Existing federal law, the Indian Gaming Regulatory Act of 1988, provides for the negotiation and execution of tribal-state gaming compacts for the purpose of authorizing certain types of gaming on Indian lands within a state. The California Constitution authorizes the Governor to negotiate and conclude tribal-state gaming compacts, subject to ratification by the Legislature. Existing law expressly ratifies a number of tribal-state gaming compacts, and amendments of tribal-state gaming compacts, between the State of California and specified Indian tribes.

The California Environmental Quality Act (CEQA) requires a lead agency to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project, as defined, that it proposes to carry out or approve that may have a significant effect on the environment, as defined, or to adopt a negative declaration if it finds that the project will not have that effect.

This bill would ratify the tribal-state gaming compact entered into between the State of California and the Morongo Band of Mission Indians, executed on September 6, 2017. The bill would provide that, in deference to tribal sovereignty, certain actions related to that compact are not projects for purposes of CEQA.

This bill would declare that it is to take effect immediately as an urgency statute.

Existing federal law, the Indian Gaming Regulatory Act of 1988, provides for the negotiation and execution of tribal-state gaming compacts for the purpose of authorizing certain types of gaming on Indian lands within a state. The California Constitution authorizes the Governor to negotiate and conclude tribal-state gaming compacts, subject to ratification by the Legislature. Existing law expressly ratifies a number of tribal-state gaming compacts, and amendments of tribal-state gaming compacts, between the State of California and specified Indian tribes.

The California Environmental Quality Act (CEQA) requires a lead agency to prepare, or cause to be prepared, and certify the completion of, an environmental impact report on a project, as defined, that it proposes to carry out or approve that may have a significant effect on the environment, as defined, or to adopt a negative declaration if it finds that the project will not have that effect.

This bill would ratify the tribal-state gaming compact entered into between the State of California and the Morongo Band of Mission Indians, executed on September 6, 2017. The bill would provide that, in deference to tribal sovereignty, certain actions related to that compact are not projects for purposes of CEQA.

This bill would declare that it is to take effect immediately as an urgency statute.

Existing law requires the California Environmental Protection Agency to identify disadvantaged communities as part of a 3-year investment plan developed by the Department of Finance for the moneys collected by the State Air Resources Board resulting from a market-based compliance mechanism relative to greenhouse gas emissions. Existing law requires the Office of Environmental Health Hazard Assessment to update the California Communities Environmental Health Screening tool, developed by the agency and the office for the purposes of identifying those disadvantaged communities. Existing law requires the office to report to the Legislature on air quality, water quality, and toxic release and hazardous waste site data necessary for updating the indicators in the tool for communities located in the California-Mexico border region, and to include that data in the next update of the tool if it is of sufficient quality and available for those communities.

This bill would require the State Air Resources Board, in partnership with the office, to include one year of data from certain local air monitoring studies, including data on particulate matter with a diameter of 2.5 micrometers or less, ozone, and diesel particulate matter. The bill would require funds to be allocated, upon appropriation by the Legislature, to the board and the office to support the continued collection of this data. The bill would require the board to collect data, separate from the local air monitoring studies, to account for cross-border pollution add air monitoring stations at additional locations in the California-Mexico border region in both the County of San Diego and the County of Imperial, as specified, and, on or before January 1, 2019, to submit a report to the Legislature detailing the methods used to account for cross-border pollution, any barriers to collecting that data, and future plans for collecting that data.

Existing law requires the California Environmental Protection Agency to identify disadvantaged communities as part of a 3-year investment plan developed by the Department of Finance for the moneys collected by the State Air Resources Board resulting from a market-based compliance mechanism relative to greenhouse gas emissions. Existing law requires the Office of Environmental Health Hazard Assessment to update the California Communities Environmental Health Screening tool, developed by the agency and the office for the purposes of identifying those disadvantaged communities. Existing law requires the office to report to the Legislature on air quality, water quality, and toxic release and hazardous waste site data necessary for updating the indicators in the tool for communities located in the California-Mexico border region, and to include that data in the next update of the tool if it is of sufficient quality and available for those communities.

This bill would require the State Air Resources Board, in partnership with the office, to include one year of data from certain local air monitoring studies, including data on particulate matter with a diameter of 2.5 micrometers or less, ozone, and diesel particulate matter. The bill would require funds to be allocated, upon appropriation by the Legislature, to the board and the office to support the continued collection of this data. The bill would require the board to collect data, separate from the local air monitoring studies, to account for cross-border pollution and, on or before January 1, 2019, to submit a report to the Legislature detailing the methods used to account for cross-border pollution, any barriers to collecting that data, and future plans for collecting that data.

CONCURRENCE IN SENATE AMENDMENTS

CSA1 Bill Id:AB 891

Author:(Mayes)

As Amended Ver:September 1, 2017

2/3 vote. Urgency

(vote not relevant)

Original Committee Reference: E.S. & T.M.

SUMMARY: Ratifies a tribal-state Class III gaming compact (Compact) entered into between the State of California (State) and the Morongo Band of Mission Indians (Tribe), executed on September 6, 2017. Additionally, this bill provides that, in deference to tribal sovereignty, certain actions are not deemed projects for purposes of the California Environmental Quality Act (CEQA); and, stipulates, except as expressly provided, that none of the provisions shall be construed to exempt a city, county, or city and county, or the Department of Transportation from CEQA requirements.

The Senate amendments delete the Assembly version of the bill, and instead:

1. Ratify a tribal-state Class III gaming compact entered into between the State of California and the Morongo Band of Mission Indians, a federally recognized Indian tribe, executed on August 18, 2017.
2. Authorize the Tribe to operate a maximum of 6,000 gaming devices (slot machines) at no more than five (5) gaming facilities, in only two of which may the Tribe operate more than 500 gaming devices. The Tribe may engage in Class III gaming only on the Tribe's eligible Indian lands held in trust for the Tribe located within the boundaries of the Tribe's reservation and certain trust lands on which Class III gaming lawfully may be conducted under the Indian Gaming Regulatory Act (IGRA), as those boundaries exist as of the execution date of this Compact.
3. Provide that the Tribe will pay into the Special Distribution Fund (SDF), its pro-rata per year share of costs the State incurs for the performance of its duties under the Compact, as specified.
4. Provide the Tribe will pay between $9-11 million per year into the Revenue Sharing Trust Fund (RSTF) and the Tribal Nation Trust Fund (TNGF), depending on the number of gaming devices the Tribe operates, as specified.
5. Require the Tribe to establish a Local Community Benefit Fund. The Tribe will be required to make monthly payments of $1.25 million, totaling $15 million per year. Funds may be used for various purposes benefiting the local community, including fire, law enforcement, public transit, education, tourism, health services, youth programs, educational programs, recycling programs, water conservation and cultural programs, as specified.
6. The Tribe has agreed to establish a "Rainy Day Fund" to serve as a buffer against either or both periodic adverse fluctuations in tribal revenues or severe long-term reductions in tribal revenues due to changes in the law or market conditions. As such, the Tribe, from revenue derived generated by the Morongo Casino Resort and Spa, shall contribute $10 million each calendar year, until the fund contains $100 million. When the fund balance is $100 million, the Tribe will contribute an additional $7.5 million per year to the Local Community Benefit Fund. The creation of this Rainy Day Fund is unique to the Morongo Compact. No other tribal-state compacts provide for such an allocation.
7. The licensing, regulatory, environmental mitigation, patron protection, labor, public health and safety provisions are substantially the same as recent compacts.
8. The Compact: a) provides a regulatory framework that respects the role of the Tribal Gaming Agency as the primary regulator while also ensuring that state gaming regulators fulfill their responsibilities; b) requires the Tribe to conduct its gaming activities pursuant to an internal control system that implements minimum internal controls that are no less stringent than those in federal regulations; c) requires the Tribe to adopt a Tribal Labor Relations Ordinance (TLRO), as specified; and, d) contains provisions to protect the health and safety of patrons, guests, and employees.
9. The Compact shall be in full force and effect until 25 years (2042) following the effective date.
10. Provide that, in deference to tribal sovereignty, certain actions are not deemed projects for purposes of the California Environmental Quality Act (CEQA); and, stipulate, except as expressly provided, that none of the provisions shall be construed to exempt a city, county, or city and county, or the Department of Transportation from CEQA requirements.
11. Contain an urgency clause, allowing this bill to take effect immediately upon enactment.

EXISTING LAW:

1. Provides, under the IGRA, for the negotiation and conclusion of compacts between federally recognized Indian tribes and the State for the purpose of conducting Class III gaming activities on Indian lands within a State as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments.
2. Authorizes expressly a number of tribal-state gaming compacts between the State of California and specified Indian tribes.
3. Authorizes the conduct of Class III gaming activities to the extent such activities are permitted by state law, a gaming compact has been concluded by a federally recognized tribe and the State, and the compact has been approved by the Secretary of the Interior.
4. Limits the operation of Class III gaming activities to Indian lands acquired on or before October 17, 1988. Provides exceptions to conduct gaming activities on Indian lands acquired after October 17, 1988.
5. Defines Indian lands to mean all lands within the limits of any Indian reservation, and any lands title to which is either held in trust by the United States (U.S.) for the benefit of any Indian tribe, or individual, or held by any Indian tribe or individual subject to restriction by the U.S. against alienation and over which an Indian tribe exercises governmental power.
6. Requires the State to negotiate to conclude a compact in good faith with an Indian tribe having jurisdiction over the Indian lands upon which the Class III gaming activity is to be conducted. Provides the U.S. district courts with jurisdiction over any cause of action initiated by a tribal government alleging that the State failed to negotiate in good faith to conclude a compact. Prescribes the remedy, mediation supervised by the courts, if it is found that the State failed to negotiate in good faith to conclude a compact.
7. Authorizes the Governor, under the California Constitution, to negotiate and conclude compacts, subject to ratification by the Legislature.

FISCAL EFFECT: Unknown

COMMENTS: On September 12, 2017, the Assembly Governmental Organization Committee held an informational hearing on the tribal-state Class III gaming compact between the State of California and the Morongo Band of Mission Indians.

Brief History and Background:

Established in 1865, the Morongo Indian Reservation (located in Banning, CA) was one of nine reservations created by President Ulysses S. Grant by Executive Order in 1876. The Tribe has a total enrolled population of 1,393 and a reservation comprising 32,718 acres in Riverside County, located at the base of the San Gorgonio and San Jacinto Mountains. A democratically elected tribal council governs the Tribe.

To manage such a large reservation, the Tribe operates nearly two dozen different departments, including public safety, a fire department, public works, education and an environmental protection department, among others. The public safety and fire departments maintain automatic and mutual aid agreements with their counterparts in neighboring communities and the County.

The Tribe provides infrastructure, roads, clean water, power and wastewater treatment services as well as healthcare for Tribal members and their families. The Tribe funds and operates the tuition-free Morongo School – the first accredited college preparatory academy of its kind on any Indian reservation in the nation. In addition, Morongo pays 100% of the college tuition costs for any Tribal members.

In 1983, the path of Morongo's future changed when tribal members started a modest bingo hall. From this building evolved one of the oldest and most successful Native American casinos in California. The present $250 million destination which opened in late 2004, the Morongo Casino, Resort & Spa, is one of the largest tribal gaming facilities in the nation. The casino offers approximately 2,400 gaming devices and various table games. The resort has 272 guest rooms and 36 suites. In addition, there is a luxurious pool complete with a sandy beach and lazy river. Guests can enjoy various dining and entertainment options.

Morongo also runs the 36-pump Morongo Travel Center, local legend Hadley Fruit Orchards, the Morongo Golf Club at Tukwet Canyon, and Canyon Bowling Lanes at Morongo. Additionally, the Tribe has agreements with Arrowhead Mountain Spring Water, who operates a bottling plant on the Morongo Reservation, and Ruby's Diner.

With its diversification into non-gaming businesses, the Tribe has become the largest private sector employer in the Banning-Beaumont region and is a major contributor to the Coachella Valley economy. The Tribe employs more than 3,000 people. The Tribe pays payroll taxes, unemployment benefits, employee benefits and provides health programs. More than two-thirds of the Morongo workforce is composed of residents from the Banning Pass and desert cities.

The Compact's preamble states, in recognition of the Tribe's fair revenue contribution, the measures that the Tribe already has taken and will take to enhance protections for local governments and the public, and to provide a sound basis for the Tribe's decisions with respect to investment in, and the operation of, its gaming activities and the Tribe's other governmental projects, programs and activities, the State agrees to enter into a new Compact to supersede both the 1999 Compact and the 2006 Compact amendment and the Tribe wishes to reaffirm its pledge to share a portion of its revenues with non-gaming and limited-gaming California Tribes.

Financials of Existing 2006 Compact: Under the existing 2006 Compact, the Tribe is authorized to operate up to 7,500 gaming devices, of which no more than 25 gaming devices may be operated at an auxiliary gaming facility on its tribal lands. The 2006 Compact requires the Tribe to make a flat annual payment to the State of $36,700,000 for the operation of its first 2,000 gaming devices. For the operation of gaming devices above 2,000 and up to 5,000, the Tribe is required to pay 15% of the "Net-Win," as defined. If the Tribe operates more than 5,000 gaming devices, it is required to pay 25% of the "Net-Win" from gaming devices, as defined.

The Tribe is required maintain its existing licenses to operate gaming devices and pay $2 million, annually, into the RSTF. Furthermore, the 2006 Compact provides that the California Gambling Control Commission (CGCC) has the authority to redirect a portion of the Tribe's contributions to the state's General Fund to cover any shortfalls in the RSTF.

Key Provisions of the Compact:

Scope of Class III Gaming Authorized: The Tribe is authorized to operate up to 6,000 gaming devices (slot machines), banking or percentage card games, and any devices or games that are authorized under state law to the California State Lottery, provided that the Tribe will not offer such games through use of the Internet unless others in the state are permitted to do so under state and federal law. The Tribe shall not be prohibited from offering Class II gaming or precluded from negotiating a separate compact governing the conduct of off-track wagering at the Tribe's gaming facility. The Tribe shall not engage in Class III gaming that is not expressly authorized in the Compact.

Authorized Gaming Facility: The Tribe may establish and operate a total of five (5) gaming facilities, in only two of which may the Tribe operate more than 500 gaming devices. The Tribe may engage in Class III gaming only on the Tribe's eligible Indian lands held in trust for the Tribe located within the boundaries of the Tribe's Reservation and certain trust lands on which Class III Gaming lawfully may be conducted under IGRA, as those boundaries exist as of the execution date of this Compact.

Exclusivity: Provides that in the event the exclusive right of Indian tribes to operate Class III gaming in California pursuant to the California Constitution is lost and other non-Indian entities are able to engage in Class III gaming the Tribe shall have the right to terminate this Compact, in which case the Tribe will lose the right to operate Class III gaming authorized by this Compact; or continue under this Compact, as defined.

Tribal Ownership, Management, and Control of Gaming Operation: The gaming operation authorized under this Compact shall be owned solely by the Tribe.

Payments to the Special Distribution Fund: The Compact requires the Tribe to pay its pro-rata share into the SDF to cover the costs incurred by the State in the performance of its regulatory duties based upon the following formula: the maximum number of gaming devices operated in the casino for the previous fiscal year, divided by the maximum number of gaming devices operated by all federally recognized tribes in California pursuant to tribal-state Class III gaming compacts during the previous fiscal year, multiplied by the total costs the State incurs for the performance of all its duties under this Compact, equals the Tribe's pro rata share.

If the Tribe's payment to the SDF, as calculated by the "pro-rata formula," totals less than $3 million per year, the Tribe will pay the difference in order to assist in maintaining the solvency of the SDF during periods when the number of tribes making pro-rata share payments is insufficient. In the event the pro-rata funding for the SDF statewide has proven sufficient to meet its stated purposes for three consecutive years, the State and Tribe will agree to meet and confer for the purpose of negotiating an appropriate reduction in the additional SDF payment. Any increases in the pro-rata share are caped at no more than 5% of the Tribe's previous year pro-rata payment.

Payments to the RSTF or the TNGF: The Tribe shall pay the following amounts annually to the State Gaming Agency for deposit into the Revenue Sharing Trust Fund or the Tribal Nation Grant Fund:

This Compact will make the Tribe one of the largest contributors to the RSTF and the TNGF ($9-11 million per year), which directs revenue to non-gaming and limited gaming tribes so that the economic benefits of gaming reach all tribal governments within California.

All payments made by the Tribe to the CGCC shall be deposited into the RSTF and the TNGF in a proportion to be determined by the Legislature. If there are insufficient funds in the RSTF to pay the required $1.1 million per year to each eligible non-gaming and limited-gaming tribe, the CGCC shall deposit the payments only into the RSTF.

Local Community Benefit Fund: The Compact provides for the establishment of the, "Local Community Fund," into which the Tribe shall make monthly payments of $1.25 million, totaling $15 million per year. If the above-mentioned Rainey Day Fund contains a balance of $100 million – the Tribe is required to make an additional payment of $7.5 million into the Local Community Fund.

The Local Community Benefit Fund is administered by the Tribe and may be used for the following purposes:

1. Payments by the Tribe to the County, local jurisdictions and/or the California Department of Transportation operating facilities or providing services within the County for purposes of improved fire, law enforcement, public transit, education, tourism, or non-profit or civic organizations operating facilities or providing services within the County, for cultural programs, emergency and routine medical services, problem gambling assistance programs, youth athletics and other youth programs, and other services and infrastructure improvements that serve off-reservation needs of County residents as well as those of the Tribe;
2. The cost of services provided by the Tribe or payments made by the Tribe, to the County, the City of Banning, other local jurisdictions, and State agencies, for purposes of financing infrastructure projects.
3. To promote continued economic growth that benefits the Tribe and the surrounding community through investments in facilities, infrastructure, or other projects that generate sustained job creation and ensure the financial longevity of the Tribe. The Tribe may utilize up to 20% of the monies in the Fund annually for the purpose of serving any of its debt that is secured, in whole or in part, by the revenues or other assets of the gaming operation;
4. Investments by the Tribe, and any funds paid to the State in water treatment or conservation projects;
5. Non-gaming related capital investments and economic development projects by the Tribe that provide mutual benefits to the Tribe and the State that provide particular cultural, social, or environmental value, or diversify the sources of revenue for the Tribe's general fund;
6. Investments by the Tribe in connection with renewable energy projects that serve the gaming facility or the Tribe's reservation;
7. Payments to support capital improvements and operating expenses for facilities within California that provide health care services to tribal members, Indians, and non-Indians;
8. Grants to Native Americans who are not members of the Tribe, or grants to other federally-recognized tribes, for educational, cultural, or vocational purposes, or for governmental or general welfare purposes;
9. Investments, loans, or other financial obligations including actual payments used to secure loans, to or for the benefit of other California federally recognized tribes; and
10. Costs of recycling programs, and any improvements incorporating recycling technology, that in part, serve the gaming facility, or other on- or off-reservation needs within the County.

The Tribe is required to provide the State a report of annual contributions to and expenditures from the Local Community Benefit Fund. The reporting will include sufficient detail to enable both parties to ensure that the funds are being used in a manner consistent with the purposes of this Compact.

Tribal "Rainy Day" Fund: The Tribe agrees to establish a "Rainy Day Fund" to serve as a buffer against either or both periodic adverse fluctuations in tribal revenues or severe long-term reductions in tribal revenues due to changes in the law or market conditions. As such, the Tribe, from revenue derived generated by the Morongo Casino Resort and Spa, shall contribute $1 million per month in each of the first 10-months of each calendar year, until such time as the fund contains $100 million. The Compact requires stringent accounting standards for the Rainy Day Fund. It and provides specific criteria and procedures for disbursement from the Fund and replenishment thereof. A Certified Public Accountant licensed to practice in the State of California shall audit the Rainy Day Fund annually.

The creation of this Rainy Day Fund is unique to the Morongo Compact. No other tribal-state compacts provide for such an allocation.

Additional Compact Components:

Gaming Ordinance and Regulations: All gaming activities conducted under this Compact shall, at a minimum, comply with: 1) a gaming ordinance duly adopted by the Tribe and approved in accordance with IGRA, 2) all rules, regulations, procedures, specifications, and standards duly adopted by the National Indian Gaming Commission (NIGC), the Tribal Gaming Agency, and the California Gambling Control Commission (CGCC), and 3) the provisions of this Compact, as specified.

Licensing Requirements and Procedures: All persons in any way connected with the gaming operation or gaming facility who are required to be licensed or to submit to a background investigation under IGRA, and any others required to be licensed under this Compact, including, without limitation, all gaming employees, gaming resource suppliers, financial sources, and any other person having a significant influence over the gaming operation, must be licensed by the Tribal Gaming Agency and cannot have had any determination of suitability denied or revoked by the Commission. In addition, every gaming employee must obtain, and thereafter maintain current, a valid tribal gaming license, as specified.

Minimum Internal Control Standards: The Compact requires the Tribe to conduct its gaming activities pursuant to an internal control system that implements MICS that are no less stringent than specified MICS of the NIGC. It requires gaming to operate pursuant to a written internal control system that reasonably assures that assets are safeguarded and accountability over assets is maintained, liabilities are properly recorded and contingent liabilities are properly disclosed, financial records are accurate and reliable, transactions are performed in accordance with the Tribe's authorization.

The Tribe is required to provide to the CGCC, upon written request, a copy of the independent certified public accountant agreed-upon procedures report conducted annually for submission to the NIGC pursuant to federal law. This report verifies that the gaming operation complies with the NIGC's minimum internal control standards.

Patron Disputes: The Tribal Gaming Agency must promulgate regulations governing patron disputes over the play or operation of any game; including any refusal to pay to a patron any alleged winnings from any gaming activities that includes specified minimum standards.

A patron must make a written complaint to personnel of the Gaming Operation over the play or operation of any game within seven days of the play. The Gaming Operation must provide the patron with a written decision within 15 days of receipt of the initial complaint, and must provide written notice of the patron's right to request resolution of the dispute by the Tribal Gaming Agency if the Initial Complaint is not resolved to the patron's satisfaction. The patron must make the request to the Tribal Gaming Agency within 15 days of receiving the Gaming Operation's written notice.

Public and Workplace Liability: Requires the Tribe to obtain and maintain a commercial general liability insurance policy that provides coverage of no less than $10 million. The Tribe must adopt a Tort Liability Ordinance stipulating that California tort law governs claims. The Tribe must consent to jurisdiction in the Tribe's tribal court system, once a tribal court system is established, or before a three-member tribal claims commission.

Any party dissatisfied with the award of the tribal venue may invoke the JAMS Optional Arbitration Appeal Procedure. The appeal will be based solely on the record developed in the tribal court or tribal claims commission proceedings. Factual determinations will not be set aside if supported by substantial evidence. The cost and expenses of arbitration shall be initially borne equally by the parties but the JAMS arbitrator shall award to the prevailing party its costs and expenses (but no attorney fees). The Tribe consents to the jurisdiction of the tribal court, tribal claims commission, JAMS Optional Appeal Procedure and any action to enforce their judgments or the obligations in this section.

Environmental Protections: The Tribe must prepare a Tribal Environmental Impact Report (TEIR) and negotiate mitigation of any off-reservation impacts, including an evaluation of energy efficiency, prior to initiating the development of a project for a facility. The Compact provides procedures regarding the (1) Notice of Preparation of Draft TEIR, (2) Notice of Completion of Draft TEIR, and (3) Issuance of Final TEIR.

The Tribe's failure to prepare an adequate TEIR when required may warrant an injunction where appropriate. Before commencement of a Project, and no later than the issuance of the final TEIR, the Tribe shall negotiate an intergovernmental agreement with the California Department of Transportation if state roads are impacted.

A binding agreement must also be negotiated with Imperial County to, amongst other things, provide for the timely mitigation of any significant effect on the off-reservation environment. This includes provisions relating to compensation for law enforcement, fire protection, emergency medical services and any other public services to be provided by the County to the Tribe as a consequence of the project.

Health and Safety Standards: The Tribe has agreed to comply with federal water quality and safe drinking water standards applicable in California. The Tribe has agreed to adopt and comply with tribal health standards for food and beverage handling that is no less stringent than State public health standards. The Tribe must also adopt and comply with federal and state laws forbidding harassment, including sexual harassment, discrimination and retaliation.

Building Codes and Fire Safety: In order to assure the protection of the health and safety of all gaming facility patrons, guests, and employees, the Tribe shall adopt and shall maintain throughout the term of this Compact, an ordinance that requires any covered gaming facility construction to meet or exceed the applicable codes. Gaming facility construction, expansion, improvement, modification or renovation must also comply with the federal Americans with Disabilities Act.

Emergency Services Accessibility: The Tribe must make reasonable provisions for adequate emergency fire, medical, and related relief and disaster services for patrons and employees.

Enhanced Audit and Compliance Review Procedures: In addition to providing for an annual independent audit, the Compact allows the state to conduct its own annual audit and compact compliance review of the gaming operation, gaming facility, and gaming activities to ensure compliance with all provisions of this Compact.

Inspection and Testing of Slot Machines: Gaming devices will have to be tested, approved and certified by an independent gaming test laboratory or state governmental gaming test laboratory to ensure they are being operated according to specified technical standards. Also, requires the CGCC to maintain adequate records that demonstrate compliance with software and hardware specifications. The CGCC would be authorized to annually conduct up to four random inspections of slot machines in operation to confirm that the slot machines are operating in conformance with these standards.

Labor Provisions: Provides that the gaming activities authorized by this Compact may only commence after the Tribe has adopted an ordinance identical to the Tribal Labor Relations Ordinance (TRLO) provided for in the Appendix of the Compact, and the gaming activities may only continue as long as the Tribe maintains the ordinance. If the Tribe employs 250 or more persons in a tribal casino facility, then the provisions of the TLRO become effective. The TLRO provides for a secret ballot election.

The TLRO provides for union neutrality. The Tribe will not oppose union but can advocate the benefits of working for the Tribe. A union must issue a Notice of Intent or Organize (NOIO). For a period of 365 days following delivery of a NOIO, the union shall not engage in strikes, picketing, boycotts, attack websites, or other economic activity at or in relation to the tribal casino or related facility. During the 365 days after the Tribe received the NOIO, the union must collect dated and signed authorization cards and complete the secret ballot election. Failure to complete the secret ballot election within 365 days shall preclude the union from delivering another NOIO for a period of 730 days.

After the certification that 30% of the employees have expressed an interest in the union, a notice of election shall be issues and the election shall be concluded within 30 calendar days thereafter. Secret ballot elections shall be held at workplace and at least one neutral location. Employee may mail ballots so long as received by election day. Union representation requires an affirmative vote of 50% plus one of all votes cast.

Mediation for any collective bargaining agreement impasse shall be resolved exclusively through the binding dispute resolution by three members of the Tribal Labor Panel, consisting of ten arbitrators appointed by a mutual selection of the parties. However, if arbitrator schedules cannot be coordinated within 30 days of submission, a single arbitrator shall decide the dispute. The arbitrators will generally follow the American Arbitration Association's procedural rules relating to labor dispute resolution.

Workers' Compensation: The Tribe agrees to participate in the state's workers' compensation program with respect to employees at the casino. All disputes arising from the workers' compensation laws shall be heard by the State Workers' Compensation Appeals Board pursuant to the California Labor Code.

In lieu of participating in the State's workers' compensation system, the Tribe may create and maintain a system that provides redress for employee work-related injuries through requiring insurance or self-insurance, which system must include a scope of coverage, provision of up to $10,000 in medical treatment for an alleged injury until the date that liability for the claim is accepted or rejected.

Furthermore, the Tribe agrees that it will participate in the state's unemployment compensation program for providing benefits and unemployment compensation disability benefits to employees at the casino. The Tribe shall withhold all taxes due to the state, except for Tribal members living on the Tribe's reservation, and forward such amounts to the state.

Possession of Firearms: The possession of firearms by any person in the gaming facility is prohibited at all times, except for federal, state, or local law enforcement personnel, or tribal law enforcement or security personnel authorized by tribal law and federal or state law to possess firearms at the gaming facility.

Prohibitions Regarding Minors: The Tribe shall prohibit persons under the age of 18 years from being present in any room or area in which gaming activities are being conducted unless the person is en route to a non-gaming area of the gaming facility. If the Tribe permits the consumption of alcoholic beverages in the gaming facility, the Tribe shall prohibit persons under the age of 21 years from purchasing, consuming, or possessing alcoholic beverages. The Tribe shall also prohibit persons under the age of 21 years from being present in any room or area in which alcoholic beverages may be consumed, except to the extent permitted by the terms of the State Department of Alcoholic Beverage Control license(s) applicable to the gaming facility.

Alcoholic Beverage Service: The Compact makes it explicit that the purchase, sale, and service of alcoholic beverages shall be subject to State law. The Tribe shall prohibit persons under the age of 21 years from purchasing, consuming, or possessing alcoholic beverages.

Problem Gambling: The gaming operation must establish a program, approved by the Tribal Gaming Agency, to mitigate pathological and problem gaming by implementing specified measures.

Tobacco Provisions: The Tribe agrees to provide a non-smoking area in the gaming facility and to utilize a ventilation system throughout the gaming facility that exhausts tobacco smoke to the extent reasonably feasible. The Tribe agrees not to offer or sell tobacco or e-cigarettes to anyone younger 21 years of age.

Amendment by Agreement: The terms and conditions of the Compact may be amended at any time by the mutual and written agreement of both parties, provided that each party voluntarily consents to such negotiations in writing. Any amendments to the Compact shall be deemed to supersede, supplant and extinguish all previous understandings and agreements on the subject.

Effective Date: The Compact shall not be effective unless and until all of the following have occurred: (a) the Compact is ratified by statute in accordance with state law and, (b) notice of approval or constructive approval is published in the Federal Register. Once effective, this Compact shall be in full force and effect until 25 years (2042) following the effective date.

Additional Background Information:

Compact Ratification: The State Constitution, as amended by Proposition 1A of March 2000, permits Indian tribes to conduct and operate slot machines, lottery games, and banked and percentage card games on Indian land. These gambling activities shall only occur if:

1. The Governor and an Indian tribe reach agreement on a compact;
2. The Legislature approves the compact, and
3. The federal government approves the compact.

The Governor is the designated State officer responsible for negotiating and executing, on behalf of the State, Tribal-State gaming compacts with federally recognized Indian tribes located within the State of California. Following completion of negotiations, the Governor shall submit a copy of any executed Tribal-State compact to both houses of the Legislature for ratification and shall submit a copy of the executed compact to the Secretary of State. The Compact provides that it shall not be presented to the Legislature for a ratification vote until the Tribe has provided the written proof and will provide written proof to the Governor the tribal governing body has ratified it.

The Federal Indian Gaming Regulatory Act (IGRA) of 1988: In 1988, Congress enacted the Indian Gaming Regulatory Act (IGRA) to provide a statutory basis for the operation and regulation of gaming on Indian lands. IGRA provides that an Indian tribe may conduct gaming activity on Indian lands if the activity "is not specifically prohibited by federal law and is conducted within a State which does not prohibit such gaming activity."

IGRA distinguishes between three classes of gaming (Class I, Class II, and Class III) and provides for different forms of regulation for each class. Class I gaming includes "social games" for minor prizes or "traditional forms of Indian gaming." Class II gaming is defined to include bingo and card games that are explicitly authorized by the laws of the state, or that are not explicitly prohibited by the laws of the state and are played at any location in the State, so long as the card games are played in conformity with those laws and regulations. Class III gaming includes such things as slot machines, casino games and banked card games such as black jack and baccarat. Class III gaming may only be conducted under terms of a compact negotiated between an Indian tribe and a State.

IGRA was enacted against a legal background in which Indian tribes and individuals generally are exempt from state taxation within their own territory. IGRA provides that with the exception of assessments permitted under the statute, to defray the State's costs of regulating gaming activity, IGRA shall not be interpreted as conferring upon a State authority to impose any tax, fee, charge, or other assessment upon an Indian tribe to engage in Class III activity. Nor may a State refuse to enter into negotiations based on the lack of authority to impose such a tax, fee, charge, or other assessment.

When a tribe requests negotiations for a Class III compact, IGRA requires the State to negotiate with the Indian tribe in good faith. IGRA provides a comprehensive process to prevent an impasse in compact negotiations, which is triggered when a tribe files suit alleging that the State has refused to negotiate or has failed to negotiate in good faith.

Rincon Decision: In 2004, the Rincon Band of Mission Indians sued the State in federal court after negotiations for a new gambling agreement with then-Governor Schwarzenegger came to a standstill. The Tribe believed the Governor was violating federal law by insisting that tribes pay money into the state's General Fund in exchange for more slot machines.

In July 2011, the United States Supreme Court declined to review a Ninth Circuit Court's decision that ruled the state could not require the Rincon Band tribe to pay a percentage of slot machine revenue into California's General Fund for more gaming devices. The Ninth Circuit had affirmed a lower court decision that the new financial concessions were nothing more than a state tax on tribal casino revenues, which is prohibited by IGRA. The court concluded that a "non-negotiable, mandatory payment of 10% of net win into the State treasury for unrestricted use yields public revenue and is [therefore] a tax and that the court was therefore required to consider the State's demand as evidence of bad faith under IGRA's statutes."

The Rincon decision has changed the dynamics of tribal-state compact negotiations in California.

Special Distribution Fund: Existing law creates the SDF in the State Treasury for the receipt of revenue contributions made by tribal governments pursuant to the terms of the 1999 model Tribal-State Gaming compacts and authorizes the Legislature to appropriate money from the SDF for the following purposes: 1) grants for programs designed to address gambling addiction; 2) grants for the support of state and local government agencies impacted by tribal government gaming; 3) compensation for regulatory costs incurred by CGCC and the DOJ in connection with the implementation and administration of compacts; 4) payment of shortfalls that may occur in the Indian Gaming RSTF; 5) disbursements for the purpose of implementing the terms of tribal labor relations ordinances promulgated in accordance with the terms of the 1999 compacts; and, 6) any other purpose specified by law. The distribution formula "sunsets" on January 1, 2021.

Revenue Sharing Trust Fund: Existing law also creates in the State Treasury the RSTF for the receipt and deposit of moneys derived from gaming device license fees that are paid into the RSTF pursuant to the terms of specified tribal-state gaming compacts for the purpose of making distributions to non-compacted tribes (e.g., federally-recognized non-gaming and tribes that operate casinos with fewer than 350 slot machines). Revenue in the RSTF is available to CGCC, upon appropriation by the Legislature, for making distributions of $1.1 million annually to non-compact tribes. The RSTF was created as part of the 1999 compacts, which, in conjunction with the passage of Proposition 1A (2000), created gaming compacts with approximately 60 California tribes. Non-compact tribes are considered third-party beneficiaries of the 1999 compacts.

Tribal Nation Grant Fund: The TNGF was created in the Graton Rancheria compact (AB 517 (Hall), Chapter 12, Statutes of 2012), as a new destination for gaming revenue for distribution of funds to non-gaming and limited-gaming tribes, upon application of such tribes for purposes related to effective self-governance, self-determined community, and economic development. The fund is designed to be fluid and payments are intended to be made to non-gaming tribes on a "need" basis, upon application by non-gaming tribes. The TNGF currently does not receive funding.

Related legislation: SB 6 (Hueso) of the current legislative session would ratify the amendment to the tribal-state gaming compact entered into between the State of California and the Quechan Tribe of the Fort Yuma Indian Reservation, executed on August 31, 2017.

SB 626 (Dodd) of the current legislative session would ratify the amendment to the tribal-state gaming compact entered into between the State of California and the Federated Indians of Graton Rancheria, executed on August 18, 2017.

SB 585 (Mendoza) of the current legislative session would ratify the amendment to the tribal-state gaming compact entered into between the State of California and the Dry Creek Rancheria Band of Pomo Indians, executed on August 18, 2017.

AB 174 (Bigelow) of the current legislative session would ratify the tribal-state gaming compact entered into between the State of California and the United Auburn Indian Community, executed on August 18, 2017.

AB 253 (Bigelow) of the current legislative session would ratify the tribal-state gaming compact entered into between the State of California and the Tuolumne Band of Me-Wuk Indians, executed on August 18, 2017.

AB 394 (Mathis) of the current legislative session would ratify the tribal-state gaming compact entered into between the State of California and the Tule River Indian Tribe of California, executed on August 31, 2017.

AB 1606 (Cooper) of the current legislative session would ratify the tribal-state gaming compact entered into between the State of California and the Wilton Rancheria, executed on July 19, 2017.

AB 1378 (Gray) of the current legislative session would ratify an amendment to the tribal-state gaming compact entered into between the State of California and the San Manuel Band of Mission Indians, executed on August 18, 2017.

Prior legislation: SB 175 (Ducheny), Chapter 38, Statutes of 2007, ratified the first compact amendment to the compact between the State of California and Morongo

Proposition 1A (Adopted by the People of California on March 7, 2000) modified the prohibition against casinos and lotteries in the California Constitution to authorize the Governor to negotiate compacts, subject to legislative ratification, for the operation of slot machines, lottery games, and banking and percentage card games by federally recognized Indian tribes on Indian lands in California, in accordance with federal law. Authorized slot machines, lottery games, and banking and percentage card games to be conducted and operated on Indian lands subject to the compacts.

AB 1385 (Battin), Chapter 874, Statutes of 1999, designated the Governor as the state officer responsible for negotiating and executing compacts between the state and federally recognized Indian tribes located in the state. Also, ratified 57 compacts and created two special funds in the State Treasury (SDF and RSTF), as specified.

Proposition 5 (Adopted by the People of California on November 3, 1998) specified the terms and conditions of mandatory compacts between the State and tribal governments for class III gambling on Indian lands; amended California law to allow slot machines and banked card games at tribal casinos; provided for contributions to trust funds benefiting non-gaming tribes, statewide emergency medical care programs, and programs benefiting communities near tribes; and, allowed tribes to retain a monopoly on authorized gambling. Proposition 5 was found to be unconstitutional because it amended a provision of the Government Code and did not amend the Constitution. The proposition was invalidated in its entirety, save the final sentence of Government Code Section 98005, containing the state's consent to federal suits brought by California tribes pursuant to IGRA.

SB 287 (Burton), Chapter 409, Statutes of 1998, ratified 11 compacts negotiated between the State of California and Indian tribes that permitted class III video gaming devices on tribal lands and established a process for ratifying other compacts.

Analysis Prepared by: Eric Johnson / G.O. / (916) 319-2531 FN: 0002333

 THIRD READING  

Bill No: AB 891

Author:

:

Vote:

PRIOR VOTES NOT RELEVANT

NOTE: On September 12, 2017, the Senate Governmental Organization Committee held an informational hearing on the tribal-state gaming compact between the State of California and the Morongo Band of Mission Indians, executed on September 6, 2017.

SUBJECT:

SOURCE: Author

DIGEST:

The bill ratifies the tribal-state compact (Compact) entered into between the State of California and the Morongo Band of Mission Indians (hereafter “Tribe”) executed on September 6, 2017.

ANALYSIS:

Existing law:

1. Provides, under the Indian Gaming Regulatory Act (IGRA), for the negotiation and conclusion of compacts between federally recognized Indian tribes and the State for the purpose of conducting Class III gaming activities on Indian lands within a State as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments.
2. Authorizes expressly a number of tribal-state gaming compacts between the State of California and specified Indian tribes.
3. Authorizes the conduct of Class III gaming activities to the extent such activities are permitted by state law, a gaming compact has been concluded by the federally recognized tribe and the State, and the compact has been approved by the Secretary of the Interior.
4. Limits the operation of Class III gaming activities to Indian lands acquired on or before October 17, 1988. Provides for certain exceptions to conduct gaming activities on Indian lands acquired after October 17, 1988.
5. Defines “Indian lands” to mean all lands within the limits of any Indian reservation, and any lands title to which is either held in trust by the United States for the benefit of any Indian tribe, or individual, or held by any Indian tribe or individual subject to restriction by the U.S. against alienation and over which an Indian tribe exercises governmental power.
6. Requires the State to negotiate to conclude a compact in good faith with an Indian tribe having jurisdiction over the Indian lands upon which the Class III gaming activity is to be conducted. Provides the U.S. district courts with jurisdiction over any cause of action initiated by a tribal government alleging that the State failed to negotiate in good faith to conclude a compact. Prescribes the remedy, mediation supervised by the courts, if it is found that the State failed to negotiate in good faith to conclude a compact.
7. Authorizes the Governor, under the California Constitution, to negotiate and conclude compacts, subject to ratification by the Legislature.

This bill:

1. Ratifies the Compact between the State of California and the Tribe executed on August 31, 2017.
2. Provides that in deference to tribal sovereignty, certain actions are not deemed projects for purposes of the California Environmental Quality Act (CEQA).
3. Stipulates, except as expressly provided, that none of the provisions shall be construed to exempt a city, county, or city, and county, or the Department of Transportation, or any state agency or local jurisdictions, from CEQA requirements.
4. Contains an urgency clause.

Background

The Compact between the State of California and the Tribe was executed on September 6, 2017.

The Compact authorizes the Tribe to operate a maximum of 6,000 slot machines at no more than five gaming facilities located on eligible Indian lands held in trust for the Tribe, and located within the boundaries of the Tribe’s reservation. The Tribe can only operate more than 500 slot machines at two of the five gaming facilities.

The Tribe has agreed to pay the State its pro rata share of costs the State incurs for the performance of its duties under the Compact. The Tribe will pay between $9-$11 million into the Revenue Sharing Trust Fund (RSTF) or the Tribal Nation Trust Fund (TNGF), depending on the number of slot machines the Tribe operates.

The Compact requires the Tribe to establish a Local Community Benefit Fund and requires the Tribe to make monthly payments of $1.25 million, totaling $15 million per year. Funds may be used for various purposes benefiting the local community, including fire, law enforcement, public transit, education, tourism, health services, youth program, educational programs, recycling programs, water conservation and cultural programs.

The Tribe has agreed to establish a “Rainy Day Fund” to serve as a buffer against either or both periodic adverse fluctuations in tribal revenues or severe long-term reductions in tribal revenues due to changes in the law or market conditions. The Compact requires the Tribe to contribute $1 million dollars during the first 10 months of each calendar year, until such time as $100 million has been contributed to the Rainy Day Fund.

According to the Governor’s Office, certain terms of the Compact related to regulatory, labor, environmental protection, public health, and safety provisions are similar to those in recent compacts.

The Compact’s preamble notes that the State and the Tribe have concluded that the terms of this new Compact will fairly compensate the State for its regulatory activities, protect the long-term governmental interests of the Tribe and the California public, and promote and secure long-term tribal socio-economic stability, mutual respect among the Tribe, the State and surrounding non-Tribal communities, and other mutual benefits.

The Tribe has a total enrolled population of approximately 1,400 and a reservation comprising approximately 37,000 acres in Riverside County (County). The Tribe currently operates the Morongo Casino, Resort & Spa which currently provides approximately 2,400 slot machines, more than 100 table games, a hotel, and various restaurants. According to the Tribe, they provide nearly 3,000 local jobs, making the Tribe one of the largest employers in the County

Once effective (legislative ratification and federal approval required), this Compact will be in full force and effect for 25 years following the effective date.

Brief History of the Morongo Band of Mission Indians. Established in 1865, the Morongo Indian Reservation, located in Riverside County, California, was one of nine small reservations created by President Ulysses S. Grant by executive order in 1876.  In 1983, the path of Morongo's future changed when tribal members started a modest bingo hall. From this building evolved one of the oldest and most successful Indian gaming facilities in California. The present $250 million destination which opened in late 2004, the Morongo Casino, Resort & Spa, is one of the largest tribal gaming facilities in the nation.

The Tribe has a total enrolled population of approximately 1,400 and a reservation comprising approximately 37,000 acres of land in the County, making it the third largest reservation in California. To manage such a large reservation, the Tribe operates approximately 24 different departments, including, public safety, a fire department, public works, education and an environmental protection department, among others. The Tribe’s public safety and fire departments maintain automatic and mutual aid agreements with the Tribe’s neighboring communities and the County.

According to the Tribe, the Tribe provides infrastructure, roads, clean water, and power and waste-water treatment services. The Tribe also provides healthcare for Tribal members and their families, as well as social services. The Tribe fully funds and operates the tuition free Morongo School, which is the first accredited college preparatory academy of its kind on any Indian Reservation in the nation. The Tribe also pays 100% of the college tuition costs for any tribal member that decides to pursue higher education. For the past 12 years, the Tribe has provided over $450,000 in college scholarships to Native American youth form other tribes in California.

As previously noted, the Tribe currently operates the Morongo Casino, Resort & Spa. Today, the Tribe provides nearly 3,000 jobs, making the Tribe one of the largest employers in the County.

The Tribe also runs the 36-pump Morongo Travel Center, Hadley Fruit Orchards, and the Morongo Golf Club at Tukwet Canyon. Additional, the Tribe has agreements with Arrowhead Mountain Spring Water, who operates a bottling plant on the Morongo Reservation, and Ruby’s Diner.

KEY PROVISIONS OF THE COMPACT

Scope of Class III Gaming Authorized. The Tribe is authorized to operate up to 6,000 slot machines, banking or percentage card games, and any devices or games that are authorized under state law to the California State Lottery, provided that the Tribe will not offer such games through use of the Internet unless others in the state not affiliated with or licensed by the California State Lottery are permitted to do so under state and federal law. The Tribe shall not engage in Class III Gaming that is not expressly authorized in the Compact.

Authorized Gaming Facility. The Tribe may establish and operate a total of five gaming facilities, in only two of which may the Tribe operate more than 500 slot machines. Class III gaming can only occur on eligible Indian lands held in trust for the Tribe, located within the boundaries of the Tribe’s reservation. The Tribe currently operates approximately 2,400 slot machines pursuant to their 2006 tribal-state compact

Payments to the Special Distribution Fund (SDF). The Tribe shall pay to the State, on a pro rata basis, the costs the State incurs for the performance of all its duties under this Compact, as established by the monies appropriated in the annual Budget Act for the performance of their duties under the Class III Gaming Compacts. The Compact includes a provision that provides that if the foregoing payments the Tribe pays into the SDF total less than $3 million dollars per year, the Tribe will pay the difference between such payments and $3 million dollars per year to assist in attaining solvency of the SDF during periods in which the number of tribes making pro rata share payments may be insufficient.

Payments to the RSTF or the TNGF. The Tribe shall pay the following amounts annually to the RSFT or the TNGF:

Local Community Benefit Fund. The Compact establishes the “Local Community Benefit Fund,” managed by the Tribe, and requires the Tribe to make monthly payments of $1.25 million, totaling $15 million per year. In addition, if the Tribe does not make a payment of $1 million dollars into the Rainy Day Fund (see below) during the first 10 months of the calendar year due to the Rainy Day Fund already having $100 million dollars, the Tribe is require to make an additional payment of $750,000 into the Local Community Fund. The Tribe is required to provide the State a report of annual contributions to and expenditures from the Local Community Benefit Fund. The reporting will include sufficient detail to enable both parties to ensure that the funds are being used in a manner consistent with the purposes of this compact.

Tribal “Rainy Day” Fund. The Tribe has agreed to establish a “Rainy Day Fund” to serve as a buffer against either or both periodic adverse fluctuations in tribal revenues or severe long-term reductions in tribal revenues due to changes in the law or market conditions. The Tribe shall, in each of the first 10 months of each calendar year, until such time as $100 million has been contributed, contribute $1 million to the Rainy Day Fund. The Compact provides for specified criteria by which the funds can be used.

ADDITIONAL COMPACT COMPONENTS

Prohibitions Regarding Minors. The Tribe shall prohibit persons under the age 18 years from being present in any room or area in which gaming activities are being conducted unless the person is en route to a non-gaming area of the gaming facility, or is employed at the gaming facility in a capacity other than as a gaming employee. If the Tribe permits the consumption of alcoholic beverages in the Gaming Facility, the Tribe shall prohibit persons under the age of 21 from purchasing, consuming, or possessing alcoholic beverages. The Tribe shall also prohibit persons under the age of 21 from being present in any room or area in which alcoholic beverages may be consumed.

Licensing Requirements and Procedures. All persons in any way connected with the gaming operation or gaming facility who are required to be licensed or to submit to a background investigation under IGRA, and any others required to be licensed under this Compact, including, without limitation, all gaming employees, gaming resource suppliers, financial sources, and any other person having a significant influence over the gaming operation, must be licensed by the Tribal Gaming Agency. Also, every gaming employee must obtain, and thereafter maintain current, a valid tribal gaming license, as specified.

Problem Gambling. The gaming operation must establish a program, approved by the Tribal Gaming Agency, to mitigate pathological and problem gaming by implementing specified measures.

Patron Disputes. The Tribal Gaming Agency must promulgate regulations governing patron disputes over the play or operation of any game, including any refusal to pay to a patron any alleged winnings from any gaming activities that includes specified minimum standards.

Environmental Protections. The Tribe is required to prepare a comprehensive and adequate tribal environmental impact report (TEIR), analyzing the potentially significant off-reservation environmental impacts of the project. The TEIR is required to provide detailed information about the significant effects on the environment that the project is likely to have and shall include a detailed statement of specified information. The Compact provides procedures regarding the Notice of Preparation of Draft TEIR, Notice of Completion of Draft TEIR, and Issuance of Final TEIR. The Tribe is also required to negotiate with the County and shall enter into enforceable written agreements with the county with specified information on the timely mitigation of any significant effect on the environmental, compensation for law enforcement, fire protection, emergency medical services, and mitigation of any effect on public safety attributable to the project.

Tobacco Provisions. The Tribe agrees to provide a non-smoking area in the gaming facility and, consistent with the Tribe’s commitment to the well-being of its employees and patrons, to incorporate ventilation, filtration, purification or other technologies throughout the gaming facility, where reasonable and feasible after consideration of engineering, economic and scientific factors, and further agrees not to offer or sell tobacco to anyone under 21 years of age within the gaming facility.

Labor Provisions. Provides that the gaming activities authorized by this Compact may only commence after the Tribe has adopted an ordinance identical to the Tribal Labor Relations Ordinance (TRLO), referenced as Appendix B of the Compact, and the gaming activities may only continue as long as the Tribe maintains the ordinance. If the Tribe employs 250 or more persons in a tribal casino facility, then the provisions of the TLRO become effective. The TLRO provides for a secret ballot election and union neutrality. After the certification that 30% of the eligible employees in a bargaining unit have expressed an interest in the union, a notice of election shall be issued and the election shall be concluded within 30 calendar days thereafter. Employees may mail in ballots provided they are received by election day. Union representation requires an affirmative vote of 50% plus one of all votes cast.

Effective Date. This Compact shall not be effective unless and until all of the following have occurred: the Compact is ratified by statute in accordance with state law and notice of approval or constructive approval is published in the Federal Register. Once effective, this Compact shall be in full force and effect for 25 years following the effective date.

Amendment by Agreement. The terms and conditions of this Compact may be amended at any time by the mutual and written agreement of both parties, provided that each party voluntarily consents to such negotiations in writing. Any amendments to this Compact shall be deemed to supersede, supplant and extinguish all previous understandings and agreements on the subject.

ADDITIONAL BACKGROUND INFORMATION

Indian Gaming Regulatory Act. In 1988, Congress enacted IGRA to provide a statutory basis for the operation and regulation of gaming on Indian lands. IGRA provides that an Indian tribe may conduct gaming activity on Indian lands if the activity “is not specifically prohibited by federal law and is conducted within a State which does not prohibit such gaming activity.”

IGRA distinguishes between three classes of gaming (Class I, Class II, and Class III) and provides for different forms of regulation for each class. Class I gaming includes “social games” for minor prizes or “traditional forms of Indian gaming.” Class II gaming is defined to include bingo and card games that are explicitly authorized by the laws of the state, or that are not explicitly prohibited by the laws of the state and are played at any location in the State, so long as the card games are played in conformity with those laws and regulations. Class III gaming includes such things as slot machines, casino games, and banked card games such as black jack and baccarat. Class III gaming may only be conducted under terms of a compact negotiated between an Indian tribe and a State.

IGRA was enacted against a legal background in which Indian tribes and individuals generally are exempt from state taxation within their own territory. IGRA provides that with the exception of assessments permitted under the statute, to defray the State’s costs of regulating gaming activity, IGRA shall not be interpreted as conferring upon a State authority to impose any tax, fee, charge, or other assessment upon an Indian tribe to engage in Class III activity. Nor may a State refuse to enter into negotiations based on the lack of authority to impose such a tax, fee, charge, or other assessment.

When a tribe requests negotiations for a Class III compact, IGRA requires the State to negotiate with the Indian tribe in good faith. IGRA provides a comprehensive process to prevent an impasse in compact negotiations, which is triggered when a tribe files suit alleging that the State has refused to negotiate or has failed to negotiate in good faith.

Before 2000, the California Constitution prohibited Class III gaming. In 2000, California voters approved Proposition 1A, which had been proposed by the Governor and passed by the Legislature. Proposition 1A amended the California Constitution to permit the State to negotiate compacts with federally recognized Indian tribes for certain Class III gaming activities. Because non-Indian parties were still forbidden from operating gaming facilities, Proposition 1A granted Indian tribes a “constitutionally protected monopoly on most types of Class III games in California.”

Special Distribution Fund. Existing law creates the SDF in the State Treasury for the receipt of revenue contributions made by tribal governments pursuant to the terms of the 1999 model Tribal-State Gaming Compacts and authorizes the Legislature to appropriate money from the SDF for the following purposes: grants for programs designed to address gambling addiction; grants for the support of state and local government agencies impacted by tribal government gaming; compensation for regulatory costs incurred by the CGCC and DOJ in connection with the implementation and administration of compacts; payment of shortfalls that may occur in the RSTF; disbursements for the purpose of implementing the terms of tribal labor relations ordinances promulgated in accordance with the terms of the 1999 compacts; and, any other purpose specified by law. (Pursuant to compact renegotiations that took place with several of the larger gaming tribes during the Schwarzenegger administration, revenue from those tribes is directed into the state General Fund, instead of the SDF.)

Current law establishes a method of calculating the distribution of appropriations from the SDF for grants to local government agencies impacted by tribal gaming. This method includes a requirement that the State Controller, in consultation with the CGCC, deposit funds into County Tribal Casino Accounts and Individual Tribal Casino Accounts based upon a process that takes into consideration whether the county has tribes that pay, or do not pay, into the SDF.

Revenue Sharing Trust Fund. Existing law creates in the State Treasury the RSTF for the receipt and deposit of moneys derived from gaming device license fees that are paid into the RSTF pursuant to the terms of specified tribal-state gaming compacts for the purpose of making distributions to non-compacted California tribes (e.g., federally-recognized non-gaming tribes and tribes that operate casinos with fewer than 350 slot machines). Revenue in the RSTF is available to CGCC, upon appropriation by the Legislature, for making distributions of $1.1 million annually to non-compact tribes. The RSTF was created as part of the 1999 compacts, which, in conjunction with the passage of Proposition 1A, created gaming compacts with approximately 60 California tribes. Non-compact tribes are considered third-party beneficiaries of the 1999 compacts.

Tribal Nation Grant Fund. This particular fund (referenced in recent compacts) was created to complement the RSTF and provides for the distribution of funds to non-gaming tribes, upon application of such tribes for purposes related to effective self-governance, self-determined community, and economic development. Payments from this fund are intended to be made to non-gaming tribes on a “need” basis, upon application. Payments from the TNGF are expected to begin in 2018.

Related/Prior Legislation

SB 6 (Hueso, 2017) ratifies the tribal-state gaming compact entered into between the State of California and the Quechan Tribe of the Fort Yuma Indian Reservation.

SB 585 (McGuire, 2017) ratifies the tribal state gaming compact entered into between the State of California and the Dry Creek Rancheria Band of Pomo Indians, executed on August 18, 2017.

SB 626 (Dodd, 2017) ratifies the amendment to the tribal-state gaming compact entered into between the State of California and the Federated Indians of Graton Rancheria, executed on August 18, 2017.

AB 174 (Bigelow, 2017) ratifies the tribal-state gaming compact entered into between the State of California and the United Auburn Indian Community, executed on August 18, 2017.

AB 253 (Bigelow, 2017) ratifies the tribal-state gaming compact entered into between the State of California and the Tuolumne Band of Me-Wuk Indians, executed on August 18, 2017.

AB 394 (Mathis, 2017) ratifies the tribal-state gaming compact entered into between the State of California and the Tule River Indian Tribe of California (hereafter “Tribe”) executed on August 31, 2017.

AB 1606 (Cooper, 2017) ratifies the tribal-state gaming compact entered into between the State of California and the Wilton Rancheria, executed on July 19, 2017. (Pending on the Governor’s Desk)

AB 1378 (Gray, 2017) ratifies the amendment to the tribal-state gaming compact entered into between the State of California and the San Manuel Band of Mission Indians executed on August 18, 2017.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT: (Verified 9/13/17)

John F. Tavaglione, Riverside County Board of Supervisors, Second District

Marion Ashley, Riverside County Board of Supervisors, Fifth District

Michael Hestrin, District Attorney, County of Riverside

Riverside Sheriff’s Association

Sheriff’s Employees’ Benefit Association

OPPOSITION: (Verified 9/13/17)

None received

Prepared by:

9/13/17 18:39:14

**** END ****

ASSEMBLY THIRD READING

ATR Bill Id:AB 891

Author:(Eduardo Garcia)

As Amended Ver:March 15, 2017

Majority vote

SUMMARY: Requires air monitoring data from the Imperial County and San Ysidro air monitoring studies to be included in the California Communities Environmental Health Screening tool (also known as CalEnviroScreen). Specifically, this bill:

1. Requires, by January 1, 2019, or in the next update of the CalEnviroScreen, the Office of Environmental Health Hazard Assessment (OEHHA) to report to the Legislature on air quality, water quality, toxic release, and hazardous waste site data necessary for updating the indicators in the tool for communities located in the California-Mexico border region.
2. Requires the California Air Resources Board (ARB), in partnership with OEHHA, to include in the air quality data provided to update the indicators in the next update of CalEnviroScreen one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. Requires funds to be allocated to the ARB and OEHHA, upon appropriation by the Legislature, to support the continued collection of data from the Imperial County and San Ysidro air monitoring studies on PM2.5, ozone, and diesel particulate matter as necessary to meet the ARB's minimum monitoring requirements for purposes of CalEnviroScreen.
3. Requires, for the purposes of collection data on a community scale, rather than on a regional or ambient scale, the ARB to add air monitoring stations at additional locations in the California-Mexico border region in both San Diego and Imperial Counties to collect data on PM2.5, ozone, and diesel particulate matter.
4. Requires ARB, by January 1, 2019, to submit a report to the Legislature detailing the methods used to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter, any barriers to collecting that data, and plans for future efforts to collect that data for purposes of CalEnviroScreen.
5. Sunsets these new requirements on January 1, 2023.

FISCAL EFFECT: According to the Assembly Appropriations Committee, enactment of this bill may result in increased costs of $193,000 for OEHHA to extend the San Ysidro air monitoring for one year, and an additional $272,000 over two years to manage the project with ARB and prepare the mandated report, and increased initial ARB costs of $1.2 million and ongoing annual costs of between $775,000 and $850,000.

COMMENTS: Prioritizing disadvantaged communities (DACs): In 2012, the Legislature passed SB 535 (De Léon), Chapter 830, Statutes of 2012, directing at least 25% of the funds from the Greenhouse Gas Reduction Fund (GGRF), which contains revenues resulting from California's Cap & Trade climate program, to go to projects that provide a benefit to DACs, and requiring a minimum of 10% of the funds to be directed to projects located within those communities.

CalEnviroScreen: To comply with the requirements set forth in SB 535, OEHHA developed CalEnviroScreen, which uses existing environmental, health, and socioeconomic data to determine the extent to which communities across the state are burdened by and vulnerable to pollution and to calculate a quantitative score for each of the state's 8,000 census tracts based on their overall pollution burdens and vulnerabilities. As it relates to air quality, ARB provides OEHHA with data on PM2.5 concentrations across the state for inclusion in CalEnviroScreen.

To generate the PM2.5 data for CalEnviroScreen 2.0, released in 2014, the ARB used data from air monitoring networks maintained by ARB, local air pollution control districts, and the federal Interagency Monitoring of Protected Visual Environments programs for the years 2009-2011, which included data from the Imperial County Air Pollution Control District PM2.5 monitor located in Calexico.

Updates to CalEnviroScreen: OEHHA recently provided updates and released CalEnviroScreen 3.0 on January 30, 2017. The tool was updated, pursuant to Assembly Bill 1059 ((Eduardo Garcia), Chapter 584, Statutes of 2015) to include additional data along the United States-Mexico border.

On March 6, 2017, OEHHA released "CalEnviroScreen Data Update for the Border Region," a report to the Legislature on actions taken to account for pollution burdens in the California-Mexico border region. In the report, OEHHA stated that it will continue to work to improve the characterization of cross-border pollution in CalEnviroScreen indicators for which data of sufficient quality are available. The San Ysidro Air Quality and Border Traffic Study and Imperial County Air Quality Study are currently underway to collect additional information regarding environmental conditions on or near the California-Mexico border. The information they generate will be evaluated to potentially incorporate into future versions of CalEnviroScreen.

Proposed changes: This bill would require ARB to include, in the air quality data provided for CalEnviroScreen, one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. It also requires ARB to collect data, separate from the Imperial County and San Ysidro air monitoring studies, to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter.

In addition, the bill would require the ARB to submit a report to the Legislature detailing the methods used and barriers to collecting data for cross-border pollution by January 1, 2019.

Analysis Prepared by: Paige Brokaw / E.S. & T.M. / (916) 319-3965 FN: 0000549

Date of Hearing: April 5, 2017

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Lorena Gonzalez Fletcher, Chair

ABPCA Bill Id:AB 891

Author:(Eduardo Garcia) – As Amended Ver:March 15, 2017

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

SUMMARY:

This bill requires the Office of Environmental Health Hazard Assesssment (OEHHA), in partnership with the Air Resources Board (ARB) to include air quality data on fine particulate matter (PM2.5), ozone, and diesel particulate matter from Imperial County and San Ysidro community air monitoring studies in the next update to CalEnviroscreen. This bill requires the continuation of the collection of these data as necessary to meet ARB's minimum monitoring requirements for CalEnviroScreen purposes.

Additionally, this bill:

1. Requires funds to be allocated to the ARB and OEHHA, upon appropriation by the Legislature, to support the continued collection of data, as necessary to meet the requirements of the bill.
2. Requires, for the purposes of collection data on a community scale, rather than on a regional or ambient scale, the ARB to add air monitoring stations at additional locations in the California-Mexico border region in both San Diego and Imperial Counties to collect data on PM2.5, ozone, and diesel particulate matter.
3. Requires ARB, by January 1, 2019, to submit a report to the Legislature detailing the methods used to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter, any barriers to collecting that data, and plans for future efforts to collect that data for purposes of CalEnviroScreen.
4. Sunsets these new requirements on January 1, 2023.

FISCAL EFFECT:

1. Increased costs of $193,000 for OEHHA to extend the San Ysidro air monitoring for one year, and an additional $272,000 over two years to manage the project with ARB and prepare the mandated report (GF or special fund). OEHHA is currently in contract with the University of Washington for San Ysidro air monitoring through March 31, 2018.  
2. Increased initial ARB costs of $1.2 million and ongoing annual costs of between $850,000 and $775,000 (special fund).

COMMENTS:

1. Purpose. According to the author, existing law does not require the OEHHA to use cross-border data that affects the lives of disadvantaged people living in border regions. As such, inadequate data is being reported by OEHHA to the legislature on air and water quality, and toxic release and hazardous waste sites in these border regions. Because conditions in the area are far worse than what is actually being reported, disadvantaged border communities are being disproportionately misrepresented. This bill addresses that data deficiency.
2. Background. Pursuant to AB 32 (Nuñez, Chapter 488, Statutes of 2006), the ARB implemented the cap-and-trade program as one of several strategies to reduce greenhouse gas emissions. Funds received from the program are deposited into the Greenhouse Gas Reduction Fund (GGRF) and either continuously appropriated or appropriated by the Legislature. Funds must be used for programs that further reduce emissions of greenhouse gases.

In 2012, the Legislature passed SB 535 (De Léon, Chapter 830, Statutes of 2012), directing at least 25% of the funds from the GGRF to go to projects that provide a benefit to disadvantaged communities (DACs), and requiring a minimum of 10% of the funds to be directed to projects located within those communities.

To comply with the requirements set forth in SB 535, OEHHA developed CalEnviroScreen, which uses existing environmental, health, and socioeconomic data to determine the extent to which communities across the state are burdened by and vulnerable to pollution and to calculate a quantitative score for each of the state’s 8,000 census tracts based on their overall pollution burdens and vulnerabilities.

1. Updates to CalEnviroScreen. OEHHA recently provided updates and released CalEnviroScreen 3.0 on January 30, 2017. The tool was updated, pursuant to Assembly Bill 1059 (E. Garcia, Chapter 584, Statutes of 2015) to include additional data along the US-Mexico border.

On March 6, 2017, OEHHA released "CalEnviroScreen Data Update for the Border Region," a report to the Legislature on actions taken to account for pollution burdens in the California-Mexico border region. In the report, OEHHA stated that it will continue to work to improve the characterization of cross-border pollution in CalEnviroScreen indicators for which data of sufficient quality are available.

The San Ysidro Air Quality and Border Traffic Study and Imperial County Air Quality Study are currently underway to collect additional information regarding environmental conditions on or near the California-Mexico border. The information they generate will be evaluated to potentially incorporate into future versions of CalEnviroScreen.

San Ysidro Air Quality and Border Traffic Study (Study): The Study is a two-year collaborative effort between OEHHA, CalEPA, San Diego State University, the University of Washington School of Public Health, Casa Familiar, and community residents to establish a network of low-cost community air monitors in San Ysidro to understand the air pollution health risks faced by San Ysidro communities.

1. Imperial County Air Quality Study. The Imperial air study is an ongoing four-year community-based air monitoring research project funded by the National Institutes of Health. The project consists of 40 air monitors located throughout Imperial County with measurements displayed on the Identifying Violations Affecting Neighborhoods website. The project is a collaboration between the California Environmental Health Tracking Program at the California Department of Public Health, the University of Washington, and a local organization, Comite Civico Del Valle. After completion of the Imperial County Air Quality Study, OEHHA will seek to obtain and evaluate the data collected for potential inclusion or adjustment of CalEnviroScreen indicators.

This bill requires ARB to include, in the air quality data provided for CalEnviroScreen, one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. It also requires ARB to collect data, separate from the Imperial County and San Ysidro air monitoring studies, to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter.

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

Date of Hearing: March 21, 2017

ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS

Bill Quirk, Chair

ABPCA Bill Id:AB 891 (

Author:Eduardo Garcia) – As Amended Ver:March 15, 2017

SUBJECT: California Communities Environmental Health Screening

SUMMARY: Requires air monitoring data from the Imperial County and San Ysidro air monitoring studies to be included in the California Communities Environmental Health Screening tool. Specifically, this bill:

1. Defines “PM2.5” as particulate matter with a diameter of 2.5 micrometers or less.
2. Requires, by January 1, 2019, or in the next update of the California Communities Environmental Health Screening (also known as CalEnviroScreen), the Office of Environmental Health Hazard Assessment (OEHHA) to report to the Legislature on air quality, water quality, toxic release, and hazardous waste site data necessary for updating the indicators in the tool for communities located in the California-Mexico border region.
3. Specifies that the report shall include air quality measurements for ozone and PM2.5 in the border region.
4. Requires the California Air Resources Board (ARB), in partnership with OEHHA, to include in the air quality data provided to update the indicators in the next update of CalEnviroScreen one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. Requires funds to be allocated to the ARB and OEHHA, upon appropriation by the Legislature, to support the continued collection of data from the Imperial County and San Ysidro air monitoring studies on PM2.5, ozone, and diesel particulate matter as necessary to meet the ARB's minimum monitoring requirements for purposes of CalEnviroScreen.
5. Requires, for the purposes of collection data on a community scale, rather than on a regional or ambient scale, the ARB to add air monitoring stations at additional locations in the California-Mexico border region in both San Diego and Imperial Counties to collect data on PM2.5, ozone, and diesel particulate matter.
6. Requires ARB, by January 1, 2019, to submit a report to the Legislature detailing the methods used to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter, any barriers to collecting that data, and plans for future efforts to collect that data for purposes of CalEnviroScreen.
7. Sunsets these new requirements on January 1, 2023.

EXISTING LAW:

1. Requires the California Environmental Protection Agency (CalEPA) to develop a methodology that identifies priority community areas for investment opportunities related to the Greenhouse Gas Reduction Fund (GGRF). Requires that these "priority community investment areas" be identified and updated at least every two years based on specified geographic, socioeconomic, and environmental hazard criteria. To meet this requirement OEHHA has developed CalEnviroScreen. (Health and Safety Code § 39711)
2. Requires OEHHA to develop and maintain a system of environmental indicators to provide policymakers and the public with information to evaluate the effectiveness of CalEPA's programs in improving environmental quality and protecting public health throughout the state, including environmental quality and public health in low-income communities and communities of color, and to assist CalEPA in making budget decisions that address the most significant environmental concerns, among other objectives for the system. (Public Resources Code (PRC) § 71080 (a))
3. Requires OEHHA to update its CalEnviroScreen 2.0 tool by using any relevant environmental data relating to known impacts of air pollution, water pollution, and toxic sites on the environmental quality of the communities in the California-Mexico border region. (PRC § 71090 (b)(1))

FISCAL EFFECT: Unknown.

COMMENTS:

Need for the bill: According to the author, "Existing law does not require the Office of Environmental Health Hazard Assessment to [use] cross-border data that affects the lives of disadvantaged people living in border regions. As such, inadequate data is being reported by OEHHA to the legislature on air and water quality, and toxic release and hazardous waste sites in these border regions. Because conditions in the area [are] far worse than what is actually being reported, disadvantaged communities are being disproportionately misrepresented.

To remove deficiencies and barriers in accessing data … in the California-Mexico border region … the bill requires the California Air Resources Board, in cooperation with the [OEHHA], to include one year of data from local air monitoring studies regarding PM2.5 micrometers or less, ozone, and diesel particulate, including vehicle emissions at border crossings, complete traffic density data within 150 meters of the border, and water quality data for waterways."

Identifying disadvantaged communities: Pursuant to the authorities provided in AB 32 (Nuñez, Chapter 488, Statutes of 2006), the ARB implemented the cap-and-trade program as one of several strategies to reduce greenhouse gas emissions. Funds received from the program are deposited into the GGRF and appropriated by the Legislature. They must be used for programs that further reduce emissions of greenhouse gases.

In 2012, the Legislature passed SB 535 (De Léon, Chapter 830, Statutes of 2012), directing at least 25% of the funds from the GGRF to go to projects that provide a benefit to disadvantaged communities (DACs), and requiring a minimum of 10% of the funds to be directed to projects located within those communities.

SB 535 directed CalEPA to identify DACs based on geographic, socioeconomic, public health, and environmental hazard criteria, including:

1. Areas disproportionately affected by environmental pollution and other hazards that can lead to negative public health effects, exposure, or environmental degradation; and,
2. Areas with concentrations of people that are of low income, high unemployment, low levels of homeownership, high rent burden, sensitive populations, or low levels of educational attainment.

The intent of SB 535 was, specifically, to direct resources to the state’s most impacted and disadvantaged communities to ensure activities taken pursuant to AB 32 will provide economic and health benefits to these communities, and to ensure that investments made per AB 32 will achieve additional emission reductions and mitigate direct health impacts on California’s most impacted DACs.

CalEnviroScreen: To comply with the requirements set forth in SB 535, OEHHA developed CalEnviroScreen, which uses existing environmental, health, and socioeconomic data to determine the extent to which communities across the state are burdened by and vulnerable to pollution and to calculate a quantitative score for each of the state’s 8,000 census tracts based on their overall pollution burdens and vulnerabilities.

CalEnviroScreen uses the following statewide data to identify the 25% most disadvantaged census tracts:

Pollution burden indicators: ozone, PM2.5 (particulate matter <2.5 microns), diesel, drinking water, pesticides, toxic releases, traffic, cleanups, groundwater, hazardous waste, impaired waters, and solid waste; and,

Population characteristics: age, asthma, low birth weight, low education, linguistic isolation, poverty, and unemployment.

As it relates to air quality, ARB provides OEHHA with data on PM2.5 concentrations across the state for inclusion in CalEnviroScreen.

To generate the PM2.5 data for CalEnviroScreen 2.0, released in 2014, the ARB used data from air monitoring networks maintained by ARB, local air pollution control districts, and the federal Interagency Monitoring of Protected Visual Environments programs for the years 2009-2011, which included data from the Imperial County Air Pollution Control District PM2.5 monitor located in Calexico.

At the time, the Calexico air monitor was the only source of PM2.5 data for the California-Mexico border region available for CalEnviroScreen 2.0. Census tracts more than 31 miles from the nearest air monitor were not assigned PM2.5 concentrations because the estimates far from monitors were considered less reliable. All but one of the 14 California census tracts along the border are within roughly 30 miles of an air monitor. Because there are likely to be substantial sources of PM2.5 in Mexico, improving confidence in the PM2.5 estimates in these border communities is important, especially in the areas furthest from the air monitors.

Updates to CalEnviroScreen: OEHHA recently provided updates and released CalEnviroScreen 3.0 on January 30, 2017. The tool was updated, pursuant to Assembly Bill 1059 (E. Garcia, Chapter 584, Statutes of 2015) to include additional data along the US-Mexico border.

On March 6, 2017, OEHHA released "CalEnviroScreen Data Update for the Border Region," a report to the Legislature on actions taken to account for pollution burdens in the California-Mexico border region. In the report, OEHHA stated that it will continue to work to improve the characterization of cross-border pollution in CalEnviroScreen indicators for which data of sufficient quality are available.

The San Ysidro Air Quality and Border Traffic Study and Imperial County Air Quality Study are currently underway to collect additional information regarding environmental conditions on or near the California-Mexico border. The information they generate will be evaluated to potentially incorporate into future versions of CalEnviroScreen.

San Ysidro Air Quality and Border Traffic Study (Study): The Study is a two-year collaborative effort between OEHHA, CalEPA, San Diego State University, the University of Washington School of Public Health, Casa Familiar, and community residents to establish a network of low-cost community air monitors in San Ysidro to understand the air pollution health risks faced by San Ysidro communities.

San Ysidro, part of the city of San Diego, is the nation’s busiest border crossing with more than 50,000 vehicles passing through the port of entry each day. The information collected will be used to identify the sources and levels of air pollution with the goal of developing mitigation strategies that might reduce exposure in the community.

Air quality data provided by the network of monitors will capture air pollution at a neighborhood scale, which in turn can provide air pollution data on the border region for CalEnviroScreen. These data can also inform future efforts to reduce impacts in this region.

The San Ysidro Air Study was modeled after another community air study in Imperial County.

Imperial County Air Quality Study: The Imperial air study is an ongoing four-year community-based air monitoring research project funded by the National Institutes of Health. The project consists of 40 air monitors located throughout Imperial County with measurements displayed on the Identifying Violations Affecting Neighborhoods website. The project is a collaboration between the California Environmental Health Tracking Program at the California Department of Public Health, the University of Washington, and a local organization, Comite Civico Del Valle. After completion of the Imperial County Air Quality Study, OEHHA will seek to obtain and evaluate the data collected for potential inclusion or adjustment of CalEnviroScreen indicators.

According to OEHHA, the San Ysidro and Imperial community air studies could allow for better cross-border characterization for the PM2.5 indicator. The San Ysidro Air Study could also potentially provide data for two additional CalEnviroScreen indicators, ozone and diesel particulate matter. These studies are scheduled to end in 2017. The ongoing collection of data in these and other communities will be valuable to understanding the localized impacts of air pollution.

Proposed changes: AB 891 would require ARB to include, in the air quality data provided for CalEnviroScreen, one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. It also requires ARB to collect data, separate from the Imperial County and San Ysidro air monitoring studies, to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter.

In addition, the bill would require the ARB to submit a report to the Legislature detailing the methods used and barriers to collecting data for cross-border pollution by January 1, 2019. The author may wish to consider synchronizing the date of that report with the next version of CalEnviroScreen (which has not yet been determined).

GGRF: The ARB has conducted 17 quarterly cap-and trade auctions since November 2012, generating roughly $4.4 billion in state revenue. The Governor’s 2017-18 budget proposes to spend $2.2 billion in cap-and-trade auction revenue on activities intended to reduce GHGs. That could result in around $770 million in investments in projects that benefit DACs as identified by CalEnviroScreen. Ensuring the CalEnviroScreen accurately implements the intent of SB 535 is important to many communities hoping to reap the investment benefits.

The "2016 Annual Report of Cap and Trade Auction Proceeds" includes an analysis of funds spent within and benefiting disadvantaged communities, excluding high speed rail spending. According to the report, 39% of expenditures were for projects located within disadvantaged communities and 51% of the overall funding benefited disadvantaged communities.

Modifications to the CalEnviroScreen could result in communities not previously identified as a DAC being eligible for GGRF investments, while other communities that were previously identified as eligible could be found to be ineligible.

REGISTERED SUPPORT / OPPOSITION:

Support

East Yard Communities for Environmental Justice

Food Empowerment Project

Food & Water Watch

Jean-Michel Cousteau's Ocean Futures Society

Opposition

None on file

Analysis Prepared by: Paige Brokaw / E.S. & T.M. /

Date of Hearing: March 21, 2017

ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS

Bill Quirk, Chair

ABPCA Bill Id:AB 891 (

Author:Eduardo Garcia) – As Amended Ver:March 15, 2017

SUBJECT: California Communities Environmental Health Screening

SUMMARY: Requires air monitoring data from the Imperial County and San Ysidro air monitoring studies to be included in the California Communities Environmental Health Screening tool. Specifically, this bill:

1. Defines “PM2.5” as particulate matter with a diameter of 2.5 micrometers or less.
2. Requires, by January 1, 2019, or in the next update of the California Communities Environmental Health Screening (also known as CalEnviroScreen), the Office of Environmental Health Hazard Assessment (OEHHA) to report to the Legislature on air quality, water quality, toxic release, and hazardous waste site data necessary for updating the indicators in the tool for communities located in the California-Mexico border region.
3. Specifies that the report shall include air quality measurements for ozone and PM2.5 in the border region.
4. Requires the California Air Resources Board (ARB), in partnership with OEHHA, to include in the air quality data provided to update the indicators in the next update of CalEnviroScreen one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. Requires funds to be allocated to the ARB and OEHHA, upon appropriation by the Legislature, to support the continued collection of data from the Imperial County and San Ysidro air monitoring studies on PM2.5, ozone, and diesel particulate matter as necessary to meet the ARB's minimum monitoring requirements for purposes of CalEnviroScreen.
5. Requires, for the purposes of collection data on a community scale, rather than on a regional or ambient scale, the ARB to shall add air monitoring stations at additional locations in the California-Mexico border region in both San Diego and Imperial Counties to collect data on PM2.5, ozone, and diesel particulate matter.
6. Requires ARB, by January 1, 2019, to submit a report to the Legislature detailing the methods used to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter, any barriers to collecting that data, and plans for future efforts to collect that data for purposes of CalEnviroScreen.
7. Sunsets these new requirements on January 1, 2023.

EXISTING LAW:

1. Requires the California Environmental Protection Agency (CalEPA) to develop a methodology that identifies priority community areas for investment opportunities related to the Greenhouse Gas Reduction Fund (GGRF). Requires that these "priority community investment areas" be identified and updated at least every two years based on specified geographic, socioeconomic, and environmental hazard criteria. To meet this requirement OEHHA has developed CalEnviroScreen. (Health and Safety Code § 39711)
2. Requires OEHHA to develop and maintain a system of environmental indicators to provide policymakers and the public with information to evaluate the effectiveness of CalEPA's programs in improving environmental quality and protecting public health throughout the state, including environmental quality and public health in low-income communities and communities of color, and to assist CalEPA in making budget decisions that address the most significant environmental concerns, among other objectives for the system. (Public Resources Code (PRC) § 71080 (a))
3. Requires OEHHA to update its CalEnviroScreen 2.0 tool by using any relevant environmental data relating to known impacts of air pollution, water pollution, and toxic sites on the environmental quality of the communities in the California-Mexico border region. (PRC § 71090 (b)(1))

FISCAL EFFECT: Unknown.

COMMENTS:

Need for the bill: According to the author, "Existing law does not require the Office of Environmental Health Hazard Assessment to [use] cross-border data that affects the lives of disadvantaged people living in border regions. As such, inadequate data is being reported by OEHHA to the legislature on air and water quality, and toxic release and hazardous waste sites in these border regions. Because conditions in the area [are] far worse than what is actually being reported, disadvantaged communities are being disproportionately misrepresented.

To remove deficiencies and barriers in accessing data … in the California-Mexico border region … the bill requires the California Air Resources Board, in cooperation with the [OEHHA], to include one year of data from local air monitoring studies regarding PM2.5 micrometers or less, ozone, and diesel particulate, including vehicle emissions at border crossings, complete traffic density data within 150 meters of the border, and water quality data for waterways."

Identifying disadvantaged communities: Pursuant to the authorities provided in AB 32 (Nuñez, Chapter 488, Statutes of 2006), the ARB implemented the cap-and-trade program as one of several strategies to reduce greenhouse gas emissions. Funds received from the program are deposited into the GGRF and appropriated by the Legislature. They must be used for programs that further reduce emissions of greenhouse gases.

In 2012, the Legislature passed SB 535 (De Léon, Chapter 830, Statutes of 2012), directing at least 25% of the funds from the GGRF to go to projects that provide a benefit to disadvantaged communities (DACs), and requiring a minimum of 10% of the funds to be directed to projects located within those communities.

SB 535 directed CalEPA to identify DACs based on geographic, socioeconomic, public health, and environmental hazard criteria, including:

1. Areas disproportionately affected by environmental pollution and other hazards that can lead to negative public health effects, exposure, or environmental degradation; and,
2. Areas with concentrations of people that are of low income, high unemployment, low levels of homeownership, high rent burden, sensitive populations, or low levels of educational attainment.

The intent of SB 535 was, specifically, to direct resources to the state’s most impacted and disadvantaged communities to ensure activities taken pursuant to AB 32 will provide economic and health benefits to these communities, and to ensure that investments made per AB 32 will achieve additional emission reductions and mitigate direct health impacts on California’s most impacted DACs.

CalEnviroScreen: To comply with the requirements set forth in SB 535, OEHHA developed CalEnviroScreen, which uses existing environmental, health, and socioeconomic data to determine the extent to which communities across the state are burdened by and vulnerable to pollution and to calculate a quantitative score for each of the state’s 8,000 census tracts based on their overall pollution burdens and vulnerabilities.

CalEnviroScreen uses the following statewide data to identify the 25% most disadvantaged census tracts:

Pollution burden indicators: ozone, PM2.5 (particulate matter <2.5 microns), diesel, drinking water, pesticides, toxic releases, traffic, cleanups, groundwater, hazardous waste, impaired waters, and solid waste; and,

Population characteristics: age, asthma, low birth weight, low education, linguistic isolation, poverty, and unemployment.

As it relates to air quality, ARB provides OEHHA with data on PM2.5 concentrations across the state for inclusion in CalEnviroScreen.

To generate the PM2.5 data for CalEnviroScreen 2.0, released in 2014, the ARB used data from air monitoring networks maintained by ARB, local air pollution control districts, and the federal Interagency Monitoring of Protected Visual Environments programs for the years 2009-2011, which included data from the Imperial County Air Pollution Control District PM2.5 monitor located in Calexico.

At the time, the Calexico air monitor was the only source of PM2.5 data for the California-Mexico border region available for CalEnviroScreen 2.0. Census tracts more than 31 miles from the nearest air monitor were not assigned PM2.5 concentrations because the estimates far from monitors were considered less reliable. All but one of the 14 California census tracts along the border are within roughly 30 miles of an air monitor. Because there are likely to be substantial sources of PM2.5 in Mexico, improving confidence in the PM2.5 estimates in these border communities is important, especially in the areas furthest from the air monitors.

Updates to CalEnviroScreen: OEHHA recently provided updates and released CalEnviroScreen 3.0 on January 30, 2017. The tool was updated, pursuant to Assembly Bill 1059 (E. Garcia, Chapter 584, Statutes of 2015) to include additional data along the US-Mexico border.

On March 6, 2017, OEHHA released "CalEnviroScreen Data Update for the Border Region," a report to the Legislature on actions taken to account for pollution burdens in the California-Mexico border region. In the report, OEHHA stated that it will continue to work to improve the characterization of cross-border pollution in CalEnviroScreen indicators for which data of sufficient quality are available.

The San Ysidro Air Quality and Border Traffic Study and Imperial County Air Quality Study are currently underway to collect additional information regarding environmental conditions on or near the California-Mexico border. The information they generate will be evaluated to potentially incorporate into future versions of CalEnviroScreen.

San Ysidro Air Quality and Border Traffic Study (Study): The Study is a two year collaborative effort between OEHHA, CalEPA, San Diego State University, the University of Washington School of Public Health, Casa Familiar, and community residents to establish a network of low-cost community air monitors in San Ysidro to understand the air pollution health risks faced by San Ysidro communities.

San Ysidro, part of the city of San Diego, is the nation’s busiest border crossing with more than 50,000 vehicles passing through the port of entry each day. The information collected will be used to identify the sources and levels of air pollution with the goal of developing mitigation strategies that might reduce exposure in the community.

Air quality data provided by the network of monitors will capture air pollution at a neighborhood scale, which in turn can provide air pollution data on the border region for CalEnviroScreen. These data can also inform future efforts to reduce impacts in this region.

The San Ysidro Air Study was modeled after another community air study in Imperial County.

Imperial County Air Quality Study: The Imperial air study is an ongoing four-year community-based air monitoring research project funded by the National Institutes of Health. The project consists of 40 air monitors located throughout Imperial County with measurements displayed on the Identifying Violations Affecting Neighborhoods website. The project is a collaboration between the California Environmental Health Tracking Program at the California Department of Public Health, the University of Washington, and a local organization, Comite Civico Del Valle. After completion of the Imperial County Air Quality Study, OEHHA will seek to obtain and evaluate the data collected for potential inclusion or adjustment of CalEnviroScreen indicators.

According to OEHHA, the San Ysidro and Imperial community air studies could allow for better cross-border characterization for the PM2.5 indicator. The San Ysidro Air Study could also potentially provide data for two additional CalEnviroScreen indicators, ozone and diesel particulate matter. These studies are scheduled to end in 2017. The ongoing collection of data in these and other communities will be valuable to understanding the localized impacts of air pollution.

Proposed changes: AB 891 would require ARB to include, in the air quality data provided for CalEnviroScreen, one year of data from the Imperial County and San Ysidro air monitoring studies, including data on PM2.5, ozone, and diesel particulate matter. It also requires ARB to collect data, separate from the Imperial County and San Ysidro air monitoring studies, to account for cross-border pollution for PM2.5, ozone, and diesel particulate matter.

In addition, the bill would require the ARB to submit a report to the Legislature detailing the methods used and barriers to collecting data for cross-border pollution by January 1, 2019. The author may wish to consider synchronizing the date of that report with the next version of CalEnviroScreen (which has not yet been determined).

GGRF: The ARB has conducted 17 quarterly cap-and trade auctions since November 2012, generating roughly $4.4 billion in state revenue. The Governor’s 2017-18 budget proposes to spend $2.2 billion in cap-and-trade auction revenue on activities intended to reduce GHGs. That could result in around $770 million in investments in projects that benefit DACs as identified by CalEnviroScreen. Ensuring the CalEnviroScreen accurately implements the intent of SB 535 is important to many communities hoping to reap the investment benefits.

The "2016 Annual Report of Cap and Trade Auction Proceeds" includes an analysis of funds spent within and benefiting disadvantaged communities, excluding high speed rail spending. According to the report, 39% of expenditures were for projects located within disadvantaged communities and 51% of the overall funding benefited disadvantaged communities.

Modifications to the CalEnviroScreen could result in communities not previously identified as a DAC being eligible for GGRF investments, while other communities that were previously identified as eligible could be found to be ineligible.

REGISTERED SUPPORT / OPPOSITION:

Support

East Yard Communities for Environmental Justice

Food Empowerment Project

Food & Water Watch

Jean-Michel Cousteau's Ocean Futures Society

Opposition

None on file

Analysis Prepared by: Paige Brokaw / E.S. & T.M. /