Senate Budget and Fiscal Review Subcommittee No. 2 on Resources, Environmental Protection and Energy

And then pretty big chunks in the next two years as well. So really over the first three years planning to spend the majority of the funding. Another thing to highlight for you in this chart here is that final column of pending you see 814 million.

Those are programs and categories for which the Administration is not proposing a timeline at this point. They want to have some more time to talk with you about when and how those funds should roll out. So I'll talk about those in a little bit more detail in a moment.

Another thing to notice here in this figure is that the timing and the rollout across the different categories of the bond does vary. You can see in coastal resilience the first year is only about 14% of the total funding as compared to the bottom climate smart agriculture 45% of the total funding in the first year.

So there's variation across the different categories. Another issue we'd highlight for you not displayed here, but part of the proposal is trailer Bill Language to exempt spending from the Administrative Procedures act, the apa. This is consistent with prior bonds. I'll talk about that more in a moment as well.

And then another thing to highlight just overall here, this multi year spending plan. This doesn't mean that this funds wouldn't come back before you all to approve every year.

This funding is not continuously appropriated and so even if you approve a multi year plan, it will still come before the Legislature as part of the annual budget act every year to appropriate these funds.

However, that doesn't mean that the Administration would come before you with specific budget change proposals as is normally the case with many other proposals. If you approve a multi year plan, the administration's intention, unless you indicate you want otherwise, is to build that into baseline budgets for the administering departments.

You would get kind of a spreadsheet every year with the plans for how much money would go out by program. That's a theme I'll come back to as we keep walking through. So turning to page two here, this dives into a little bit more detail on that 814 million that was in the final column, the pending allocations.

These are the specific programs for which the Administration does not propose a timeline for appropriation right now for a variety of reasons. Some they're waiting for additional information and reports to come out.

Some they and again, I'll defer to my colleague from the Department of Finance to talk about some of the specific reasons, but to highlight for you, these are proposals and programs for which there is not a proposed timeline at this point. Additionally, the Administration has not yet put forth a proposal for staffing and administering the bond.

They've indicated that will come later in the spring as they're still assessing staffing needs. Those positions, whatever positions, would be administering the bond, would be funded out of the bond Fund, so not additional General Fund. That's how bonds have historically been administered and is allowable in the bond language.

Turning to page three, this theme was already touched on in opening comments. Part of the administration's proposal is to revert some previous approved spending for various categories and replace it with Proposition 4, totaling just over $300 million, 273 from the General Fund and 32 million from the greenhouse gas reduction Fund.

So as we note here in the bottom bullet, there are three key effects from this approach. The first is that it does maintain previously planned amounts for these activities. We don't view this as a cut. It does sustain previous activities with a different funding source.

The second is that it frees up some funding, some General Fund, and again, a small amount of GGRF to use for other priorities. And the Administration is proposing to use those for its priorities. This is a tool. This is an option. This is a policy choice that the Administration has put forth.

The third, which I think is what WISS touched on already, is that it does preclude this amount of Proposition 4 funds from being used to expand or enhance. It keeps this amount of Proposition 4 from being additive on top of what was already planned.

So I'll talk more about this again in a moment, but this is part of the administration's proposal, and these show you the specific programs.

So turning to page four of the handout and really highlighting what our overarching comments are, the first feels a little silly to say here in front of the person whose name was on this bond, but this was a legislative proposal that went onto the ballot.

Very true. That's very true.

The silly part or the so, you know, presumably the Legislature crafted this bond with its priorities in mind. Now the Governor has the responsibility in the Constitution to put forth a budget proposal before you, and so they have done.

So we think it's very helpful that they worked hard between November when this was approved and January 10, when they had to put it out, to put something before you quickly so that you had something to think about.

But we think this is really a starting place and to the degree that this doesn't reflect the proposal before you, doesn't affect what you were intending, we would suggest, and this is previewing my recommendations on the next page. We would suggest you view it just as a starting place.

We do think the proposal before you does have several merits that there was a lot of thought that went into it even within the short time frame. As I noted on the first page, there is a phasing in and it was different treatment across different categories of the bond.

And we saw evidence that the Administration was really thinking about the capacity of the field and of the administering Department of Program by program. Where were they ready to get funds out the door and where might they need a little bit more time to think about how to spend the funding strategically?

Or if there was still funding remaining from prior years, it builds on those existing investments from prior years. So again, there are several advantages and thought we saw in this proposal regarding the multi year approach. We think there are some important trade offs to think about with this approach. There are certainly some advantages.

It allows for longer term strategies, more certainty for the administering departments and the field to have a better sense of when funds might be rolling out. Certainly some efficiencies from a staffing perspective to have that all planned. But there are some drawbacks as well.

In particular, once you kind of set this on autopilot again you have the opportunity to revisit it. But there are those expectations that this is the timeline for how funding will be moving forward.

And it might make it more difficult to pivot if situations, situations change like wildfires or droughts or changes in federal funding that might want you lead you to want to not only change the timing of funding, but also some of the specific uses of those funds.

And that's a little bit harder once there are expectations and it's built into a baseline and you're not having proposals come before you each year. Also want to highlight there will be a different Governor and a different Administration coming into place over the life of this bond, as well as changes within the Legislature.

And that could lead to some different priorities as well. We have seen that recently that different administrations can have different priorities. So thinking about reserving some of your flexibility to be able to pivot and respond to evolving conditions. It also just reduces the transparency again when you're not having proposals come before you to discuss every year.

But it's just kind of baked into baseline. It puts more of the burden and onus on you to raise the issues, ask the questions and make changes. We think this might be a particular issue for some of the programs that are brand new or don't have a lot of detail available yet for you of how they're going to be administered.

There are several categories of the bond that are very straightforward and they're for existing programs and it just gives more money to keep doing the things we've been doing. But there are also a number that are brand new and there aren't a lot of details.

And there are some categories where there are a number of different allowable activities. The Administration putting together its proposal made a lot of choices. Maybe you're fine with those choices, maybe you want to make different ones. So we highlight several of those within our report in the specific categories, but we think that that's something to keep an eye on as well.

Even for the established programs, we think oversight is important and would encourage you in the coming years to continue asking, okay, well for example for the flood program, where there's an established process for selecting programs and projects and how flood funds will be spent by the Department of Water Resources over a number of years, still will be important to ask, well, what are the projects being funded?

How are you choosing? What are the federal funds coming in? Those types of oversight. Even if you're comfortable with adopting a multi year plan for something like that, there are a number of plans and initiatives noted in the bond that were part of the goals of Proposition 4.

Things like 30 by 30, our water sustainability plans that are linked to a lot of goals and outcomes. That linkage isn't so clear here with the specific programs. How many acres are we planning to clear in our forest health program? How many acre feet of water are we planning to recycle? So those are the types of quantitative measures you may want to require some more reporting on.

We would suggest being selective about the amount of reports you request of the of the Administration, but focusing on what you really want and what are we getting from this funding, both for letting voters know but also for informing future discussions and decisions about how we use our funds most effectively.

Moving down to the second to last bullet here on page four, just highlighting again about the Fund shifts, that this is a policy choice. It is available to you as a tool if you want to free up other funding for addressing other priorities.

It is also available to you to reject that proposal and have all of Proposition 4 be additive. That does have some implications of the overall budget architecture, at least compared to the governor's proposal, where that funding in their proposal is freed up to use for other things.

So you'll have to make some adjustments if you want to reject that part of the proposal. And then finally on the APA exemption, this does seem reasonable to us. It does align with past precedent and would allow the funds to be out the door much more quickly through an expedited process.

But if you are concerned about transparency, you could add some additional language just to ensure that the Administration is very transparent and public about the way they are planning to administer the bond. So pretty quickly here on the final page, page five, our recommendations link pretty closely to the comments I've just made.

First, we would again recommend that you as the authors, use this as your starting point, but ensure that whatever the final plan plan that you adopt is really reflects your priorities. Regarding the multi year plan. One option that is before you is to take kind of a dual pronged approach for those programs where you're very comfortable.

That's pretty straightforward. We're continuing with existing efforts. Maybe you want to approve a multi year plan on that where you get less detail in future years and kind of set that more on autopilot.

But for some, and I'm happy to give you some examples, where the programs are brand new or the Administration doesn't have a lot of detail right now over how they want to administer it, but they're asking for a first year of money and multi years of money. As they work on the details.

You might want to say, well, no, those are issues where we want more coming forth. We want budget change proposals next year. We're not approving a multi year plan because we want more information about the decisions you're making and the policy choices you're making.

Before we set this on a multi year plan for those types of programs, we would suggest you consider putting more spending guidance in statute. Even if you're comfortable with what the Administration is indicating, they're going to proceed having that memorialized so that future administrations are continuing with Fidelity for what your expectations are.

Similarly, on the reporting, to the degree there are important goals you are focused on and you want to understand progress, those are things you could put in statute or in reporting language to make sure, or do it more informally and make sure it's happening through oversight committees, but tracking that progress. What are we getting from the funding?

Not just the projects that are getting funded, but the outcomes. How are we learning what is effective and what's not effective in terms of the Fund shifts?

You know, I think our overall message is maybe see how things evolve over the next couple weeks and months as you're figuring out what your highest priorities are for for both General Fund and GGRF as well as Proposition 4.

And then finally we would approve recommend approving the APA exemption in order to be consistent with prior practice and help the funds be used more quickly. However, if you do have concerns about public processes. We are happy to help with some reporting language and guidance.

Language you could put in budget Bill or trailer Bill to help ensure those are happening. With that, Looking forward to the conversation today and over the coming weeks.

Thank you so much. And I want to just welcome Senator Stern who is very involved in the crafting of the, the bond and we welcome his presence here too. So let's open it up to questions, thoughts, comments from the Members, things that people want to raise. Obviously we're going to be hearing from you, Stick around typically through the rest. Okay.

Yeah, can ask a question.

Okay. oh, okay. Well actually you know what, I'm sorry, let's hear from Stephen first. I'm sorry. Yeah. And then, and then we'll, then we'll open up the floor and we'll go to you first, Centers Choi after that. Let's go. Let's hear from you first, Stephen.

I promise to keep my comments short so we can get to questions just for everyone know.

This is Stephen Benson from Department of Finance.

Yes, I'll keep my comments short. The agenda and Ms. Aylor's comments. Do a good job of setting up an overview of the bond. Just want to point out that we did propose a multi year expenditure plan that was developed with significant input from the departments that will be administering these various investments.

Spent a lot of time talking with them about their feasibility in terms of capacity with existing staffing levels spent time, the time they'll have to spend developing new guidelines tries to take into account those capacity and workload needs of the departments in terms of the pace that we're rolling out the plan.

So that's part of why you have a multi year expenditure plan. Also just the context behind how that plan is developed. There's a lot of thoughtful consideration into like existing capacity and the time needed for guidelines. Our approach is trying to our aims to accomplish several different things.

One of which is maintaining momentum for achieving state's climate goals. So the continuity of the efforts that we've got underway. Two, we're trying to provide greater certainty for potential grantees and for departments in terms of their developing capacity to deliver on the programs.

Having a multi year plan that while does need to maintain some flexibility for things as it changes, allows people to plan towards proposals they're going to submit and developing projects and the planning that goes behind a lot of those efforts.

Third, we're trying to reduce administrative inefficiencies that can sometimes happen when you have midstream delays in projects and things like that. When you can't do that sort of foresight and planning. So those are some of the aims that we were trying to achieve with the multi year plan.

I did want to touch on the topic of what we'll be doing in future years, which you'll see it is correct that we will do annual BCPs. Typically when there's non substantive changes, what's provided is sort of a spreadsheet that lists the programs where there aren't substantive changes and sort of shows here's the next level of funding.

But we are committed to making sure that you get the details that are needed where there are substantive changes or where there previously wasn't detail provided in those instances.

Like for example, there was mention of the group that's in sort of this pending allocation pot because we need some further information for the discussions before we decide sort of the rollout on that.

Those are issues where there absolutely will be standalone BCPs because the details of what is being planned to do isn't provided yet and will need to be provided.

In addition, even with previous bonds where we've had funding that was previously out there, if we're proposing to make any sort of substantive change into how it's going to be used, we typically have done some sort of additional detail, budget narrative detail to try and explain those changes.

And we are committed to making sure that that details and those changes get explained appropriately. So very open to a conversation in terms of what level of detail the Legislature wants and how we can deliver on that. Obviously trying to maintain as much efficiency and effectiveness as we can in terms of the implementation.

But it needs to be transparent and make sure that you have the information you need. So we are committed to that. There was some mention of the shifts in the bond. I won't go through all of those unless there's a desire to do that. But they're all laid out in the agenda.

We can certainly talk about them if folks want to. But just want to briefly mention there that sort of the context of that is as you look over the overall budget, there's a lot of different policy priorities that folks are trying to balance. And so General Fund availability is of course very limited.

And so part of our perspective on this is to take a look at what efforts there are, what Fund sources are available for these efforts and how to balance that stuff out so you get an overall balanced Governor's Budget that's proposed to you. So that's sort of the context.

And in that context we identified that there were some activities that previously had General Fund that are eligible for Prop 4 funding and that in order to sort of balance the overall budget, it made sense to us to make to do some shifts. So that's the context of those budget shifts.

There was comment about, I think some questions have been raised about, you know, whether or not voter intent or legislative intent. I guess I'll just address that up front and say that for us. We try not to speculate on what folks intent is. We look at the language in the bond act.

Bond act doesn't include any non supplantation language. In the past there have been several prior bond acts that do include non supplantation language specifically identifying the intent that it not be backfill that's not in this bond. So we didn't read additional intent into the bond act in that aspect or from that perspective.

So just addressing that question off up the front in terms of the pending allocations, as was noted, there are several of them. Those are generally issues where we felt like there are a lot of different ways that some of these things could be addressed.

And in the essentially month or so two months that we had to develop between the bond act passing and the Governor's Budget being sort of finalized, we felt there was more discussion needed to sort of pin that down.

So we're open and looking for input in terms what the legislative intent was for some of these allocations and frankly further discussion within the Administration in terms of what we think is the most effective use. And so the plan would be that there'll be future proposals that provide the details when those determinations are made.

I think we already talked about the APA exemption. Nothing really to add there. It's consistent with prior bond acts and will allow for more timely implementation. But there are measures that are put in place to make sure that there's still public engagement and transparency in terms of how that's done.

So it's not removing all public engagement or all transparency, but it sort of streamlines how that is accomplished and it's consistent with what we've done with prior bond act in terms of accountability. Just reminding folks that there are a number of various reporting requirements already in place. Last year we bolstered, for example, Wildfire force resilience.

Last year we worked really closely with the legislative staff and bolstered some of the metrics that are required for wildfire reporting, acreage and hours spent by every firefighter and things like that. Your first take on getting those reports is going to be this next year.

And so as you get that information, consider whether or not there's still gaps in what you're needing, but certainly open to making sure that the legislation.

When you say the acreage, expand upon that a little bit.

So there's reporting requirements that with the treatments that are done. CAL FIRE provides a report that identifies acres treated for different types of activities that are done. Some of the new requirements included number of hours spent by staff working on prevention versus suppression and things like that.

Is proximity to large numbers of homes part of that calculus too?

So CAL FIRE is here and can talk more detail about it when we get there. But on their website, they have actually a new tool that's really useful. You can look it up and basically pull up on a map like where all the projects are being done.

And so you can see acres treated where it is, how close it is to different things. So the reports do include acres. I don't think that there's things in there that talk about proximity of those treatments to major population centers or anything like that, but there's reporting done on their website that you can go and see.

We'll get into that. Thank you.

But I'll end my overview there. I know folks are anxious to ask questions. And so just, you know, we're here and we have a host of folks from the Administration to help answer questions.

Great, thank you. All right, we'll. We'll just. A couple comments. I really appreciate all the thoughtful work that goes into these presentations. Obviously, you know, we worked really hard on, on Prop 4 for, I think 56 years before it was finally passed. Obviously, we're really pleased to see all the support from the voters. And there continues to be good polling about the, the rollout of the investments.

I mean, this was ultimately about making sure that our most pressing climate impacts, we'd have some funding for preparedness and resilience and mitigation in water wildfire, extreme heat, sea level rise, parks, open space, natural lands, making sure that they have some resources so they can buffer against some of the worst impacts of climate change.

And of course, we now see what's happened down in Los Angeles, unfortunately, just the latest of many catastrophic wildfires around the state. So, you know, I remember people were saying this is a lot of money. 10 billion. I mean, the total cost of these fires, I think is 250 billion just alone.

So there's just these fires and we've had so many. A couple things I want to just, you know, just comments I want to make on the presentations. And then we'll go to Senator Choi and then Senator Blakespear for questions.

But you know, there was a, I hear you on the explicit language on supplementation, but throughout the entire process, from discussion to discussion and including campaign comments, there was a clear message also as the bond was being crafted about this not being used as a backfill.

And I think, you know, we're all just concerned about, you know, the bond being used to offset the General Fund as proposed by the Administration. So I want to, I want to just raise that concern.

I think it's going to be a topic of real discussion here today and going forward, you know, I also want to ensure that voter and legislative 10 is realized, which includes a commitment to the justice 40 principles that are embedded in the measure.

But you know, the issue is discussed, I think at the very end of the Committee analysis in a very correct way with regards to my understanding of the legislative intent. And so I just, I drive people to that paragraph in the analysis.

If you, if you want some more sense of where our thinking is on, on the way that the 40% should be allocated. You know, the other thing is, of course we do want this process to be rolled out quickly and efficiently, but there are some serious accountability, transparency, public participation concerns that we have, particularly for new types of programs and projects.

I think for the older ones that have been tried and true and seen over many years, maybe there's less of a need. So I think that will be something that will be weighing as we look at the APA portion. So anyway, with that, looking forward to. We're going to have a lot of discussion today.

This is obviously something we all worked on really hard over the last few years and want to make sure that this is going to be something that's going to benefit the state, that people will be proud of these upfront investments today.

One of the things I said over and over again through the process was I want people to feel comfortable people 2030 years from now to feel good about paying the debt service for these investments that we put in place now because they're reaping the benefits from those investments decades into the future.

And I think that has to be our North Star as we think about these expenditures. So with that, let's turn to Senator Choi for questions.

Thank you, Chair. I would like to address a couple of areas of my interest and the concern. I come from Southern California and looking at the governance of multi year proposal, one top two tier important categories, one is water and the other is fire.

So now in water related question, the Southern California and Central California desperately dependent on water supplies from Northern California and water tunnel was One of the projects I hear I've been asking several questions to many people related to tunnel project. But nobody seemed to give me the clear answer. What stage it is when the construction will begin.

And since this is a good source of funding for that project from Prop 4 for multi year planning. And I don't seem to find any mention of water tunnel. And if you can update me on the future the status of the water tunnel and what the cost.

If you have done any cost analysis, how much it will cost, whether we should project in this multi year plan that cost to be reflected in governor's proposal. We can make a suggestion or changes. And the other area is regarding the wildfire.

I've been working on my Bill idea but because of council the Bill Language Back and forth that we got delayed. And I'll have to wait until next year to propose. But one of my big ideas and mitigating the wildfire that we are fighting every year. Literally every year.

And we are trying to find ways how to efficiently fight. But my focus is on prevention. So how we can prevent the wildfire. I classify two reasons for the wildfire. Number one is the energy high power energy line through the by the wind it falls, it causes a fire.

And if that is the case, I mean we are facing a lot of difficulties. PSPs is what the power safety power shutdown plan. And last week the mayor and Mayor Potem from Villa Park came to me and what the state can do.

Our village, the Villa Park Village people, the city people suffered several times of power outage because of PSP's plan for the safety and for several days. And a lot of elderly people are suffering. Not only food issue inconveniences, but the medical issues as well. And so finding the resources of hiring more firefighters or trucks.

Water, I mean water is another related thing. You know, you heard one of the dry reservoir, there's no water. When the fire hydrants, you know, opened, there was no water in there. That's all water related in the fire.

So I would guess over 90% of fire causes are from the high wind that knocks down the high power lines.

So why not we take a long term plan relatively short term, 5 years, 10 years to 50 years, even 100 years it'll cost because everybody will say less underground high power lines then zero, that would be too much.

Then compare fighting and the damages of the old properties that you have seen recently in Southern California fire that will be more costly all the losses we are facing.

So for long term plan that investment for undergrounding the Fire lines, if rugged areas can be above the ground, but we can feasibly technically possible can underground them so that when the wind blows that we would not be as much affected. Maybe we can control 99%.

If we do everywhere where the nearby residences are located and nearby the power lines will affect their lives. So I would like to see that the long term plan and that this will be great source for funding for future. So that's one area. And number two reason that I see is that we see some crazy people when fire prone weather conditions, they get tempted to go out and set a fire.

So we need to be smart using technologies and set up CCTV or any other wise technical devices so we may see and strategically locate them where most likely those arsenic may show up. And access points, strategic access points so we can set up such a CCTV. Any other AI technology would be really good.

So so we can rely on the human behaviors and the most likely access points. So that will cost also again, maybe I don't know the percentage of the arson cost fires, whether 10%, 2%, but there are probably much less costs than the high power lines. So that will also cost money.

And that should be planned long term planned and that one can be done a lot easier short term plans than underground in the high power lines. So that's a secondary wildfire mitigation prevention rather than fighting and trying to fight and win the mother nature which will continue year by year every year.

So these two areas, I think it will cost a lot of money and we have to be planned in the multi year plans that will be the resources will become available through this Prop 4.

Let me just start by saying, I think Senator Choi has brought up a number of issues that we're going to be discussing extensively through the course of this semester as a Committee. You know, specifically on the Delta. There's no money in Prop 4 for the Delta conveyance project.

There is potentially money to ensure, you know, the Delta levees could be repaired, for example. Of course the Delta conveyance project is a major topic of discussion for the Committee and for the water Committee as well. And we'll be hearing, we'll be discussing that extensively.

Of course the fire issues, you know, there is potentially money for some of the things that he mentions. You know, there's other sources potentially also in ggrf. I'd like to open up the conversation with regards to GGRF and what that looks like with regards to undergrounding.

But anyhow, I'd love to hear your thoughts on all these very important issues. That have been raised.

Yeah, I was just going to reiterate what the chair said. There's no, there's explicitly no funding for delta conveyance in the bond. You can see on page seven of your agenda what the water categories are Also on page 8 of your agenda. The full 1.5 billion for wildfire is all on the prevention side.

So that all of the activities are for prevention. And you can see there, if you look at the chart on page eight, there is explicitly funding for reducing risk from electricity transmission as well as for fire ignition technology, which are two categories that you mentioned. And both of those are kind of in the pending.

That pending category where the Administration doesn't have a proposed timeline because they want to work with the administrator, with the Legislature on that. So those two topics that you mentioned, there is funding in the bond for each of those. On the Wildfire side.

Can you kindly do some study in California how power lines that are likely to cause fire wildfire, how many mileages we have them exposed and they are year after year causing wildfire and or become the candidate to cause fires. So that will give us idea how much it will cost.

Years ago in my City of Irvine, all undergrounding is required, the whole high power lines. If a developer wants to develop nearby the high power line and goes through at that time, probably more than 10 years ago, it was a lot lower cost of $1 million per mile. But now the cost may be higher.

So if you can figure the current amount, the cost of undergrounding per miles and the total mileage we have for higher power lines exposing all the wilderness areas. So I think that will give us a good idea how much allocation we need to put into that fire prevention programs.

Yeah. So sort of a lot to unpack. So let me start there. We have, there will be hearings coming up to the chair's comments that are specifically on energy. And you'll have the opportunity, I think to dive into this a lot deeper.

But what I could say here is the office of emergency Emergency Services, Office of Infrastructure Safety works with the utilities to review their wildfire mitigation plans. The utilities are required to have plans in place that address things like hardening transmission line infrastructure. And some of that's undergrounding, some of that's hardening above ground infrastructure.

Things like that that are certainly multi year long term plans that the utilities have that are being viewed by state offices that have oversight over that. And there are of course a lot of different efforts that are going on. There's a whole chapter in the bond that's related to energy.

And there are certain things in there that address that. And we have folks here that are specific to the energy assignments that can come up with their specific questions. But in terms of cost for mileage to underground and things like that, I think there's going to be a lot of variability

and you office to do that calculation and the mileage that I'm talking about,

My office wouldn't. But we can certainly work with departments that look at that. I think with undergrounding for example, depending on where you're doing the undergrounding, the cost per mile would vary a lot. You know, really rocky ground or solid ground versus softer ground or like terrain. And a lot of factors I think go into the cost per mile to underground it.

And yeah, after you find those data, if you can plan and make a proposal for short and long term plan and suggest that the Governor's proposal and for the multi year for the future Governors to work on, it'll take several generations to complete that. But I think this is really necessary for Californians.

I don't know that I can commit to us making a plan. But what I can say is there are folks that are experts in the energy area who could talk to what plans already exist through the utilities and whatnot are required to develop and what's already in place in that effort.

Yes, thank you, thank you for being here today. I have a couple of questions and comments. So the first one is that studies show that the voters give support for a bond when they believe the government agency will do what they promise with the money.

So it basically goes to trust, it goes to the idea that they're agreeing to more money than would come from their taxes because they think that this is an important thing and they believe that the government will do right by it.

And I'll just say that I think despite the lack of non supplementation language, I think there's an Overall understanding that $10 billion would go to new projects related to fire and water and climate.

And so I understand the extreme situation we're in with both threats from the Federal Government withholding or pulling back from commitments and also with our own budget difficulties across a whole range of topics.

But I would just encourage us to really take that seriously that voters trust and to to Fund projects that will show something at the end that we will be proud of that we can look back at to say this $10 billion was spent to do things that achieve the goals that the voters had and that they voted on.

Because if we're using it to backfill things like deferred maintenance for our state parks. You know, those are the types of things that we, that I think generally taxpayers believe should be part of the ongoing operations of a budget that's $228 billion from the General Fund. You know, it's already a lot of money.

And the reality of $10 billion in a bond is $16 billion over the life of the bond, which is 40 years. So, you know, it's more money and it's not, it's obviously not the best way for us to be budgeting.

So this is just the beginning of what's going to be a long process over multiple years with this money. And it of course applies to multiple different bonds that we have had and will have potentially on the next ballot.

So I know it's difficult, it is always difficult to do budgeting at really every level of government where there are always more needs than we have money for.

But it's just like our household budgets and you know, we need, I think we need to be disciplined and we need to recognize that the climate bond should not be used to offset other priorities in the General Fund that would free up money so that money could be spent in other ways.

And so, you know, there's a shifting of money from here to there that in General concerns me and I caution us about it. I urge us to do as little of it as we can.

And I recognize that maybe we have to have certain things that are unexpected expenses for our already existing commitments, but making sure that we're not just being cavalier and saying, well, you know, it wasn't specifically excluded in a non supplementation language clause because I just in General do believe that you have to go back to what does an average person believe and an average person believes when they're voting on this bond that it was not going to just backfill General government services.

So, you know, that's my kind of opening comments and my hope that as this moves forward that we do this very little and that we take this seriously as one of our guiding north stars. So I have a couple of questions and thoughts.

So one of them is that the process for applying for money can be onerous and there are projects that have multiple benefits at times. Like for example, there's a tribe that wants to build a fire resiliency center and it would include fire training, climate resilience, food sovereignty, fuels reduction, evacuation, workforce development and clean air.

And those are all different types of programs that might come from different Fund sources.

And are we, I'd like to encourage us and I'd like to hear the response of are we trying to figure out how to reduce what can be a very onerous process to apply for grant money and have that burden just be reduced so that we are not spending so much, applicants don't spend so much money on consultants and time and trying to piece together from many different funds to do something like that.

Yeah, I will allow my colleague Bryan Cash to talk to the details. I mean, obviously we're trying to always be as efficient as we can with it, but I'll let you talk more details.

Bryan Cash from the Natural Resources Agency. Yeah, we were. We are organizing a lot of outreach to stakeholders, to potential grantees to improve our application process to make it simpler, maybe to have a two step process where you submit a concept and it makes it a lot easier, then you're not spending as much money to actually develop a whole grant application first.

So we are working on that. We've had a couple public meetings already to work with our stakeholders, had several hundred people attend each one. So there's been a lot of great participation and we look forward to continuing to do that and improve not only the application process, but make it easier too on the getting reimbursed. So the whole process, we're taking a really close look at that right now.

Okay, great. I think that's a really important value and so I appreciate that you're focused on that and I hope you remain focused on that. That's great. I want to get ahead of something.

So the Habitat Conservation Fund is something that was approved by the voters and I'm very concerned about proposals that either sweep that funding or move something that should be continuously funded into this ad hoc source like the Climate Bond. So I want to just put out there in advance.

I don't see it proposed, but I hope it doesn't get proposed because it is really important that we continue to Fund that.

And I think it's at $30 million, which is not a large ongoing amount in the ongoing scheme of things, but it's really important that we continue to preserve our open space and our habitat and our natural lands and to be able to have money available for that.

It's preserved a number of very important projects throughout the state and it's something that the voters really care about. I also want to make a note about the coastal resilience projects. Those are very important to me. I represent San Diego and Orange County here in the State Senate and I wanted to ask about whether some.

There's a particular lagoon restoration project, the Buena Vista Lagoon restoration project. That's at 60% design. And it is. Will there be money available to finish design and also do construction or from the bond, or is that not part of. Part of it? Would it just be for construction?

So the bond allows for design and construction costs of projects. I don't remember off the top. I don't think there's a specific allocation for that project. It would probably be eligible under a number of these coastal resilience categories. And certainly those categories can be used for both design and construction.

Okay, okay. Yeah. I think that that also goes back to the point about natural habitats. I mean, our lagoons are just such a critical part of our coastal ecosystem. So I do really want to uplift those types of projects. And then also finally we see that the Federal Government is less interested in alternative energy sources.

And as we're evaluating that landscape, I think it's important that we continue to invest in those things, which I know is part of the governor's proposed budget, these clean energy projects. And the Scripps Institute of Oceanography has a hybrid hydrogen ship and they're trying to close a gap of $20 million.

And I think of that as something that is a really important future looking project that would be new, that is not currently existing, that could be really important for us to Fund. So I just want to put it out there as an important value. So with that, I will yield back to the chair.

I thank the chair for this hearing and a lot of good information is coming out on this. First, I want to be clear that I respectfully disagree with my colleague from Irving on the need for the Delta tunnels and reiterate that there's no money in Prop 4 for conveyance or tunnels.

But before I proceed with my question, is there anyone from the Delta Conservancy here that could respond to questions about the Delta or levees?

Thank you. Thank you for stepping up. Appreciate that. I'm concerned about the long-term Delta Levees maintenance and want to ensure that the appropriate agencies receive funds they need for maintenance projects, especially for critical Levees. There's a $2.4 billion needed in the Delta for identifying and defining projects, programs and Delta flood protection.

Meanwhile, there's only $150 million in the governor's proposal allocated for Delta levies and 29 million for the Delta Conservancy. Did the LAO consider recommending that the full and necessary funds be allocated to implement the Flood Control levy subventions program?

I'll just have a point of clarification. The bond total is 150 million. That's included in Proposition for total available set aside for Sacramento and San Joaquin Delta levies. There's no, none of that. 150 million is proposed for the first year of implementation by the Administration. So I'll defer to the Administration to, to clarify what their multi year plan was for that 150 million.

I'm representing the Delta Conservancy. So we have the 29 million but are not responsible for the 150 million.

Okay, and the 29 million, is that going to be sufficient for the needs to protect the Delta in the next four years?

Well, we did put forward the proposal that you mentioned and I forget exactly the dollar figure, but that's a lot closer to what we need. But the 29 million will go very quickly and we very much appreciate it being there. And there's a lot of work in the Delta that needs to be done that that won't cover.

Thank you.

And if I may, I'm Kasey Schimke with the Department of Water Resources. We actually administer the Delta Levy Maintenance and subventions program and the special projects programs that are funded as part of the $150 million proposal in the bond. Those programs are partnerships with the maintaining agencies of those private levies they propose annually.

What projects they have that they are going to be looking to do. The state partners with them. It is a cost matching process and then the state pays for a share. So on an annual basis we, we have. Because this has been funded in past bonds and in past efforts since the 1970s.

Those dollars currently are in the 15 to $17 million amount of projects that are brought forward in state share of cost for those projects that are brought forward by the locals.

And we still have funding, a little bit of funding remaining, which is why there is no proposed Prop 4 funding in the budget year that would come in subsequent years. For that. So that is the process that we undertake with that.

So I mean the deltas are, the levies are at risk in my opinion to a degree anyway. So no matter what happens with conveyance, those levies need to be protected.

And we don't disagree with you. And this is the process we have working with them. Those levies are privately owned and operated levees. So we, that's why we have this process to work with the landowners and the maintaining agencies to address the needs as they come through.

I will say additionally, the Department does have a statewide flood response element to our, to our duties that we do. And in fact just this last year dealing with, with some, some slippage of a levy and addressing those kind of issues. So we are investing in it.

We don't have an Overall, we have a $20 plus billion levy need in the Central Valley where we do have a liability and responsibility. There's an efforts on all those parts and that's actually addressed in the budget proposals.

Your number is bigger than mine. I said 2.4 billion and you said 20.

But I'm talking Sacramento and San Joaquin river systems where the, where the state has the primary responsibility for those. The delta levees being separate from that. We have this separate program and effort.

Okay, thank you. All right, I'm going to move on to a second question. Did you have a comment? For the next question I'll follow up on backfill issue that's already been raised a couple of times, starting with a specific example. Development of offshore wind is an important element to meet the state's clean energy and climate goals.

Prop 4 funding is intended to be additive to the already existing state commitments to offshore wind and prior budgets. I hope this climate bond funding will be used to expand and continue the state's efforts in this space. Last year the budget maintained 45 million for competitive grants to support development of offshore wind projects. What is the current status of the program? When will the funding be awarded?

David Evans with the Department of Finance. I'm going to have my CEC colleagues come up and respond to that question.

Thank you.

While she's getting ready, I do want to clarify that none of the Prop 4 dollars are going to replace any of the prior investments for offshore wind and for this investment category it is additive.

So no money has been reduction.

There's no reductions or swaps with Prop 4 for offshore wind investments.

Okay. Especially considering what might be coming down from Washington, we need to be clear that we're going to protect that project.

Good morning, Chair and Senators. I'm Elizabeth. Can you hear me okay or.

Yeah, you're on. I'm on. Okay.

I'm Elizabeth Huber. I'm the Division Director at the California Energy Commission Siting Transmission and Environmental Protection Division. Amongst other things, we, we do CEQA work in licensing clean and renewable facilities under AB 205. And then of course our historic application for certification for thermal power plants. We do ensure compliance.

And so we're like the regulatory division, I should say. We implement the renewable portfolio standard. And then as you get all the information and give us guidance, we also work on planning on the implementation of it.

So with that said, when the Legislature brought Forward to us AB525 and the offshore wind Strategic Plan was the final product of it, it included numerous recommendations and within that also included under that Bill, legislation guiding us on interim reports as we recall them, with regards to ports and ports infrastruct.

So not only is there a section in the final strategic plan, the CEC led an informative public process in developing an interim report on the preliminary assessments of economic benefits to seaport's infrastructure. And then our colleagues at the State Lands Commission did an interim report specific to port readiness.

So we took all that information and so to your question, Senator, on the AB 209, that was budget Bill that gave us funding for specific categories of grants, we took all this information from those reports and then we initiated in November of 2023 a public process.

So we had a public workshop, a day long workshop, gaining information, building on the recommendations and the final strategic plan to help us lay out the specific categories. As a result, we did put out a solicitation in September of 2024 that included two specific categories. One for early onset development, grants for assessment and studies at their ports.

And then the second category is advanced. So those ports who have actually maybe initiated some initial studies or started the CEQA process with the drafting environmental impact report, we then held based on those categories.

And then there were different criteria or additional points that you would get, if you will, such as if it's based on the legislation, the direction if it is used through matching with federal funds or private sector funds, and then as well as underserved communities. So with that said, solicitation went out.

Then in October and November of 2024, we had these, what are called pre application or pre solicitation workshops so that the entities that are applying to these grants, they could ask questions, get you just get some one on one in a public setting asking questions and some guidance.

So we had those workshops and As a result of those workshops, the allocation of the $42.7 million specific for the delivery of those grants, we were asked to do a Fund shift from the advanced category 2 work to more of the early stage development based on the direct, based on the guidance we were getting, we received from these entities on the what they think would be subscribed to.

So we made that change then in November. And as a result, we extended the solicitation through the end of December and that closed at the end of December. And so beginning of January after the holidays, we had our legal house to look through the applications, ensure that they met the minimum criteria.

And then a panel of experts in this area became part of the review panel. We're finalizing that review. Panel is finalizing review of those applications between the two categories. And our hope is to get those awards announced and out by the end of the first quarter of this year.

Well, thank you. The Legislature does expect these to be boarded as soon as possible. They've been sitting in the CEC for two years. Yes, understood. If the chair will indulge a couple more questions. Okay, thank you. My next question will be on the transparency issue and multi year programs.

You know, if there's multi year programs, there's going to be almost certainly a lack of transparency and accountability. The Administration would not be required to provide the Legislature with the same level of oversight each year as it would if we had year by year allocations.

So the Administration would not be subject to oversight and programs as directed since it would not have oversight hearings and the normal budget change proposals would. Should we be considering yearly review on new spending, at least on some projects.

So I wanted to clarify something. So even if we do a multi year implementation plan, there will still be an annual BCP that can still be agendized so that there's conversation and discussion about what's in that.

It wouldn't be the same as if it was allocated every year.

So. Right. The level of detail in the BCP narrative is I think the issue that's sort of in debate here. When we have a program, take the forest health program, for example, that's a very established program. How it's used and what it's used for is very consistent.

And so that's a program where we feel a certain level of comfort. And if the Legislature doesn't that, absolutely, we're open to hearing that feedback and we can address that.

But we think there's a certain level of comfort that in a program like that just having, hey, this is the amount we're planning to allocate for that program this year is probably fairly, fairly good.

I've been in the industry, I understand how multi year planning is very beneficial for a lot of different reasons. But we're going to need that additional transparency.

And I tried to touch on earlier and hopefully we can help to continue to make people comfortable in other programs that are less established and less clear in terms of how they're used. It is our intent to make sure that the additional detail is still provided.

It maybe it will take some adaptations to what we've done in the past, but we are committed to making sure that you still get a BCP and that for things that are substantive changes or programs that have not been detailed previously, that we would provide those details so that you get the same type of BCP narrative detail that you normally would for those changes and for those programs where details have not previously been provided.

Okay, so this Committee will be working with you on making sure that those procedures are in place. My last question is for you, Rachel. You mentioned metrics in terms of accountability. Would you kind of go into that a little bit? How can we develop metrics and how can we make sure that they're certified and accounted for?

Yeah, it's a really important last question. Important topic. You know, historically with bonds and including with this one, there are a lot of reporting requirements on the Administration, but those have historically been about how did we spend the money and did we spend the money the way we were legally required to?

So they have very robust websites where you can go in and see the specific projects that were funded and where they are and how much they cost. And that's all very helpful information. But I think what we would encourage is going beyond that, given the challenges of climate change.

Well, not just how did we spend the money, but what did we get from the money, what are the outcomes, what did we learn? What are the most effective strategies? You know, for example, in the area of extreme heat, which is a relatively new challenge for the state, what is working? We're putting in funding for resilience centers.

Are people using them? What are the barriers to using them? There's a lot of research coming out of UCLA. I just went to a research symposium this week about the importance of shade structures and what type of shade structure you're putting in and where is it. These are the types of things that not just learning.

Okay, we spent the dollars in this district according to the legal requirements, but how effective was it? And that type of reporting and metric is a little bit new. We're making some progress, particularly in the area of forest resilience in this Legislature and some of the requirements and CAL FIRE's initiative as well at looking at effectiveness.

But I think those are the types of areas that we would suggest with this investment and the areas that we're focused on that you might want to think about making sure you're getting that type of information, not just how was the dollar spent but what did we get from it?

And given the number of programs, you probably wouldn't want to require that across every single program the administrative burden would be very high. But focusing explicitly on, okay, this program is supposed to be targeted around our 30 by 30 goals or our water resilience goals.

So are we making sure we're getting the information we want to see what kind of progress we're making on that. And you may even want to think about putting some money aside for specific evaluations on some of these from academic researchers on some of these questions that are really important to you.

So again, I think we would suggest being very strategic about what are the brand new efforts perhaps or what are the areas that we're most concerned about and thinking in collaboration with the Administration of what are we already planning to collect on that and is that enough or is there something else that you are hoping for so that we can get 51015 years from now and say, okay, what did we learn as we're potentially crafting the next bond or the next hopefully the next General Fund surplus? Let's go with that. How can we use that funding most effectively?

Thank you. Very thankful for those answers.

You hear all the excitement about the next surplus. When's that going to happen? Do you know, I miss those days. All right, well, let's just keep all asking. We have a lot of time. We really want to do a deep dive here.

This is an immensely important part of the work of the Committee this year is on Prop 4. So I'm just going to start asking a lot of questions on a lot of topics. I just welcome my colleagues to jump in with follow up questions as topics come up that are of interest. So let me.

This is going to be. So this line of questioning will focus most on CNRA and Department of Finance. You almost got up. Just sitting up for you. Right? Right. Yeah. Just shuffling in the seat. And by the way, we got water and coffee. I know. You know. Please, please don't.

Yeah. And then energy as well under CNRA. So maybe we can do some follow up on the line of questioning that Senator McNerney has I know Senator Stern has some questions in this area as well.

So just on the whole question of spending guidance that we touched upon a little bit, you know, let me give one specific example that we had a section in the Coastal Chapter that provided funding for activities under DFW fisheries, kelp, island, invasive management, those kinds of things.

And then there was language in the Wildlife Chapter that directs CNRA to implement regional wildfire projects through state conservancies. But the Administration only allocated funding to CAL FIRE and the Sierra Nevada Conservancy, and they excluded Southern California conservancies. So I think we need some additional budget Bill Language to direct this funding appropriately.

So I guess the Leo, so when the bond language allows for several different potential activities within a given category, the Leo has recommended that the Legislature consider specifying spending guidelines in the budget Bill or trailer language.

So in this, in this language, with regards to fisheries and kelp, the section 92050, you know, does the Administration interpret the language in Coastal Chapter as three separate programs for the DFW to administer or, you know, I want to get into how specific we need to be because we, you know, when we put that language and it said fisheries, kelp and invasive island, invasive management, and how should we be thinking about directing language to make sure that our intent is preserved?

Yeah. So we have water experts here to talk our Fish and Wildlife, I guess, experts to talk about those three. And then I think specifically to your wildfire one, if we get back to that one too, CAL FIRE and CNRA could talk about how, why CNRA and CAL FIRE and how CAL FIRE is planning on doing that. I think that could be a helpful discussion too, but go ahead.

Good morning. My name is Valerie Termini. I'm the Chief Deputy Director over at the Department of Fish and Wildlife. And early on, CNRA helped lead collaboration across all of the different departments and agency thinking about how we can build on that momentum and existing priorities.

So in that coastal section, we have both advancing climate change ready fisheries as well as salmon and salmon management. So within that we want to build on, you know, the Department has our salmon action plan and we really want to build on those priorities. And then the climate ready fisheries includes whale safe fisheries.

And OPC is also committed to helping with the kelp section there as well. So we think we can build and make huge progress on those priorities. Those also have ripple effects on island ecosystems. So therefore I think we're getting a lot of those priorities captured, though just in those two sections of salmon and climate ready fisheries.

Okay. And congratulations I've read the paper today about North Yuba River and all the fact that salmon are now back up. Sorry. It's all because of you.

That's all Chuck. . Okay.

No, it's all Chuck No, no, no. All right. But. But that's, you know, that's all good news. Okay. So, yeah, I. I just. I'm just kind of. I'm flagging this because we're going to want to. This is. We're just gonna have to.

This is an area where we're going to be working on some budget trailer language as we think about the implementation of that section. Yeah. Yes, sir.

Yes. I would just say that as we're trying to explain to you what the intent is, certainly if there's a.

You want it directed differently than what we're planning on doing, then yes, I think a conversation between the Legislature, Administration in terms of, like, budget Bill Language and how we can craft that to make sure that the intent of your actions is being carried out correctly.

Yeah. I think the thoughts were that with regards to this coastal money, there are three separate existing programs within the Department in those areas, and we just want to make sure they get some funding to do their work.

But again, this is going to, you know, if you disagree or you have a different vision, you know, we can. That's something we can work.

We'd be happy to work with you and hear your ideas.

Okay. All right. Now, how. We were sidebarring about this. I mean, how does the. How. What are your thinking. What's your thinking about determining when a section needs to establish a local assistance program versus when the state agency should complete the activity?

In general terms, whether it's budgeted as state operations or local assistance sort of depends on who's actually going to carry out the activity. So in a case like, where we're going to have the department specifically, you know, hold the contract or their staff is physically going out and doing it, that would typically be like a state operations type of appropriation where we plan on doing a grant program or in some cases there's allocations that specify it's supposed to go to this particular entity. So it's sort of a direct grant, if you will. In those instances, they typically get budgeted as local assistance because it's not a state department who's like sort of physically doing the work. Hopefully that helps clarify.

Yeah, please.

Maybe it helped to ground your point, Mr. Chair, in a... I was in the weeds on this whole bond, so I hope I'm adding a little bit of value. But take for example the fire prevention grant program that CAL FIRE administers. Up to this point it's been sort of individual grantee based.

I think the sizes can, you know, $300,000 for a particular prescribed burn or management of vegetation on the hillside of one community, maybe a million dollars for a larger project. Department might know what the range is and maybe they can share some insight on it.

But administering that many grants statewide and knowing the sort of local details and what is required of that, the merits of project A versus B, and especially when it gets to down to a metrics driven grant strategy, which is essentially like they, you know, you get a score and you see how you score. Right? I mean that's sort of the classic thing.

But the hitch has been that we've missed, we've missed opportunities that just sort of get lost in the shuffle of a smaller scale, you know, large scale, small dollar grant making process versus thinking, for example, coordinating with county OES or county fire to identify the most vulnerable areas in the region that could then self organize amongst multiple local fire prevention grants and get sort of, sort of larger amounts with bigger outcomes that aren't going to miss things.

And you're, you know, the example I give, it's a, it's a harsh one. It's where I just moved away from that just burned down on Big Rock, and there was literally a fire prevention grant request for like $300,000 from this fire prevention grant program that I guess we're now planning to backfill or something.

We're not going to add new money, we're just going to shift money around. Still trying to get my head around that one. I thought we were going to have, we told everyone we're gonna have more fire prevention money for you. So that's still confusing.

But you know that grant not happening is exactly where the fire came through and burned a bunch of people's houses down. And so everyone's sort of scratching their heads like what did we not do right? You know, and why didn't this work out and why didn't CAL FIRE award it to them?

It didn't have a lot of forest carbon that that project was going to save. And that program, folks at CNRA or CAL FIRE can attest more to the details, but it's, it's a forest carbon avoidance metric that is in that sort of broader formula for how the grants get administered.

And because of that weighting, things in that pot tend to go to rural forestry based fire prevention projects and not those that are closer to population centers. So I guess the, maybe the observation or the question, the sort of direction for you all to consider as you advance this next sort of phase of the program.

And I know there are still more changes underway, but it's how to, how to find both the metrics that work and the size, you know. And so you can imagine the difference between a $10 million grant to a county versus a series of 300,000, 500,000s. And so I don't know if that same dynamic applies sort of more broadly, to the Chair's point, like if that's a broader observation. But I just know in some of those cases it seems like we need innovation at a policy level of how we design.

And don't just assume that because there are already guidelines, which is a fine thing and it's going to move things along. But how to realize that those guidelines may need to change and how to do that efficiently or how to work within them to make it go fast. No one wants to slow things down.

Well, I don't want to slow things down with fire prevention. I'm not sure still on the administration's priority on that front from what I'm reading here. I'm getting that they don't want to go big on the Proposition on that front. I don't understand quite the logic of not front loading it, but especially if we're asking Congress for $50 billion. I'm like, why are we pulling back at all on fire prevention? But the broader point, yeah, I'm not sure if that's a useful observation for all programs. I would just say in this particular instance it'd be helpful to know from department just how they're thinking of dealing with those gaps in the system.

So I certainly would invite CAL FIRE and CNRA to come help with the comments. But I think a couple of things I would like to observe is one, the administration is absolutely fully committed to fire prevention, and we don't want to slow it down any either.

And hopefully that's not the impression that's being given by the way we're implementing this. So we have a multi-year implementation plan because we want to make sure that we have some continuity in providing things and we take into account capacity for delivering on things in a thoughtful and effective way. There are, when you kind of hit on backfills a little bit, the local fire prevention grant program is not one that has any backfills. That was... I don't remember the exact...

I'm sorry, I should have said the home hardening. The Cal OES is a backfill. That's a $13 million backfill.

Yeah. So I was going to say, in the wildfire space there's two of those. There's the stewardship of state owned lands, which is essentially sort of defensible space, forest health treatment on like state owned property, and then the home hardening. And I probably did a disservice to all of us in not providing more detail in terms of how we thought about those backfills on the front end.

I would like to clarify that what we did, and make sure it's clear to everybody, that we looked at what programs and activities in Prop 4 were completely compatible with some existing General Fund dollars that had not yet been encumbered. So there were no projects identified yet. They weren't awarded yet.

And again, to my earlier comments about sort of balancing across the overall budget with General Fund and those constraints, those are the specific things where we identified saying okay, we have $13 million of home hardening funding. That is of course a huge priority for us, an important program, and we're continue to committed to doing that.

Prop 4 includes a significant pot for that. We're going to continue to implement the program at the same pace as our capacity and projects are ready. We're shifting which fund source we're supporting that with. And I get that that does not address the concern of complete additive total dollars. It shifts some, it's replacing some dollars.

And we accept that and appreciate that. But I do want to make sure it's clear that there are no cases where we're not using Prop 4 dollars for what the intent of the Prop 4 bond act says they're supposed to be used for. Like parks deferred maintenance was mentioned before.

There is a specific pot in Prop 4 for parks deferred maintenance. The General Fund that's being saved that is shifting directly into deferred maintenance. So it's not like we're doing something different than the activities the voter approved. Now of course we acknowledge and concede that it is a less total dollar amount because there is some General Fund being removed. So I just want to make sure...

And I guess I'm probing the logic of doing the backfill versus, take home hardening. We still don't have the home hardening commission up and running. We're still waiting for a number of regulations. Zone 0 has not come down from department yet, but supposed to be coming.

I mean we're waiting, and we're waiting on the updated fire maps throughout the state. So there's a few pieces that are going to kind of drive it. And it's a similar dynamic to how you do your electric transmission infrastructure. Where you're waiting, like that's in the... Sorry, what do you call the category? The unallocated category versus the backfilled category. I mean can you just comment on that sort of logic?

Especially when a plan is sort of gestating and, you know, sort of about ready to go but not yet ready setting aside, you know, sort of funding an existing thing that is about to get changed just to do a backfill versus, yeah, even calling it unallocated for now or another way to anticipate those sort of mid year changes.

The 3264 report that you all refer to or LAO does that's coming back in July on saving electric costs, for example. The energy pot has a backfill to sareup. It doesn't say let's wait to look at that report. It says no, here's 50 million and we're just going to sort of backfill DSGS. But we're not... Then you're...

Then the budget is all sort of lined up around that new backfill dynamic versus, oh, it's almost ready. Right. Like if that if the administration comes back with a really solid report on 3264 and ever says good to go in July. Like that's ready but the budget doesn't time with it.

So, so I one thing I do want to make sure to clarify in that space is the backfills and the pending allocations are not really related. They were sort of two separate thinking. So on the pending allocations pot, those were instances... Like for example, there's a wildfire transmission line piece that's in the pending allocations.

There's wildfire fire detection technology that's in the pending allocations. Those are issues where there are a number of ways that those dollars could be spent towards that purpose. Like the technology. There's lots of technology that could be used for wildfire detection type of stuff.

What's the most effective and efficient use of that is something that we haven't sort of put our finger on and said this is what we think is the best use of that dollar. So rather than just stick something in there and then not really have... We talked about sort of having details behind proposals here.

We don't know really what the best use of that is right now. We haven't sort of made a decision on that yet. And we acknowledge that the Legislature drafted the bond act and probably has some thoughts on what they intended it to be used for. Having some of that's helpful.

So that's different than sort of the backfill conversation. And those pending allocations, that's really what the context is. We think given the limited resources and a focus on trying to be as effective and efficient as we can in the use of them that it merits having like again some reports that are due.

In the case of that utility thing. Get that product, see what it says. That should factor into the decisions and how we use it. Wildfire detection. Let's have some conversations about our options and what sort of the best use. So that's really we're coming from with the pending allocations.

Can I follow up quickly here? You mentioned fire maps. Is there a geographic allocation plan for home hardening based on the fire maps or how is that money going to be distributed?

So that's an existing program. There was General Fund provided. It was a three year essentially pilot program. The Prop 4 funding will provide some continuity of that. It's still sort of in a bit of a pilot phase. But at the front of that, and it was related to... I think it's AB 38. Yeah. Okay.

Don't always trust my memory, but.. So as part of that there was some ratings that were done that took into look risk factors as well as sort of vulnerable population factors and sort of scored together and it ranked all the 58 counties in terms of a combined score on that.

And again CAL FIRE, Office of the State Fire Marshal can talk in more detail about how that went. But so when with the pilot program, we started with the county sort of at the top of that list. And then you identify some pilot communities that you then work with. And there's local entities that are identified to sort of lead the effort around all of that. And we have Chief Bigelow here. So actually, let me just defer to him. He's actually the expert on it. Let him.

All right, well, thank you. Thank you for the question. And again, my name is Frank Bigelow. I'm deputy director for community wildfire preparedness and mitigation out of the Office of the State Fire Marshal. And the, you know, we've talked about a lot of topics here, but we'll stay on topic with the home hardening.

It's one of the programs that's near and dear to, to my heart because it's one of the programs that I have the pleasure of overseeing. So as Mr. Benson mentioned, there was a specific criteria that was listed in AB 38 of things that we had to incorporate into our analysis when we scored, if you will, the counties or ranked them in order. Many different criterias like social vulnerability, financial concerns, fire hazard severity zones, and others.

So we took those into account, we ran them through an analysis, and the ones that rose to the top, we then reached out to our local CAL FIRE units and the communities around their local leaders and said, what are your most vulnerable communities in those counties. And we went and did tours of those counties and assessed those communities.

And that's how we, we came to the decision collectively that we would go into those first six communities. And within those communities, again, as Chief Berlant testified in the Assembly hearing yesterday, recognizing that there are many, many other communities just within those six counties that could use this work. But we had to start somewhere.

So as a part of this pilot program, we had to build the plane while we were flying it. And nobody had ever done this before in the creation of a home hardening program. So we worked with research institutes like the Insurance Institute for Business and Home Safety and the National Institute for Standards and Technology to develop what's called a hazard mitigation methodology to prioritize home hardening efforts. That was the baseline that started how we would go to each home and determine.

Then we had to build an application, a mobile application to do assessments around the home that would determine what needed to be done as an on the ground assessment. Then we had to build the application portal, the financial part, the frequently asked questions, the outreach material. We had to develop contractor list.

We had to do all the financial part of it. So yes, it took us a little while to build out the program. But we've got our legs under us now, and this program is really seeing the fruits of the labor. 24 homes have been completed, completely home hardened, with more in the hopper.

And now that people are seeing what it looks like to have your home hardened, people are a lot more willing to participate in the program. Some of the challenges that we continue to face are the people that we are trying to affect this change for are some of the most vulnerable among our communities.

And there's tax burdens that come with gifting people money. And when we say to those people that make maybe 30, 40, 50, $60,000 a year, we're going to give you $40,000, well, now there's a, that's a tax liability for them, and it really hampers them from wanting to participate in the program.

So it's one of the, one of the challenges that we've faced to try to get people to, to participate. So, as you know, Assembly Bill 2469 passed last year, which extended the program through fiscal year 28-29, which was really helpful. Now Climate Bond has passed to help influx additional funds to continue the program.

So this is like a new science. Were Altadena or Pacific Palisades, did they race to the top in this or were they...

They weren't at the top. They were... Again, we ranked by county, not by community. So as those counties rose to the top, then we went to those counties, our local CAL FIRE units and other local leaders to get input. So although LA County was near the top, they didn't raise to the level of the top six.

Do you have the resources you need to make this into a real science where you can be as accurate as possible?

So with respect to the science to make... So I think there's two questions you have there. The resources to make the program successful, ongoing. Is that one question? And then the science to make it...

Well, they're related, of course, but...

They are, yes. So we, the resources for the pilot program as we know it now, we have adequate resources. If there were to be additional funds influx to, we would need additional Climate Bond. We would need additional funds to... Not additional funds, additional resources to help manage the additional funds.

Because then we could go into other counties and other communities to further the program. The science, I think, is very clear. The research community has made their voice very loud and clear about the things that matter. And the available science today is the most effective.

Thank you.

I was just going to add... Julianne Rolf for Department of Finance. That this program is also leveraging federal funds, and so part of this program has brought in about $95 million in federal funds. And so it's important that these communities also pass the FEMA requirements. And so that's one of the conditions.

Pre-hazard mitigation?

The hazard mitigation grant program.

Yeah. So. So just pointing out that the 9 or the 15 million that's being backfilled, a lot of that funding... That's not the whole picture. There's also a lot of federal funds that are available. Yeah. Or 13. Yeah. Excuse me. So there's a lot of federal funds in the mix right now that are also being used in this current year. So the funding available is. Yeah, we have OES here to explain more.

Hi. Robyn Fennig, hazard mitigation assistant director at Cal OES. As my colleague from the Department of Finance was saying, we are leveraging the state funding that was provided through the variety of the funding mechanisms to match with FEMA Hazard Mitigation Assistance Grants. All of them are through the Hazard Mitigation Grant Program, which is a post-disaster grant funding option, including additional funding for the, that's being used for that 13 million previously mentioned.

So can you... You're saying from the 2.5 billion the Legislature just appropriated that from... What previous funds are you talking about?

Those from AB 38.

You're talking about the old AB 38 funds. Okay, so that's six county pilot. But we'd need new congressional money to go do any... To do future leverage. This presumes a federal appropriation or no?

Sorry, just to clarify, it wasn't funding from AB 38 specifically. We did the climate sort of packages over the last couple of years. There was funding in those climate packages that were...

That then... Yeah, right. That went to... Was it the defensible space category? Was that...

So we actually had a home hardening category.

$2 million, I believe. Oh boy. Yeah. I think it was about...

There was a couple of appropriations. There was a 12 million and then there's a 13 million. The 13 million is the part, that's part of the, the backfills, the General Fund savings here. The 12 million first appropriation, that was used towards the existing projects.

And I don't want to get, I mean, relatively speaking to the size of the problem, I don't want to get obsessed about this scale of money because it's so big. I mean, I think the larger point that I get, I'd love to hear from you all on is where hardening fits into the broader priorities around fire prevention.

So that's the part I just need. Because when we look at the balance of funding and the like we talked about the metrics earlier avoided forest carbon being a metric for a fire prevention grant program while there's still forest health sitting over here. So I'm trying, the fact that so little proportionally has gone to community oriented or sort of ranked because of the metrics in the system right now. Because it came from GGRF, it had to demonstrate before that it had an associated greenhouse gas reduction.

So without that requirement, you don't need to have that metric anymore and you could finally start getting the bulk of those fire prevention grant dollars to line up alongside your community along alongside your hardening money, if that makes sense.

Just a couple clarifications. So on the home hardening one, that was all General Fund, so that didn't have those like the GGRF requirements.

Fire prevention grant program did. The 200 million.

Some of it because... Yeah, exactly. There's the 200 million of annual GGRF. That of course does. The climate budget stuff that was primarily General Fund, of course doesn't have that requirement.

I'm talking about the 200 million ongoing and then how that, how the follow on to that 200 million is going to be dealt with here.

I think, Senator Stern, what I just want to highlight is how many important policy questions there are around this funding. One important question before you is the timing of when you want to provide it. But even for existing programs like you're highlighting, there are questions around how do you want to prioritize the money. What kind of criteria are going to be used? For the programs that are brand new, like the regional projects funding in the wildfire, there's not even an AB38 to provide guidance for the department before.

So I think just, I'll defer to the administration to respond to your specific question, but just want to underscore if you all as a Legislature have priorities either for existing programs that you want done differently, but in particular for the brand new ones of, you know, home hardening, for example. Do you want to spread the funding across more recipients and provide smaller amounts of grants so that more have access, or do you want to have larger grants for a fewer number so that you are ensuring that they get covered? Different areas of the state.

You know, these are really important policy questions that, the administration is very thoughtful. They have a lot of experts, but they are... There is no clear answer. And so I think we just want to really underscore that for you that the proposals before you do not have statutory language guiding these. It is a multi-year timeline. We want this much money and then we want it on autopilot. So if you have those types of opportunities, excuse me, those types of priorities, this is your opportunity.

Understood. It'll just be a change of course. And so, you know, I don't know if it takes updates to the existing guidelines or with the APA exemption, you can just start to change how you administer them. But heretofore the previous 200 millions and the, what's been a continuous and large scale appropriation, I think 85% of the fire prevention grant dollars have gone to rural parts of the state, which are very important fuel break projects and things like that.

But if you ranked it on a population basis, there are a lot of people left behind from that program. And so when we look at appropriating more funds to that program, you know, I think there's 180 million in here for that fire prevention program. What's the, what are the plans for the Department, I guess on how to the future of that, that funding?

Well, and how to ensure a more equitable regional distribution? Because we did an analysis that showed that, you know, something like 77% of the, of the, of the wildlife prevention grant programs were going to north of the Tehachapis.

Yeah. So there's a, there's a, there's a, there's a geographic sort of north, south way to look at it. But. And then there's also this closest to people way to look at it. Right. And, and it's that forest carbon metric that I think is standing in the way of that. So is there openness to not making that a fixture moving forward of the fire prevention grant program? That would be the question.

All right, a lot of questions there. No, that's great though. Thank you, Senator Stern, for all those thoughtful questions. And those are all things that we have taken into consideration as the Climate Bond became a reality and we were looking into what the requirements were for those dollars versus the Greenhouse Gas Reduction, the 20, the 200 million ongoing, and how we are planning to distribute those funds based on exactly what you're talking about.

So for those projects that don't need a carbon calculation to them, our education grants or our document grants, like local hazard mitigation grant document funding or CWPP document funding. Those, those grants are perfect for GGRF because we don't have to worry about the carbon calculation funding because we're not taking out woody material.

So that's exactly what we plan to do is prioritize that money so that we can use them most effectively moving forward. One of the other components to that that you see in the Climate Bond is a new program that is for defensible space. And in that category, it's one of the ones that was referenced as having multiple options. But the, and as it was mentioned, agency chose, we chose to focus on the defensible space.

And this is the 0 to 5 foot zone where we plan to provide financial, direct financial assistance, exactly like the home hardening program to those to be able to conduct that home hardening. And one of your other questions was how are we prioritizing homes? Well, it's a...

It's a three pronged approach, how we look at it. And where we focus on the parcel level mitigations, moving out to community level mitigations, and of course landscape scale or forested projects. And all three need to be done together in all communities to be effective. Because if the fire starts beyond the community and moves toward it, if we've done the work outside of the community, then the work, the fire has less chance or less impact once it gets to the homes or the community.

But the community still needs to prepare itself in the event that we have atypical winds like we saw in the Palisades, in the Eaton Fire, and the other fires in Southern California, where the community still needs to be hardened in those aspects and then the homes themselves need to be hardened to ensure that they have the most level of survivability.

Is that kind of how you're... Can you give me a sense of how the LA fires have, have influenced the thinking about, about these resource allocation questions? I mean, is there, is it sort of, has there been a shift in thinking as a result of what we learned from the fires?

Yeah, there... And that's ongoing. Of course, we are reflecting on from every aspect, from our fire protection resource allocation, our resource management, through our watershed emergency response teams, to see what happened in that realm, to our fire prevention aspect.

So every aspect of what the fires did and the cause of them, our department is looking at and learning from. So we're a little early to say exactly which changes we plan to make specifically for wildfire prevention grants moving forward. But we are definitely looking at all those things. One of the things I can commit to, and we talked about yesterday in the Assembly hearing, was our commitment to maintenance.

Because we've put so many fuel breaks, and through commitments through the Legislature, a lot of money has been put out in for work on the ground, but maintenance had not been prioritized. But we commit to prioritizing maintenance moving forward so that we don't lose the work that we've already done and having to put more investments back into the work that was already completed.

Right. I guess I just, I mean, for example, I love the Sierra Nevada Conservancy. I've done work with them. We ran a bill together. I just couldn't help but notice, right, you had your $80 million for wildfire prevention and over half of that was dedicated to them in your line item.

And you know, I guess I just kind of makes me wonder how are we making sure that, we've got all these other conservancies around the state. Obviously, they're the biggest territory, but how do we, you know, I guess I just want to make sure we're thinking about geographic equity and also taking into account the changed conditions.

Nobody expected whole neighborhoods in the middle of Los Angeles to just go up in flames, and yet that's what we've seen. It just has to, it has to influence our... We've got to start shifting some resources toward that sort of preventing this kind of thing from happening again. I hope it's really starting to imbue the thinking about these allocations.

And Senator Allen, if I may quickly. Is one of the things that we do, you know, is we, we know we have a certain amount of money every year. And the last couple of years we've had the influx of the multi-year funding package plus the 200 million ongoing. So for wildfire prevention grants, we've had anywhere between 117 and $120 million to grant out. We've had an over subscription to that money anywhere between 247 to 320 million dollars for requests. And so to your point, Senator Stern, that some of those grants get passed up due to a money availability issue.

We start with making sure that every one of our CAL FIRE units gets at least one grant to make sure there's even distribution across the state, of which there are every unit, including our contract counties that have applications that come in. We want to make sure we have an even distribution. We also look at to make sure that we are in north and south. And as you know, for CAL FIRE, we break our northern and southern regions up a little bit different than we kind of contextually think of Southern California.

So we've been pretty good at keeping our averages about around 50% for Southern California to Northern California as CAL FIRE breaks it up. Your point is well made that if you look at it from north of Tehachapi, to south of Tehachapi, that number becomes a little bit different. So once we've made sure that everyone gets there...

We're being generous of that because Kern County takes a big chunk. So anyhow, I, I, I get your. Yeah, sorry, sorry.

It's fine. They, and then beyond that, whatever's money is left, we look at distributing that based on the criteria that we received from the feedback from our local CAL FIRE units, our region assessment, and then our Sacramento assessment to determine the best projects of where that that money can go. So that's kind of in a nutshell, how we distribute that money.

I think, if I may, I think what I might. I'm concerned that maybe we've sent mixed signals, I guess is what I'm getting at in terms of what we expect your top priority to be. Because we talked earlier about the acreage reporting, I think, Mr. Benson, you mentioned it right.

There has been that statutory directive, and I believe SB 456, to hit a 500,000 acreage target. That is, like CAL FIRE's on notice. Everyone's supposed to be coordinating. There is a, there are acreage metrics driving our fire prevention policy. There are not this, there are no statutory metrics to say maximize the number of communities protected or maximize public safety. And I know there's been criticism in the past, by the way, that, oh, you're not getting to enough acres.

So we've sort of shifted ourselves into this chase the acreage paradigm that then it makes it inherently complicated to administer a grant program when you're at the one hand being said, maximize your acreage. On the other hand you're saying, well, but what about all these people who live near a small gully that could burn 400 houses down?

And you're only going to, you're only going to harden, you know, you're only going to treat an acre and a half or two acres, but that could make the entire difference. And so it's not so much, I guess, a criticism of the department. I'm just trying to get the insight of, is it because of the statutory or those kinds of directives that the policy being set up that way and is there something that we need to say that's clearer about priority? Yeah.

So just the one thought I'll add on that, is that the Wildfire Resilience Task Force does just some great work around considering metrics and, and you know, how much focus should be putting on acres versus other types of measurements and things like that.

Things like that SB 456 setup...

Yeah, I think that, okay. Yeah, right. So that that group and their website's got some things on it. And so I think what will be helpful is we just need to make sure that we're engaging that with the Legislature and having... Sorry. Some conversations on what are the best metrics.

Exactly. And that, and that that legislation didn't, it had a metric for acreage. Right. It did what set up that task force did not have a similar quantitative goal for say, community hardening or protection. You know, so it's something maybe we need to explore legislatively. I'm not sure. There's enough discretion that I think you, that there's actually room to do this. I don't think it bars that kind of prioritization.

Completely agree. I think my point in bringing it up is just to say that I think there's been some evolution in terms of the best metrics over time and that might be something for us to...

I would just hope that after Santa Rosa and Altadena and the Palisades and just thinking about the sheer costs, both in terms of human misery, but also financial costs, greenhouse gas implications, the pollution costs, economic costs, we've got to, we have to focus more attention on making sure that those kinds of...

We do the work to make sure that those kinds of fires don't happen again. And that just has to be, from my perspective, has to be like a number one driver in this space. I hope you'd agree. And I'd hope that we'd really incorporate that kind of core principle into the way that we're thinking about these allocations.

I'll just build on what Mr. Benson mentioned about the task force. Our understanding is they are putting out their updated five year action plan update this year, and they've been doing, at least from the briefings, we've received some really intense work with academics to model different scenarios. What if we focused on community protection?

What would that look like? What if we focused on watershed prevention? What would that look like? So at least based on the information we've seen, this looks like it will be a pretty helpful tool set for the administration, but also for the policymakers. So something to follow and perhaps have oversight hearings or briefings to look at. But we're hopeful that the investments the state has made in that could yield some really important information to help guide these difficult decisions.

Yeah. You know, can I just ask you a question? You know, where in terms of percentage of population of the State of California with regards to the CAL FIRE definition of northern Southern California, where, do you know the breakdown?

No, not off the top of my head, but...

Yeah. It's my understanding that the Southern California portion is, we're talking 65% or maybe higher. Maybe higher, actually, 70%. I mean, I love to look at that data, but when you're talking about equality between the two regions, I think we just have to be thinking about where people live and how we prevent these kinds of catastrophic community fires from happening again and again. I mentioned Santa Rosa. It's a Northern California community that burned to the crisp. So this is not just a, this is a Northern California problem, too. But what were you going to say? Sorry.

I've got a couple things here. We've talked about reporting quite a bit, and as you know, the public resource code 4137 requires the department to produce what's called the fire prevention report annually. And we talked a little bit about what some of those metrics were.

But moving forward, there will be additional reporting requirements, one of which that I could note is the department personnel classification that are primarily 75% focused on wildfire resilience activities and also the number of unique parcels inspected by the department personnel for compliance with defensible space. And the list goes on and on of additional requirements that were placed on the department. So you're going to get a more comprehensive look at some of the things.

Interface with locals, too? Sorry, the database one you mentioned, is that the one that's supposed to have defensible space tracking for the whole state?

So that. That is a different. That is not a component of the 4137 reporting. However, that will be available on our website soon. About the qualified entities. That came to us from SB 63 that required us to create that bill. Yeah, that was a great bill that we have implemented.

The qualified entities training, of which we have done 23 trainings across the state and taught more than 300 students. Those students have gone out now and conducted over 1400 inspections or assessments across the state. That also created what is called the common reporting platform for defensible space.

So the local jurisdictions and those people who are qualified to do those assessments feed into that database. So, yeah, that's already been completed and well on its way. The other thing I wanted to mention as far as measuring success is our Fuels Treatment Effectiveness Program, which we rolled out in June of last year.

This is, when we talk about the amount of money that we're putting into wildfire prevention grants and fuel reduction projects, whether that's prescribed fire or right of way clearance or just fuels reduction on its own. What are we getting for that money? Is it effective? Are we putting it in the right place?

And this fuels treatment effectiveness reporting, which is available on our website, allows you to take a deep dive into each one of those projects that was introduced to wildfire and what effect it had. Did it act as a primary control line? Did it slow the forward spread of the fire, allowing firefighters to get in and make a stand? Did it provide for ingress and egress for people to get out of harm's way, allow firefighters to get in to make access to the fire? And of those, when we started last year, we had 63 impacts of fire to projects.

Of those 63, 45 of those had a positive impact. Those are available for you to look at with pictures on them, descriptions, and everything. So we're able to assess. Did we put it in the right place? Understanding that we're not always going to be able to know what the weather conditions are and how that is going to interact with fire, but it allows us to now objectively assess each one of those projects and make a better assessment about did we pay too much? Did we pay too little? Did we do too much? Did we put it in the right place? But this is a much better path for us moving forward in determining the effectiveness of those projects.

Yeah. Okay. Would you mind just. Thank you. Good number. Could you. Could you follow up just on the question I asked about ensuring, you know, are we engaging the other conservancies in that, in the wildfire prevention allocation beyond just Sierra Nevada?

I was just... Because I just... I think you're talking about the regional one, not the wildfire prevention, local wildfire prevention pot. So just making sure we're on the same page.

And that would be a different person that we have with us that oversees the regional block grants, and I'm sure he would be more than willing to talk specifically about that. So I'll move out of the way.

Or did you want to ask him more?

No, no, it's great. Thank you.

And maybe you could just talk broadly speaking about ensuring a more consistent regional distribution of funds when we're talking about implementing Prop 4.

Well, hello, Chair, Members of the Committee, my name is Matthew Reischman. I'm the Cal Fire Deputy Director for Natural Resource Management. And yes, we do have funding available for what we're calling regional grants. And these grants or the funds are going to be split between Cal Fire and the Sierra Nevada Conservancy.

And we also have members here from the Sierra Nevada Conservancy that can speak to that. But a portion of those funds go into the Conservancy based on work that was done under the Wildfire and Forest Resilience Task Force where they actually broke the state into different regions. There's four regions. Sierra Nevada is in one of those regions.

And then we have a North Coast, Central Coast and then Southern California region. And so we currently have pilot projects in three of the regions. The one that we don't have a pilot project in right now is the Central Region or Central Coast region.

And so with these funds, we will be looking to augment some of the work that's currently being done under the task force, work that had been completed by Department of Conservation, their Regional Forest and Fire Capacity Program. And so we'll be building off work that's already done to be as efficient as possible.

The Central Coast region doesn't have a project. And so the way we're selecting those is through a combination of solicitation and then working with the conservancies and other entities within those regions. As far as the south goes, we are working with some of the conservancies down there.

But to answer your question, the reason those funds went to the Sierra Nevada Conservancy, I believe some of those decisions may have been at finance or made by the Natural Resource Agency.

So I think to sort of maybe further that a little bit because of the four region approach. And Sierra Nevada Conservancy basically covers one of those reasons almost entirely. So there's the thought that you split the funding and Sierra Nevada Conservancy will sort of cover that Sierra Nevada region that the Wildfire Resilience Task Force identified.

And then Cal Fire will work on coordinating the efforts on the other three regions. There is coordination that is done cross-departmental. For example, Department of Conservation has the Regional Forest and Fire Capacity Program.

That program is aimed at working with regional collaboratives to develop sort of planning and well put together collaborators regionally and then work on developing and planning projects and stuff that then feed into these grant programs that Cal Fire or Sierra Nevada or others administer.

And so it's really, there is Cal Fire is administering for those three regions, but it's not just going to be completely Cal Fire driven. And like, there's a lot of coordination that goes into this. And CNRA is going to be involved in helping with that coordination.

But the other conservancies and other regional entities and things like that will all be involved in sort of the coordination around what those regional sort of landscape level projects look like that come forward to seek funding. Hopefully that helps.

Okay, that's helpful. That's helpful.

Yeah. Okay. Yeah. I think I've made my point about just broadly concern about just ensuring, and I think this is the line of questioning we've had in several levels to just ensure that we really incorporate the incredibly hard lessons learned from the past month into the way we're thinking about these allocations.

And really, and I think Henry's right, this acreage metric doesn't adequately deal with these community risks. And so I don't know that it needs a statutory change. I think it just involves. Here we are sitting here talking about our expenditures, both with Prop 4 and then also more broadly speaking with the fire budget.

I would like to work with you. I'd like you to come back to us with. I'd like us to engage in a conversation about thinking about metrics that will really incorporate the lessons learned and just the need, I think, for Cal Fire to shift its focus toward these kinds of disasters.

There just seems to have been kind of a traditional focus on the backcountry fires. So anyway, do you have another fire question?

No.

Okay. Okay. Thank you. All right, that's helpful. Let me, if you don't mind, I'd like to shift gears a little bit to, to APA, you know, so obviously there's a blanket exemption proposed for every Prop 4 funded program, regardless of whether the program currently exists or is new.

And kind of getting back to our earlier conversation, I guess the question is for you, you know, about whether the Administration believes that some programs, particularly the new ones, may warrant more or tighter measures to guarantee a sufficient or satisfactory level of transparency, accountability, public participation in the process.

And so I just want to think about get your thoughts on that question because I totally get the APA exemption for some tried and true programs. But there's some new stuff here that may warrant more accountability, transparency measures.

Yeah. So I will just say that we're obviously committed to the transparency and accountability. Those are important factors and sort of miles guiding whatever you want to call them guardrails, whatever you want to call them, those are very important for us and we are committed to those.

And I think what, and I'll have Mr. Cash talk in more detail about this, but I just want to make sure it's clear that what we're proposing is to maintain that, but through like a slightly different approach if you will. We've used, the APA exemption has been provided in prior bond acts and that doesn't mean that we don't have the transparency and accountability and whatnot.

It means that we use a different approach to do it that's a little bit more nimble. But we still make sure that we're having that public engagement and that transparency. And that's, Mr. Cash, I'll have him talk a bit more about what we have done and what we plan to do here.

But I just want to make sure that point is clear. The APA exemption request isn't about in any way impeding or reducing the amount of engagement and transparency. It's about trying to have a more nimble process so that we do it, you know, as timely as we can, but do it right.

Yeah.

Brian Cash with the Natural Resources Agency Transparency is, is a priority and has been since, you know, we've had nine bond measures since the year 2000 and each one of those has had different requirements and has built on the previous bond measures and we plan on continuing that transparency and when programs are developed, having like a 30 day notice for people to provide comments on the guidelines when they're post posted, having public meetings to actually get that feedback.

Same thing with the solicitation process when, when the solicitation goes out, having public meetings and with Zoom meetings being so popular now, we're actually able to reach farther and into the state and, and have people participate that, that normally wouldn't be able to before.

So continuing that process and continuing to take get the outreach that we need and the transparency we need, the feedback we need actually to develop good guidelines, and we plan on continuing that with the Prop 4 bond measures.

So would we build those kinds of requirements into the language? Was that how we would do it typically?

Normally it was built into the bond measures, but we continue.

Right, but I mean, okay, look, I just want to make sure that because we wanted to create flexibility but that should be taken advantage of. Right?

I mean, you know, and I'm not saying you're trying to, but I, I, I just, it's been brought up a couple times now, but it, that doesn't mean that we don't continue to care about these kinds of accountability elements.

It just, it just means that it gives us a little bit more flexibility from which to work to craft solutions that are going to work for these particular types of programs, recognizing that some are newer than others and some might require more, some might be more De minimis.

So I just want to throw that out there and hopefully we can work on a plan together that will meaningfully. If we're not going to do APA as strictly done in the past, how do we create something that will create a similar benefit, a similar mechanism for public engagement?

Yeah, the Administration is definitely open to working with the Legislature on that. And if we need to detail what we're going to do with each program, we can do that too.

Okay, great. Okay, that's helpful. Okay, let's talk about, you know, just the little. Well, the issue of 40%. 10%. So the PR, the Public Resources Code states that a minimum of 40% of the total funds are to go to vulnerable populations and disadvantaged communities. 10% of the total funds to severely disadvantaged communities.

This is a groundbreaking language that we incorporated. Nothing quite like it, but it's, except it's very much based on the justice 40 principles. You know, I just wanted to get clarity from DOF as to whether we certainly have a position on this.

But was there, does the Administration interpret the code to mean 40% of 10 billion, or does the Administration view this section as requiring 40% of each bucket or chapter or program in Prop 4? So let's start with that.

We interpret it as being 40% of the 10 billion or 40%. Geez, 40% of the 10 billion.

Right. Okay. That's, I think, where we are too. Just again, flexibility. Right. We, you know, and that will of course mean more money for, you know, way over 40% in some buckets. Other areas. It just doesn't make sense. Great. Now, of course, SDAC is a subset of DAC.

So, you know, so that the 10%, which is basically 1 billion for the SDAC, is part of the 40%, the 4 billion of the total funds available in Prop 4. You know, I think that anyway, some people may interpret the code to read that the 10% is intended to be in addition to the 40%.

That's just not correct. It's not consistent with the plain meaning of the language from, you know, and I remember this discussion. Maybe we should have made it a little tighter, you know, because that would ultimately mean that, you know, you have.

That basically would be 50% instead of 40, you know, anyhow, I just want to make sure that we're on the same page on that, you know.

If it's helpful. Yes, we interpret it the same way. The 10% is part of the 40.

Okay. And again, I hate to. We're very committed. This is central to the bond is ensuring key equity principles and, and helping our most disadvantaged. And we know that of course far more than the 40% will actually end up benefiting disadvantaged communities.

But for practicality sake, I think it's important we get on the same page about, about that portion. Okay. Now obviously you've heard a lot of concern about backfill. Ah, you know, it was a legislative proposal. And so, you know, the.

So, so I guess that I think there's these, all these impacts that, that are potentially implicated here with regards to the Governor's, you know, shift cost shift proposal. So you know, it's ultimately opening up money within the general fund of GGRF for things that were for budget activities proposed by Administration. Many good things.

But most importantly for us, it precludes the amount of Prop 4 funds for being used to expand or enhance previously planned activities. So it's true, it is true that we did not include specific language prohibiting Prop 4 from being used as a plant General Fund or GGRF.

But you know, I guess my question is, is it the administration's position that the proposed shifts to supplant the general fund and GGRF from Prop 4 are what the Members of the Legislature and the voters intended.

So again, not to be like, I'm not, honestly not trying to, this isn't semantics thing for me. But with the overall requirement to propose a balanced budget, what we're left to interpret off of is what the law actually says. And so in this particular case, the bond measure doesn't have the nonsupplantation language in it.

And so in this grand scheme of how do we balance out all the competing priorities of the overall budget and trying to be as effective as we can with limited General Fund and things like that, that's the context we came from.

I completely acknowledge and open that the Governor's Budget is a proposal for the governor's way of doing a budget and it starts a conversation with the Legislature.

And you know, if this is a priority for the Legislature to not do this and to address general fund needs in a different way, then that's a conversation that'll happen in that overall budget architecture and stuff.

And so it's not a matter of, "We don't think any of these", none of the backfill stuff was like, hey, we looked at it from a policy perspective and said, oh, these are lower policy priorities. That's not what we were doing.

What we looked at is in that grand scheme of balancing the budget, we said, hey, here's all these activities we have. Here's all the available fund sources that can support those activities. There are multiple fund sources that can support some of these activities.

And as we're trying to balance things, we said we think there's a need to rely more heavily on the bond act here for these because there's available funding for the same activity and that frees up resources for other things. So again, it's in that grand architecture.

And I think as we go through the overall budget process and talk about like how to balance it out, this is part of that discussion. And if the Legislature wants to say, well no, let's not do this, that's a conversation we can have.

But then it's sort of what other things are we not going to do with the general fund and stuff. And so it's part of that balance.

I get it. And I just, you know, just want to flag. There will be some tension over this. I think you know that. And I understand the difficult job that everyone is under right now. Yes.

Senator, can I just add one caveat which is special fund too, right? So that's the only nuance to the, to the issue is so something like the SERAP funds, the clangy reliable investment program where it was proposed at 50 million. You're the SERAP guy. Okay, cool. Yeah.

If you don't mind, come up for a quick second while you're on this point. Just because that, that's a GGRF-funded program and that's going to backfill or is proposed backfill, demand side grid support, the DSGS program. There are a number of other eligible categories within Prop 4 for that energy, for that $50 million energy piece, right.

There's long duration storage, distributed energy, backup assets. I forget there were a few, there were a few different items. I don't remember it verbatim, but so that one. It's not that we have to go find the money elsewhere from the general fund, in other words.

It's just that it's indicating a priority of the Administration not to necessarily fund energy side work with GGRF. That's the signal I'm taking from it, but I'm not.

But then I'm trying to square that because what I've been hearing for the last year or so is that we need to get money off of, you know, like more energy funding through the GGRF to soften the blow, say to rate players and things like that. So that's where I'm sort of trying to figure out.

Yeah, when you backfill on the special fund, what are you trying to, what's the policy rationale behind that?

David Evans Department of Finance. This is one of the unique circumstances where the allocations and the investments made for the demand side grid support program, the prior general fund dollars that was appropriated for that program, it was used to offset and to try to support the solvency of a different fund, the Motor Vehicle Fund, the Motor Vehicle Account Fund, which is in a structural deficit.

And so to my colleague's point about looking at the budget from a holistic perspective, we looked at this is one of those programs where there was a blend across like the multi-year appropriations for this program where there was general fund appropriations, there was also GGRF appropriations.

There are planned GGRF appropriations for 25-26 which is also part of SIRUP. So there's various like previous appropriations and planned allocations for this particular program for the man side grid support program. But this is one of those like numerically that the 2024 Budget Act it actually is in a plus.

So the 2024 Budget Act there was $202.5 million for the demand side grid support program. With the governor's proposal it actually increases it to $252.5 million for demand side grade support program. So it is a benefit towards it.

So it shows up here in the analysis as a, as almost like a backfilled GGRF. But in fact net we're looking at a 252 range.

There's, there's some shifts that happen between.

Right, when they borrowed against it and pulled it to the motor vehicle account. But then that's been, that's been solved now and that, or not. So we're back filling right backfilling that.

And I can go through like the various years and so in 20, the 2023 appropriation there was 19 million for a part of the Clean Energy Reliability Investment Plan. That's CERIP.

So 18 million of that is being backfilled essentially with Prop 4 there's the, there was a planned allocation for CERIP, 50 million GGRF. that program we didn't, for that CERIP, that 50 million, it wasn't specified which program it was going to go towards. That was 50 million for that for Prop 4 we backfilled 32 million.

So you have the 18 million that was general fund plus the 32 million and so that nets the 50. And so that CERIP, that 50 million. It wasn't specified to go towards the Manicide Grid support program.

But looking at past precedents and looking at how we can utilize to Prop 4 dollars and then looking at the success of the Minnesota Grid support program, it kind of like fit the picture towards that.

I appreciate the logic. I understand, I'm about to hear from Elliot too, but I guess my simple point would just be when we wrote that that portion of the bond, I think, yeah, just the notion of sort of existing funding that we were already expecting to be there. Like it's such a small amount.

Also in the context of the bond, right. You're talking about $50 million within $10 million bond. So there was a lot of member interest and attention on it.

So I would just anticipate that'll be an ongoing issue of okay, you've just taken it on, put it to DSGS, but then what about everything else that it didn't get put to? I'm sure you'll hear from people too.

So there will be demand for more, but I think that'll probably evolve also throughout the Greenhouse Gas Reduction Fund conversation as that evolves with this Committee and ongoing. But I think there's going to be more demand for energy funding that's not rate based than less and that's sort of net, I don't know. Thanks.

The syrup is sticky.

Yes, there should be more.

Okay, I'm a dad now I got to make these jokes. Yeah. Okay. Did you want to.

I think they've got to explain. I think just to kind of boil it down, the two main issues that are happening here with syrup are one, a backfill, you know, the same fund swap. And you ask why the special fund? And the answer is really, it's the same story as with the General Fund.

It's trying to free up GGRF to use for a different priority under the administration's proposal and the priority they're using it for is to address the structural deficit in the motor vehicle account for one year. The second thing is a specific decision of how to spend the SARIP planned dollars for this year. And it's on DSGS.

You have other options. You know, I think the, the bill that set up the $1.0 billion over multiple years for this Clean Energy Reliability Investment Plan was intentional about, I presume, as the authors, was intentional about not Saying specifically how that billion would be spent, to leave it up to decisions of what the highest priorities are.

So that's a policy choice to spend it on DSGS this year.

Okay, let's. Thank you. Thank you. Let's pivot to staffing needs. So the Administration indicates that it's still assessing staffing needs of the departments and it plans to I guess propose some administrative expenditures from the bond and associated personnel later this Spring.

So, so could you just give a sense of what factors are being take into account when determining the staffing needs and administrative expenditures of a bond? Because again, this is almost a build off of the backfill, but yeah, I can do that one. Yeah.

Bryan Cash, Natural Resources Agency. Each program is really taking a look at current workload from the general fund appropriations, the pass bond measures, how much is left from those. And as those measures go down and the workload goes down from that, taking into consideration the amount of workload that's going to come in from Prop 4 too.

So the amount of grants are going to be made and the workload that's going to be on the grants, administrators, and the people managing the programs. So as the one goes down, the other goes up. Do we need additional staffing? How many staffing are we going to need from that?

Is the Department taking on multiple programs from Prop 4? Are they new programs? Do they have current staff?

Are these limited time or permanent positions?

They're permanent positions because the funding rolls out usually over multiple years and then the projects go on for about four or five years after that.

Okay, okay. And just to add, but I don't want to get too much into the weeds of this, but as we try and figure out how to do this, you get a four or five year implementation plan, sort of by rules. A limited term position is only good for two years.

And so it's like if you try and do limited term positions, it creates a whole bunch of administrative challenges. And so we tend to do permanent positions, but we also try and minimize that because you don't want to create a whole bunch of new permanent positions then that run out of funding and a few years.

So it's sort of that balance of like where does it make sense to create some for continuity and where does it, you know.

And as you can see in that first figure on our handout, some of the position administrative money they've planned from all the way through 2039-40 in that. So the project money is pretty front loaded in the first few years, but the administrative small amounts go on for multiple years.

What kind of work are these folks going to be doing in these positions? I know that's a broad question, but give me examples of, mainly beyond what's already happening within the Administration.

It's mainly rolling out the program. So doing all the work, the transparency work that you were talking about, rolling out the program, soliciting the projects, evaluating the projects, and then afterwards managing the payment requests that come in for the projects and then closing out the projects.

So going out and visiting the projects on site, making sure the state got what it paid for.

Yeah. Okay, gotcha. Okay. All right. Sea level rise. I know Parks, there's a, there's $50 million in there for Parks to implement a sea level rise adaptation strategy. So I know Parks also has a mandate for a comprehensive level of assessment study that isn't done yet.

So I just want to get a sense of what the Department plans to spend the 24 million that's been proposed in the Governor's Budget proposal for sea level rise adaptation.

Chair Stern. Sorry, Chair Allen. Senator Stern. Jay Chamberlain, California State Parks so yes, of course there is $50 million. So embarrassed. Sorry.

It's not the first time, I'll tell you.

So yes, our proposal or the Governor's proposal is for $24 million in this fiscal year to extend multiple years of investments. And that would really do essentially three things. First is to complete some subset of shovel ready projects that have been developed by the Department.

The second is to indeed do that assessment that you spoke about, which would be essentially a statewide exposure and vulnerability assessment, and then complete other decision support tools that are in our sea level rise adaptation strategy. These are tools that will help our staff develop future projects.

And then third is to develop the, to begin initiating the development of those multi phase projects that then can be funded with the second tranche of money in out years.

Okay, and then what's the plan? So what's the plan for rolling out the remaining 26 million?

So, and finance could speak to this, but the, I believe the second tranche of funding would be in fiscal year 27-28, and that would be essentially the second half of that $50 million to implement those longer scale multiphase projects. As you know, projects in the coastal zone are complex.

We're talking about the need to have multi-phase projects because of engineering studies, feasibility studies, other types of initial efforts to assess the vulnerability and to make sure that those projects, larger projects, can be completed.

Okay. All right. Now I saw that the, another backfill proposal on deferred maintenance, which, you know, for God's sakes, I mean, this is something we have to get our handle on. I mean, I think that the Department already has like a $1 billion deferred maintenance backlog.

It's an absolute, I think shame on us for letting that build up as far as it is giving out these gems of parks that, that people really do love and rely on for recreation and cultural heritage and all the rest.

And now we're looking to, you know, I mean, the funding for deferred maintenance seems to be so difficult to come by and now we're fund shifting some, you know, some of it to the bond. So what's the justification for the fund shift and what's our plan, broadly speaking, on this issue?

I mean, it's really the same rationale that I explained. Overall, again, we sat down, we looked at the existing general fund and what's compatible with Prop 4 purposes. And you have multiple fund sources that can support these different activities. And your point is, of course, right on. There's $1.0 billion.

We're going to be doing that over many, many years and certainly doing some sort of reduction in this space and shifting over to other stuff impacts the total amount over time that's available for it.

But I think our focus is looking at the budget over the next couple of years and again, sort of that overall budget architecture of how do you balance across available fund sources for these same purposes and saying, okay, well, at this point in time we should, we have Prop 4, we should shift using Prop 4 for deferred maintenance and we'll use that funding.

And then as we get to the point where we're running that out, there's of course going to still be a deferred maintenance backlog and we'll have to look at how we continue to fund that, candidly.

Okay, we're going to obviously continue to work on this both regards to Prop 4, but also the broader problem, which is a very real one and one that I'm really personally committed to working with you on because I love the parks and so many of our fellow Californians love the parks.

And yet we're really diminishing experience of the public going to the parks when we don't, when we're so backlogged on, basic upkeep. You know, I mean, I saw one of these service provision studies.

The state parks are one of them, are just one of the worst funded, one of the most underfunded agencies in state government, it seems, given the use and mission. So I think that's something we all have to work on together to correct. All right, thank you. Thank you for your appearance on the dias. Really fantastic.

Okay, so let's go over to water. Right. The biggest part of the bond. We haven't spent much time talking about it, I guess, except for conveyance and levies, which was an important discussion, of course, as well. Now we are, something like a million of our fellow Californians don't have access to safe drinking water.

And, you know, it's 2% of our population, but, you know, it's still pretty, pretty shameful given our size, scope, and power and wealth as a state. So I think we've spent, you know, almost $1.0 billion to help with providing, improving, accessing safe drinking water. There's 610 million in our bond for water quality and safe drinking water.

The Governor's Budget proposes allocating, I think, something almost 200 million. So 194 million. So I'd love to get some thoughts from the Water Resources Control Board as to how the board plans on spending 194 million proposed in this year's budget for water quality and safe drinking water.

And then specifically what, you know, so that broadly speaking, and then what kinds of projects are going to set for the highest priority for receiving bond funding?

Yeah. Thank you Chair. Joe Karkoski, I'm with the State Water Resources Control Board. I head up our Division of Financial Assistance.

So for the part of the bond that we're administering for drinking water and clean water, what we plan to do is integrate those funds with our annual Drinking Water State Revolving Fund intended use plan, as well as our Clean Water State Revolving Fund intended use plans. So these are annual plans that go through a public process.

The board sets priorities on how those funds will be spent. And we're also able to simplify an application process for folks who have a clean water or drinking water project. So they submit one application to us, then we're able to identify the appropriate federal or state funding source to apply to that.

So currently, the board's priorities on the drinking water side are to address failing water systems. So to your earlier point about the number of Californians that still don't have access to safe drinking water, those are considered failing systems if they're not delivering that safe drinking water and they're out of compliance.

So that's where we would prioritize the funding, primarily for small, economically disadvantaged communities. So that's been our overall goal in addition with a safe and affordable drinking water fund, too, to focus on those communities because they have the hardest time raising enough funds, revenue to pay for those projects.

100%. Yeah. And I'll tell you, this is. I mean, just having seen a lot of the polling, being involved on the political side, this is something people care a lot about across the board.

Yeah, yeah. So we have a pretty huge demand. We have a continuous application process. So basically be going through those projects as they're ready to go. You know, we provide pretty extensive technical assistance to these small disadvantaged communities so that there are a lot of projects that are ready to go or nearly ready to go.

So that's on the drinking water side. On the clean water side, the focus for the board has been on septic to sewer projects. Because when you have those kind of projects, it's kind of a dual benefit, providing that sewer service. Also preventing pollution of the underlying groundwater aquifer, the ocean. Yes, yeah.

As well as dealing with any compliance issues. Again, with a focus on small, economically disadvantaged communities.

Yeah, yeah. Okay. Yeah. I mean, I'll tell just a little anecdote. I mean, dealing with the fire right now, you know, so much of Malibu, for example, is on septic, and a lot of it's been compromised.

A lot of the septic systems that service the various homes along the PCH that have been burned down are now severely compromised. And there's creating a whole new set of water pollution issues both in the watersheds and on in the ocean. So one of many, many problems. But. Okay. Did you want to add?

Okay. No. You're happy? Okay. All right. Well, thank you. Thank you. Water questions? No. Okay. Obviously, massive part of the bind we're watching and want to work. You know, you're doing God's work in this space because we, you know, it's wild how many of our fellow Californians don't have access to good, clean drink water?

Is a water question. Yes. Okay. All right. Senator's got a water question. Then we'll go to Wildlife Conservation Board so you can mentally prepare.

And I'm not sure if it belongs here or there, but urban rivers and then LA River. Is that in, whose world is that? In the water pot or in the, so I'm just wondering about the allocation strategy there. Is it in.

It's in the water chapter, LA River Stuff. That one's split between LA Rivers and Mountains Conservancy and Santa Monica Mountains Conservancy. Is that. So those two Conservancy. Right. Those two conservancies aren't here today, but I think agency can, if you have specific questions about those. We could talk about.

We could have them come help talk about it and then. Sorry, what was the other.

Was there an urban, wasn't there an urban rivers, urban,