district for fire prevention in the state responsibility areas. Additionally, this bill requires the Board to adopt guidelines to clarify the type of written documentation the owner of a structure is required to provide in order to receive the fee reductions.

FISCAL EFFECT:

1. Significant reduction in fire prevention fee revenues, potentially in the tens of millions of dollars annually (SRA Fire Prevention Fund).

The Board of Equalization (BOE) estimates approximately 98% of structures subject to the feeare located in an area that provides local fire protection services. This bill will likely result in partial fee reduction, at least, for nearly all structures subject to the fire prevention fee, which would substantially diminish the $76.9 million in fee revenue CAL FIRE anticipates in 2015-16.

2. General Fund pressure of an unknown amount, potentially in the tens of millions of dollars, in 2015-16 to fund fire prevention activities at CAL FIRE and the California Conservation Corps (CCC) that otherwise would be funded by the fire prevention fee.

3. Unknown administrative costs, potentially in the hundreds of thousands of dollars,for the Board to adopt guidelines to implement the program.

COMMENTS:

1. Purpose. According to the author, property owners who are already paying a special tax for these services at the local level should not also have to pay for them at the state level. This bill provides a reduction in the SRA fee in the amount paid to local districts.

2. Background. The state is responsible for wildland fire protection in the SRA which are generally defined to include most nonfederal timberlands, rangelands and watersheds thinly populated and not within the boundaries of a city. Over 31 million acres, much privately owned, are located in SRA. In the past, SRA lands were largely unpopulated. In recent years, however, local governments have allowed increased housing development in SRA but at a level of density that maintains the state's obligation to provide wildland fire protection.

As housing development in SRA increased, so did state fire protection costs. In 1996-97, the department spent $475 million on fire protection; in more recent years, CALFIRE's annual fire protection costs neared or surpassed $1 billion.

The Legislative Analyst's Office (LAO) attributes much of the increase in CALFIRE's fire protection costs to increased housing development in SRA. The LAO notes that as housing development in SRA has increased, the department has spent greater resources responding to events other than wildfires for which the state is not legally responsible, such as structural fires and medical emergencies. Because the LAO concludes that much of CALFIRE's nonwildfire activities provide private benefits, LAO has long recommended a fee on owners of private land in SRA to pay for a portion of CALFIRE's fire protection costs.

3. SRA Fire Protection Fees. In 2011 the Legislature passed ABx1 29 (Blumenfield), requiring the Board of Forestry and Fire Protection to adopt emergency regulations to establish a fire prevention fee. The fee, not to exceed $150 on each structure, was to raise $50 million to fund CALFIRE fire prevention activities. In January 2012, the board issued its regulation, establishing a fee of $150 per habitable structure on a parcel located within SRA, with a $35 reduction for each habitable structure that is also within the boundaries of a local agency that provides fire protection services. Revenues from the fee are to be used exclusively for fire protection. In authorizing the fee, the Legislature recognized that individual owners within SRA received a disproportionately larger benefit from fire prevention activities than realized by the state’s residents generally.

As required by law, the fee was adjusted for inflation and is currently $152.33 per habitable structure outside a fire protection district and $117.33 for habitable structures within a fire protection district. According to the Board of Equalization website, approximately 98% of habitable structures in the SRA are covered by a local fire protection agency resulting in most bills amounting to $117.33 per habitable structure.

4. Local fire protection. There are many different districts and many of them charge the public for fire protection and prevention. District rates have a high degree of variance with some less than the $35 reduction and some more than the $150 fire fee. The fees assessed by districts can also be assessed by parcel, single family, or by the use of the parcel. Districts combine their fire protection and fire prevention services in one fee. In contrast, the SRA fee is one set amount for the whole state, is charged by habitable structure, and only covers fire prevention. AB 1202 allows the owner to provide written documentation of what they pay to a district to receive a reduction in their SRA fee

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

Date of Hearing: April 27, 2015

ASSEMBLY COMMITTEE ON NATURAL RESOURCES

Das Williams, Chair

ABPCA Bill Id:AB 1202

Author:(Mayes) – As Introduced Ver:February 27, 2015

SUBJECT: Fire prevention fee: fee reduction

SUMMARY: Requires the Board of Forestry and Fire Protection (Board) to reduce the amount of the fire prevention fee (fee) by an amount equal to the amount paid to a local fire district (district) for fire prevention.

EXISTING LAW:

1. Requires the Board to classify all lands within the state for the purpose of determining areas in which the financial responsibility of preventing and suppressing fires is primarily the responsibility of the state (these areas are known as “state responsibility area” or “SRA”).
   
   

2. Declares that it is necessary to impose a fee to pay for fire prevention activities in the SRA that specifically benefit owners of structures in the SRA.
   
   

3. Requires the Board to adopt regulations to establish the fee in an amount not to exceed $150 (which must be adjusted every year for inflation) to be charged on each “structure” on a parcel that is within the SRA. Defines “structure” as a building used or intended to be used for human habitation (including a mobile home or manufactured home). Reduces the fire prevention fee by $35 if the structure is also within the boundaries of a local agency that provides fire protection services (this reduction applies to most structures). Defines “owner of a habitable structure” as the person that is the owner of record of a habitable structure in the county tax assessor rolls or as recorded by the Department of Housing and Community Development (HCD) on July 1 of the state fiscal year for which the fee is due.

4. Requires the fire prevention fees to be deposited in the State Responsibility Area Fire Prevention Fund, which is available to the Board and the Department of Forestry and Fire Protection (CAL FIRE) to expend for fire prevention activities that benefit the owners of structures within the SRA. Limits fire prevention activities to the following: a) local assistance grants established by the Board; b) grants to Fire Safe Councils, the California Conservation Corps, or certified local conservation corps for fire prevention projects and activities in the SRA; c) grants to a qualified nonprofit organization with a demonstrated ability to satisfactorily plan, implement, and complete a fire prevention project applicable to the SRA; d) inspections by CAL FIRE for compliance with defensible space requirements around structures in the SRA; e) public education to reduce fire risk in the SRA; f) fire severity and fire hazard mapping by CAL FIRE in the SRA; and, g) other fire prevention projects in the SRA that are authorized by the Board.

5. Allows a person to petition CAL FIRE for a redetermination of whether the fire prevention fee applies to him or her within 30 days after being served with a notice of determination (i.e., the notice from CAL FIRE stating that a person must pay the fire prevention fee).

6. Imposes a 10% penalty for each 30-day period in which the fee remains unpaid after the fee becomes final.

7. Allows the Board to exempt from the fee any habitable structure that is subsequently deemed uninhabitable as a result of a natural disaster during the year for which the fee is due, as well as one subsequent year if the habitable structure has not been repaired or rebuilt.

THIS BILL:

1. Requires the Board to reduce the amount of the fee to be charged on a habitable structure by the amount equal to the amount paid by the owner of the structure to a district for fire prevention services during the year for which the fee is due.

2. Requires the owner of the structure to provide the Board with written documentation of the amount paid to the district for those services to receive the reduction.

FISCAL EFFECT: Unknown

COMMENTS:

1. Author’s statement.

Current practice provides a $35 reduction of the SRA fee for any property also in a local fire protection district, and a previous proposal (AB 2474, 2011-2012) would have provided a dollar-for-dollar reduction of the SRA fee based on the amount paid to a fire protection district, regardless of the use of those funds by the local district.

AB 1202 recognizes that the SRA fee was intended to fund prevention activities that mitigate the risk of wildfires caused by structures in the SRA, and thereby provides a reduction in the SRA fee in the amount paid to the local district for fire prevention services. Property owners who are already paying a special tax for these services at the local level should not also have to pay for them at the state level.

2. Background. California’s SRA covers over 31 million acres and includes land in every county except San Francisco and Sutter. CAL FIRE operates more than 200 fire stations within the SRA, contracts with other firefighting agencies, and has a proposed wildland fire protection budget of $1.5 billion for this fiscal year. The fire protection budget includes, among other things, fire prevention activities such as brush clearance, defensible space inspections, fire breaks, and other measures to reduce the cost of firefighting, property loss, injury to firefighters, and damage to the environment.

CAL FIRE’s fire protection budget has seen a steady increase over the years and is the largest budget in the Natural Resources Agency. In 1996-97, CAL FIRE’s fire protection budget was $266 million. This increase has been attributed in large part to the significant housing development at the boundaries between wildlands and urban areas, the heightened risk of catastrophic fires due to fire suppression activities over the last century, and increased staff costs.

3. Fire Prevention Fee. In early 2011, the state was facing a $26.6 billion budget deficit, and an annual structural deficit of up to $21.5 billion was projected into the future. In March 2011, the Legislature passed $13.4 billion in budget solutions (consisting mostly of spending cuts) to address the deficit; however, there was still a shortfall of $10.8 billion. To help address the budget shortfall, the Legislature passed, among other bills, ABX1 29 (Blumenfield), Chapter 8, Statutes of 2011-12 First Extraordinary Session, which required the Board to adopt emergency regulations to establish a “fire prevention fee” not to exceed $150 for each structure on a parcel that is within the SRA. The fee was intended to fill a hole created by a $50 million General Fund cut to CAL FIRE in the 2011 budget bill. The 2014-15 Budget appropriated $76.3 million from SRA revenues to enhance statewide fire prevention work including, for the first time, $10 million for local assistance grants to be used in locations where the effects of drought, fuel loading and structure development converge.

4. Local fire protection. There are many different districts and many of them charge the public for fire protection and prevention. District rates have a high degree of variance with some less than the $35 reduction and some more than the $150 fire fee. The fees assessed by districts can also be assessed by parcel, single family, or by the use of the parcel. Districts combine their fire protection and fire prevention services in one fee. In contrast, the SRA fee is one set amount for the whole state, is charged by habitable structure, and only covers fire prevention. AB 1202 allows the owner to provide written documentation of what they pay to a district to receive a reduction in their SRA fee. The author and committee may wish to consider amending the bill to require the Board to adopt guidelines to implement this provision and clarify what written documentation should be provided.

5. Prior legislation. AB 2474 (Chesbro, 2012) requires the Board to reduce the amount of the fire prevention fee (fee) by an amount equal to the amount paid to a local fire district. This bill was held in the Assembly Appropriations Committee.

REGISTERED SUPPORT / OPPOSITION:

Support

California Association of Realtors

California Fire Chiefs Association

California Taxpayers Association

Central Coast Forest Association

Fire Districts Association of California

Howard Jarvis Taxpayers Association

Mendocino County Board of Supervisors

Morongo Valley Community Services District

San Diego County Board of Supervisors

Southwest California Legislative Council

Opposition

None on file

Analysis Prepared by: Michael Jarred / NAT. RES. / (916) 319-2092