Existing law establishes the Department of Fish and Wildlife and sets forth the duties of that department, which include administering various programs for the protection and conservation of fish and wildlife resources. Existing law provides for the regulation of the aquaculture industry within the state. Existing law requires an owner of an aquaculture facility to register with the department and pay a specified registration fee to recover the cost of reviewing new registrations, and to renew that registration annually.

This bill would require the department to consider and, if appropriate, investigate whether and how to seek state verification authority from the United States Army Corps of Engineers and any other appropriate federal agencies that offer state verification authority in order to streamline the review and approval of federal permits issued by the United States Army Corps of Engineers or another federal agency that may be required by a mariculture project that intends to operate within the state. The bill would require the department, if it elects to seek to obtain state verification authority, to notify and update the Assembly Committee on Water, Parks, and Wildlife and the Senate Committee on Natural Resources and Water, as specified. The bill would require the department to increase aquaculture facility registration fees by an unspecified amount until the cost of obtaining the state verification authority is fully recovered from those aquaculture registrants that benefit from state verification authority. The bill would define mariculture for the purposes of these provisions. the Fish and Game Code.

Existing law authorizes the Department of Fish and Wildlife, by and with the approval of the Department of General Services, to sell grazing permits or otherwise dispose of excess vegetation or other products produced on lands acquired by the Department of Fish and Wildlife.

This bill would make a nonsubstantive change to that provision.

SENATE COMMITTEE ON

Senator Anna Caballero, Chair

2023 - 2024 Regular Session

AB 3220 (Papan) - Marine resources: Department of Fish and Wildlife: authority: mariculture

Bill Summary:

This bill would require the California Department of Fish and Wildlife (DFW) to consider and, if appropriate, investigate whether and how to seek state certification authority for certain federal permits required for mariculture in state waters, as provided.

Fiscal Impact:

• Cost pressures for DFW to actually seek and obtain state verification authority as a result of the considerations and investigations that would be required by this bill. According to DFW, seeking and obtaining state verification authority would necessitate a new level of staffing that may be estimated to at least match U.S. Army Corps of Engineers permitting staff levels reflecting current and expanded projections, which are unknown. Staff note that taking on additional regulatory permit review absorbed from federal agencies without substantial state investments in additional capacity would worsen funding and staffing shortfalls at DFW. Recent service-based budget analysis conducted by DFW confirmed that the more broadly defined aquaculture program is equipped with less than 48% of the resources needed to fulfill its mission.

Background:

Aquaculture in California, according to DFW, is very diverse and includes a variety of species raised in different environments. It ranges from the raising of freshwater fish or seaweeds in tanks on land to the cultivation of oysters in bay tidelands. Many of the species raised – oysters, mussels, clams, abalone and seaweed – are produced for high-value niche markets. For example, oysters available by mail from one aquaculturist are on the order of $2.15 - $3.00 each. From 2023 - 2024 there were about 91 - 106 registered aquaculturists in the state, and most commercial marine aquaculture occurs in the state’s estuaries and bays. While about 5,700 acres of state water bottoms and tidelands are leased for aquaculture, estimates are that less than 10% of that area is actively cultivated.

Current 2024 fees for a new aquaculture permit, aquaculture renewal permit, late fee, and aquaculture surcharge are $1,082.50, $676.50, $203.25, and $811.50, respectively. The surcharge applies to aquaculturists who meet certain landing criteria in order to help support the aquaculture program at CDFW. About half of registered aquaculturists pay the surcharge. These fees raised in aggregate just under $100,000 in 2024. The raised surcharge and the relatively increased aquaculture fee rates are due to sunset on January 1, 2025. A rough calculation indicates that if these were allowed to sunset, fee revenue would decrease about 40%. In 2022, SB 1392 (McGuire, Chapter 307, Statutes of 2022) extended the aquaculture surcharge and relatively increased aquaculture fees for one year only as a legislatively-mandated report examining the cost of the aquaculture program was not released in a timely manner. The report was due in February 2022, but released in August 2022. In 2023, another bill (SB 500, McGuire, Chapter 876, Statutes of 2023) extended the sunset until January 1, 2025.

The late 2022 aquaculture report showed a 78% shortfall in resources for the California Aquaculture Program to meet its “mission level” of service, including leasing-associated expenses. The program operates at a deficit, and collected fees, including the surcharge and relatively increased fees, do not come close to covering CDFW’s and the California Fish and Game Commission’s (Fish and Game Commission’s) actual costs. As noted in the report, the CDFW Aquaculture program “may continue to face difficulties in providing coordination, resource management, and administrative oversight.” The outlook for additional public resources for the Aquaculture Program, given the state’s budget situation, is challenging in the near-term.

Permitting an aquaculture project involves multiple state, federal, and local agencies for those requiring the use of state water bottom leases (an aquaculture facility on land would require only a waste discharge permit (WDR) from the local regional water board, and, to staff knowledge, there are existing WDRs available in each region that an aquaculturist could use). Aquaculture facilities using state water bottom leases need multiple permits for the use of these public resources which can take several years and involve significant costs (from tens of thousands of dollars to hundreds of thousands dollars) to an applicant. At the state level, permitting agencies include CDFW, the Fish and Game Commission, the California Coastal Commission (Coastal Commission), the State Lands Commission, the regional water quality control board, and the California Department of Public Health. Each of these state agencies exercises permitting authority within its respective jurisdiction.

In addition to state permits, federal agencies with permitting or oversight authority include the U.S. Army Corps of Engineers (UCACOE) (for placement of structures in the waters of the United States), and the National Marine Fisheries Service, among others. In a recent federal report, one of the many recommendations included the delegation of federal permitting authority through agreement to the states. The USACOE issues Nation Wide Permits (NWPs) which are general permits issued on a nation-wide basis to streamline the authorization of activities that will result in “no more than minimal individual and cumulative adverse effects on the aquatic environment.” NWP 55 for seaweed mariculture activity and NWP 48 for commercial shellfish mariculture activities are relevant to California. Each NWP may include additional permits granted by the USACOE including Rivers and Harbors Act Section 10 certification and Clean Water Act 404 certifications.

Delegation of authority to CDFW through CDFW obtaining “state verification authority” has the potential to increase permitting efficiencies. A few states – including Florida, New Hampshire, and Virginia – have obtained this authority.

Proposed Law:

This bill would require DFW to consider and, if appropriate, investigate whether and how to seek state certification authority for certain federal permits required for mariculture in state waters, as provided.

Related Legislation:

SB 500 (McGuire, Chapter 876, Statutes of 2023), among other provisions, extended the sunset for the aquaculture surcharge for one year to January 1, 2025.

SB 1392 (McGuire, Chapter 307, Statutes of 2022) extended the sunset for the aquaculture surcharge for one year.

AB 303 (R. Rivas, 2021) would have established an alternative regulatory process for mariculture projects cultivating specified species of oyster, mussel, clam, and kelp within five 200-hectare tracts designated by the CDFW for 12 years. (This bill was held without hearing in the Assembly Natural Resources Committee.)

SB 262 (McGuire, Chapter 472, Statutes of 2019) requires the Coastal Commission to develop guidance for applicants for coastal development permits for shellfish, seaweed, and other low-trophic mariculture production and restoration, among other things.

SB 809 (Senate Natural Resources and Water Committee, Chapter 521, Statutes of 2017) extended the increased aquaculture surcharge, registration, renewal, and penalty base fees until January 1, 2023, and required a report from CDFW by February 1, 2022, among other provisions.

AJR 43 (Chesbro, Resolution Chapter 123, Statutes of 2014) states that the Legislature supports ensuring a clean and healthy marine environment to protect existing shellfish beds and access to additional acreage for shellfish farming and restoration, and further supports a dialogue between industry, environmental, and federal and state agency leaders to develop an improved permitting process that is efficient and economical for both shellfish restoration and commercial farming.

AB 1886 (Chesbro, Chapter 301, Statutes of 2012) increased the registration, renewal, surcharge and penalty base fees for aquaculture facilities and expanded the duties of the aquaculture program coordinator position within CDFW.

Staff Comments:

DFW has been historically underfunded. The recent service-based budgeting effort at DFW revealed that DFW received on average about 1/3 of the resources it needs to fulfill its mission. While the administration did not include a plan to sustainably fund DFW, despite the requirement to do so, the Legislature responded to this effort by providing additional General Fund allocations. Given the current condition of the General Fund, it is unlikely this additional funding will be sustained over the long-term.

-- END --

SENATE COMMITTEE ON NATURAL RESOURCES AND WATER

Senator Dave Min, Chair

2023 - 2024 Regular

Bill No: AB Hearing Date: June 17, 2024

Subject: Marine resources: Department of Fish and Wildlife: authority: mariculture

SUMMARY

This bill would define the term mariculture, and authorize the California Department of Fish and Wildlife to seek state certification authority for certain federal permits required for mariculture in state waters, as provided.

BACKGROUND AND EXISTING LAW

Aquaculture in California, according to information available from California Department of Fish and Wildlife (CDFW), is very diverse and includes a variety of species raised in different environments. It ranges from the raising of freshwater fish or seaweeds in tanks on land to the cultivation of oysters in bay tidelands. Many of the species raised – oysters, mussels, clams, abalone and seaweed – are produced for high-value niche markets. For example, oysters available by mail from one aquaculturist are on the order of $2.15 - $3.00 each. From 2023 - 2024 there were about 91 - 106 registered aquaculturists in the state, and most commercial marine aquaculture occurs in the state’s estuaries and bays. While about 5,700 acres of state water bottoms and tidelands are leased for aquaculture, estimates are that less than 10% of that area is actively cultivated.^[1]

Current 2024 fees for a new aquaculture permit, aquaculture renewal permit, late fee, and aquaculture surcharge are $1,082.50, $676.50, $203.25, and $811.50, respectively. The surcharge applies to aquaculturists who meet certain landing criteria in order to help support the aquaculture program at CDFW. About half of registered aquaculturists pay the surcharge. These fees raised in aggregate just under $100,000 in 2024. The raised surcharge and the relatively increased aquaculture fee rates are due to sunset on January 1, 2025. A rough calculation indicates that if these were allowed to sunset, fee revenue would decrease about 40%. In 2022, SB 1392 (McGuire, Chapter 307, Statutes of 2022) extended the aquaculture surcharge and relatively increased aquaculture fees for one year only as a legislatively-mandated report examining the cost of the aquaculture program was not released in a timely manner. The report was due in February 2022, but released in August 2022. In 2023, another bill (SB 500, McGuire, Chapter 876, Statutes of 2023) extended the sunset until January 1, 2025.

The late 2022 aquaculture report showed a 78% shortfall in resources for the California Aquaculture Program to meet its “mission level” of service, including leasing-associated expenses. The program operates at a deficit, and collected fees, including the surcharge and relatively increased fees, do not come close to covering CDFW’s and the California Fish and Game Commission’s (Fish and Game Commission’s) actual costs. As noted in the report, the CDFW Aquaculture program “may continue to face difficulties in providing coordination, resource management, and administrative oversight.” The outlook for additional public resources for the Aquaculture Program, given the state’s budget situation, is challenging in the near-term.

Permitting an aquaculture project involves multiple state, federal, and local agencies for those requiring the use of state water bottom leases (an aquaculture facility on land would require only a waste discharge permit (WDR) from the local regional water board, and, to staff knowledge, there are existing WDRs available in each region that an aquaculturist could use). Aquaculture facilities using state water bottom leases need multiple permits for the use of these public resources which can take several years and involve significant costs (from tens of thousands of dollars to hundreds of thousands dollars) to an applicant. At the state level, permitting agencies include CDFW, the Fish and Game Commission, the California Coastal Commission (Coastal Commission), the State Lands Commission, the regional water quality control board, and the California Department of Public Health. Each of these state agencies exercises permitting authority within its respective jurisdiction.

In addition to state permits, federal agencies with permitting or oversight authority include the U.S. Army Corps of Engineers (UCACOE) (for placement of structures in the waters of the United States), and the National Marine Fisheries Service, among others. In a recent federal report, one of the many recommendations included the delegation of federal permitting authority through agreement to the states. The USACOE issues Nation Wide Permits (NWPs) which are general permits issued on a nation-wide basis to streamline the authorization of activities that will result in “no more than minimal individual and cumulative adverse effects on the aquatic environment.” NWP 55 for seaweed mariculture activity and NWP 48 for commercial shellfish mariculture activities are relevant to California. Each NWP may include additional permits granted by the USACOE including Rivers and Harbors Act Section 10 certification and Clean Water Act 404 certifications.

Delegation of authority to CDFW through CDFW obtaining “state verification authority” has the potential to increase permitting efficiencies. A few states – including Florida, New Hampshire, and Virginia – have obtained this authority.

Existing law:

1. Establishes CDFW and the Fish and Game Commission in the California Natural Resources Agency.

In general, the Fish and Game Commission sets regulations that CDFW implements and enforces. CDFW also provides data and expertise to inform the Fish and Game Commission’s decision-making process.

1. Defines "aquaculture" as a form of agriculture devoted to the propagation, cultivation, maintenance, and harvesting of aquatic plants and animals in marine, brackish, and fresh water. "Aquaculture" does not include species of ornamental marine or freshwater plants and animals not utilized for human consumption or bait purposes that are maintained in closed systems for personal, pet industry, or hobby purposes. (FGC §17)
2. Finds and declares, under the California Aquaculture Development Act, that it is in the interest of the people of the state that the practice of aquaculture be encouraged in order to augment food supplies, expand employment, promote economic activity, increase native fish stocks, enhance commercial and recreational fishing, and protect and better use the land and water resources of the state. (Public Resources Code §826)
3. Declares a statewide policy to encourage the conservation, maintenance, and utilization of the ocean and waters under the jurisdiction of the state for the benefit of the state citizenry and development of fisheries, including, among other objectives, the development of commercial aquaculture. (FGC §1700)
4. Requires the owner of an aquaculture facility to register certain information with CDFW by March 1 of each year, and requires CDFW to impose prescribed fees for registration and renewal. (FGC §15004, §15101)
5. Requires, in addition to the registration and renewal fees, a surcharge fee to be paid at the time of registration by the owner of an aquaculture facility if the gross annual sales of aquaculture products of the facility during the prior calendar year exceed $25,000. (FGC §15103)
6. Imposes a penalty for delinquent payment of aquaculture fees. (FGC §15104)
7. Increases, until January 1, 2025, registration, renewal, surcharge, and penalty fees, as provided. (FGC §15004, §15103, §15104)
8. Requires CDFW, at least once every five years, to analyze the fees and taxes authorized for the aquaculture program to ensure that the amount of the appropriate fee or tax is sufficient to fully fund the program. (FGC §15004)

PROPOSED LAW

This bill would define the term mariculture, and authorize CDFW to seek state certification authority for certain federal permits required for mariculture in state waters, as provided.

Specifically, this bill would:

1. Define “mariculture,” for the purpose of this bill, to mean that form of agriculture devoted to the propagation, cultivation, maintenance, and harvesting of aquatic plants and animals in marine water. “Mariculture” does not include species of fin fish and species of ornamental marine plants and animals not utilized for human consumption or bait purposes that are maintained in closed systems for personal, pet industry, or hobby purposes.
2. Require CDFW to consider and, if appropriate, investigate whether and how to seek state verification authority from the USACOE and any other appropriate federal agencies that offer state verification authority in order to streamline the review and approval of federal permits issued by the USACOE or another federal agency that may be required by a mariculture project that intends to operate within the state.
3. Make extensive findings and declarations regarding shellfish and seaweed aquaculture.

ARGUMENTS IN SUPPORT

According to the author, ““AB 3220 is a simple bill that requests that the Department of Fish and Wildlife to consider seeking state verification authority from the Army Corp of Engineers. Mariculture can significantly benefit the ocean ecosystem if done right, by improving water temperature, acidity, carbon sequestration, and more. Yet, the demand for environmentally beneficial shellfish and seaweed projects far outpace the regulatory permitting processes that are currently in place. New Hampshire, Virginia, and Florida have sought state verification authority, which resulted in greater permitting efficiency. In an effort to increase permitting efficiency in California, AB 3220 requests the Department of Fish and Wildlife investigate means by which it can streamline the federal permit process of the United States Army Corps of Engineers and other federal agencies whose approval is necessary to operate a restorative ocean farming project in California.”

ARGUMENTS IN OPPOSITION

None received

COMMENTS

Permit streamlining. While there is, in general, merit in permit streamlining, it is unclear, given the significant capacity and funding constraints within CDFW’s aquaculture program, that it has the consistent ongoing resources to obtain and successfully implement state verification authority. That written, however, this bill would provide permissive authority to CDFW to seek to do so, and not require it to do so.

The CDFW Aquaculture Program does not generate sufficient revenues to pay for CDFW and Fish and Game Commission costs to implement the program.

The August 2022 legislative report and more recent budget documents are very clear that the program operates at a deficit in aggregate. While the relatively increased fee structure and the surcharge provide some additional revenue, it is insufficient. Despite the opportunity – and existing requirement to do so – neither CDFW nor the Fish and Game Commission have appeared to do more than index the fees. While the August 2022 report is expressly concerned about increased fees raising barriers to entry for new potential aquaculturists, the report is not equally concerned by the costs to the state’s taxpayers to subsidize this for-profit industry that in many instances uses public trust resources. Should aquaculture expand in the state, the revenue shortfall would likely get worse.

To be sure, the recent “service-based budgeting” effort undertaken at CDFW found in 2021 that CDFW funding was inadequate to meet its “mission” service level across virtually all of its programs in aggregate. While the results varied by program, overall only about 1/3 of CDFW’s mission was funded. More recent data obtained from CDFW show that CDFW and its programs remain in a similar condition overall despite some progress in the intervening years. The Aquaculture Program is not alone in revenues being far less than ongoing costs. However, the Aquaculture Program – unlike many CDFW programs to protect fish and wildlife resources – explicitly serves businesses with the potential to generate revenue to fully cover CDFW’s and the Fish and Game Commission’s costs. While CDFW is tasked with promoting aquaculture that is not equivalent to subsidizing the aquaculture industry. In addition, personnel capacity constraints at the Fish and Game Commission and CDFW have been cited recently as an obstacle to, for example, addressing aquaculture needs (see comment below).

There may be multiple methods or combinations of methods to cover the costs of the California Aquaculture Program, including seeking business development funds from GO-Biz or restructuring fees, including lowering initial fees for new registrants. The recent one-year sunset extension in SB 500 to the aquaculture surcharge was intended to allow stakeholders to develop a plan to fully and sustainably fund the California Aquaculture Program in an ongoing manner. As of now, the surcharge will sunset at the end of this year.

In view of this and the difficult fiscal outlook for the state, the Committee may wish to amend the bill to provide for aquaculture registrants that benefit from the statewide verification authority to pay back the state for any costs associated with CDFW seeking that authority in the event that it chooses to. [Amendment #1]

Technical amendment. The Committee may wish to move the definition of “mariculture” outside of the one section and have it apply throughout the Fish and Game Code. [Amendment #2]

Statewide Aquaculture Action Plan under development.

The Ocean Protection Council (OPC) is currently developing a statewide Aquaculture Action Plan that will create a comprehensive, consistent, and science-based framework and policy for marine aquaculture in California. The Action Plan will focus on marine algae and shellfish in state marine waters (i.e. mariculture) and land-based/recirculating tank operations for marine algae, shellfish, and finfish, and is expected to be completed soon. The core principles that are meant to inform the Action Plan include: develop and utilize best available science; ensure aquaculture sustainability; build governance and management partnerships; ensure effective aquaculture planning; develop and implement efficient and effective aquaculture oversight; and protect public health and food safety. This bill’s goals appear to be aligned with the OPC’s effort.

Recent Fish and Game Commission action on aquaculture.

In June 2020, the Fish and Game Commission adopted a six-month hiatus on receiving new aquaculture lease applications, largely due to staffing constraints and the processing of three new recently received applications. While this hiatus was lifted in April 2021, continuing capacity constraints were again cited.

In March 2021, the Fish and Game Commission began a process – through its Marine Resources Committee – to develop public interest criteria for new aquaculture leases. In order for the Fish and Game Commission to issue a new aquaculture lease of state water bottoms, it must find that it is in the public interest (FGC §15400). Discussions continued for over a year, and the Fish and Game Commission formally adopted the new criteria at its meeting in August 2023.

Recent aquaculture efforts by the Coastal Commission.

The Coastal Commission in the last several years identified numerous permitting and Coastal Act compliance issues related to marine aquaculture statewide. In some instances, the same operator repeatedly violated lease terms. Significant progress resolving these issues was made through the Coastal Commission’s issuance of new and amended permits. Almost all of the new and revised permits were approved unanimously by the Coastal Commission via its consent calendar.

In December 2020, the Coastal Commission published its Coastal Development Permit Application Guidance for Aquaculture and Marine Restoration. The guidance is intended to help applicants more effectively navigate the coastal development permit application process. The guidance was required by SB 262 (McGuire, Chapter 472, Statutes of 2019).

Recent related legislation

SB 500 (McGuire, Chapter 876, Statutes of 2023), among other provisions, extended the sunset for the aquaculture surcharge for one year to January 1, 2025.

SB 1392 (McGuire, Chapter 307, Statutes of 2022) extended the sunset for the aquaculture surcharge for one year.

AB 303 (R. Rivas, 2021) would have established an alternative regulatory process for mariculture projects cultivating specified species of oyster, mussel, clam, and kelp within five 200-hectare tracts designated by the CDFW for 12 years. (This bill was held without hearing in the Assembly Natural Resources Committee.)

SB 262 (McGuire, Chapter 472, Statutes of 2019) requires the Coastal Commission to develop guidance for applicants for coastal development permits for shellfish, seaweed, and other low-trophic mariculture production and restoration, among other things.

SB 809 (Senate Natural Resources and Water Committee, Chapter 521, Statutes of 2017) extended the increased aquaculture surcharge, registration, renewal, and penalty base fees until January 1, 2023, and required a report from CDFW by February 1, 2022, among other provisions.

AJR 43 (Chesbro, Resolution Chapter 123, Statutes of 2014) states that the Legislature supports ensuring a clean and healthy marine environment to protect existing shellfish beds and access to additional acreage for shellfish farming and restoration, and further supports a dialogue between industry, environmental, and federal and state agency leaders to develop an improved permitting process that is efficient and economical for both shellfish restoration and commercial farming.

AB 1886 (Chesbro, Chapter 301, Statutes of 2012) increased the registration, renewal, surcharge and penalty base fees for aquaculture facilities and expanded the duties of the aquaculture program coordinator position within CDFW.

SUGGESTED AMENDMENTS

AMENDMENT 1

Should CDFW decide to seek state verification authority, require CDFW to provide certain relevant information to the Legislature and provide for those aquaculturists that benefit from the authority to fund obtaining it.

AMENDMENT 2

Move the definition of mariculture to Chapter 1: General Definitions of Division 0.5 of the Fish and Game Code.

SUPPORT

AltaSea

AltaSeads Conservancy

California Aquaculture Association

Holdfast Aquaculture

Pacific6

OPPOSITION

None received

-- END --

1. Final Report to the California Fish and Game Commission, “The Status of Commercial Marine Aquaculture in California.” May 2020 (corrected). ↑

Date of Hearing: May 8, 2024

ASSEMBLY COMMITTEE ON APPROPRIATIONS

Buffy Wicks, Chair

ABPCA Bill Id:AB 3220

Author:(Papan) – As Amended Ver:March 21, 2024

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

SUMMARY:

This bill defines “mariculture” for purposes of this bill and requires the Department of Fish and Wildlife (DFW) to consider and, if appropriate, investigate whether and how to seek state verification authority from the Unites States Army Corps of Engineers (USACE) and any other appropriate federal agencies that offer state verification authority in order to streamline the review and approval of federal permits issued by federal agencies that may be required by a mariculture project that intends to operate within the state.

FISCAL EFFECT:

Minor and absorbable costs to DFW (special fund). This bill simply requires the department to consider and investigate whether and how to seek state verification authority from federal agencies. It does not require DFW to actually seek or utilize this authority or take any other actions with respect to mariculture permit streamlining.

COMMENTS:

1) Purpose. According to the author:

Three other states have sought this verification authority with permitting efficiencies realized by the implementation of this practice. Mariculture can significantly benefit the ocean ecosystem if done right, by improving water temperature, acidity, carbon sequestration, and more. Yet, the demand for environmentally beneficial shellfish and seaweed projects far outpace the regulatory permitting processes that are currently in place. [This bill] takes a critical first step in this direction by requesting the state [DFW] investigate means by which it can streamline the federal permit process of the [USACE] and other federal agencies whose approval is necessary to operate a restorative ocean farming project in California.

2) Background. Aquaculture is a form of agriculture devoted to the propagation, cultivation, maintenance, and harvesting of aquatic plants and animals in marine, brackish, and freshwater. DFW and the Fish and Game Commission (FGC) are the principal state government entities responsible for the management, protection, and conservation of the state’s fish and wildlife resources. As part of that responsibility, FGC has the authority to regulate certain aspects of commercial marine aquaculture on state lands or in state waters, while DFW has management responsibility. A total of 5,740 acres of California public tidelands are leased for marine aquaculture.

The Ocean Protection Council (OPC) is tasked with coordinating the activities of ocean-related state agencies to improve the effectiveness of state efforts to protect ocean resources. OPC is developing a statewide Aquaculture Action Plan (Action Plan) that will create a comprehensive, consistent, and science-based framework and policy for marine aquaculture in California. The Action Plan was expected to be completed in 2023 but is still pending.

Permitting an aquaculture project involves multiple state, federal, and local agencies and can take several years and involve significant costs. The state maintains a website with a permit guide to aquaculture that contains information on the various agencies and permits required. Key state oversight agencies include DFW, FGC, the Coastal Commission, the Department of Public Health, and the State Lands Commission.

A 2018 report to the National Oceanic and Atmospheric Administration Fisheries, titled “Evaluation of U.S. Shellfish Aquaculture Permitting Systems: Recommendations to Improve Permitting Efficiencies and Industry Development,” provided 15 recommendations based on a review of the permitting processes in coastal states. This bill requires DFW to consider pursuing one of these recommendations, specifically the delegation of federal authority. The report recommends considering strategies to incorporate state verification (or permit) authority into USACE’s general permits. This general permit program allows USACE to authorize activities with only minimal adverse environmental impacts in a timely manner. The report contends that incorporating state verification authority and accountability measures into the relevant general permit, where appropriate, “can provide further permitting efficiencies, reduce the burden of the federal government, and allow the Corps and other agencies to focus more time on individual permits.”

Should DFW ultimately decide to seek and utilize state verification authority, it may incur additional costs. Aquaculture registration fees are administered by DFW and deposited into the Fish and Game Preservation Fund’s (FGPF) aquaculture dedicated account. Revenue from aquaculture entitlements (including registration fees, permits, lease rents, and privilege taxes) is about $200,000 per year and is used to fund DFW’s aquaculture program. Additional funding for the program is supplemented by non-dedicated sources in the FGPC. It is possible that DFW could rely on aquaculture fees to offset any increased costs as a result of obtaining state verification authority from federal agencies. However, aquaculture fees are set in statute, so any increase in fees would necessitate future legislation.

Analysis Prepared by: Nikita Koraddi / APPR. / (916) 319-2081

Date of Hearing: April 23, 2024

ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE

Diane Papan, Chair

ABPCA Bill Id:AB 3220 (

Author:Papan) – As Amended Ver:March 21, 2024

SUBJECT: Marine resources: Department of Fish and Wildlife: authority: mariculture

SUMMARY: Defines mariculture and requires the Department of Fish and Wildlife (DFW) to consider and, if appropriate, investigate whether and how to seek state verification authority from the Unites State Army Corps Engineers (USACE) and other federal agencies. Specifically, this bill:

1. Defines “mariculture,” for the purpose of this bill, to mean that form of agriculture devoted to the propagation, cultivation, maintenance, and harvesting of aquatic plants and animals in marine water. “Mariculture” does not include species of fin fish and species of ornamental marine plants and animals not utilized for human consumption or bait purposes that are maintained in closed systems for personal, pet industry, or hobby purposes.
2. Requires DFW to consider and, if appropriate, investigate whether and how to seek state verification authority from the USACE and any other appropriate federal agencies that offer state verification authority in order to streamline the review and approval of federal permits issued by the USACE or another federal agency that may be required by a mariculture project that intends to operate within the state.
3. Makes findings and declarations regarding shellfish and seaweed aquaculture.

EXISTING LAW:

1. Establishes DFW to oversee the conservation, protection, and management of fish, wildlife, native plants, and habitats necessary for biologically sustainable populations of the state’s diverse fish, wildlife, and plant species [Fish and Game Code (FGC) § 1802].
2. Defines “aquaculture” as the form of agriculture devoted to the propagation, cultivation, maintenance, and harvesting of aquatic plants and animals in marine, brackish, and fresh water; and specifies that aquaculture does not include species of ornamental marine or freshwater plants and animals not utilized for human consumption or bait purposes that are maintained in closed systems for personal, pet industry, or hobby purposes (FGC § 17).
3. Defines the role of the aquaculture coordinator within DFW (FGC § 15100).
4. Provides a framework for regulation of aquaculture operations in California, including regulations for broodstock acquisition, leasing of state water bottoms, disease control, and importation of shellfish and finfish (FGC §§ 15300, 15400, 15500, and 15600, respectively)

FISCAL EFFECT: Unknown. This bill is keyed fiscal.

COMMENTS:

1. Purpose of this bill. This bill defines “mariculture” and requires DFW to consider pursuing new mariculture permitting authorities from federal agencies, including USACE. According to the author, “[This] is a simple bill that requests that the [DFW] to consider seeking state verification authority from the [USACE]. Three other states have sought this verification authority with permitting efficiencies realized by the implementation of this practice. Mariculture can significantly benefit the ocean ecosystem if done right, by improving water temperature, acidity, carbon sequestration, and more. Yet, the demand for environmentally beneficial shellfish and seaweed projects far outpace the regulatory permitting processes that are currently in place. [This bill] takes a critical first step in this direction by requesting the state [DFW] investigate means by which it can streamline the federal permit process of the [USACE] and other federal agencies whose approval is necessary to operate a restorative ocean farming project in California.”
2. Background. DFW and the Fish and Game Commission (Commission) are the principal state government entities responsible for the management, protection, and conservation of the state’s fish and wildlife resources. As part of that responsibility, the Commission has the authority to regulate certain aspects of commercial marine aquaculture on state lands or in state waters, while DFW has management responsibility. Commercial aquaculture in California is relatively modest in scale, but supports many different species, raised for many diverse purposes, and are cultured using a variety of techniques. So far, none of the species can be considered commodity products; each of them fit into fairly small-volume, high-value niche markets. A total of 5,740 acres of California public tidelands are leased for marine aquaculture, the majority in Humboldt and Tomales Bays, according to the 2020 report The Status of Commercial Marine Aquaculture in California.

Aquaculture Action Plan. The Ocean Protection Council (OPC) is tasked with coordinating the activities of ocean-related state agencies to improve the effectiveness of state efforts to protect ocean resources. The OPC is currently developing a statewide Aquaculture Action Plan (Action Plan) that will create a comprehensive, consistent, and science-based framework and policy for marine aquaculture in California. The Action Plan will focus on marine algae and shellfish in state marine waters and land-based/recirculating tank operations for marine algae, shellfish, and finfish, and was expected to be completed in 2023, but is still pending. The Action Plan is centered around three principal goals outlined in the Guiding Principles for Sustainable Marine Aquaculture: (1) develop and utilize best available science; (2) ensure aquaculture sustainability; and (3) build governance and management partnerships.

Definitions. Mariculture is not yet defined in statute, although the word does appear in both Public Resources Code § 30705 and § 28004. The definition proposed by this bill aligns closely with the current definition of aquaculture (FCG § 17) except it is limited to marine environments and specifically does not include finfish. Finfish aquaculture will be considered in the Action Plan, although finfish aquaculture is not currently permitted in California. While the Commission is authorized to issue leases for finfish aquaculture, the law prescribes that the Commission may not do so until it considers how it will address specific concerns, identified in statute, within a new regulatory framework using the analysis of a programmatic environmental impact report (FGC § 15400). The definition of mariculture only applies to this section so it will not impact other law.

Permitting process for aquaculture projects. Permitting an aquaculture project involves multiple state, federal, and local agencies and can take several years and involve significant costs (from tens of thousands of dollars to hundreds of thousands dollars) to an applicant (see Figure 1 for a representation of the permitting process). The state currently maintains a Permit Guide to Aquaculture in California website that contains information on the various agencies and permits required. Key oversight agencies include DFW, the Commission, the Coastal Commission, Department of Public Health and State Lands Commission (SLC). The Commission (with DFW support) is lead for a state water bottom lease. DFW is also lead for an aquaculture registration, an importation permit (if applicable), and a wild broodstock collection permit (if applicable). The Coastal Commission is lead for a Coastal Development Permit, the regulatory mechanism to ensure proposed developments in the coastal zone are brought into compliance with the Coastal Act including the protection of marine resources and environmentally sensitive habitat areas. SLC is the primary state agency responsible for leasing of state waters; however, when it comes to aquaculture projects the Commission and DFW are lead on state water bottom and water column leases. SLC’s role is to certify that the area proposed for aquaculture is unencumbered or the ownership is properly described.

Figure 1– Flow chart of the permitting process in California Waters. From the California Aquaculture report by CEA consulting (October 2022)

Report to National Marine Fisheries Service (NMFS). A 2018 report to NMFS entitled “Evaluation of U.S. Shellfish Aquaculture Permitting Systems: Recommendations to Improve Permitting Efficiencies and Industry Development” (2018 Report) provided 15 recommendations based on a review of the permitting processes in all coastal states on the continental United States. Some of these recommendations include: #1—improve coordination between state and federal permitting agencies; #2—delegate federal authority; #4—provide adequate staffing; #5—develop a centralized permitting website; #7—develop siting tools; #8—improve permitting efficiencies where local agencies have permitting authority; and, #12—“establish expedited permitting programs for small-scale ‘experimental’ shellfish aquaculture operations.”

This bill requires DFW to consider pursuing recommendation #2—delegate federal authority. Specifically, this recommendation suggests ‘verification authority’ be delegated from federal to state authority. This delegation is regarding USACE’s Nation Wide Permits (NWP). NWPs are general permits issued on a nation-wide basis to streamline the authorization of activities that will result in no more than minimal individual and cumulative adverse effects on the aquatic environment. ‘Verification’ is the term used instead of ‘permit’ for NWPs. There are two relevant NWP’s for the purpose of this bill: NWP 55 for seaweed mariculture activity and NWP 48 for commercial shellfish mariculture activities.

NWP may also cover additional permits granted by USACE including Clean Water Act Section 404 and Rivers and Harbors Act Section 10 certifications. Clean Water Act 404 certifications are required for any project that disturbs or adds material to the ocean floor and Rivers and Harbors Act Section 10 certifications are required to protect navigation for commerce. The terms and conditions of these certifications are incorporated into a NWP verification by becoming a Special Condition of those permits.

The 2018 Report suggests that state verification authority would increase permitting efficiencies and reduce burden on the federal government. So far, this recommendation has only been implemented by three states: Florida, New Hampshire, and Virginia.

1. Arguments in support. Several organizations write in support promoting the role of bivalve and kelp aquaculture for mitigating the impacts of climate changes such as reducing excess nitrogen and carbon dioxide in the ocean as well as reduce methane emissions from beef cattle when certain types of seaweed are incorporated into feed. They write that this bill is “a critical first step in [… streamlining] the federal permit process.”
2. Related legislation. SB 500 (McGuire), Chapter 876, Statutes of 2023, extend the operation of the increased registration, renewal, surcharge, and penalty fees for aquaculture permits until January 1, 2025.

AB 303 (R. Rivas) of 2021 would have established an alternative regulatory process from 2024 to 2036 for mariculture projects (a sub-type of aquaculture that involves the cultivation of marine saltwater organisms) cultivating specified species of oyster, mussel, clam, and kelp within five 200-hectare tracts designated by the DFW. AB 303 was referred to, but never set for hearing in, the Assembly Natural Resources Committee.

SB 262 (McGuire), Chapter 472, Statutes of 2019, among other provisions, requires the Coastal Commission to develop guidance for applicants for coastal development permits for shellfish, seaweed, and other low-trophic mariculture production and restoration.

SB 809 (Senate Committee on Natural Resources and Water), Statutes of 2017, Chapter 521, among other provisions, extends the increased aquaculture registration, renewal, surcharge, and penalty fees until January 1, 2023, and requires a report from the DFW by February 1, 2022.

AJR 43 (Chesbro), Res. Chapter 123, Statutes of 2014, states that the Legislature supports ensuring a clean and healthy marine environment to protect existing shellfish beds and access to additional acreage for shellfish farming and restoration, and further supports a dialogue between industry, environmental, and federal and state agency leaders to develop an improved permitting process that is efficient and economical for both shellfish restoration and commercial farming.

AB 1886 (Chesbro), Chapter 301 Statutes of 2012, increases the regulatory fees for aquaculture facilities and expands the duties of the aquaculture program coordinator position within the DFW.

REGISTERED SUPPORT / OPPOSITION:

Support

Altasea (Sponsor)
Altaseads Conservancy
California Aquaculture Association
Holdfast Aquaculture, LLC
Pacific 6 Enterprises

Opposition

None on file

Analysis Prepared by: Stephanie Mitchell / W., P., & W. / (916) 319-2096