Existing law, as part of the hazardous waste control law, requires a facility handling hazardous waste to apply for and obtain a hazardous waste facilities permit from the Department of Toxic Substances Control. Existing law requires that a hazardous waste facilities permit be for a fixed term not to exceed 10 years for certain facilities. Existing law requires the owner or operator of a facility intending to extend the facilitys permit to submit a complete Part A application for a permit renewal before the fixed term of the permit expires and, at any time following the submittal of the Part A application, to submit a complete Part B application, or any portion of that application, and other relevant information, if requested by the department. Existing law requires a person who applies for, or requests, a renewal of an existing hazardous waste facilities permit to enter into a written agreement with the department pursuant to which that person is required to reimburse the department for the costs incurred by the department in processing the renewal application.

This bill would require the department to process a hazardous waste facilities permit renewal application in an expedited manner, as provided, if the department determines that certain conditions are met, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit in effect at the time the renewal application is submitted. The bill would require the department to cease processing a hazardous waste facilities application in an expedited manner if the hazardous waste facility no longer meets one or more of the specified conditions. The bill would authorize the department to exempt a hazardous waste facility from a requirement to provide certain information for purposes of the permit renewal if the department determines that review of the information is not necessary given that the hazardous waste facility meets the conditions for expedited permit renewal. The bill would provide that the expedited permit renewal process is not available for land disposal facilities. The bill would impose a maximum on the amount of reimbursement to the department for the costs incurred by the department in processing a hazardous waste facilities permit renewal application through the expedited permit renewal process added by this bill in the amount of $200,000 for large storage facilities and large treatment facilities or $100,000 for all other hazardous waste facilities. The bill would authorize the Director of Toxic Substances Control to raise those maximum reimbursement amounts if specified conditions are met. The bill also would repeal certain legislative findings and declarations relating to a 2016 act that affected charges for hazardous waste facilities permit applications.

Existing law, as part of the hazardous waste control law, requires a facility handling hazardous waste to apply for and obtain a hazardous waste facilities permit from the Department of Toxic Substances Control. Existing law requires that a hazardous waste facilities permit be for a fixed term not to exceed 10 years for certain facilities. Existing law requires the owner or operator of a facility intending to extend the facilitys permit to submit a complete Part A application for a permit renewal before the fixed term of the permit expires and, at any time following the submittal of the Part A application, to submit a complete Part B application, or any portion of that application, and other relevant information, if requested by the department. Existing law requires a person who applies for, or requests, a renewal of an existing hazardous waste facilities permit to enter into a written agreement with the department pursuant to which that person is required to reimburse the department for the costs incurred by the department in processing the renewal application.

This bill would require the department to process a hazardous waste facilities permit renewal application in an expedited manner, as provided, if the department determines that certain conditions are met, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit in effect at the time the renewal application is submitted. The bill would require the department to cease processing a hazardous waste facilities application in an expedited manner if the hazardous waste facility no longer meets one or more of the specified conditions. The bill would authorize the department to exempt a hazardous waste facility from a requirement to provide certain information for purposes of the permit renewal if the department determines that review of the information is not necessary given that the hazardous waste facility meets the conditions for expedited permit renewal. The bill would provide that the expedited permit renewal process is not available for land disposal facilities. The bill would impose a maximum on the amount of reimbursement to the department for the costs incurred by the department in processing a hazardous waste facilities permit renewal application through the expedited permit renewal process added by this bill in the amount of $200,000 for large storage facilities and large treatment facilities or $100,000 for all other hazardous waste facilities. The bill would authorize the Director of Toxic Substances Control to raise those maximum reimbursement amounts if specified conditions are met.

Existing law, as part of the hazardous waste control law, requires a facility handling hazardous waste to apply for and obtain a hazardous waste facilities permit from the Department of Toxic Substances Control. Existing law requires that a hazardous waste facilities permit be for a fixed term not to exceed 10 years for certain facilities. Existing law requires the owner or operator of a facility intending to extend the facilitys permit to submit a complete Part A application for a permit renewal before the fixed term of the permit expires and, at any time following the submittal of the Part A application, to submit a complete Part B application, or any portion of that application, and other relevant information, if requested by the department. Existing law requires a person who applies for, or requests, a renewal of an existing hazardous waste facilities permit to enter into a written agreement with the department pursuant to which that person is required to reimburse the department for the costs incurred by the department in processing the renewal application.

This bill would require the department to process a hazardous waste facilities permit renewal application in an expedited manner, as provided, if the department determines that certain conditions are met, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit in effect at the time the renewal application is submitted. The bill would provide that the expedited permit renewal process is not available for land disposal facilities. The bill would impose a maximum on the amount of reimbursement to the department for the costs incurred by the department in processing a hazardous waste facilities permit renewal application through the expedited permit renewal process added by this bill in the amount of $200,000 for large storage facilities and large treatment facilities or $100,000 for all other hazardous waste facilities. The bill would authorize the Director of Toxic Substances Control to raise those maximum reimbursement amounts if specified conditions are met.

Existing law, as part of the hazardous waste control law, requires a facility handling hazardous waste to apply for and obtain a hazardous waste facilities permit from the Department of Toxic Substances Control. Existing law requires that a hazardous waste facilities permit be for a fixed term not to exceed 10 years for certain facilities. Existing law requires the owner or operator of a facility intending to extend the facilitys permit to submit a complete Part A application for a permit renewal before the fixed term of the permit expires and, at any time following the submittal of the Part A application, to submit a complete Part B application, or any portion of that application, and other relevant information, if requested by the department. Existing law requires a person who applies for, or requests, a renewal of an existing hazardous waste facilities permit to enter into a written agreement with the department pursuant to which that person is required to reimburse the department for the costs incurred by the department in processing the renewal application.

This bill would deem a hazardous waste facilities permit renewal application approved 90 days after the submission of the application to the department, if the department has not taken action on the application and certain other conditions apply, require the department to process a hazardous waste facilities permit renewal application in an expedited manner, as provided, if the department determines that certain conditions are met, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit for the preceding term. in effect at the time the renewal application is submitted. The bill would provide that the expedited permit renewal process is not available for land disposal facilities. The bill would impose a maximum on the amount of reimbursement to the department for the costs incurred by the department in processing an application or responding to a request for the renewal of an existing a hazardous waste facilities permit that is deemed approved after 90 days pursuant to the above provision renewal application through the expedited permit renewal process added by this bill in the amount of $200,000 for large storage facilities and large treatment facilities or $100,000 for all other hazardous waste facilities.

Existing law, as part of the hazardous waste control law, requires a facility handling hazardous waste to apply for and obtain a hazardous waste facilities permit from the Department of Toxic Substances Control. Existing law requires that a hazardous waste facilities permit be for a fixed term not to exceed 10 years for certain facilities. Existing law requires the owner or operator of a facility intending to extend the facilitys permit to submit a complete Part A application for a permit renewal before the fixed term of the permit expires and, at any time following the submittal of the Part A application, to submit a complete Part B application, or any portion of that application, and other relevant information, if requested by the department. Existing law requires a person who applies for, or requests, a renewal of an existing hazardous waste facilities permit to enter into a written agreement with the department pursuant to which that person is required to reimburse the department for the costs incurred by the department in processing the renewal application.

This bill would deem a hazardous waste facilities permit renewal application approved 90 days after the submission of the application to the department, if the department has not taken action on the application and certain other conditions apply, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit for the preceding term. The bill would impose an unspecified a maximum on the amount of reimbursement to the department for the costs incurred by the department in processing an application or responding to a request for the renewal of an existing hazardous waste facilities permit. permit that is deemed approved after 90 days pursuant to the above provision added by this bill in the amount of $200,000 for large storage facilities and large treatment facilities or $100,000 for all other hazardous waste facilities.

Existing law, as part of the hazardous waste control law, requires a facility handling hazardous waste to apply for and obtain a hazardous waste facilities permit from the Department of Toxic Substances Control. Existing law requires that a hazardous waste facilities permit be for a fixed term not to exceed 10 years for certain facilities. Existing law requires the owner or operator of a facility intending to extend the facilitys permit to submit a complete Part A application for a permit renewal before the fixed term of the permit expires and, at any time following the submittal of the Part A application, to submit a complete Part B application, or any portion of that application, and other relevant information, if requested by the department. Existing law requires a person who applies for, or requests, a renewal of an existing hazardous waste facilities permit to enter into a written agreement with the department pursuant to which that person is required to reimburse the department for the costs incurred by the department in processing the renewal application.

This bill would deem a hazardous waste facilities permit renewal application approved 90 days after the submission of the application to the department, if the department has not taken action on the application and certain other conditions apply, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit for the preceding term. The bill would impose an unspecified maximum on the amount of reimbursement to the department for the costs incurred by the department in processing an application or responding to a request for the renewal of an existing hazardous waste facilities permit.

SENATE COMMITTEE ON APPROPRIATIONS

Senator Anthony Portantino, Chair

2017 - 2018 Regular Session

AB 2606 (Fong) - Hazardous waste: facilities: permits: renewals

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

This bill would require the Department of Toxic Substances Control (DTSC) to process a hazardous waste facility renewal permit in an expedited manner if the department determines certain conditions apply, as specified.

Fiscal Impact:

• $270,000 000 for the first six months and $550,000 for each of the following two years (HWCA) for DTSC to conduct rulemaking to establish an expedited permitting program.
• DTSC cites additional costs associated with the expedited permitting program and states it would need to increase its personnel significantly to account for the compressed timeline to expedite permits in order to ensure resources from existing workloads do not need to be redirected. The department claims it may need up to 35 new permit and permit support positions at approximately $6 million annually. Should the department require these resources, these costs would be paid by the permit applicant under fee for service. However, it is unclear why such a significant increase in permit support positions would be necessary, especially on an ongoing basis. The policy committee analysis notes that a streamlined process, which includes approving existing documents, should decrease the amount of time that DTSC spends on an individual permit, and that this alone should decrease the costs associated with the permit renewal. It makes sense that a streamlined process would reduce costs, especially on an ongoing basis once an initial batch of permits are approved under the new process.

Background:

DTSC is responsible for administering the hazardous waste facility permitting program established under the California Hazardous Waste Control Law and the federal Resource Conservation and Recovery Act (RCRA). In general, DTSC issues permits for complex and large facilities, such as Class I landfills, large treatment facilities, and for facilities managing RCRA hazardous waste. Presently there are 119 permitted hazardous waste facilities in California.

Proposed Law:

This bill would require DTSC to process a hazardous waste facility renewal permit in an expedited manner if the department determines all the following conditions apply:

1. The permit renewal application was submitted to the department two years before the expiration of the current permit.
2. Operations at the hazardous waste facility have not changed since the approval of the permit for the preceding term.
3. The hazardous waste facility did not have any issues with compliance with any regulatory agency during the preceding term of the permit.
4. The hazardous waste facility was not the subject of any public concerns during the preceding term of the permit.

Related Legislation:

AB 2094 (Kalra, 2018) would require DTSC to, on or before January 1, 2021, adopt regulations establishing inspection frequencies for permitted hazardous waste treatment, storage, and disposal facilities; hazardous waste generators; and, transporters. This bill has been referred to the Senate Appropriations Committee.

AB 2345 (Reyes, 2018). Would require an applicant for a hazardous waste facilities permit to submit their application two years before their permit expires. This bill has been referred to the Senate Appropriations Committee.

SB 774 (Leyva, 2017) creates a governing board over DTSC. This bill is pending action on the Assembly Floor.

AB 1179 (Kalra, 2017) would have required DTSC to, on or before January 1, 2020, adopt regulations establishing inspection frequencies for permitted hazardous waste treatment, storage, and disposal facilities and for hazardous waste generators and transporters. AB 1179 was vetoed by Governor Brown who stated that comprehensive fiscal and structural reforms are necessary.

Staff Comments:

Staff notes that the proposed funding source (HWCA) has a structural deficit and is projected to be depleted within the current year. If the structural deficit is left unaddressed, there will be significant cuts to DTSC’s programs and the department would be unable to absorb these additional responsibilities or expand its programs without new funds.

Specific incidents across California have exposed and continue to expose glaring failings in DTSC’s implementation of its core programs as well as its support programs. The mishandling of the hazardous waste facility permitting and enforcement of first the Exide and now the Quemetco battery recycling facilities; neglected cost-recovery efforts for cleanups across the state leading to an accumulation of 1,661 projects totaling almost $194 million in uncollected cleanup costs dating back 26 years; a growing backlog of applications to renew hazardous waste permits; delayed site remediation; failed public participation and transparency activities; and personnel issues have all led to decreased stakeholder confidence and public trust in DTSC’s ability to meet its mandate to protect public health and the environment. Numerous statutory changes have been made to clarify and strengthen the statute to help DTSC better achieve its mandates, and budget augmentations have been made to give DTSC the resources to reduce backlogs and address outstanding programmatic failings. However, many of the underlying concerns about transparency, accountability, and long-term stability of DTSC programs remain.

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SENATE COMMITTEE ON ENVIRONMENTAL QUALITY

Senator Wieckowski, Chair

2017 - 2018 Regular

Bill No: AB 2606

SUBJECT: Hazardous waste: facilities: permits: renewals

ANALYSIS:

Existing law:

1. Governs, under the federal Resource Conservation and Recovery Act (RCRA) of 1976, the disposal of hazardous waste as follows:
2. Sets, through regulation, standards for the treatment, storage, transport, tracking and disposal of hazardous waste in the United States.
3. Authorizes states to carry out many of the functions of the federal law through their own hazardous waste laws if such programs have been approved by the United States Environmental Protection Agency (US EPA).
4. Under the California Hazardous Waste Control Act (HWCA) of 1972:
   1. Establishes the Hazardous Waste Control program.
   2. Regulates the appropriate handling, processing and disposal of hazardous and extremely hazardous waste to protect the public, livestock and wildlife from hazards to health and safety.
   3. Requires the Department of Toxic Substances Control (DTSC) to enforce the standards within the Hazardous Waste Control Law (HWCL) and the regulations adopted by DTSC pursuant to the HWCL.
   4. Authorizes DTSC to conduct inspections, conduct sampling activities, inspect and copy documents, and take photographs at sites or establishments where hazardous wastes are stored, handled, processed, treated, or disposed.

This bill:

1. Requires DTSC to process a hazardous waste facilities permit renewal application in an expedited manner, as provided, if DTSC determines that certain conditions are met, including that operations at the hazardous waste facility have not changed significantly since the approval of the permit in effect at the time the renewal application is submitted.
2. Requires DTSC to cease processing a hazardous waste facilities application in an expedited manner if the hazardous waste facility no longer meets one or more of specified conditions.
3. Authorizes DTSC to exempt a hazardous waste facility from a requirement to provide certain information for purposes of the permit renewal if DTSC determines that review of the information is not necessary given that the hazardous waste facility meets the conditions for expedited permit renewal.
4. Provides that the expedited permit renewal process is not available for land disposal facilities.
5. Imposes a maximum reimbursement for the costs incurred by DTSC in processing hazardous waste facility permit renewal applications through the expedited process added by this bill in the amount of $200,000 for large storage facilities and large treatment facilities or $100,000 for all other hazardous waste facilities.
6. Authorizes the Director of DTSC to raise those maximum reimbursement amounts if specified conditions are met.

Background

1. DTSC Hazardous Waste Management. DTSC is responsible for protecting public health and the environment by overseeing the state’s response to releases of hazardous substances and disposal of hazardous waste. DTSC investigates, removes and remediates contamination as part of that mission. The Hazardous Waste Management Program (HWMP) is one of DTSC’s four major divisions.
   
   HWMP is responsible for issuing permit decisions for proposed new hazardous waste facilities and the approximately 120 existing hazardous waste facilities in California that treat, store, and dispose of hazardous waste. HWMP staff conducts inspections and takes enforcement actions to ensure compliance with hazardous waste laws and regulations. HWMP oversees the hazardous waste generator program. In addition, it provides hazardous waste management-related policy support, regulatory and statutory interpretation, financial assurance, and data management support for internal and external stakeholders. HWMP also provides emergency response support for hazardous materials-related emergencies throughout California.
   
2. Exide Technologies, Vernon, California.  The Exide facility in Vernon, California was one of two secondary lead smelting facilities in California which recovered lead from recycled automotive batteries.  It has over 100 employees.  It recycles 23,000 to 41,000 batteries daily and has an average production of 100,000 to 120,000 tons of lead per year. 
   
   The facility has been used for a variety of metal fabrication and metal recovery operations since 1922.  Previous owners have included Morris P. Kirk & Sons, Inc., NL Industries, Gould Inc., and GNB Inc.

The facility in Vernon has been operating with an interim hazardous waste facility permit since 1981. 

In recent years, the Exide facility has brought to light the failings of DTSC’s permitting program.  Over the 30 years that the facility operated with an interim permit, there were many violations of the permit as well as other regulatory standards, such as those by the South Coast Air Quality Management District, which caused environmental damage and risk to public health. 

In March, 2015 it was announced that an agreement was reached between the United States Department of Justice and Exide Technologies to permanently close the battery recycling facility in Vernon, CA, and in order to avoid criminal prosecution, Exide Technologies further agreed to a stipulation and order with DTSC to complete remediation activities as specified in the stipulation and order issued by DTSC. 

This example of a failed process calls into question whether the statutory authorizations, requirements, and direction to DTSC is adequate to ensure that the program runs correctly and is appropriately protective of public health and the environment, especially in the vulnerable communities where there are permitted facilities.

Additionally, it called into question whether there are other facilities that may currently be similarly causing harm to the communities in which they are located.

The community crisis around Exide created significant concern about DTSC’s permitting statutory authorization and implementation. 

1. DTSC’s hazardous waste management enforcement program: DTSC’s inspection and enforcement responsibilities include its delegated authority under RCRA, California’s HWCL, and state laws pertaining to toxics in packaging, toxic substances in consumer products, and disposal of universal wastes, such as electronic waste. Core activities of DTSC’s hazardous waste management program include: routine compliance inspections, which involve review of submitted data and reports as well as physical observation, testing, and evaluation of regulated facilities; and targeted compliance inspections, which involve review of specific units or processes in response to focused concerns or to inform permitting decisions, as well as analysis of current and historical compliance to inform those decisions.
   
2. Legislative Oversight. Specific incidents across California have exposed and continue to expose glaring failings in DTSC’s implementation of its core programs as well as its support programs.
   
   The mishandling of the hazardous waste facility permitting and enforcement of first the Exide, and now the Quemetco, battery recycling facilities; neglected cost-recovery efforts for cleanups across the state leading to an accumulation of 1,661 projects totaling almost $194 million in uncollected cleanup costs dating back 26 years; a growing backlog of applications to renew hazardous waste permits; delayed site remediation; failed public participation and transparency activities; and personnel issues have all led to decreased stakeholder confidence and public trust in DTSC’s ability to meet its mandate to protect public health and the environment.
   
   Over the last five years, the Legislature has conducted numerous hearings on DTSC’s internal controls, its business practices, and its basic statutory obligations. In those hearings, the budget and policy committees have evaluated the following four main areas: (1) reviewing and monitoring DTSC’s strategic plan and reorganization; (2) auditing cost recovery at DTSC; (3) providing staffing to improve permit backlogs and business operations; and, (4) improving enforcement at DTSC.
   
   Numerous statutory changes have been made to clarify and strengthen the statute to help DTSC better achieve its mandates, and budget augmentations have been made to give DTSC the resources to reduce backlogs and address outstanding programmatic failings. However, many of the underlying concerns about transparency, accountability, and long-term stability of DTSC programs remain.
   
3. Legislative Analyst Office – DTSC Review. On April 4, 2017, LAO released its web post entitled, “Department of Toxic Substances Control: Performance Improvement Initiatives Merit Oversight.” LAO discusses DTSC’s progress to date in addressing its deficiencies, focusing on those programs that have received additional funding and personnel resources, including (1) Hazardous Waste Management Program, (2) Exide Facilities Contamination Cleanup Program, (3) Site Mitigation and Brownfields Reuse Program, and (4) Office of Strategic Planning and Development.
   
   LAO concluded that, “over the past few years, the Legislature has approved funding and personnel resources to address specific deficiencies in DTSC’s programs. Even with these new resources, DTSC’s own projections show that for some programs it will be years before the deficiencies are fully remedied. Therefore, it will be important for the Legislature to continue to oversee DTSC’s progress and hold DTSC accountable for producing results over the next several years … In cases where the department is not achieving its performance goals, the Legislature may wish to consider further oversight measures. These could include holding hearings to determine the reason for the lack of progress and whether funding and personnel continue to be justified. It could also include having an independent entity—such as the Bureau of State Audits—conduct program reviews to better understand why the program continues to underperform. In our view, such continued oversight is necessary to ensure that the department continues to improve its performance in several key programs.”
   
4. The Independent Review Panel. With the aim of identifying and addressing the continued failings of DTSC to meet its public health and environmental protection mandates, SB 83 (Committee on Budget and Fiscal Review, Chapter 24, Statutes of 2015) established an Independent Review Panel (IRP) to review and make recommendations regarding improvements to DTSC’s permitting, enforcement, public outreach, and fiscal management with the goal of resolving the outstanding operational problems within DTSC and creating strong statutory mandates and accountability in the long term.
   
   The IRP is comprised of three individuals: an appointee of the Speaker of the Assembly with scientific experience related to toxic materials, an appointee of the Senate Rules Committee who is a community representative, and an appointee of the Governor who is a local government management expert.
   
   The IRP additionally advises DTSC on issues related to its reporting obligations, making recommendations for improving DTSC’s programs, and advises DTSC, along with the other California Environmental Protection Agency boards and departments, to “institute quality government programs to achieve increased levels of environmental protection and the public’s satisfaction through improving the quality, efficiency, and cost-effectiveness of the state programs” and “submit a biennial report to the Governor and Legislature, no later than December 1 with respect to the previous two fiscal years, reporting on the extent to which these state agencies have attained their performance objectives, and on their continuous quality improvement efforts.”
   
   The IRP is required to report to the Governor and the Legislature every 90 days on DTSC’s progress in reducing permitting and enforcement backlogs, improving public outreach, and improving fiscal management. In addition, the IRP must submit recommendations at the time of the submission of the Governor’s annual budget to the Legislature.
   
   Pursuant to SB 83, the IRP sunsetted January 1, 2018.
   
   Over the course of its term, the IRP conducted 24 public meetings and released 11 progress and annual reports. In December 2016, the IRP released a thorough list of recommendations compiled from the meetings and reports conducted in the IRP’s first 11 months. That report contained a compendium of the recommendations that the IRP made in its quarterly reports during 2016. The compendium showed that of a total of 23 IRP recommendations made, 7 have been adopted by DTSC and 16 have not yet been implemented.
   
   In 2017, IRP Chair Kracov, testified before legislative policy committees on the progress of the IRP. His testimony revealed that less than a third of those recommendations had been implemented and that the IRP shared stakeholder concern and frustration with the lack of implementation of those recommendations. Additionally, Chair Kracov stated that the IRP believed that one of the key improvements needed at DTSC is a transparent and accountable process by which stakeholders can participate in a public way, in the deliberative processes around permits and cleanup orders.
   
   On January 1, 2018, the IRP completed its term and on January 8, 2018 released its final report and recommendations concluding:
   
   “DTSC made considerable progress since the IRP began meeting in November 2015. The Governor and DTSC Director Lee stabilized the Department’s leadership team. DTSC worked systematically to evaluate its organizational culture and lay the groundwork for improvements. Budget augmentations have made a difference, especially in cost recovery, reducing permitting backlogs, environmental justice work, and the Exide residential cleanup. DTSC has been working on improvements to its public engagement efforts. It has made efficiency improvements. It has enhanced the EnviroStor public interface and made content improvements to its other website offerings. The Department has implemented, or is working on, most of the IRP’s recommendations and has achieved, or partially achieved, many of the IRP’s suggested performance metrics.
   
   “However, there is more work to be done. DTSC can expect a wave of retirements in the coming years, with a consequent loss of institutional knowledge. The Department is only beginning to consider and implement its organizational culture plans, and several cannot be implemented without additional resources. Structural deficits in DTSC’s two major accounts require immediate attention. Several programs need additional funding, especially for orphan site cleanups, the Exide residential cleanup, and the SCP Program. It is not yet certain whether DTSC’s public participation and environmental justice work will lead to enduring improvements. The website and EnviroStor require further improvements and fastidious content updates. DTSC must find a better balance between work product quality and timeliness. DTSC’s governing statutes should be reviewed to delete redundancy and give the Department more focus.
   
   “The IRP process challenged DTSC to explain publicly why it operated the way it does and to think about how it can better accomplish its mission in a climate of limited resources. In the absence of the IRP, the Governor and the Legislature should consider a DTSC governing board or other structural change to enhance transparency and accountability and regularly monitor the status of the IRP-suggested recommendations and performance metrics, as well as the Department’s ongoing initiatives and decision-making.”
   

Comments

1. Purpose of Bill. According to author, “California’s Hazardous Waste Management program oversees the issuance of permits for the state’s hazardous waste facilities. These permits allow operators to manage, treat, transfer and store various hazardous materials. However, the permit program is currently running a decades-long backlog of new and renewal applications, causing uncertainty for industry and putting communities where these facilities are located at risk. With fewer facilities to receive hazardous substances, there is a greater risk of these substances being disposed of in an unsafe manner.
   
   “In my district, the Naval Weapons Station China Lake – our nation’s premier military development, test and evaluation center – has been operating with an expiring permit the last 6 years despite the fact that the mission of China Lake has not changed and has maintained full compliance. Other facilities affected are Edwards Air Force Base, Travis Air Force Base and the naval bases in San Diego and Coronado.
   
   “AB 2602 will streamline the renewal process for facilities that have not made significant changes to operations, and institutes a cap on permit fees. By creating a new expedited permit process for certain facilities, DTSC will be able to focus its time and resources on those facilities that treat, store, and dispose of hazardous waste, especially those facilities within disadvantaged communities.”
   
2. Incremental change or systemic or both? Over the last several year many bills have been introduced and passed aimed at making targeted statutory changes to DTSC’s hazardous waste management program based on specific recommendations of the IRP.
   
   A question arises as to how many more incremental changes will be made or need to be made to improve this department and whether these changes will result in a cure to DTSC’s dis-functionality.
   
   The Legislature, the Administration, and stakeholders have all pointed to systemic issues and programmatic deficiencies that have impacted DTSC’s ability to fulfill its public health and environmental protection mandates. In the last five years, the Legislature has had more than 20 hearings on DTSC’s deficiencies in both the policy and budget committees of both houses. DTSC and the Governor have initiated audits, panels, reports, and their own initiatives to fix identified problems. The Legislature has passed several reform bills and significantly augmented DTSC’s budget and staff by more than two dozen positions (limited-term and permanent) and millions of dollars.
   
   Many of the measures approved by the Legislature and signed by the Governor directing specific action by DTSC remain undone. Additionally, the IRP has made recommendations for improvements that have not been implemented.
   
   It is clear, that all review and changes to date point to systemic issues at DTSC. At the heart of the criticisms around DTSC’s failings is a lack of accountability and transparency.
   
   While these new bills will result in tightening the statute, additional action is needed to address the systemic problem of greater transparency and accountability within DTSC.
   
   This bill in particular creates an improvement to the permitting for the regulated community, however, because DTSC’s programs are plagued with a lack of transparency and accountability, this streamlining comes at the expense of public awareness and participation.
   
   Additionally, the Hazardous Waste Control Account will be in a structural deficit within the next 12 months. While a cap on fees may assist permittees with providing certainty in fees, it is not being done comprehensively with other regulatory fees. Without a comprehensive solution, this bill contributes to further offsetting the balance of the needs of DTSC’s constituents – both regulated entities and the communities where these facilities are located.
   
3. Suggested Amendments.
   
   1. Clarity of Criteria. The bill specifies several criteria by which DTSC will expedite a permit renewal. This criteria must be clear in statute, without any subjective language.
      
      1. “Operations at the hazardous waste facility have not changed significantly since the approval of the permit in effect at the time the renewal application is submitted.” (Emphasis added.)
         
         In order for a facility to bypass submission of updated documents that would show changes in conditions that impact the facility, the facility should not have changed AT ALL – the “significantly” qualifier is not only subjective but would allow a facility change that would not necessary be reflected in the renewal application supporting documents.
         
         An amendment is needed to remove the word “significantly.”
         
      2. “If the hazardous waste facility had any major violations during the term of the permit in effect at the time the renewal application is submitted, the hazardous waste facility returned to compliance in a timely manner.”
         
         If truly special treatment for a standard permit renewal is warranted, a facility should have NO violations – not just major violations, which at this time is also a subjective term. Even minor violations from other regulatory bodies can be indication that there is an issue at a facility. For example, in the case of Exide, the facility had not been cited by DTSC, but rather by the air quality management district. Had this bill been in place, (if Exide was a renewal permit) it would have qualified for the expedited permit renewal.
         
         Therefore, language should be added that states it is not just DTSC violations but any regulatory entity.
         
      3. “There were no significant concerns raised by the public during the public processes associated with the permit in effect at the time the renewal application is submitted.” (Emphasis added.)
         
         This would severely limit how a community could participate in this new renewal process. IF a community member submits concerns via letter to DTSC about a facility that may be contaminating the community, but it isn’t during a specified public process, should DTSC not slow down the permit and review the concern? Additionally, what is a “significant” concern? By expediting the permit renewal process, this bill already truncates the community’s ability to have input, putting qualifiers on how concerns can be raised about a permit renewal only further hinders community involvement.
         
         An amendment is needed to remove the word “significant” and “during public processes associated with the permit….”
         
      4. “The department may exempt a hazardous waste facility from a requirement to provide certain information for purposes of the permit renewal if the department determines that review of the information is not necessary given that the hazardous waste facility meets the conditions specified in clauses (i) to (iv), inclusive, of subparagraph (A).”
         
         This language is extremely broad; what is “certain information?” This language gives far too much discretion in statute for DTSC to determine what is required in a permit. If there are specific documents that proponents of this legislation would like to give special consideration, that should be specified in the bill. As this language is written, it would allow DTSC the authority to allow any information to not be updated or provided as part of a permit. This is an extreme exemption that further hinders public access to information.
         
         An amendment is needed to remove this language. Language could be added back later in the process IF it is clear language about what specifically the permittees would not be required to submit, under which circumstances and IF it does not prevent further public input.
         
   2. Remove Fee Cap. While the author and proponents have pointed out that there is a lack of assurance in the process about the expected costs associated with a permit renewal, it is not appropriate to cap the fees AS WELL AS set aside and expedite one set of permits. The author rightly points out that a streamlined process, which includes approving existing documents, should decrease the amount of time that DTSC spends on an individual permit. This alone should decrease the costs associated with the permit renewal. At a time when the Hazardous Waste Management program is suffering from a deficit, it is not appropriate to further tie the hands of the program to collect fees for work done.
      
      An Amendment is needed to remove the fee cap.

Related/Prior Legislation

AB 2094 (Kalra, 2018) requires the Department of Toxic Substances Control (DTSC) to, on or before January 1, 2021, adopt regulations establishing inspection frequencies for permitted hazardous waste treatment, storage, and disposal facilities; hazardous waste generators; and, transporters. This bill is set to be heard in the Senate Environmental Quality Committee on June 20, 2018.

AB 1179 (Kalra, 2017) would have required DTSC to, on or before January 1, 2020, adopt regulations establishing inspection frequencies for permitted hazardous waste treatment, storage, and disposal facilities and for hazardous waste generators and transporters. AB 1179 was vetoed by Governor Brown who stated that comprehensive fiscal and structural reforms are necessary.

AB 245 (Quirk, Chapter 499, Statutes of 2017) requires DTSC, within 90 days of receiving a renewal application for a hazardous waste facilities permit, to hold a public meeting; requires DTSC review the financial assurances required to operate a hazardous waste facility at least once every 5 years; requires DTSC, under specified circumstances, to request an owner or operator of a hazardous waste facility to submit to DTSC for review and approval a written cost estimate to cover activities associated with a corrective action based on available data, history of releases, and site activities, as specified and require the owner or operator, within 90 days of the approval or the imposition of a corrective action cost estimate, as specified, to fund the cost estimate or enter into a schedule of compliance for assurances of financial responsibility for completing the corrective action; requires DTSC to review permit financial assurance every 5 years; and increases administrative and civil penalties to $37,500.

AB 246 (Santiago, 2017) would have promoted the use of fence line monitoring by hazardous waste facility permit holders. This bill was amended to pertain to a different subject.

AB 248 (Reyes, 2017) would have required permittees to submit complete renewal applications 6 months prior to expiration of a hazardous waste facilities permit if the permit is due to expire prior to July 1, 2020 and two years prior to expiration for those permits that expire after July 1, 2020. AB 248 was vetoed by Governor Brown who stated that comprehensive fiscal and structural reforms are necessary.

SB 774 (Leyva, 2017) creates a governing board over DTSC. This bill is pending action on the Assembly Floor.

AB 1102 (Santiago, 2016) would have required DTSC to inspect a permitted hazardous waste land disposal facility no less than once per month, inspect a permitted and operating hazardous waste facility no less than four times per calendar year, and inspect a permitted hazardous waste facility no less than two times per calendar year.  AB 1102 was held by the author in the Senate Environmental Quality Committee.

AB 1205 (Gomez, 2016) would have required DTSC, within 90 days of receiving a renewal application for a hazardous waste facilities permit, to hold a public meeting for specified purposes in or near the community in which the hazardous waste facility is located, and requires DTSC review the financial assurances required to operate a hazardous waste facility at least once every 5 years. If DTSC’s review finds the financial assurances for a facility to be inadequate, the bill would require DTSC to notify the owner or operator of the facility and would require the owner or operator to update and adopt adequate financial assurances within 90 days. AB 1205 was held by the author in the Senate Environmental Quality Committee.

AB 1400 (Santiago, 2016)  would have required DTSC, as a condition for a new hazardous waste facilities permit or a renewal of a hazardous waste facilities permit, to require a facility operator to install monitoring devices or other equipment at the fence line of the facility to monitor for potential releases from the facility into the surrounding community, except as specified; requires DTSC to grant such a request from a member of the public for a technical assistance grant for the purpose of getting assistance relating to, and information about, a pending hazardous waste facility’s permit if DTSC receives the request within one year of the submission of the applicable hazardous waste facility’s permit application, and would authorize DTSC to, in its discretion, grant such a request received more than one year from the submission of the applicable permit application and requires the permit applicant to fund the grants; requires DTSC, upon receipt of an application for a new hazardous waste facility permit or for a renewal of a hazardous waste facility’s permit, to post on its Internet Web site that the application has been received, and to include with this information a description of the process for applying for a technical assistance grant. AB 1400 was held by the author in the Senate Environmental Quality Committee.

SB 83 (Committee on Budget and Fiscal Review, Chapter 24, Statutes of 2015) among other things, created the IRP to review and make recommendations for improving DTSC programs, as specified.

SB 673 (Lara, Chapter 611, Statutes of 2015) revises DTSC’s permitting process and public participation requirements for hazardous waste facilities.

SB 712 (Lara, Chapter 833, Statutes of 2014) requires DTSC, on or before December 31, 2015, to issue a final permit decision on an application for a hazardous waste facilities permit that is submitted by a facility operating under a grant of interim status on or before January 1, 1986, by either issuing a final permit or a final denial of the application.

SB 812 (De León, 2014) would have required DTSC to adopt regulations by January 1, 2017, to specify conditions for new permits and the renewal of existing permits, as specified, and establishes deadlines for the submission and processing of facility applications, as specified. SB 812 was vetoed by Governor Brown.

AB 2345 (Reyes, 2014). Requires an applicant for a hazardous waste facilities permit to submit their application two years before their permit expires. This bill has been referred to the Senate Appropriations Committee.

SOURCE:

Author

SUPPORT:

California Business Properties Association

California Chamber of Commerce

California Manufacturers and Technology Association

California Small Business Alliance

Camarillo Chamber of Commerce

Chemical Industry Council of California

Clean Harbors/Safety-Kleen

County of Solano, Board of Supervisors

Department of the Navy

El Dorado County Chamber of Commerce

Industrial Environmental Association

Southwest California Legislative Council

OPPOSITION:

Center on Race, Poverty and the Environment

California Environmental Justice Alliance

Sierra Club

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 2606

Author:(Fong)

As Amended Ver:May 25, 2018

Majority vote

SUMMARY: Requires the Department of Toxic Substances Control (DTSC) to process a hazardous waste renewal permit application in an expedited manner if certain conditions are met. Specifically, this bill:

1) Requires the Department of Toxic Substances Control (DTSC) to process a hazardous waste renewal permit application in an expedited manner under the following conditions:

a) The renewal application was submitted to DTCS two years before the expiration of the permit;

b) Operations at the hazardous waste facility have not changed significantly since the approval of the permit for the preceding term;

c) The hazardous waste facility did not have any significant issues with compliance during the preceding term of the permit; and,

d) The hazardous waste facility was not the subject of any significant public concerns during the preceding term of the permit.

2) Caps the amount that DTSC can be reimbursed for processing a renewal of a hazardous waste facility permit using the new expedited permit process at $200,000 for large storage or treatment facilities, and $100,000 for all other hazardous waste facilities.

3) Authorizes the Director of DTSC to raise the fee caps for the expedited permits if the costs to process the expedited permit exceeds the caps and there are not sufficient funds in DTSC's accounts to fund DTSC's regulatory activities.

EXISTING LAW:

1) Authorizes DTSC to issue permits for the use and operation of one or more hazardous waste management units at a facility if those units meets the standards adopted pursuant to the Hazardous Waste Control Law (HWCL).

2) Requires an owner or operator of a hazardous waste facility who intends to extend the term of the permit, before the fixed term expires, to submit a complete Part A renewal application.

3) States that when a complete Part A renewal application has been submitted before the end of the permit's fixed term, the permit is deemed extended until the renewal application is approved or denied and the owner or operator has exhausted all applicable rights of appeal.

FISCAL EFFECT: According to the Assembly Appropriations Committee, enactment of this bill could lead to annual revenue loss to DTSC between $1 and $4 million per year for 10 years during the 2021 to 2031 permitting cycle, resulting from the permit fee reimbursement cap (Hazardous Waste Management Account). However if costs exceed the fees and the Hazardous Waste Management Account is insolvent, the Director of DTSC may adjust the fees to reflect the actual costs, thus reducing the revenue losses.

COMMENTS:

Need for this bill: According to the author,

California's Hazardous Waste Management program oversees the issuance of permits for the state's 118 hazardous waste facilities. These permits, valid for 10 years, allow operators to manage, treat, transfer, and store various hazardous materials. The permit program is currently running a decades-long backlog of new and renewal applications. Under existing law, facilities that submit timely renewal applications may continue operating past the expiration date of the original permit under what are referred to as continuing permits. Due to the backlog, many facilities have been operating under continuing permit status. AB 2606 will streamline the renewal process for facilities that have not made significant changes to operations, and places a cap on permit fees.

California Hazardous Waste Control Law (HWCL): The HWCL is the state's program that implements and enforces federal hazardous waste law in California and directs DTSC to oversee and implement the state's HWCL. Any person who stores, treats, or disposes of hazardous waste must obtain a permit from DTSC. The HWCL covers the entire management of hazardous waste, from the point the hazardous waste is generated, to management, transportation, and ultimately disposal into a state or federal authorized facility.

DTSC's hazardous waste management permitting program: DTSC is responsible for administering the hazardous waste facility permitting program established under the California HWCL and the federal Resource Conservation and Recovery Act (RCRA). A hazardous waste facility permit granted by DTSC authorizes a facility to transfer, treat, store, or dispose of hazardous waste. Presently there are 119 permitted hazardous waste facilities in California.

At any point in the permit application review process, if DTSC finds that the facility does not meet applicable standards, it can deny the permit application. Either an approval or denial by DTSC is considered a permit decision. Federal and state law allow facilities with expired permits to continue to operate if the facility has submitted an application for renewal that is administratively complete in advance of the permit expiration date. These types of permits (i.e., expired permits for a facility that has submitted an administratively complete application for a permit renewal) are referred to as "continued permits."

Over the past decade or so, DTSC had received complaints from the public about its permitting program and held meetings with the public, the regulated community, and stakeholders to identify and understand concerns about its permitting program.

In early 2014, DTSC developed a Permitting Enhancement Work Plan (Work Plan) to significantly upgrade and strengthen DTSC's permitting program and to ensure that the problems of the past would not resurface in the future. The Work Plan serves as a comprehensive roadmap that guides DTSC's efforts to improve the permitting program's ability to issue protective, timely, and enforceable permits using more transparent standards and consistent procedures. In addition, DTSC mapped, for the first time, the entire permitting process and memorialized it in the form of a baseline flow chart that staff can work from and incorporate future improvements.

Permit processing time: Ensuring that hazardous waste facilities are managed safely begins with proper and timely permitting by DTSC. These facilities handle dangerous substances and involve complex processes, making the review of permit applications challenging, yet extremely important. Before DTSC embarked upon improving the permitting program, the average time it took to process an application was 4.4 years, with some applications continuing 10-20 years past the expiration of their permit. Given the dangerous nature of substances at these facilities, it is very important that the public be kept informed about these facilities, including the siting, permit process, and enforcement actions taken at these facilities.

Fees support DTSC's hazardous waste regulatory program: DTSC's hazardous waste regulatory program consists of the regulation of the generation, treatment, storage, transportation, and disposal of California-only and federal hazardous waste; permitting and inspection of hazardous waste facilities; enforcement of hazardous waste control laws and regulations; and, regulation, policy and procedure development. DTSC's hazardous waste program is funded by fees assessed to businesses in California that generate, store, transport, treat, or dispose of hazardous waste.

DTSC removes the permitting activity fee: In 2016, DTSC proposed removing the "Activity Fee" and replacing it with a reimbursement for a "fee for service" option. The Activity Fee was a flat fee, while the fee for service is a fee that fully reimburses DTSC for their costs of reviewing the permit. This proposal was adopted by the Legislature and incorporated into the budget in 2016. When DTSC proposed this change it stated that it did not receive enough fees from the "Activity Fee" in order to cover its permitting costs. This bill proposes to cap the amount of fees DTSC can receive for its permitting work on expedited permits.

Expedited permit renewal: This bill sets up a new expedited permit renewal process for hazardous waste facility permits. The goal of this bill is to encourage and enable DTSC to quickly and more efficiently process permits for facilities that do not have enforcement problems and whose operations have remained unchanged for a decade. Ideally, by creating a new expedited permit process for certain facilities, DTSC is then able to focus its time and resources on those facilities that treat, store, and dispose of hazardous waste, especially those facilities within disadvantaged communities.

Analysis Prepared by: Josh Tooker / E.S. & T.M. / (916) 319-3965 FN: 0003381

Date of Hearing: May 2, 2018

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 2606

Author:(Fong) – As Amended Ver:April 12, 2018

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

SUMMARY:

This bill requires the Department of Toxic Substances Control (DTSC) to process a hazardous waste facility renewal permit in an expedited manner if the department determines all the following conditions apply:

1. The permit renewal application was submitted to the department two years before the expiration of the current permit.
2. Operations at the hazardous waste facility have not changed significantly since the approval of the permit for the preceding term.
3. The hazardous waste facility did not have any significant issues with compliance during the preceding term of the permit.
4. The hazardous waste facility was not the subject of any significant public concerns during the preceding term of the permit.

Additionally, this bill caps the amount DTSC can be reimbursed for processing a renewal of a hazardous waste facility permit at $200,000 for large storage or treatment facilities and $100,000 for all other hazardous waste facilities.

FISCAL EFFECT:

Annual DTSC revenue loss of between $1 and $4 million per year for 10 years during the 2021 to 2031 permitting cycle, resulting from the permit fee reimbursement cap (Hazardous Waste Control Account).

COMMENTS:

1. Rationale. The 2015-16 Budget Act created a three-person Independent Review Panel (IRP) to oversee DTSC's permitting, enforcement, public outreach, and fiscal management. The IRP released multiple reports in 2016 and provided various recommendations on the aforementioned categories. The IRP was authorized until January 1, 2018. Over the course of its term, the IRP conducted 24 public meetings and released 11 progress and annual reports. On January 8, 2018, the IRP released its final report and recommendations concluding, "The Department has implemented, or is working on, most of the IRP’s recommendations and has achieved, or partially achieved, many of the IRP’s suggested performance metrics. However, there is more work to be done."

The recommendations included requiring permit applicants to submit their applications two years prior to the permit expiring. This bill is consistent with the IRP recommendation.

According to the author, “The permit program is currently running a decades-long backlog of new and renewal applications. Due to the backlog, many facilities have been operating under continuing permit status.” This bill provides an expedited permitting process under specified circumstances.

SB 839 (Committee on Budget and Fiscal Review), Chapter 340, Statutes of 2016, changed the way renewal fees are charged by moving from a flat-rate system to a "fee-for-service" system. This system requires facilities to reimburse DTSC for its actual costs associated with processing applications.

According to the author, “Travis Air Force Base, for example, has seen a ten-fold increase from $35,000 to more than $330,000. As a result, the Air Force is considering closing down a portion of the facility due to infeasible costs.”

This bill caps the amount DTSC can charge under the “fee-for-service” system.

1. Background. DTSC is responsible for administering the hazardous waste facility permitting program established under the California Hazardous Waste Control Law and the federal Resource Conservation and Recovery Act (RCRA). In general, DTSC issues permits for complex and large facilities, such as Class I landfills, large treatment facilities, and for facilities managing RCRA hazardous waste. Presently there are 119 permitted hazardous waste facilities in California.
2. Similar Legislation. AB 2345 (Reyes) makes statutory changes to improve the permitting process for hazardous waste facilities. This bill is pending in the Senate Environmental Quality Committee.

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

Date of Hearing: April 10, 2018

ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS

Bill Quirk, Chair

ABPCA Bill Id:AB 2606 (

Author:Fong) – As Amended Ver:April 2, 2018

SUBJECT: Hazardous waste: facilities: permits: renewals

SUMMARY: Provides that a hazardous waste facility renewal permit shall be deemed approved within 90 days of submittal of the permit and caps the amount the Department of Toxic Substances Control (DTSC) can be reimbursed for processing the permit application. Specifically, this bill:

1) Provides that a hazardous waste facility renewal permit shall be deemed approved 90 days after submittal of the permit to DTSC if DTSC has not taken action on the permit and if all of the following apply:

a) Operations at the hazardous waste facility have not changed significantly since the approval of the permit for the preceding term;

b) The hazardous waste facility did not have any significant issues with compliance during the preceding term of the permit; and,

c) The hazardous waste facility was not the subject of any significant public concerns during the preceding term of the permit.

2) Caps the amount that DTSC can be reimbursed for processing a renewal of a hazardous waste facility permit at two hundred thousand dollars ($200,000) for large storage or treatment facilities, and one hundred thousand dollars ($100,000) for all other hazardous waste facilities.

EXISTING LAW:

1) Authorizes DTSC to issue permits for the use and operation of one or more hazardous waste management units at a facility that meets the standards adopted pursuant to the Hazardous Waste Control Law (HWCL). (Health and Safety Code (HSC) § 25200 (a))

2) Requires DTSC to impose conditions on each permit specifying the types of hazardous wastes that may be accepted for transfer, storage, treatment, or disposal. (HSC § 25200 (a))

3) Requires a permit issued by DTSC to be for a fixed term, not to exceed ten years. (HSC § 25200 (c) (1)(A))

4) Requires an owner or operator of a hazardous waste facility who intends to extend the term of the permit, before the fixed term expires, to submit a complete Part A application. (HSC § 25200 (c) (1)(B))

5) States that when a complete Part A renewal application has been submitted before the end of the permit’s fixed term, the permit is deemed extended until the renewal application is approved or denied and the owner or operator has exhausted all applicable rights of appeal. (HSC § 25200 (c)(1)(B))

6) Requires an owner or operator of a permitted hazardous waste facility to submit an application for permit renewal at least 180 days before the expiration date of the permit. (22 California Code of Regulations (CCR) § 66270.10)

FISCAL EFFECT: Unknown.

COMMENTS:

Need for the bill: According to the author,

"California’s Hazardous Waste Management program oversees the issuance of permits for the state’s 118 hazardous waste facilities. These permits, valid for 10 years, allow operators to manage, treat, transfer, and store various hazardous materials.

The permit program is currently running a decades-long backlog of new and renewal applications. Under existing law, facilities that submit timely renewal applications may continue operating past the expiration date of the original permit under what are referred to as "continuing permits". Due to the backlog, many facilities have been operating under continuing permit status.

Legislative solutions have sought to improve the backlog via increased funding and resources for the department. According to the LAO, these additional resources were intended to eliminate the existing backlog of permit applications and complete most future decisions on permit renewals within two years of permits becoming continued.

Additionally, the costs to renew these applications have skyrocketed. SB 839 (2016) moved from a flat-rate system to a "fee-for-service" system. This system requires facilities to reimburse DTSC for its costs associated with processing the application. Under this system, many facilities have seen their permit renewal costs increase substantially. Travis Air Force Base, for example, has seen a ten-fold increase from $35,000 to more than $330,000. As a result, the Air Force is considering closing down a portion of the facility due to infeasible costs.

The potential closures of Travis Air Force Base and other hazardous waste facilities greatly increase the risk of mismanagement of these toxic substances. AB 2606 will streamline the renewal process for facilities that have not made significant changes to operations, and places a cap on permit fees.

Specifically, AB 2606 will require DTSC, where an applicant is seeking a renewal of their hazardous waste permit, to grant the application if the facility meets the following conditions:

• 1. Has not had a significant change in operations
  2. Has not had significant compliance issues
  3. Has not had significant public concerns

AB 2606 also caps fees at no more than $200,000 for large storage and treatment facilities, and no more than $100,000 for all other facilities."

California Hazardous Waste Control Law (HWCL): The HWCL is the state's program that implements and enforces federal hazardous waste law in California and directs DTSC to oversee and implement the state's HWCL. Any person who stores, treats, or disposes of hazardous waste must obtain a permit from DTSC. The HWCL covers the entire management of hazardous waste, from the point the hazardous waste is generated, to management, transportation, and ultimately disposal into a state or federal authorized facility.

DTSC Independent Review Panel (IRP): In 2015, the Legislature passed and the Governor signed, SB 83 (Chapter 24, Statutes of 2015) which established within DTSC a three-member IRP to review and make recommendations regarding improvements to DTSC's permitting, enforcement, public outreach, and fiscal management. The statute stipulates that IRP membership shall be comprised of a community representative, a person with scientific experience related to toxic materials, and a local government management expert. Pursuant to SB 83, the IRP was authorized until January 1, 2018. Over the course of its term, the IRP conducted 24 public meetings and released 11 progress and annual reports. On January 8, 2018 the IRP released its final report and recommendations concluding: "The Department has implemented, or is working on, most of the IRP’s recommendations and has achieved, or partially achieved, many of the IRP’s suggested performance metrics. However, there is more work to be done."

DTSC’s hazardous waste management permitting program: DTSC is responsible for administering the hazardous waste facility permitting program established under the California HWCL and the federal Resource Conservation and Recovery Act (RCRA). The core activities of the permitting program include: review of RCRA and non-RCRA hazardous waste permit applications to ensure safe design and operation; issuance and denial of operating permits; issuance of post-closure permits; approval and denial of permit modifications; issuance and denial of emergency permits; review and approval of closure plans; oversight of approved closure plans; and, providing public involvement on issues related to permitted facilities. In general, DTSC issues permits for complex and large facilities, such as Class I landfills, large treatment facilities, and facilities managing RCRA hazardous waste.

A hazardous waste facility permit granted by DTSC authorizes a facility to transfer, treat, store, or dispose of hazardous waste. Presently there are 119 permitted hazardous waste facilities in California. In order for a facility to gain authorization to treat, store, transfer, or dispose of hazardous waste, its permit application must include a detailed description of the facility’s activities, units, equipment, operation plans, recordkeeping system, procedures for response to accidental release of toxic substances or other emergencies, and training. The application will also contain engineering and structural specifications, closure plans, closure cost estimates, and the mechanism for financial assurance in the event of closure. Ultimately, the applicant must demonstrate the ability to manage the waste in a protective manner. DTSC permit applications must also address requirements beyond hazardous waste laws and regulations. For example, the permit process must adhere to the California Environmental Quality Act (CEQA) requirements, which involves a comprehensive review of impacts of the facility on public health and the environment.

At any point in the permit application review process, if DTSC finds that the facility does not meet applicable standards, it can deny the permit application. Either an approval or denial by DTSC is considered a permit decision. Federal and state law allow facilities with expired permits to continue to operate if the facility has submitted an application for renewal that is administratively complete in advance of the permit expiration date. These types of permits (i.e., expired permits for a facility that has submitted an administratively complete application for a permit renewal) are referred to as "continued permits."

Over the past decade or so, DTSC had received complaints from the public about its permitting program and held meetings with the public, the regulated community, and stakeholders to identify and understand concerns about its permitting program.

In 2012, DTSC commissioned CPS HR Consulting, a non‐profit corporation established under the California Joint Powers Authority, to conduct an external review of the permitting program. The review found that permitting decisions were not timely, taking upwards of four years to complete on average and that the permitting program restructuring from Fiscal Year (FY) 2008‐2009 had resulted in a lack of management structure. The review found that the lack of management structure was a factor in the poor performance of the program; lacked consistent processes for making permitting decisions; resulted in deficient training of staff; lead to a lack of clarity around when to deny or revoke a permit; and, resulted in a lack of performance metrics.

In early 2014, DTSC developed a Permitting Enhancement Work Plan (Work Plan) to significantly upgrade and strengthen DTSC’s permitting program and to ensure that the problems of the past would not resurface in the future. The Work Plan serves as a comprehensive roadmap to guide DTSC’s efforts to improve the permitting program’s ability to issue protective, timely, and enforceable permits using more transparent standards and consistent procedures. In addition, DTSC mapped, for the first time, the entire permitting process and memorialized it in the form of a baseline flow chart that staff can work from and incorporate future improvements.

Beginning in FY 2015‐2016, DTSC’s permitting program established a performance management approach similar to that used by the DTSC cleanup program. One of the essential elements to the implementation of this performance management approach is the development of an annual work plan. The annual work plan specifies due dates for major milestones in the permitting process on permitting projects, tracks completion of permitting activities, increases communication between staff and management on permit progress, and measures planned versus completed milestones as a performance measure of the permitting program.

Permit processing time: Ensuring that hazardous waste facilities are managed safely begins with proper and timely permitting by DTSC. These facilities handle dangerous substances and involve complex processes, making the review of permit applications challenging, yet extremely important. Before DTSC embarked upon improving the permitting program, the average time it took to process an application was 4.4 years, with some applications continuing 10-20 years past the expiration of their permit. Given the dangerous nature of substances at these facilities, it is very important that the public be kept informed about these facilities, including the siting, permit process, and enforcement actions taken at these facilities.

Currently, the only time the public is involved in the permit process is when there is a draft permit decision released by DTSC. If a permit application takes 10 years to review, that means it could have been 20 years since the public has been provided information about the hazardous waste facility in their community. DTSC’s permit improvements have a stated goal of being able to process 90% of the permit applications within 2 years; however, under current law, this means that even if DTSC achieves this goal, all of these permits will exceed their expiration by a year and a half.

Fees support DTSC's hazardous waste regulatory program: DTSC's hazardous waste regulatory program consists of the regulation of the generation, treatment, storage, transportation, and disposal of state-only and federal hazardous waste; permitting and inspection of hazardous waste facilities; enforcement of hazardous waste control laws and regulations; and, regulation, policy and procedure development. DTSC's hazardous waste program is funded by fees assessed to businesses in California that generate, store, transport, treat, or dispose of hazardous waste. These fees are the:

1) Generator Fee: Paid by generators that produce 5 or more tons of hazardous waste per calendar year;

2) Disposal Fee: Paid by persons who dispose of hazardous waste to land in California;

3) Facility Fee: Annual fee paid by hazardous waste facilities operating under a Full Permit;

4) Standardized Permit, Post Closure Permit, or Transportable Treatment Unit Permit;

5) EPA ID Verification Fee: Assessed to businesses that require an EPA ID number;

6) Manifest User Fee & Manifest Processing Fee: Paid by users of manifests; and,

7) Activity Fee: Paid by persons applying for hazardous waste facility permits, permit modifications, or permit renewals. (Note: this fee was removed in 2016 and replaced by a "fee for service").

DTSC removes the permitting activity fee: In 2016, DTSC proposed removing the "Activity Fee" and replacing it with a reimbursement for a "fee for service" option. The proposal was adopted by the Legislature and incorporated into the budget in 2016. When DTSC proposed this change it stated that it did not receive enough fees from the "Activity Fee" in order to cover its permitting costs. Here is some information DTSC provided:

Budget FY 11/12 FY 12/13 FY 13/14 FY 14/15

Actual permitting costs $3,096,000 $3,387,000 $3,586,000 $5,413,000

Revenue Activity Fee $402,000 $356,000 $293,000 $628,000

As this information shows, DTSC did not receive enough revenue from the permitting "Activity Fee" to cover the permitting costs. This information also shows that the permitting costs fluctuate over time depending on how many permit applications DTSC receives in any given year. AB 2606 proposes to cap the amount of fees DTSC can receive for its permitting work, the author may wish to consider how much it will cost DTSC to process these permits in a timely fashion, and whether the caps proposed in AB 2606 will provide sufficient funding.

Similar legislation to AB 2606: AB 2345 (Reyes), which passed out of this Committee on March 20, 2018, also addresses the DTSC permitting process. AB 2345 requires a permit applicant to submit its application two years before their permit expires. The approaches in both bills appear compatible. If the permit applications are submitted sooner, as envisioned within AB 2345, then it could speed up the time DTSC reaches a permit decision, which is the focus of AB 2606. It is important to note that both bills amend the same section of law, therefore the author will want to consider how to address potential chaptering conflicts in the future.

Expedited permit renewal: The current approach in the bill has some flaws; however, there is value in setting up a process to expedite certain permit renewals. AB 2606 currently deems an application approved within 90 days; however, current state and federal requirements include a public process with a public meeting and comment period as well as a draft and final permit application. This current process allows the public to participate as well as offers a pathway for the public or the facility to appeal DTSC's permit decision. If DTSC is forced into making a decision within 90 days, there likely will not be ample time for public participation or even the ability for the facility or the public to appeal the permit decision. Therefore the author and Committee may wish to consider the following amendments to the bill to set up an expedited permit renewal process for those facilities that have not had any major violations.

Specifically, the Committee and author may wish to consider the following:

On page 3, strike lines 28-40 inclusive and insert:

(2) The department shall process permit renewal applications in an expedited manner, if all of the following apply:

(a) The permit renewal application was submitted two years before the current permit expires.

(b) Operations at the hazardous facility have not changed significantly since the approval of the facility's current permit;

(c) The hazardous waste facility did not have any major violations where the facility did not return to compliance in a timely manner during the term of the current permit.

(d) There were not any significant concerns raised by the public during the public process associated with the facility's current permit.

(3) When processing a permit renewal in an expedited manner pursuant to (2), the Department shall begin the review process as early as possible, shall ensure that the public process is adhered to, and shall issue a permit decision no later than six months after the current permit has expired.

(4) The expedited permit renewal process, described in (2) shall not be available to a land disposal facility.

Related legislation:

1) AB 2345 (Reyes). Makes statutory changes to improve the permitting process for the permitting of hazardous waste facilities. Amends the same section of law as AB 2606. This bill is pending action on the Assembly Floor.

2) AB 248 (Reyes, 2017). Would have required an applicant for a hazardous waste facilities permit to submit their application two years before their permit expires. This bill was vetoed by the Governor.

3) SB 774 (Leyva). Creates the California Toxic Substances Board (Board) within DTSC to provide effective, reliable, transparent, and accountable oversight of California's hazardous waste management and of the remediation of contaminated sites. This bill is on the inactive file on the Assembly Floor.

4) SB 812 (De León). Would have revised DTSC's permitting process for hazardous waste facilities, including deeming permit applications denied if they were not acted on by DTSC within three years after permit expiration. This bill was vetoed by the Governor.

REGISTERED SUPPORT / OPPOSITION:

Support

California Chamber of Commerce

California Business Properties Association

California Manufacturers & Technology Association

California Small Business Alliance

Camarillo Chamber of Commerce

Clean Harbors

El Dorado County Chamber of Commerce

Industrial Environmental Association

Safety-Kleen

Southwest California Legislative Council

United States Department of the Navy

Opposition

California Environmental Justice Alliance

Center on Race, Poverty and the Environment

Sierra Club

Analysis Prepared by: Josh Tooker / E.S. & T.M. /