Assembly Budget Subcommittee No. 4 on Climate Crisis, Resources, Energy, and Transportation

[Background]

Good morning, and welcome to assembly budget subcommittee number four on climate crisis, resource, energy, and transportation. Today, we're really pleased to to welcome secretary Garcia and the departments under the California Environmental Protection Agency. We have 10 presentations today, so a lot to get through.

For each presentation item, I'll ask each of the witnesses in the agenda to introduce themselves before they begin their testimony. At the end of the presentation, members of the subcommittee may ask questions, make comments, or request a presentation on any of the non presentation items. We will not be taking a vote today on any of the items on the agenda. After all the items are heard, we will take public comment for members of the public who wish to provide public comment. Please limit your testimony to items that are on the agenda.

Each member of the public will have one minute to speak. Let's begin with secretary Garcia's opening remarks. Secretary Garcia. Happy to have you.

Thank you. Good morning. Good morning. Good morning Chair Bennett and members of the committee. Always a pleasure to be here with you.

Frankly, always a pleasure to be able to share some of our work. I wanna start by just acknowledging the the, fluctuation point that we find ourselves in with so many challenges in front of us. Whether that be from extreme heat to unprecedented wildfires and storms, severe drought conditions, ongoing, etcetera. And needless to say, a unique relationship with the Federal Government that has left many of our communities vulnerable to the intensifying impacts of climate change. I think you would all agree that our partnership at this moment is more important than ever.

And if there's one thing that I want you all to leave here with today, it is the knowledge that we are very lucky to have an incredibly talented workforce all across our state, but including at Cal EPA. I feel extraordinarily privileged to lead an agency where the staff are dedicated to creating real tangible benefits for Californians, to enhance their climate resilience, to improve air quality and water quality all across our state. So, I hope that you see that from our team. I wanna share a couple of examples of our work before going into maybe some of the questions you all might have on, the budget proposals before you. And I wanna focus a bit on two areas of concern that I think you all share with us.

The first is, you know, disruptions and changes in the nature of the Environmental Protection Agency's work, resulting from attacks from the federal administration. And the second is really improving our ability to maintain a nimble approach to respond to some of the evolving changes in our environment as we move forward. I know we're we'll be talking about, some of the work around landfills and and subsurface elevated temperature events, which are one example of those evolving, shifts in our work. So I'll start with, something that we're very proud of, which is, the work that we're doing to address methane. And this is an area where, you know, with the absence of federal leadership in the climate space, there is a real void at the global scale.

And, of course, you all know well that California is no stranger to stepping into the role of of global leadership. And so while we're occupying the space which is familiar to us, it is also a growing space for us. I will I will say that our international partners are increasingly looking to us to demonstrate the leadership that is sorely lacking, with the federal administration. They're looking to us for hope, but also for tangible examples of what they can do to move the needle to reduce, the impacts of climate change. And methane, of course, as you know, is a super pollutant.

It has over 80% the potency of greenhouse gas emissions. So it's all the more critical to dramatically reduce it and slash methane emissions where we can. We're working on this through implementing diversions of our landfill organics going to, our waste landfills. And we're seeing quite a bit of progress in this space. We have a lot more to do, but we are seeing now over 90%, 97% in fact

of jurisdictions offering residential organics collection. A 100% are having edible food recovery programs. We're, issuing so much in, community composting grants, which, carry a multitude of benefits as well on the ground for communities all across our state. At the same time, we're also strengthening methane accountability through innovation and partnership there. We are detecting methane leaks where they're occurring across the oil and gas sector and and other sectors.

And again, this is an example not only of what we're doing to create tangible benefits and reductions in methane emissions here in California, but also across the globe. Now federal rollbacks have also, impacted the extent to which our communities could face threats from exposure to toxics. And this is in air quality. This is in our water systems and also in our lands. So we remain committed to and proud of our work to drive down, air pollution at the community level.

We do a lot of this in partnership with our air districts. We owe a lot of, gratitude to you all for, you know, granting us the the authority, the direction, and the funding to be able to continue this great work. And this is an area where, again, we will be pivoting to see more of a focus on our community air protection work in partnership with the air districts and with local governments. In water infrastructure and resilience, you know, the State Board has provided more than 11,000,000,000 in financial assistance to drinking water, wastewater, and water recycling, as well as stormwater and groundwater projects. Again, we're very proud of this work, particularly as we see the Federal Government roll back, not only on its investment, but also its protection of communities from certain contaminants of concern, in our water streams, our wastewater and drinking water streams.

Through the SAFER program, we're also continuing to bring systems back into compliance. Another area that we will maintain a heavy focus on, as we move forward, particularly under this federal administration. And we're also overseeing the cleanup of more than 6,000 residential properties impacted by lead contamination specifically at the former Exide Vernon facility. This is an area of course where we want to continue the great progress that we've already made, and that is the subject of one of our, budget change proposals. Finally, in addition to addressing legacy contamination, as many of you know well, we're also looking forward into the future to see how we can reduce waste streams from chemical contaminants and chemical products to which we are unfortunately still a bit reliant on, but we're looking at ways to enhance safer alternatives and the access to safer alternatives to, for example, chemical based pesticide products.

This is an area of great pride of of mine personally, of ours through Department of Pesticide Regulation and our partnership with growers, with innovators, with the organics agricultural community, and those who are interested in really moving the needle on how we can, deploy more regenerative practices across our state, which we will only, benefit from, now and into the future. And, with that, you know, I wanna just note that the accomplishments again are great, but in order to demonstrate continued meaningful progress, the challenges we continue to face require us to again stay on our toes. So we have a couple of budget change proposals before you. I'll start with landfill response and enforcement. As you know well, our waste streams are changing and our climate impacts are intensifying, which means that the risks around our landfills, specifically the risks presented to communities, that find themselves in proximity to those landfills are increasing.

And to address these risks, we're proposing a coordinated strategy that strengthens landfill response and enforcement capacity across multiple boards and departments, many of whom are here represented today to answer questions that you might have. But ultimately, we're looking to strengthen our ability to monitor, detect, prevent, and rapidly respond to, subsurface elevated temperature events, which we're, seeing more, characteristics emerge for these while we improve coordination across our boards and departments to ensure a consistent statewide approach. Now recent federal actions have also created uncertainty around transportation, specifically around emission standards, making our leadership in the space even more important, and making our ability to protect the great progress that we've already achieved, really critical. The governor's proposed a new incentive program designed to support first time buyers of zero emission vehicles. This proposal provides a point of sale incentive, which is matched dollar for dollar by original equipment manufacturers for first time zero emission vehicle buyers in order to accelerate consumer adoption of new zero emission vehicles and keep us on track to meet our clean air and climate goals.

You know, the last time we saw gas prices, not quite at this level, but nearing this level, and I think we're at at about a 30% increase, in prices at the pump currently, we did see a significant uptick in, purchases of of zero emission vehicles. It's incumbent upon us to ensure that, we continue to provide this as a realistic option for our residents, particularly as these price fluctuations continue to take place. Now finally, as I mentioned, Exide cleanup, the Department of Toxic Subsances Control is also seeking to do critical cleanup work associated with this, former facility. Our proposal would allow additional residential properties and impacted communities to be remediated. Continuing our progress toward addressing this long standing, area of contamination and environmental injustice here in our state.

And I think many of you are familiar with the details of the former Exide Lead Acid Battery recycling facility. And then again, we're happy to answer questions here. Two last areas of proposal that I wanted to mention to you all, of course, Prop four. We spent quite a bit of time discussing Prop four Here, just about a year ago. And, the State Board is actively now implementing Prop four Dollars, with anticipated awards from four of the five dedicated grant programs within this calendar year.

Very much looking forward to that. And as we are we are approaching that, we're prioritizing critical needs such as enhancing water quality and ensuring safe drinking water with significant funding allocated to wastewater and drinking water infrastructure projects. And finally, the state board is also continuing its work to implement the Bay Delta Water Quality Control Plan. This is one of the most important efforts underway to protect our water resources all across our state. Advancing this work is essential to safeguarding our water quality, supporting our ecosystem health, and protecting the communities, farms, and industries that rely on this critical watershed.

I wanna thank you again for having us here this morning. We are looking forward to answering any questions you might have and certainly look forward to continuing the great partnership that we have moving forward. Thanks.

Thank you very much. We really appreciate you being here. I have a few questions to kick us off and my colleagues here and perhaps will be joined by our vice chair at some point in time later. But, you know, the first overall policy I want to bring up is, you know, we have this polluter pay sort of principle. And I think it's generally good for government to try to, wherever possible, do two things, which is match ongoing revenue with ongoing expenses.

And if if some action somebody is taking is causing an an ongoing expense for the public, for the citizens that we have to address, then those people that are causing that should be the ones that are paying for that. And we try to match that. I mean, the the road tax is a classic example. You know, people do wear and tear on the road, so we try to find some way of matching the people that are causing the problem with with the the solutions, the problem. So that's always a challenge for governments to to try to institute and maintain that and adjust that as as circumstances change.

But it's particularly a challenge right now as we're talking about affordability and, you know, the things that you need to do to try to adjust and make sure that that's the case also have an impact on affordability. So that's the first of all, what what are your thoughts about where are we in terms of trying to match those those two, the people causing the problem with with the solution. And how far along are we? What kind of changes do you see? What kind of things should we be looking at, to to make that policy a more effective policy in the future?

Sure. Sure. So I I appreciate this question. And first I wanna acknowledge, you know, while the while the characteristics of this program are a bit distinct from what I think your your question is getting at in terms of operators for facilities more akin to a landfill, etcetera. I do just wanna give a nod to the extraordinary work that not only this legislature, but also past legislatures here in the state of California have done through the cap and invest, cap and trade program to really provide what has become an emblematic program that embodies the polluters pay principle in a way that makes market sense, that makes good economic sense, and also makes environmental sense.

So, this is something that I think, really runs deep in our state, in our approach to, handling the balance of environmental harms and and economic growth. In terms of some of the issues that we're seeing now that I certainly classify as the the emerging challenges that we want to to maintain our ability to respond to adequately. You know, we're we're first looking at the issue of legacy contamination, and certainly that is a priority to continue to clean up, and to frankly continue to maintain a focus on accountability for this is an area where our enforcement work is critical, and the support that you all have shown us with respect to our ability to expand that enforcement work is extraordinarily important for us. We need to be able to handle investigations properly. We need to be able to pursue claims against operators and hold them accountable.

So as to insulate and protect the general public from, having to absorb that risk. So that's sort of the the way that I see our us focusing, in this space first and foremost. And then pursuing, you know, adequate cost recovery, ensuring that, our penalties and our ability to, leverage cost recovery over time reflect the real challenges that are in front of us. Sometimes this requires, statutory changes, which, I have I have seen a lot of willingness on the part of so many of you and your colleagues to be able to explore with us.

Excuse me. Let me interrupt you right there. Would you pull the microphone a lot closer?

Oh, sure. No problem.

We've had some some requests already.

Of course. I've seen a lot of willingness from you all and your colleagues to help us address the the need to restructure penalties and our ability to really ensure that there is a a deterrent effect for our enforcement work, which again is really critical in this respect and our ability to recover costs for violations, existing violations. And frankly, to to see how some of our statutory authority may need to be tweaked to be able to encompass perhaps new violations, things that conditions that we may not have seen in the past, that do need to now come into the structure, of some of our penalties. So I guess I would again reiterate, I think, enforcement, accountability, and cost recovery are critical, and enhancing the tools that we have to be able to address these issues as they come up are going to be all the more important to ensure that we maintain our commitment to a polluter pays principle.

So we we have in our agenda, we have some significant discussion about the issue of vacant positions and and positions that are funded by special funds, positions that are funded by general funds. So special funding seems to match our principle pretty well. You know, we have a mill tax, and the mill tax pays for the implementation of of the regulatory aspects of that program. We're now we we have a bit of a history here of a great deal of frustration with how we were implementing some of our regulations, etcetera. Mhmm.

And so in partnership with the Governor's office and the legislature, we decided to beef up those regulations and and the staffing for those regulations and pay for it with increases in the mill tax. Even though the mill tax hadn't been changed for two decades I know. We were able to win support for making that change. And now we have we've made the change. We have the increase, and now we're talking about cutting the positions.

So could you help me with your perception? Because we're going to talk about that more today as we go forward with your perception of this issue of trying to balance our budget and the challenges that we have with that using special funds money to cut special fund positions, that don't have an impact on the general fund, although there is some indirect impact on the general fund. And I'm gonna try to pick, pick the brains of our Department of Finance people with regard to that. But but I have concern about that, and I'd love to, at the beginning here at the intro, sort of get your perspective of this because we'll be asking other people in your department these questions also.

Of course. I will kick it over to to my colleague here at Department of Finance to answer some of the, maybe, more specifics around the vacancies and that approach. But I would say from from our standpoint, you know, and we we have been engaged, particularly with stakeholders interested and curious about what this means given, the somewhat recent increase to the MILFI, which again, we're we're very proud to have landed, what I think is a very sound approach to that increase. You know, we we remain committed to the the specifics associated with that MILFI increase, the workloads that it supports. You know, the Department of Pesticide Regulation has already done so much incredible work to ensure that we do not miss a beat in that in the scope of that work, and that was very carefully crafted in a way to ensure that we're able to really leverage, the the fee structure increase.

And I would say more generally, you know, particularly with, the, budget scenarios that we are living, that we're foreseeing, it is time to take a careful look at our fee structures. Yes. You know, these revenue streams can fluctuate. It is not the first time that these revenue streams are, you know, tapped for lack of a better word when we have fluctuations in the general fund. That's something that that's a that's a tool that we've relied upon in the past, and it's something that we should continue to keep in mind as we're looking at the overall health of our programs, as we're looking again to the deterrent effect for certain activities, and as we're also looking at how to support the work going forward.

But suffice to say in terms of the ... increase specifically and the Department of Pesticides regulations work there, we remain committed to fulfilling that work and, we will continue to periodically reassess our revenue structures to be able to reflect the challenges ahead. But I'll kick it over to my colleague at Department of Finance if they wanna add anything on the vacancies.

Good morning. Andrew March of the Department of Finance. Chair, as you mentioned, this will be a further discussion later. But, with regard to the, the various special funds, and I think particularly with the MILFEE, we would note that, you know, reducing vacant positions now would potentially provide us more time before we would have to increase the mil fee again in the future to provide additional buffer.

Thank you. I would. We went two decades without increasing the mail fee, which was a mistake. But we had lots of challenges and concerns about regulations and enforcement, etcetera. And consistently we heard, well, it's because we're underfunded or understaffed.

We don't have enough staff to do this. That's what we heard all the way up to increasing the mil fee. Now we're increasing the mil fee and now we're laying off or reducing the positions there. And so, you know, saying we're committed to, you know, enforcing those things. I really need to hear more specificity later when we get to this, but I I would like to hear the the rationale that we're confident that we don't need these positions because we we we went through a battle.

I mean, we we the governor's office and the legislature used up political it took political effort to increase the mil fee. And I specifically particularly tried to push through, you know, cost of living increases and trying to match that so we wouldn't have these problems. So where is the assurance that the positions we said we needed just eighteen months ago that we really needed because we had all of these shortfalls, suddenly we we think we can get by without those? Or is it just a or is it just a statement that the budget is so bad, we're just not going to be able to enforce the regulations the way we wanted to do that? That's that's the concern that I have. Sure. Could you help me with that?

Yeah. I appreciate that concern. So I wouldn't say that we absolutely do not need the positions. I wouldn't say, you know, that we're we are not challenged to figure out how to make the commitments happen within the department. I think that the challenge and opportunity that we have in front of us is to figure out, you know, all across the board how to build in efficiencies in our approach.

That was always the idea, that that structure to the mill increase. And certainly, you know, once we're able to maintain a bit more of a of a healthy, workforce, we certainly, intend to do that. I think, what you're hearing from me is is a strong commitment to ensuring that we are not left without the ability to do the best that we can to meet the commitments that we made during the the negotiations leading up to to the mil fee increase. You know, we believe very strongly in those and we're we remain committed to those. The vacancies, you know, you'll hear the Department of Finance kind of tick through the details on that as you just heard from Andrew, but I don't want that to to indicate to any of you that we do not still remain committed.

So I appreciate the commitment to do the best that we can, and I assume we had that same commitment three years ago before we had the positions. And the question is, you know, we should we should. And as you say this more often, I think, and I will try to say this more often. If we work for the public and collect the public dollars, we have a greater responsibility than people in private industry to work really hard and to departments coming and saying we can't we can't do this properly because we don't have the positions. And so if we had the same level of commitment four years ago that we have today, which is to do the very best we can to try to enforce it, I remain concerned that we still are losing these positions.

So it is something we're going to to have further conversation with. But I wanted to try to get your perspective to see if you had some sage insights for us as we tried to attack this this particular aspect of it. I have a few other questions, but I want to turn over to my colleagues and see if they have any questions here in the introductory aspect of this. And then we will be hearing all 10 items still, so these are overall questions for the secretary.

Thank you. I just wanted to I know you mentioned Exide, and I wanted to first say welcome back. Congratulations on your new baby.

Thank you.

I didn't actually expect to see you here. So it's nice to see you.

It was a feat. Yeah. Yes.

So are you I know as I've worked and I know we're gonna be talking about Chiquita in a minute, but, you know, it's been clear become very clear to me how important transparency is for our communities to have the information that we have because oftentimes they are the ones who are raising the alarm bells when maybe we should have noticed and didn't or before we even notice or could. And so, you know, I know that there's been work around verification sampling at Exide and I wonder when this is going to be released to the public, if there's plans for that.

Do you mean from the department? Yeah. From the department of toxics? Yeah. I I don't I don't have a date for that off the top of my head, but I'm Is we're happy They are here. Yeah. There. And we could potentially ask director Butler when she's up at the podium Or up at the

Or Dan.

Or Dan. Sure. Go for it, Dan. Okay.

Thank you.

Great question.

So Could you pull that really close? Everybody needs those microphones. If you can pull the microphone. Yeah.

There you go.

It's noisy in here.

My name is Thanne Berg. I'm deputy director of site mitigation and restoration at DTSC. So, the verification and retrospective sampling started in April and continued through December. So, we have our contractors working on all those reports.

We then have to get them, and we're evaluating them. And so we're gonna be releasing those reports on a site property by property basis in rounds as they become available. Okay. So we're really close to releasing the first round, which will be about 18, and then we'll continue to do that as we get the reports ready to release. Each report is about a 100 pages.

So they're not short. Right. But the good news is is that as we're doing the sampling, the purpose was to determine whether or not the cleanup previously was according to the plan that we were mitigating the risk to the greatest extent possible. And so thus far, we feel very good about the sampling that we're receiving that is confirming that we were successful in doing those cleanups.

Okay. Great. And you say it's coming soon. Do you have any ballpark estimate of what soon means?

I wish it was last Friday. So I'm hoping in the next couple of weeks. Okay. Trying really hard.

Okay. Thank you. Appreciate your work. Thank you. I know there's been a lot of as we've been working on Chiquita Canyon Landfill, there's been a lot of comparisons to Exide when I talk to people about it and what a nightmare that has been as well. So so I feel a lot of camaraderie with what the community of Exide is going through as well. So thank you for your work there.

City member Rogers.

Thank you, mister chair. Going from actively burning landfills to sealed and enclosed off landfills, I sent a letter a couple of weeks ago. I look forward to to a response from you and and your your agency. But we have a landfill just outside of Laytonville in Mendocino County that has been capped. The cap was damaged in 2015, and the the cap has still not been fixed.

And while I understand that most of that falls on local jurisdictions, local counties, to oversee, cap landfills once once they actually reach that point, for many of our smaller communities, they don't really have the funding or the expertise. So I'm hoping you can talk a little bit about what you can do to partner with small communities, or rural and and poorer districts, to try to help make sure that there isn't significant issues around concerns with health and safety. In in our my letter, just to refresh, was asking for some additional testing in the surrounding area, particularly on tribal land

Mhmm.

Mhmm.

Just if for nothing else, for ease of mind for the community that lives there.

That was not eligible for some of the grants and funding for testing.

Sure. And thank you for your letter. Thanks for your patience as we respond. I actually just was able to see it myself this week. I'm just freshly back.

So I appreciate, your patience with this. The issues around, that landfill are are not unfamiliar to us. I think you're familiar with our history working with the Laytonville Rancheria on some of the testing, together with, the Bureau of Indian Affairs, several years back and US EPA. You know, I've asked my team to think about, how we can use existing data, access to current information, potentially, look for the ability to conduct any new sampling, and we need to think creatively about around some partnerships to be able to do that. But we're certainly thinking about what some options are to enhance the access to information in that region because we know that those those concerns are very real.

I've I've been up there and visited several times myself, and so we we wanna make sure that we're able to enhance that data to the extent we're able. But I'd also like to to brief you on some of the work we've already done to date so that you have some access to that information at your fingertips as well. So thank you.

Yeah. And but even pulling back from that specific example, understanding that you probably run into this in many communities that are smaller and don't have as many resources, Do you feel like the agency has the authority and the funding that it needs to be able to assist, rather than just monitor and put pressure on the the local counties to do something?

Mhmm. Well, you know, some of the, ways in which we've talked about, with with many of you, the enhanced authority, and, some of the tools that we could garner through, our oversight of landfill operations in general in response to to what we're seeing the challenges at Chiquita, but also in general, I think would support our ability to take a more careful review of some of the data and work with the counties, yes, but also potentially leverage our own resources to to get that original information and data ourselves.

So the short answer to your question is I don't think we have the perfect tool set currently. I do think the issues around landfill caps, landfills still in operation are going to continue. And so I would say we're we're actively looking at ways to enhance our access to resources and, oversight and authority to be able to to, examine some of these issues in real time.

Yeah. I appreciate that. Just to punctuate the point, and I'll get off of it. Mendocino County has a budget shortfall where they can lay off literally their entire public safety, sheriffs, firefighters, and then still have a deficit. And so just finding them as the only tool to get them to to make changes is never gonna be an option that's gonna be helpful. Yeah.

Great. Thank you. Appreciate that.

Any anybody else during the introductions? Assemblymember Gallagher.

Yeah. Thank you, mister chairman. We didn't have the resources secretary last time, so I was just gonna ask on the I know you oversee carb to some extent. The the new proposal for 200,000,000 for zero emission vehicles, you know, there's been criticism of that in the past that a lot of that went to, you know, wealthier individuals and helped them buy cars that they probably could have afforded on their own. How do you see, you know, this program being more successful this time?

And have you had some discussions at all about that?

Sure. I have. And, you know, appreciate the observation and critique that I know is is common across the state in terms of access to resources to purchase new zero emission vehicles. I'd say the approach on this proposal is really intended to respond actively to, you know, the attacks that we're seeing from the Federal Government on our direct authority to regulate not only emissions, not not only zero emission vehicles, but really emissions from from combustion fuels. And so seeing that the transportation sector remains such a significant source of emissions means that we do have to see more of an uptick in in zero emission vehicle adoption.

I mentioned a bit earlier, know, the last time we saw fuel prices at this at this level, we did see more of an uptake, a significant uptake in zero emission vehicle adoption, which we hope that we can continue to see.

This particular proposal is really intended to match, with the OEMs, at a point of sale, the ability to, increase access to zero emission vehicles during this time. We're we're trying to deploy all of the tools that we can, that we continue to have access to, and so we're really hopeful that, this approach given the context that we find ourselves in, will be successful.

But I I fully appreciate, you know, the, the concern, and the consideration that we will continue to have, that our existing programs that, really focus on low to middle income Californians and their specific access to zero emission vehicles, remain just as important to ensure that this is not something that is only accessible to a limited few, but is actually accessible to those who who may need it the most.

And just following up on that a little bit, do you think that CARB has gone too far in the sense that it's pushing things and mandates and otherwise the credits issue has come up here, obviously, recently in the news that's affecting affordability? You know, I mean, we all wanna do something. I mean, it's a big priority of everyone to make sure that California is more affordable, and yet many of the things that CARB is pushing for

I I could tell you a lot of people in my district were actually kinda happy that there was some pushback on the mandate for zero emission vehicles. Understood. And the reason why is because, similar to mister Rogers, you know, in in our rural districts, we don't have charging stations.

Our constituents can't afford a zero a ZEV. We have to drive really long distances, and especially in agriculture. We need diesel and gas trucks to move our goods to bring them to your table so you have affordable, healthy food. So, like, I mean, do you think that there does need to be some rain in a carb to ensure that we actually have things that are affordable or not we're not passing on too much cost, you know, to consumers.

Mhmm. Mhmm. Well, first, I'd say, you know, there are many things that are impacting affordability today for Californians. And, you know, I think we need to really consider each and every one of those, issues that are affecting affordability for families all across our state. With respect to, you know, CARB's approach on zero emission vehicles, we have been at the forefront.

That's long been a part of our leadership and our history, not only in, you know, again, adoption zero emission vehicles, but frankly, you know, providing the tools to regulate emissions from combustion fuels, but also in enhance efficiency so that people aren't spending as much money on gas in vehicles in in the state of California.

Those those efficiency standards help with with costs at the pump, with prices at the pump. So we want to actually see more of that. You know, there are a lot of benefits associated with our regulatory approach. Those are benefits that are felt at the household level, benefits in terms of cost reduced, in terms of health care costs, and, you know, missed days at work, missed days at school, etcetera.

So I think I think the ledger, we can we can talk about in more depth. But at this moment, I think the the task before the the board and before us as an agency and us, I'd say overall as a state is to ensure that we're really refining our approach to make sure that we're providing the type of access that Californians need today. Not necessarily focused on our long term goals. Yes. Those are still there.

Yes. We need to prioritize progress toward them, but the immediate priority is ensuring that Californians have access to what they need on their tables and their homes and to be able to get to and from work. I very much appreciate the issue in rural areas. I think this is also why, you know, these programs don't exist in a vacuum.

They also exist in collaboration with our sister agencies to ensure that charging infrastructure goes up in our rural areas and rural communities to ensure that we have equitable access to that all across our state.

And I hope to to continue the conversation with you and your constituents as the Air Resources Board has done and is continuing to do currently.

Thank you.

Thank you. We have 10 items, and so we do need to move on here. But I have a few final questions. I check with my colleagues.

So, first of all, you started off your comments talking about how many challenges there are out there, and there are an enormous number of challenges when it comes to climate change, when it comes to what we're trying to get done in California in in terms of protecting our environment, trying to match, you know, resources and polluter pays, etcetera.

So we have these enormous challenges, and we have limited resources. And it's why I would say that you have, I think, one of the two or three toughest jobs in California. And, that is and I don't mention that lightly. I think trying to juggle to make this all happen.

I give you just a classic example. The question about ZEVs is really a carb question, but it also, you know, the Environmental Protection Agency has, you know, has a voice in so many of these sort of sort of things. I will offer this, you know, with Zev.

We got ourselves to what I feel like we started to plateau at about 25% adoption and then sort of getting that next group of people. And I would still think we're going to have challenges getting to an all EV adoption by 2035 as as our goal is.

I think we're still making a mistake if we don't, identify and clearly, reinforce that, plug in hybrids that get a certain amount of distance, whatever carb would come up with, should be something that counts temporarily towards our ZEV goal. Because just as, Assemblymember Gallagher pointed out, they're just places where this range anxiety and the number of charging stations, etcetera. This is not a comment for you. It's really a comment. We we had carbon, and we did a lot of things about all of those EV program and stuff, last year.

So I wanted to get that on the record, but it it just shows the the it's it's an example of of the enormous challenges that that we have out there. So, you have this this really tough job, and, we look forward to being partners with you in terms of doing that.

And we would we welcome you coming and letting us know where you're having the greatest difficulty with the limited resources and the challenges that are out there. So as we've asked some of these questions up here, we're not out to get the department or anything else. We're out to try to make the department as effective as possible, recognizing that we don't have the resources to attack everything the way we would like to to attack those things as as we go forward.

So, you know, you made comments about cap and trade and that being a polluters pays, you know, sort of thing. And yet many of us in the legislature are concerned that we're violating that principle because we're collecting the money from the carbon auction, but we're not using that money always directly to try to reduce carbon emissions.

We're using it for general fund, you know, Department of Motor Vehicles and and those kinds of things. So, we're trying to move that direction, and we hope this is another opportunity for us to remind the administration that we think that's the one place where we should definitely match, you know, the polluters pay aspect of this, which is, the the money collected from the carbon auction ought to be reserved for actions that are doing that. There should be a good faith effort.

That's that that we've that will come up over and over again here with Department of Finance, and I know they heard that last week. My final two questions for you. Could you just reflect on us what you see in terms of environmental justice and the evolution in the state of California in terms of a commitment to environmental justice and where you see the next challenges are in in terms of our efforts to deal with the environmental justice issues.

Sure. Appreciate the question. And I'll just note, but before answering, you know, the the air resources board, of course, is a board within our agency family. So, CARB questions are always fair game. And again, I I I do genuinely, mean that, we really want to continue to engage in in these discussions because they are challenging.

They are difficult, and they have been for us for quite some time. With respect to environmental justice, you know, I think we are lucky in California to have such a robust network of environmental justice focused organizations. And many of the sort of traditional conservation based environmental nonprofits and organizations are also really focused on

environmental justice issues and challenges here in California because of that, history and and movement building, that has taken place here. So I count us all very lucky to be able to benefit from, their good work, the research, the organizing, the the work that they've already done on the ground.

I think right now, one of the biggest challenges facing us all collectively in light of that is really coming from a fundamental vulnerability that many of those organizations are facing, that frankly, some of our staff are facing when they are doing environmental justice work.

that might, put them in positions, that are are unsafe. We we don't ever want to do that. So that's been something that's been very challenging, in the environmental justice space. I'd say the the thing, the aspect of our environmental justice work that we remain deeply committed to and that, as secretary, I am very focused on, is making tangible, real differences on the ground in environmental justice communities.

And that is because that that term has become, so loaded, has become the basis for, attacks, on, people even personally. And so I I don't discount the very real impact that that has on our ability to continue to engage with stakeholders on the ground and to continue to have our our staff even take on, roles that might make them feel uncomfortable,

that's very focused on environmental justice communities through our, work in vulnerable communities, through our cleanups, through, the Department of Pesticide Regulation, and much of, the work that they've done. As you all know, we have environmental justice advisory committees now at almost every, board and department, and that's been something that's long been pushed for, by many environmental justice based organizations.

So I think there's been quite a bit of evolution, in the work and the uptake of that work across our state agencies, but the priority being that we maintain a real focus on delivering tangible results on protecting people, on making sure that they see that we're not only, committed to environmental justice work, for, procedural, or, outreach and engagement, aspects of it, but really meaningful aspects of it.

And finally, I'll just end with the notion that, you know, dealing with environmental injustice is somehow worthy of attack from the federal administration.

We've seen a lot of great progress in the investment of dollars from the greenhouse gas reduction fund in disadvantaged communities over the past ten years now, ten years plus. And so that's been an area that's of of strong focus of ours, but it's also something that's permeated the approach that so many of our other departments have taken, including departments like the Department of Toxics

You know, it's it's ludicrous truly. But, I also wanna note that it's really about making sure that our programs and our efforts are as effective as they can be. When we focus on driving down emissions in disproportionately burdened communities, we make, sure that all the state benefits. The the entire state benefits from that. The nation, I'd posit the world benefits from that.

That's where our efforts are going to go the farthest. That's where our dollars and investment go the farthest. And so that's something that we remain committed to even as a matter of efficiency.

An incredibly effective answer. Thank you. No problem.

Yeah, that's I think very, very helpful. And I'll take me to my last question. And you started to allude to this with your answer there. And that is, can you give us your opinion of the scale of the impacts in the from the federal administration's cuts and hostility and vindictiveness towards California and how that how that is affecting California from the perspective of the head of the Environmental Protection Agency.

Right.

You know, the the attacks on our authority have been, so unprecedented and are leaving us in this kind of lock jam of litigation. And so I think the the impact to our resources in that respect, you know, these will be lawsuits that, you know, may go on for a very long time. And that's going to take a lot of resources, a lot of attention away from the work that is about just making progress and continuing that that progress.

True. And while we talked a little bit about, you know, some of the ways that we wanna maintain a nimble approach, particularly in the zero emission vehicle space and and this this particular proposal, in light of some of the federal attacks, on our zero emission vehicle programs.

that our agency works in great partnership with and relies upon for access to data and information on emerging contaminants, on toxicological considerations, weather patterns. All of that information and that sort of baseline of access to just good science and data is incredibly impactful. Losing that, is incredibly harmful.

So I would say that kind of an overarching impact is that, and that is a real challenge that we find ourselves up against. Again, something that we've really worked on building our muscle to respond to in the in the legal space. But I'd also say more broadly, the underfunding and cutting of, science and, scientific offices,

And, you know, in some ways, we've, been able to, frankly, benefit in as a state from some of the folks who have fled these these cuts and a lot of the movement away from science. But, you know, I I can't discount the impact that that is really having on on the nation and certainly on California.

And so I think we're at a time where our commitment to science is critical. We're we will continue that, but it's it's certainly impacted our work. It will continue to impact our work, and then we have to stay apprised of what we can do to to maintain our muscle memory in this area given the federal administration's defunding and cutting of so many critical programs.

Secretary Garcia, you're an eloquent spokesperson for the for the agency and the department and for California. Thank you.

Thank you.

I really appreciate you giving us your time here this morning.

Of course. Thank you so much, chair. Thank you again, members. I I do wanna note before just leaving the table, we we can get you more specifics from the Department of Pesticide Regulation. I appreciate the concerns on the mill fee. You know, this is, an area that, you know, is very important to us. I wanna make sure that we're able to answer your questions.

I I think you'll certainly find, as the hearing goes on, that we will, both have a lot of questions and we'll probably have a different perspective than, where the administration is at this point in time. Great. Thank you very much.

Thank you.

And now we will go to issue two, a landfill landfill support response and enforcement. And we have a cast of thousands on this panel. So people will have to rotate in terms of heading up to the table. So we have yeah. They yeah. They will introduce themselves, but I'm just trying to figure out who all yeah. So get close if you're on the panel, but you're not here yet. Right? Right.

You guys excuse me for one second. Nobody knows the air conditioning It just kills us up here.

Oh, we feel it too.

There's plenty of room.

I am gonna file a unfair labor practice against the state for this. But if you will introduce yourselves as you begin your. Begin your testimony and give me one more second. I want to make sure I'm at the right page here. There we go. Great. Thank you. Who wants to go first?

Sure. Hi. Brandy Hunt, deputy secretary for fiscal policy at Cal EPA, here to present the landfill inset BCP to you. As you noted, We have several of our board's departments and offices that are part of this this BCP and they'll be here to answer your questions. For a high level overview, we're requesting $5,100,000 in 12 positions and that is across CalEPA and several of our BDO's.

Just as an overview of what set events are, they're an emerging environmental issue that can disrupt landfill operations. They diminish disposal capacity, and unfortunately the broader community impacts including a concerning rise in illegal dumping in the surrounding areas.

So it's a secondary effect of these set events. Some of our BDO's that are involved in this work, CalRecycle who in this BCP will take the lead in administering the additional grant funding that we've asked for. The California Air Resources Board is has an active role in monitoring the air in and around the community where the set event is occurring.

Looking ahead with your approval, this proposal with this proposal, we envision a future where our state's ability to manage these events is is more rapid and significantly strengthened. We also want to be able to identify risks earlier so that we can respond rapidly or, implement tools where we can reduce the impact and detect things early before they become, a public health issue.

We also have the State Water Resources Control Board here who focuses on, groundwater and ensuring that we are keeping our water clean, safe, and healthy. And lastly, office of environmental health hazard assessment does all of the the assessments and evaluations of what safe levels are and how our community members are being impacted.

We have the Department of Toxic Substance Control who is also here today, and they are instrumental in evaluating the potentially hazardous conditions caused by hazardous waste, and they are going to offer technical support related to waste stability and overall environmental safety.

With that, I'd like to thank you for your time and consideration, and we'll open the floor for questions and ask that my colleagues come up when it is time for them to answer.

Great. Thank you very much. Department of finance.

Jamie Gonsalves, Department of Finance. No further comments at this time, but here to answer any questions.

Great. LAO.

Good morning, mister chair and committee members. Frank Jimenez with the Legislative Analyst office. As we've said in other hearings, given the tenuous budget situation, we recommend that the legislature use a high bar in approving any budget proposals, both those from the general fund and special funds.

For this proposal, we find that it does meet that high bar in addressing a critical health and safety need. The funding and positions would support state and local entities in addressing the two current active set of set events in California.

And the ongoing portions of this funding would help those same entities in preventing and and mitigating future events from happening. But happy to take any questions.

Great. I will turn it over to our premier landfill assembly member expert, Assembly member Schiavo.

Yes. An unwanted title, truly. I thank you so much. I I am incredibly grateful to the chair for flagging this and inviting me to sit on the committee today. And unfortunately to my chagrin and my community's chagrin, I'm becoming known as Chiquita Pilar because everywhere I go, I talk about this horrific disaster happening in our community, the Chiquita Canyon Landfill that burning and will be burning for twenty years.

90 acres of burning trash underground. That's 108 football fields. It is making my community sick and, and really, ruining lives. And, so I wanted to join this budget subcommittee hearing, not only to highlight this ongoing disaster, but also to ask a couple questions about the landfill response and support and enforcement funding.

For three years, castaic and velvety have been plagued by toxic, nauseating, and cancer causing chemicals that are being released by the set event or the subsurface elevated temperature event at Chiquita Canyon Landfill.

But for the public, let's be clear what this means. It's really God knows what types of trash are liquefying at hundreds of degrees. We heard just recently they are at temperatures of 261 degrees, at Chiquita Canyon Landfill. And just to level set, water boils at a 100 degrees. So this landfill is literally hotter than boiling water, And that's what's spreading these harmful gases and deadly liquid around our community.

supportive and and even coming to the community, meeting with family members and experiencing seeing what they're experiencing with, you know, their children having daily nosebleeds, nausea, vomiting, tremors, debilitating, you know, career ending illnesses where people are no longer able to work because they're so sick.

Recently, it was reported that, you know, these temperatures are excessive at least in multiple of the wellheads where they where they test them. I know that the chair and my colleagues have heard me speak many times about this and, and I'm really grateful that so many of our my colleagues have been so

And most recently, there have been three funerals due to cancer in this community just that I know of. People are fleeing generational homes, homes where they grew up.

Homes where they they thought they'd found their forever homes. I'm sorry. It's so horrible.

Take your time. We have we have a few other things we can cover and then come back to what you wanna say. Would you like to do that?

It's okay. It's okay. K. And I'm incredibly grateful for how the state is responding.

There has been robust response from state agencies, and I know I saw you've racked up over 20,000 hours staff hours on this $2,500,000 to a disaster that the operator truly has caused. And I know we all agree that the landfill should foot the bill, but I also know that work needs to continue and that needs to continue to direct the landfill to take substantive action. So I wanted to get into some questions around the proposed funding. So can you explain a little bit about these positions? Because I know there's already a lot of staff that are dedicated and have been spending a lot of time, on this issue.

And from what I understand, it's gonna be for Chiquiti Canyon and also Elsa Bronte. Is that correct?

That's correct.

Yes. Correct. Okay. So just those two? Correct. Okay. So is this are these positions going to be increasing the capacity, replacing folks that need to be doing some other things? How is this is this gonna be bolstering the response or how are these positions going to help in terms of the response?

So the easy answer is everything. Right now, we are committed to responding, and so we're going to do what it takes to respond, which means there may be staff who are working on other things right now that are responding to Chiquita Canyon in El Sobrante, and they'll continue to respond until we can hold the landfill operator accountable. Mhmm. These positions that we're requesting will will augment that. We're looking for experts in g geological engineers, people that can really look at slope stability that we don't have that really specialized expertise right now that we see there's there's a large need.

And once we can get to a place where the set event is reducing, we're able to mitigate what's going on, and we're getting the community, hopefully, as soon as we can back into a place where they are staying in their homes and they are have healthy children and are healthy themselves, then those staff will start focusing on, you know, other events that do need to be monitored. And we're gonna focus on doing the waste characterization and the research that we need to do so that we can mitigate these events. We can catch them early so that they aren't creating these types of issues in our communities.

Mhmm. I appreciate your optimism with the estimates of it, but nearly for twenty years. I don't imagine that in the next year, although, oh my goodness, if there could be a solution in the next year, I would do anything for that. So I'm a little concerned. I mean, I'm curious if this seems like it's enough because in addition to Elsa Bronte and Chiquita, we know that there's 11 landfills total that have gotten waivers from the EPA to operate at higher temperatures.

And so there's potentially 11 landfills in the state that are on their way to be in a set event if they are not already. And so, you know, my I guess, I wonder if you think this is actually enough because we know it's I mean, as we've seen by the multiple agencies that you lift listed off that I've been meeting with monthly as well, this is a huge, huge response and very staff intensive.

I can answer that. Good morning. Alana Matthews, deputy secretary for law enforcement and general counsel. And I first wanna say that we are sorry that your community is experiencing that, and I think that's the underlying goal and motivation of why you've seen such a robust response from Cal EPA and our BDOs. For right now, it is enough.

I will say that our current response has required the diversion of a tremendous amount of resources that are currently assigned. I mean, we have staff within our videos. This is primarily all of what they are doing. Mhmm. So part of this proposal is to allow us to have staff who have been diverted from their primary duties to go back to that and to add on to that.

And I think that there are three ways that our proposals are trying to, address the ongoing need that we see in dealing with the active to set event landfills as well as potentially. And that would include increased on the ground support so that we have positions to provide additional staff and experts to experts to enhance the current response efforts. We also want to look at state cost supports because these funds will also have cover the cost that the state is currently shouldering, as we divert that from other functions, and then the future detection and improvement. So, again, we're still trying to figure this all out and to be able to do that and have sufficient support and resources to properly assess and monitor. And if there needs to be further compliance or enforcement actions, we wanna make sure that we have the staff and resources.

And that, of course, includes technical as well as other classifications to really have a comprehensive approach to make sure we are effectively responding to said events.

I mean, I guess I would say, and I and I completely see that. I completely see how this has taken over people's jobs when they, you know and and taken them away from other things that they really need to be doing. And so I agree that this augmentation is really, really needed. And I guess I would just, you know, urgency is the name of the game in this on this issue. And in the other landfills, I think that we need to get really on top of them to make sure that they don't turn into the kind of disaster that we're seeing at Chiquita Canyon and at El Sabrante, though very, very, very different.

Because we know I mean, this is really I mean, this can mean financial disaster for the state if we don't get these under control because it's a million dollars a week. I don't think anyone probably knows this. It's a million dollars a week just for them to truck the toxic leachate, which is the liquid that the, you know, landfill is producing. Just for that is a million dollars a week for one landfill. And so we had 11 landfills on fire and they're trucking.

I mean, not only does it cost a lot to truck that leachate, just our one landfill is running out of places to take that leachate now. We are taking it to other states. I've heard that they're taking it to Mexico, which I think is illegal. So, you know, it's like it's a disaster creating disasters in other areas. So we like, I I hope that some of what this will go to is also bolstering the ability to respond to the other landfills that clearly are operating at higher temperatures if they're getting waivers to do it.

And really, like, ultimately, at the end of the day, we have to change the culture of these landfills. Because these landfills have just and, you know, and we've probably allowed them to just Kinda hot rod these landfills and, you know, and we hear them in these meetings say, oh, well, you know, by the EPA standards, right, you're not supposed to get to a 131 degrees. That's red flags. But they will say publicly at meetings, oh, we don't really worry until it gets to a 150. There's a culture of total disregard in these landfills that they are not concerned about letting these these landfills heat up.

And, and once it gets out of control, as we've all seen at Chiquita Canyon, it grows and grows and grows and we can't get it under control. So, we already have the names and locations of the other landfills. I think we got it really, really, really get on top of that. Just one last question around the million dollars for local assistance. Is that specifically for LEAs?

Like, in the case of Chiquita, the depart LA County Department of Public Health or the county Yep. Or is it for community members, organizations? How how is that going to be distributed?

CalRecycle is part of that specific part of that proposal. So I'm gonna ask my colleague from CalRecycle to come up and give some details about the grants.

Okay. He needs a mic.

Thank you. Mark de Bie with CalRecycle. Thank you for that question. The money is focused on the local enforcement agencies, and our strategy is to recognize that LA County and Riverside County LA events. And so we would earmark a a large portion of that money to them initially.

But we also, as you've observed, aware that other landfill could be landfills could be subject to the same set event. And so we wanna start funneling money to the other LEAs with landfills to prepare them, to equip them to better monitor for set events and be prepared to address those set events if they were to occur.

Oh, good. Okay. That's great to hear. I have to say, if we're given money to LA CDPH, they need to do a better job. They have been horrible to work with and deplorable in their response.

And I as someone who fought for public health for twenty years, almost all all of the twenty years in my career, I have been shocked, so shocked and dismayed about the LACDPH response to Chiquita Canyon. I mean, it took them like a year. Finally, they came out with we should improve a message that gets sent out if the air monitors are putting out alarming levels. Like, that we had to fight tooth and nail just to get them to inform local physicians that, you know, maybe they shouldn't they they should be informing them of the health impacts that this is having. So I hope with that money will come a very strong conversation about their responsibility to step up in real ways and, you know, and and actually help people, especially when it comes to protecting public health in our community.

That's all my questions. I just I wanted to just leave with one, little bit more around the urgency. I am, you know, I have to thank everyone in this room, everyone who may be listening, who is part of these agencies for responding. The response has been robust. As I said, I know it's been painful for everyone to hear these stories every month, and I really know that people's hearts are in it.

I also see that what we're doing is not working, like, at the end of the day. Right? We are stuck in this situation where we are at the mercy of the landfill in in a lot of ways. And the landfill strategy is delay and don't pay for stuff that they don't have to. Right?

I mean, it seems very clear to me that they are just dragging their feet. We have been trying to get them to cover the landfill for the last year and hardly anything is happening. We've been asking them to put a barrier in so the fire doesn't grow into another part of the landfill. They've been in putting insufficient plan after insufficient plan after insufficient plan forward, and we just we're going back and forth with them forever. And I I'm hoping other things are happening and coming.

But but it I I think it, like, calls into question our whole system and response. And I think that in moments like this, we have to be really reflective about how we need to change what we are doing and how we do it to to be able to respond and take action in real ways that helps people. Because at the end of the day, that's what these agencies are for. Right? All of your agencies are to protect people, and I am so grateful so grateful that you are there.

But I I see where that system fails. It is it is failing in this in this in this situation where, you know, the the air resources board is like, oh, we see all these toxic things, but we don't cover health. Right? So health has to respond when it comes to health. And department of public health, the LA County Department of Public Health has not been responding.

Their pathetic survey was not enough. And so, you know, so I I think, like, I think that we have to think creatively right now because right now what is happening is that we are just stuck in a back and forth with this landfill that does not want to spend money and does not wanna fix it. And, you know, the more they drag it out, the better off they are they are. And the more they drag it out and don't take action, the sicker our community is. And while there is a lot of kind of what's it called when it's just, like, spinning around?

I don't know. Anyway, there's a lot happening over here to go back and forth with the landfill and respond and hold them accountable and cite them and Dah Dah Dah Dah Dah. There's not actually a lot happening on the landfill to mitigate this situation, and there is nothing happening to get our community out of harm's way. Nothing. And that's why I've been calling for a state of emergency to the governor, to the county, doing it again today, state of emergency.

If we if we don't change any of our response, it at least gives financial relief to our community where they can get mortgage forbearances and other tax relief just automatically. They are being told they cannot get any of that relief because there is no emergency declared. And people are desperate to get out of this community now, because they know they are all getting too sick. So, so I hope that we can find all of the creative ways to hold this landfill accountable to make them pay for it, but we have to just make things happen. We have to make things happen in the interim because it is it is too slow and people are getting too sick while we push paperwork around with these guys who don't wanna help.

So thank you. Thank you. Thank you for all you do, and thank you for your future creative thinking that will even make more happen. Thank you.

Thank you. She Assemblymember Rogers.

Thank you so much. So part of it is I just wanna make sure it's very clear. I represent the other end of the state, and this is still an important issue to me. This isn't just a specific issue for Assemblymember Shavo and her district, but we're all watching what the response is and asking questions about what that would mean for our own communities to go through this. And we know that it's not just one landfill.

So I wanted to start with kind of a a general question, which is I heard, I think, 17 times holding the landfill accountable. And I wanna know what that means. Does that mean making sure that they're taking care of the long term health of the people impacted? Does that mean addressing issues around the inability to sell those homes? Does it mean forcing them to do things like capping the landfill? Like, when when the department says holding them accountable, what's the definition for holding them accountable?

Well, that definition is sort of dependent upon the authority of each of the BDOs in addition to CalEPA and all of our boards, departments, and offices under that umbrella of the agency, there is also authority with the local entities and also with US EPA. So for us, our budget proposal really reflects resources being committed so that for the jurisdiction under or the authority under CalEPA and our BDO's that we can exercise to the fullest extent of that. And just as as though we have specific authorities, there's also specific jurisdictions that everyone has. So this is a very unique situation because CalRecycle, CARB, DTSC, they're all different authorities under which they act. So CalEPA sort of places coordinating role.

And so what that means for us is making sure we have a coordinated and consistent enforcement response to hold, a landfill operator accountable. And that requires making sure there's information sharing. We understand. We have updates on whatever regulatory actions fall under specific authorities that others understand that, and they understand how they're impacted so that we can have a coordinated approach. So depending on the authority of the agency, it could have a different meaning.

But I think overall, for the agency, it really means understanding what those authorities are and having a coordinated and consistent effort so that we are able to hold the landfill account.

And I'm gonna interrupt here just I know we have a number of questions and comments that the the member's going to want. We have 10 items. We're on item number two right now. We've been at this for more than an hour and a half now, and we always take a fair amount of time with the agency director. But I'm gonna ask that the respondents try to be very efficient with your answers and that assembly members take into consideration that it's 11:00, and we have a hard removal from this room at 01:00.

So, yeah, we have eight more items. So if everybody can be as efficient as possible, but Yeah. Continue. Anything else, mister Rogers?

Yeah. I I think what I need to hear from you is an understanding that holding them accountable needs to be more extensive than what they've built in as their cost of doing business. That the creative solutions that my colleague is looking for don't exist if holding them accountable is cheaper than implementing those creative solutions, and that folks in other districts that operate other landfills need to see that holding them accountable means that preventative measures from them are less expensive than allowing something to happen that then they can later write off, because we don't do enough to do enforcement. So particularly when I hear concerns from my colleague that they've been asking for a cap to try to help prevent some of the health issues, and I've and I've met with some of the folks down there who are dealing with cancer and other types of health impacts from this. I need to hear from our agencies that holding them accountable means forcing them to do the things that are gonna save human lives and make sure that the financial burden of this doesn't fall on the people who are impacted but falls on the business that has allowed this to happen, that's what I need to hear from the agencies.

My other question, and then I'll get off it, mister chair, is if there are 11 other landfills that have received a waiver, what are you doing to coordinate with folks at the local level in those agent in those jurisdictions to make sure that there's additional monitoring compliance, to make sure that we don't end up hitting this this self perpetuating disaster, which is what this is.

What part of it is asking for this proposal to get more resources so that we can make sure that we have staff that coordinate not only within the local regulatory community, but also with the local agencies and local communities to assess, monitor, investigate, look at compliance and enforcement to your point earlier to do that.

And that's that million?

That is not the million because that deals with CalRecycle. But from Cal EPAs, the the amount that we are asking for is specifically for a dedicated position that does the coordination. So looks at the other landfills that potentially have a waiver or may show other indications that it could be a potential set event to gather the working teams, the relevant videos to do the proper assessments.

Right. Thank you.

And I'm going to ask everybody that comes up on the panel when you talk, if you could move your papers to the side so that you can pull those microphones. No, you don't have to close your paper, but you got those microphones have to be really close to your mouth. We have people still letting us know that they can't hear you. You really have to be up here like this. There's a big difference between that and this, and I even have to remember the differences.

I can't pull my microphone forward. You guys can't. So please don't let the don't put the paper between you and the microphone. You're too far away. You have to move the paper to the side and pull the microphone. Assemblymember Gallagher.

I'm trying to be quick here. What is causing these set events?

I think we should bring up, maybe DTSC and CalRecycle who are have more scientific expertise in what's causing them.

Sure. And just, like, if we could just Kinda lay out just what are the key factors that what do we know right now? And and I know we're trying to be efficient, so just lay out what do you think are the things that are leading to these set of ends?

Hi. What the paper did? Away the microphone. There you go.

PPSC, site mitigation restoration. We don't always know exactly what causes it. Sometimes, there's things in the landfill that ignite depending on what's been disposed of there that will start the landfill reaction. But because it's so deep in the landfill and we don't have a lot of causal reports and investigations, we don't always know exactly what causes the landfill and this reaction to occur. And I'm hoping that, mister DeBhee here has more.

Thank you, Thane. Mark De Bie with, CalRecycle again. Not much more to add, but, what what is difficult for us is that there isn't a true pattern that we can see as yet. These kind of events happen all over the country, all over the world. And when they're investigated, half of them come back with no definitive answer on what the cause was.

And what's baffling too is we see landfills that are very similar to ones experiencing a set event that aren't experiencing a set event. You know, the same types of waste, the depth of the waste, the moisture content, all of those things are very, very similar. But one landfill would have a set event and one won't. So we are learning a lot from the current set events, and we will be applying that to our approach going forward to other landfills, better monitoring, looking at well temperatures

to see trends. I don't mean to cut you off. I'm just trying to get is this a newer phenomenon or has it been going on for a long time?

It's very new to California.

Okay. So within the last five years is when we've seen this or or what? Yes. Okay. So that begs the question, is it something new that we're putting into landfills that could be contributing to that?

Lithium ion batteries, I'm guessing.

Well, I mean, that's one question, but I'm just saying, like, is it something new that we maybe have been putting into landfills as causing this phenomenon? What do we know?

Yes. It would just be conjecture, but that is something that we're looking at. One thing that we've identified is, as we all know, lithium batteries are much more prevalent than they have been. People are not good at keeping them out of the waste. So we know that some are going into landfills. Could that be one of the reasons we're seeing this, now and hadn't seen it in the past?

Are you seeing it deeper in there, like, deeper layers of landfill, which would suggest maybe, you know, stuff from far in the past that maybe we're putting in landfills, or are we seeing it maybe at the higher layers?

With these set events, we're seeing it at all layers in terms of high temperatures.

Okay. Are we seeing any difference in, like I mean, is are we seeing this happen where people are not properly, you know I I don't know all that goes into, but putting linings or different things in place? Or I mean,

I think everyone's

been more compliant or not?

Each set again is different, as Mark has mentioned. And that's part of the reason why we have this proposal is because we're trying to get more resources and staff so that we can determine, more accurately the scope of the problem in California as we've recent this is more of a recent phenomenon that it has come to attention. So we still have work to do with that, and that's what we're committed to doing.

If I may,

Are there, like, more compliant ones that we don't see this, like, I mean, or maybe more, like Yes. Meeting standard and others that don't?

Yes. Okay. Yes. If I I

Assemblymember Schiavo.

I've been touring landfills. So what I what I have learned is that and what I think has some potential to lead to set events is that we have also incentivized extracting methane, which there's a lot of good things about that. But if you over pull if you over pull methane out of the landfill and then it starts pulling something has to replace that, right? So it pulls in oxygen and it's like fanning a fire. And so landfills are already hotter, right?

They're decomposing and they heat up naturally. And when oxygen is introduced, that can lead to a set event. Cracks happen in the in the landfills. That's just normal occurrences. Right? So heating events from what I understand from landfill operators, other landfills that I've toured, heating events are normal to happen. But if you're on top of it as a landfill, you'll see, hey. This one's heating up over here. We gotta go investigate what's going on. Oh, there's a crack.

Let's cover it up with dirt. They can get it down to a normal temperature within hours or at least days from what I understand. And so so in places where that has not happened, right? And it's growing for months and months and then years and years, they really have been not on the job. Right?

So that's so that's another way other than like combustion type things and, you know, ion batteries and all that kind of stuff. Type things and, you know, ion batteries and all that kind of stuff. Certainly in this landfill, it's an older part of the landfill. So maybe it's because we weren't really regulating as well. What was going into that landfill at the time could be all kinds of toxic stuff, right?

There's, oh, I don't even wanna think about it, but there's a there's the Rocketdyne, you know, Santa Susana Field Lab is not far away, and they could have been bringing rocket fuel and all kinds of junk from there over that super toxic. So so it's it's I think that because we have to be careful and I know that LMRs, that carb has, updated recently were brought up earlier, but I think those methane, the landfill methane regulations, we have to be super, super thoughtful in the monitoring of that and making sure that we're not over incentivizing drawing out the methane because on Chiquita, there's there's a power plant that operates, doesn't operate anymore because the gases are so toxic. It's not a high enough methane level anymore, but they were, you know, powering Santa Clarita, part of Santa Clarita with the power coming out of that. But so there has to be that balance to make sure that you're not over pulling and then bringing in oxygen that's gonna just fan the the potential flames.

Okay. And I was just gonna is that another cause that you guys are investigating?

Yes. Definitely. Thank you, member Schiavo. Yes. Operational issues can play in. Overdrawing of gas is something that we're noting and are monitoring, and trying to assess if that is part of the cause. Yes.

And do you guys do you guys follow-up and, like, have them report to you their temperatures at different levels? And if they're seeing something that's too heavy, do you guys go on that? Well, what are you, you know, do you go in and require them to cap it? Or is that a

power that you

28 is a bill that we are considering as a legislature right now that would make sure things happen at certain temperatures. Okay.

guys have?

Just generally, the the, responsibility for, gas control is with, US EPA and, air districts. And part of their reporting, system does require regular reporting on wellhead temperatures. So there are monitoring of it. I think the the new lens that we're bringing into this is, being able to recognize, patterns and know what they mean and take actions to address them.

I'll just I'll end on this glass note. It's just that it seems like we don't quite know exactly. So that's one thing we need to get to the actual bottom. What is the cause, right, so that we can formulate the solution. But yeah.

And well,

I mean, I think we should also be looking at we just heard earlier, we're moving forward with, you know, more and more electric vehicles. We use a lot more lithium ion batteries and, like, everything that we're utilizing. Are we creating? It's a question that we should be asking. Are we creating another environmental problem, you know, with what we've been doing and how do we address that?

Well, I really appreciate all of these questions, and I I note that the five questions that we asked here always try to make sure we get all of these questions out. And I think they've been pretty sufficiently answered except when does Cal EPA expect the scoping and regulations to be completed?

Thank you again. Mark to be with CalRecycle. Our expectation now is that we would have CalRecycle, the water board, DTSC, and other partners weigh in in a in a scoping opportunity, get our hands around, make sure that we have everything in in the reg package that we want.

We're running out of time. Just tell me when.

I'm sorry. Six months for scoping and then a year for the formal rulemaking.

Thank you very much. I think that the difficulty of this topic is, you know, I think we all appear across the aisle included recognize this is really a challenging topic. And every time we we do something new technologically, we increase the likelihood or we have another challenge in front of us. Lithium ion batteries are here. We're gonna be a big part of because we have a real challenge with climate change, which is another technology that created an impact.

These things all have impacts. But it does tell me two things. One, we have some legislative, and I think we're probably going to have more legislative fixes that need to come so that we put into statute real penalties for people not properly monitoring and and all of that. And the assembly member was we talked about that. But I would offer to you that given that as many resources have gone into this as possible, our current idea that we're just gonna landfill everything is simply outdated.

It does not work anymore. We it's not a question of if these other ones are gonna catch. It's gonna be when these other ones will catch it at at at some point in time and have these set events. And that's why, I want to make sure that we do come up with funding for a study on what are the new things we should convert over to. I I point out that in Oslo, they're doing incineration, which is a terrible word, you know, from an environmental standpoint, but they now are doing carbon capture with that.

They they they we should at least study that, but not just that, but every other way. But we can't just keep landfilling our way out of this situation. It has to change. This should be the clarion call for that, and we need a whole new way. Now recycling is a real key, but recycling will have, as as you see with backside as example, you you can have problems with with recycling, but recycling is the ultimate thing that we have to get to.

But we need the funding for the second half of this, and I'm I'm just a little concerned that we're challenged to do this, so we won't come up with funding for the study to say what is the new way forward. But that's the challenge that EPA and everybody else in the agency have to help us with. And with that, thank you all very much. Really appreciate this. And we're going to go to issue three.

Assemblymember Schiavo really appreciate your participation at this point in time. Everybody, if you will be prompt with your presentations and concise with your answers, we would really appreciate it. And we're at issue three, which is safe and affordable funding for equity and resilience, the safer drinking water program update and impacts of the new cap and invest program. So we will start this department.

Good morning to see you this morning, chair Bennett, members of the assembly. My name is Joaquin Esquivel. I have the honor of serving as the chair of the State Water Resources Control Board. The State Water Board is a five member board. We, along with our nine regional water quality control boards, oversee water quality regulation in the state.

The state board also administers, water rights. And as about a decade ago, the division of drinking water was transferred over to the state board and so oversees, drinking water regulation and agencies in the state. Taking a quick step back as secretary Garcia said, we continue to hear urgently address the challenges that climate change are putting onto our communities. And when it comes to access to clean and safe drinking water, our communities were already dealing with legacy challenges, in their access. And so climate change, certainly adds in a sense of urgency so as to ensure that those communities that are impacted most, don't continue to bear that brunt.

I think as we all know, in 2012, the state of California was the first state in the nation here to acknowledge the human right to water, but it came with a few caveats. And those included no additional funding at the time of that passage or authorities. And through the course of the last decade plus, the state of California with the partnership here with the legislature and state board, and importantly, the leadership here of the governor have gone from a moment where we didn't have dedicated funding to where we have additional authorities. And in 2019, the safe and affordable fund was passed. It guaranteed a 130,000,000 over the course of ten years, a yearly $130,000,000.

And proud to say since 2019 in the passage of the safe and affordable fund, we have gone from 1,600,000 Californians down to 600,000 today without access. That's an improvement of a million Californians over the course of these years. And in that time, we've actually brought 320 systems back into compliance benefiting 3,300,000 Californians. So, you know, the the that benefit is larger than, you know, when you look at those net numbers, and that's because, we have the challenge of at risk and other failing systems. So the number of Californians without access to clean water is not a static number.

It is one that is evolving as additional systems, face challenges, whether through drought or climate change or additional maximum contaminant levels and come out of compliance. So today, we have 98% of Californians, 98.5 that are served by water systems that are served by systems meeting standards. So over 98% of Californians have access to clean water. Of the 400 drinking water systems currently on the failing list, which, is that 600,000 figure of Californians, all of our working toward long term solutions. I think importantly to note as well, since 2019, the State Board has actually distributed 1,800,000,000.0 in drinking water grants, distributed 1,800,000,000.0 in drinking water grants.

That, it is a larger number because the board has used, the safe and affordable funding to really maximize other pots of funding, including, the state revolving funds, general bond obligation, and general fund expenditures here that have helped bolster the the dollars that we have to work with. But that 130,000,000 from the safe and affordable fund are our most flexible. They're allowing us to respond to interim drinking water needs and emergency drinking water needs while also providing technical assistance and construction dollars with lower requirements than some of those federal programs or even others. So now we're really working with the communities with some of the most intractable, long standing problems of which drinking water may be only one of the issues they face. Each community requires unique solutions tailored to their needs and circumstances.

Time frames are often extended due to issues of governments and related process. Emerging contaminants make finding solutions much more difficult. So the work we have still in front of us, is to keep an eye on these funding sources. As we know that the IIJA or the bipartisan infrastructure law, which was passed in the Biden, Harris administration is coming to an end. And so we see those dollars, decreasing.

There have been threats, diminishing capitalization grants coming to the drinking water and clean water state revolving funds from the feds. And so we are at a moment where we're keeping an eye certainly on the uncertainty of those various funding sources, while also making sure that we keep our eye on the goal here of ensuring all Californians have access to clean water. I'll stop there for now. I'll just also note that there is no other state in the nation that has a program like this that is focused on communities with access to clean water that have the data and hear just the the machinery, if you will, on the governance side that has been built because communities have demanded it. So the accountability of this program, the fact that we have a dashboard that daily is updated on how many Californians are currently served with systems that are not meeting compliance, gives me a lot to be proud of.

And really fortunate for the leadership of the governor here who when he came in in 2019, made this and continues to make this such a huge priority. And we wouldn't have the sort of success that we have seen without the partnership of a number of water agencies, communities, and other environmental justice groups that have been a bridge to so many communities out there in their need.

Thank you very much. Department of Finance?

Vin Dong Ling with the Department of Finance. I'm happy to answer any questions.

Thank you. Hello?

Good morning, mister chair and members. Sonja Petek with the legislative analyst office. I just wanted to provide a little bit more information, I guess, about some of the impacts of SB 840 the cap and invest, restructuring bill, on the SAFER fund for general awareness. So as chair Escobar mentioned, the SAFER fund has had a, set amount of funding up to a 130,000,000 backfilled with general fund if GGR funds were not enough each year. The way that the cap and invest program has been restructured, the safer program is now in the third tier of programs that are funded with g g with greenhouse gas emission greenhouse gas reduction funds.

What this means is that tiers one and tiers tier one and tier two must be fully funded before any funding goes to the programs in tier three. So this creates a little bit of uncertainty about how much funding the safer program is gonna get each year. So that's one, impact. And then the second impact I wanna mention, which I hope I'm explaining this correctly, and the chair may wish to ask finance department of finance or the chair ask Gaval if I've explained it correctly. Because the because SAFR is now in tier three, and tiers one and two have to be funded first, As the auction revenues come in, the SAFER program may not get any revenues throughout the year until the the end of the year when more is known about how many rep how much revenue is available to provide to tier three programs.

So what this means, this isn't necessarily a problem. It essentially means that the program is going to be funded in arrears, like, sort of closer to the end of the year, but it will create this weird transition period for fiscal year 2627 where they may not get any funding until the end of end of the year. So just wanted to raise that issue for your general awareness. And you may want to check that I've explained that correctly.

I I think she said it right. Is that correct? Department of finance?

Very much correct.

Great. Thanks. And so what is what is your plan for how to make this transition to funding in arrears versus funding in advance?

Yeah. I appreciate that. We're we're actively right now going through our projects, where they are in the pipeline. And importantly, as I said, we we do have other sources of funding. And so we're just making sure that we're not delaying any projects, that we continue to fund projects as they become ready for for that investment, and are are looking to ensure that, again, we're using our other pots of funding to be able to cover any gaps that there may be.

But, I I am I just have to give a lot of credit to the division of financial assistance, or folks in the program. You know, we don't make communities hunt and peck amongst our various pots that we receive, to figure out what they match best for. We do all that ourselves, and so we will continue to provide that level of service to folks. We will manage whatever the the legislature and the resources were being provided and do our best to bridge the gap.

I'm gonna move quickly through the questions that we've prepared for you guys in advance. And because I wanna make sure we get those those answers into the record. But I have one question in in advance of question one, and that is, you know, impressive numbers going from 1,600,000 people to 700,000 people in in the report in terms of improvement in terms of people that have access now to safe drinking water. What's the definition of of somebody now having access? I know some places were still delivering water Yes.

On a weekly basis so that people have drinking water. Are those people counted as having safe?

Thank you for the question, chair. No. Folks that are receiving emergency or interim water, you know, the system is still not meeting a maximum contaminant level, so they are still categorized as a failing system and still show up as

Great. Thank you. And again, we'll try to be as efficient as we can with the questions and answers here with regard to this. We have thousands of small water districts throughout California. Many of them are undercapitalized, underfunded structures that are capital structures that are teetering with with climate change.

We're probably going to have a constant battle of as we're improving some of these water districts, there are others that are gonna fall into this. So this is an absolute essential program that everybody should have access to clean, affordable drinking water. And these small districts certainly need both assistance, but they also need monitoring and some pressure being put on them and whether it's viable for us to maintain in the future all of these small water systems. And I know that you you folks have been focusing on trying to consolidate where it makes sense for for the customers. And you're getting a lot of pushback from the the water districts themselves.

And it's understandable. If you have five water districts, that's five people that are general managers and water districts. That's maybe five members on the breast, 25 Board Members. They all want to keep their position. And those and we have to make sure we try to overcome that and give the citizens what is in the best interest of the citizens in the long run.

So I I throw that out there as that. I think that you've answered the question one. But how much is the program projected to receive in 2627? I think it's 89,000,000. Am I correct?

I'll look to our Department of Finance colleagues.

Yes. I can answer that. For fiscal year 2627, the governor's budget projects $92,000,000 in proceeds Yeah.

There we go.

In 2627. I'll also note that all of the historical transfers into the safe and affordable drinking water fund would still be available for expenditure. So that is also available.

But we are we are cutting back from a 130,000,000 to the 92,000,000. Correct?

Yes. Under the new structure of the capital invest expenditure plan, the the annual proceeds can be up to $130,000,000. And then depending on proceeds and, tier one and tier two appropriations needing to be met first, then there would be a proportional downward reduction from the maximum of $130,000,000. And the projection as of governor's budget is for $92,000,000 in proceeds.

So the bottom line is we are decreasing funding. We're we're projected to be decreasing funding for the SAFER program. Correct?

The projection currently yes. It projects $92,000,000. I'll I'll just note that the governor's budget is not proposing this or any change. It simply reflects the actions that the bill package that the legislature passed last year and was signed by the governor. So just wanted to note that.

Well, there there is a change. So there is a change and it's changes in how we how we have sort of implemented the tearing structure. And the tearing structure has been changed since the passage of s p 840. The tearing structure was changed. So this is this is not just that there's been a change and the safer program is going to get less money.

And I think that that's going to going to be a concern. I think there are many areas where the legislation is going to be willing to accept cuts. And but whether it's in the safer program or not is a is a real question in my mind.

then what's the fiscal impact and the tiering structure, you know, that we have in terms of GGRF? I think we've just we think we just covered question three. Question four, what specifically is funded by the safer program that can't be funded by revolving funds or general obligation bonds? And do you have any examples of that funding for essential that are essential for a project?

And

Yeah. A lot of it is, on the emergency and interim side. It's our most flexible dollars, ultimately. So, you know, it's a bit of a a a fund of last resort when we think of, say, response to the drought where we, funded well over nearly 3,000 hold water tanks and are still providing hold water to a number of folks who are still have dry wells.

So that's that's that's the most at risk of all of the programs?

Insofar as what what we wouldn't necessarily fund, are you asking

more? Yes. Yes.

It's hard to say what exactly we wouldn't amongst there, but amongst the other the other items, ultimately, that we're funding with the safer funds that we're not, say, with those other funds are things like construction are, you know, they are our most flexible dollars ultimately. They have the less the least amount of strings, if you will, attached. The less be most likely.

Can those emergency water deliveries be funded by the revolving fund or the general fund?

They can't. Well, I won't speak for the general fund, but certainly not the state revolving fund, the federal programs. They they don't allow

for that sort of flexural obligation. Bonds. That's I didn't mean to say general fund.

Oh, okay. Yes. General obligation funds. Yeah.

So anything besides the emergency deliveries that can't be funded by the revolving fund or general obligation bonds?

Again, it's it's also going to actual construction and technical assistance would be the other category

Okay.

Of of things that we're, again, most nimbly able to fund with the safe and affordable fund that those other funds are are less nimble around.

And then how are you measuring success? What is it what what is the what are the criteria you're using?

Yeah. The the top line really is how many Californians are without access to clean water, but it includes, to your point, earlier, metrics around consolidations. We've been able to do a 180 consolidations since, 2019. And, yes, to your point, there are there are communities where it's more challenging, but we see a lot of momentum in gaining that more regional and, greater resilience by ensuring smaller systems are either matching up with larger ones with the resources or pulling together to create a better, more refined system.

And I strongly encourage you to keep exercising your authority to push to to push when it's in the best interest of of customers. Right? They see somebody who wants to make a comment. Assemblymember Gallagher.

I'll just make a quick comment. I I agree with you, mister chairman. It is is unfortunate that, you know, SBA 40, deprioritized, this program. This is a program that, my my former colleague, Devin Mathis, from the Central Valley really pushed for, you know, a lot of these areas where we need, you know, safe drinking water, where we need to improve the drinking water systems are in rural areas.

Yes.

You know, many in the Central Valley, but also in my district, you know, these rural areas where we need to make improvements so that we can ensure safe drinking water for these communities. This has been a a a really good program, and it is unfortunate that was deprioritized. And instead, you know, we prioritize high speed rail. You know, I think if you ask these Central Valley communities, these rural communities, what would you prefer? Would you want safe drinking water coming out of your faucet, or do you want a high speed rail in your community?

I'm pretty sure I know the answer. Thanks. So it's an example of misplaced priorities, and I hope that we can change that in the future.

Thank you, mister Gallagher. Final question for you. What are the primary challenges to getting the last 1,300,000 people covered?

Yeah. These are, again, some of our most intractable and long standing communities that have been without access. Sometimes it's a it's a there's resistance. We're having to use our mandatory consolidation authorities and could drag folks through a process. So sometimes it's the local conditions, that are that are driving those.

You know, I also just have to flag. We we know that we have emerging contaminants of concern like PFAS or microplastics that are coming down the line. So when I think of the challenge that we have, I think it's helping to message that we we have made incredible progress. We have a program here that's working, and folks may see that number increase. I'm here telling you there are 600,000 Californians still yet without access to clean water.

We wanna see that, you know, that's our major metric. We need to get that down to as low as possible, but it is an ongoing challenge that we will have to keep an eye on as a state and as people as to how do we ensure that that number keeps going down.

Thank you very much. Appreciate it. Alright. We're ready to move on to issue number four.

Alright. This is around the safe drinking water state revolving fund administration fund. As I had just mentioned, you know, of the tools the State Board has, the state revolving funds both on the clean water side, but here we're talking about the drinking water side are incredibly important, because it is a growing fund into perpetuity, meaning that the longer we go here, the more we invest in it, the more resource we have. It was first created in 1997, by by amendments, for the federal safe drinking water act where annual federal grants associated with state match. Interest earnings and revenue bond proceeds provide a a revolving loan program into perpetuity, as I said.

Since its inception, we have funded $4,300,000,000. It has been actually funded with, apologies, $4,300,000,000. And in turn, we have been able to finance 5,100,000,000.0 in projects, including 750,000,000 in principal forgiveness for grants to, communities. This request, ultimately is to, allow us to, use what authority authority we've had for a while, which is fee in lieu of interest, to fund the staffing for this program. The yearly sort of staffing costs for the administration of the, drinking water state revolving fund is around 7,000,000.

And as I said, we're seeing a reduction in the capitalization grant from the feds, and so we're starting to see a gap in the resources we need to even get the dollars out. And so this fund would allow us to use that fee in lieu of interest in order to then keep funding our staff and ensuring we have a funding source and here a fund to be able to pay for the staffing it requires for this program. Great.

Thank you. Viet Langhui, Department of Finance. I'll just add that the proposal is simply requesting the expenditure authority to just expand the the funds that are already there. So I just wanted to make that technical clarification.

Thank you for that. Great. LAO?

Sonia Peddick with the LAO. And I just add a little bit more context, which is that because the annual grant from or the the annual allocation from the Federal Government fluctuates each each year, it means that the amount that's provided for administration also fluctuates each each year even as the the fund itself has been growing over time and the workload associated with that has been growing over time. So this proposal would really provide a more stable source of funding. In addition, happening at the same time, the water board's about to experience a bit of a cliff as the IIJA funds drop off. Meanwhile, Congress has also there's a a recent and growing trend to provide allocations not through states, state revolving funds, but rather as direct, sort of earmarks to specific projects.

So this means not only is there going to be less funding provided to the state, which then the Water Board can prioritize for specific projects, but that the administration amount or the the amount the percentage amount for administration annual lower allocation will also be lower. So there's kind of multiple things happening at the same time, but I think this proposal provides a way to sort of stabilize the funding for the administration required to run the program.

We have four questions that you've sort of answered in in in your comments. I'd like to have you just echo any other thoughts you have. LAO pointed out the congressional directed spending and the impacts. Any specific projects that are are at threat as a result of this?

I'll just say, you know, as as Elio said here, the fact that the program has seen a reduction in the capitalization grant that we received because of earmarks is is a real concern. It also is a concern because even if some of those earmarks are coming to the state of California, regrettably, the Environmental Protection Agency, US EPA, doesn't have the staffing or expertise, it seems, to get those dollars out. They're kinda just sitting there. They have not been, all reward awarded. And so, it's kind of a double hit where, you know, these earmarks are happening.

They're they're they're they're not actually then even, being delivered to the states and having these consequent impacts on not just California, but all the state's abilities to continue to have a a a secure source of funding that was there prior to this earmarked challenge.

You know, we saw this last week when we had the conversations about what's happening with weather and weather forecasting, etcetera. But these cuts are having a specific and material impact on the quality of life of people. It's very hard for people to to make the connections between all of these things. But when you're talking about just trying to get these basic projects moving, you know, the the the the people of California are suffering from those those cuts that have been made Yes. At the federal level.

Yeah. The IIJA, the bipartisan infrastructure law, I think for a lot of us, we thought was a a turning point where the Federal Government was returning as a strong partner in the investment of our water systems, and that has that has not carried through. Right.

Thank you. Anything? No. No. Alright. We are going to go to issue five.

Alright. This is here, permitting impacts of the recent Supreme Court decisions and a request for 2,600,000 in fiscal year 2627 and ongoing and 12 permanent positions from the waste discharge permit fund to conduct essential water quality permitting enforcement work in response to the 2023 US Supreme Court decision, the Sackett decision, which has reduced the federal jurisdiction over our water bodies. The Sackett ruling substantially narrows what quantifies as the waters of The United States, reducing Federal Clean Water Act jurisdiction and leaving gaps ultimately in oversight of wetlands and other waters. The state board have analyzed internal data on orders issued since the Sackett ruling for the requirements of the 2024 budget act. Report of those impacts, was sent to the legislature on January 2026.

The budget change proposal request is aligned with that report to the legislature. The board must redesign programs to fill gaps left by the loss of federal oversight and ensure state protection where federal law no longer applies. In many cases, the state processes require more time and resources than the federal processes that were historically used, and the BBCP indicates trailer Bill Language will improve but not eliminate the need for additional resources. So, you know, at this time, it it is really critical that even amongst the federal rollbacks that we maintain our momentum and protections on water quality. I think it's important to note that, actually, since COVID, we have seen a doubling of the complaints on water quality on the water quality side that have come into our office, and I think reflects what is a continued desire from Californians to ensure that the places that they recreate, the rivers, streams, lakes, and bays, are fishable, swimmable, and ultimately, don't harm public health.

And so really appreciate the consideration of this budget change proposal. As we noted just here on the funding on the drinking water side, these these rollbacks from the federal responsibilities are meaning that our state agency and authorities are just having to to step up and fill the the gap and appreciate the support.

Thank you so much.

First question I have is really if these, budget positions aren't filled, the what are the impacts gonna be of the existing gaps that have been left from the Federal Government?

If we don't have the resources to be able to respond, it means that, you know, polluters and and others out there that, could put, you know, are are are potentially off the hook, without, the the resources, one, to to ensure that we can move through permits quickly, but also respond to what are, you know, threats or or enforcement needs that are out there. I I think that it's important to remember that a lot of efficiencies had been built into the federal programs, the National Polluting Discharge Elimination System, and PDS permits. And what's at risk is delaying housing, delaying critical projects that the regional boards now are needing to then permit if we don't have the resources to match the expeditious improvements that we had prior to this rollback.

Any questions? Any questions?

Thank you. Yeah. I didn't grab the Gatlin back, did I? Right?

Yeah. I I didn't.

The vast authority being passed back and forth here. Right? The you mentioned you mentioned trailer bill. That's all I heard, but I didn't I didn't hear any I didn't could you repeat whatever it is you said about the trailer bill?

To clarify, the administration is not proposing any statutory changes as part of this budget proposal. Okay.

Okay. So you have no trailer bill? No. Okay. Great. Alright. The I think I think that I agree with LAO that this is sort of an intelligent way to come up with a trying to handle the administrative cost here. Right? Oh, we haven't oh, we haven't jumped to LAO yet. I agree with LAO and watch and see watch and see what she says. Right? Yeah. You'll be surprised too. Right? Go ahead.

You you hardly you hardly need me, mister chair. Let me Sonja Petek again. Let me start with the proposal at hand. First of all, as noted in the agenda, our office finds that this proposal meets sort of this high bar for legislative consideration. The request is justified and supported with workload data.

We recommend the legislature approve the proposal. But then I did wanna to to mention that, for context, that in 2425, when the board first came forward to request positions, the legislature only approved some of the positions at that time and did not approve these 12 particular positions because it it expressed a desire to gather more information about the actual workload impacts resulting from the Supreme Court decision. It also wanted more information about the sorts of limitations that are in current state statute that caused the state program to be somewhat more inefficient than, the program under federal authorities. So to that end, the legislature required a report from the from the water board, which the water board provided in January 2026, just this past January. And in that report, the water board highlighted a number of areas in current state statute that are creating additional workload, creating longer timelines, but not necessarily creating more quality permitting, should you say.

So a few of these areas are a few of the areas that are affected are enforcement. The state processes are less able the state's less able to be proactive when it comes to enforcement. The penalties are a lower amount. Both of these deterrent effects then are less effective. There are some other issues.

I won't go into all of them. I'll just name one more, which is when the state board, rather than the nine regional boards, issues a water quality control plan or amends a water quality control plan at the state level, it only applies to waters of The United States. This is how state statute is written. So then each of the nine water quality sorry. Each of the nine state water board regional state water boards have to then amend their water quality control plans to match the state plan.

You can see that there's opportunity for improved efficiency there. So we would recommend that the legislature consider some or all of these issues and consider making some changes to statute. It could do this through trailer bill, but it could also do this through the policy process. And the policy process would allow for a more in-depth discussion and consideration of trade offs.

I wanted to take this opportunity to just say over and over again, the LAO has been pretty consistent in coming up with policy guidelines for us to use to evaluate these budget proposals and then applying them to these. And so it's been, I think, very helpful to know that we have an LAO office that has created sort of the criteria for approval and therefore the criteria for rejection and and has been firm in sort of the application of those. I think it's been very helpful for the legislature, again, to to to have this role. So I really appreciate this and and the support for this. I think the you know, we were at 38 positions.

We've approved 26, and now we're back with the 12. Mhmm. And I see that they've sort of passed muster in terms of, yes, there there is the requirement out there to to be able to do this. So I I agree. And these I mean, water is just a pretty essential issue for us to make make sure that we get right.

And this the second ruling has thrown lots of complications at us in terms of of moving forward. So I appreciate that. I have a couple of quick questions. I just did you. Are you okay? Great. And the how long does it generally take to complete the projects funded by? I'm sorry. I jumped over. I was. Oh, there we go. I've I've had it marked up here, right? In terms of the statutory changes, L. A. Was talking about statutory changes.

And you guys decided not to pursue any trailer bill. LAO was encouraging us to to do something. Do you folks see benefits to having some changes at some point in time, whether it's this year or

not? Yes. As our, you know, report indicated, there are there are efficiencies that we could be building into the program and are are supportive of trying to figure out how best, whether through the legislative process or just continued technical assistance to you all here, how to how to ensure that we we get some of those efficiencies.

So I know this is a very politically sensitive question to ask because normally you are strictly forbidden to try to give us any suggestions about legislation. But is there a way that we can work with the administration and find out from you what you think are the most appropriate things so we can decide whether to do them by administrative trailer bill or by legislative trailer bill or by lead policy legislation either next year or something done as as a gut and amend bill this year or finance.

I'll just say that in the report that the water board has provided, you know, we describe in detail the limitations based under current statute. Our understanding is that, you know, there's conversations in the policy process. And so the water board and we're open to conversations and just answering any questions on the report and the limitations described in the report.

So did the appropriate policy committees have the have come are they having conversations with the water board?

I believe there are conversations ongoing, and we are providing technical assistance.

Great.

Alright. Thank thank you very much. I appreciate that. Any other of these questions that are critical from our perspective. Right? Thank you.

There we go. Thank you.

We're at issue six, the elimination of the vacant positions. This is where you're gonna earn your pay. Okay. Great. And the Department of Toxic Substances Control, State Water Resources Control Board, and Department of Pesticide Regulations all have eliminations of vacant positions. And we are going to start this time with the, LAO's report or response, and then, turn it over to Department of Finance. Alright?

Thank you, mister chair. Sonja Petek again. On this issue, I've organized my comments into four sections. So I'm first going to start with sort of a lay of the land to provide context, then go over what's included in the governor's budget proposal, then discuss what the joint legislative budget committee found in its review of these proposed eliminations and what it conveyed to the Department of Finance in a December 2025 letter. And then finally, I'll conclude with our office's assessment and recommendation.

So to start, you should have a handout. It's just a single page with a figure. We thought it might be a little easier to think about or to follow along rather if you had a visual. So over the past couple of years, the governor's administration has proposed a number of options for reducing spending across state departments. One of those methods was to simply reduce reduce spending in non personnel, areas.

The other was to eliminate vacant positions. And, that's what we're here, obviously, to talk about. So at May revision last year, May 2025, the governor came forward with a a specific proposal for reducing or for, rather, eliminating positions. And the proposal was to eliminate 6,000 roughly 6,000 positions across departments, and this is the first row of the the year.

Given that the proposal came forward in May, it didn't give the legislature a lot of time to consider the specific positions proposed for elimination or the impacts of eliminating those positions.

So a compromise was reached to the final budget agreement. Essentially, if you look at the next row of the graphic, the final agreement, in effect eliminated roughly 5,000 positions, but gave the legislature additional time to review roughly a thousand positions.

The joint legislative budget committee was the entity given the the task of reviewing those those positions. So in December, the JLBC provided the letter to the Department of Finance in which it did not concur with eliminating 650 of those thousand positions. So we're in the third row on the graphic.

Within those positions are a 138 positions affecting the departments before you today, the three departments before you today. And it's our understanding that the the remaining environmental positions will be heard at subsequent hearings.

So in effect, that eliminated about 360 positions. Of the 650 positions that the JLBC did not concur with, Roughly 350 of those are in are essentially, environmental positions. There are positions in the departments under the natural resources and Cal EPA agencies as well as positions at food and ag and the public utilities commission.

Okay. So what does the governor any clarification questions before I proceed? So is a lot of numbers to throw at you.

Just to comment, very helpful. I mean, you could look at this or you can read and try to do this sentence by sentence, and it's much easier to do this.

Right? Thank you. Yeah. I thought could sort of follow along with the the darker shaded squares. So, what the governor proposes is that, basically, the governor's January budget proposal built in savings from the elimination of all 6,002 positions.

So in its review, the joint legislative budget committee reached out to departments to learn more about the various positions and their functions, why these positions were authorized in the first place, and it used some specific criteria to do this.

So back again at the top of the the hierarchy on the graphic. At the three departments before you today, that would generate annual savings of about $21,000,000. Okay. So moving on, what did the JLBC find in its review, and why did it non non why did it not concur with 650 position eliminations?

For example, were any of the positions authorized as part of a reform effort or to improve program outcomes Were any of the positions associated with law enforcement? Were any of the positions associated with revenue generating activities such as issuing fines or penalties?

And then were the positions general supported with general fund or supported with special funds? So at the Department of Toxic Substances Control, the JLBC did not concur with eliminating 80 of the 112 positions proposed. The JLBC considered whether these positions performed key functions for the department or supported important legislative priorities.

At the state water board, the JLBC did not concur with eliminating 43 positions, which was roughly half of the positions proposed for elimination. The JLBC considered whether the whether the positions were associated with permitting and enforcement of discharges.

You know, one of the issues we were just talking about, whether they were associated with water rights or enforcement of curtailments or other drought activities, flood management, groundwater recharge, water quality control plans, chemical contamination, prop four supported drinking water programs and other drinking water programs.

The JLBC had specific concerns about eliminating positions that were established as part of reform efforts in 2022, And these reforms included addressing structural deficits in two of the special fund sub accounts or special fund accounts. These reforms also created a board of environmental safety and expanded programs to address high priority programs and activities.

Basically, it looked at, are these positions supporting core functions of the state water board? We'd note that or the and the JLBC found that many of these positions were established to regulate industry and are supported with industry fees. And moreover, some of these positions were actually authorized to ensure more timely, issuance of permits.

At the Department of Pesticide Regulation, the JLBC did not concur with the elimination of 15 of 19 positions. These are all special funded, and these are actually positions that were discussed earlier in this hearing that were associated with legislation passed in 2024, which increased the mill assessment, to address structural funding deficit, enhance core functions, and improve timelines.

Okay. So lastly, I will provide, the LAO's assessment and our recommendations. So to the extent that the legislature wishes to retain rather than eliminate some of these positions, it will erode some of the savings that the governor built into the baseline budget, and the legislature likely would have to look elsewhere for a similar level of savings.

For these three particular departments, the total savings in the budget proposal is about 21,000,000. However, our second finding is that eliminating positions supported by special funds has no real direct impact on the general fund.

I'm sort of stating the obvious here. But if you go back to the handout at these three departments, eliminating these positions would result in savings of about 3,000,000 general fund. The rest of it is from special funds. So eliminating those positions and the the special funds is not going to help the state's general fund structural deficit. Granted, special funds can be used to provide loans to the general fund when needed.

But as I just went over, some of these funds actually had structural deficits. So they're not they don't have a lot of excess lying around to make loans. In addition, for for funds that for funds sorry. Some of these positions also were just authorized to do priority legislative activities. I would also note that for special funds, a lot of these programs are are meant to regulate industry, and industry pays fees to cover the cost of that regulation.

So they're sort of calibrated to make sure that the the fees are set in a way to just cover costs. So there may not be a lot of, extra funding in those funds. Okay. I'll try to wrap this up, mister chair. We our third point is that eliminating certain positions could have undesirable program impacts, and so there would be important trade offs to consider if you do choose to eliminate them.

And finally, just because a position is vacant doesn't mean the position is not important. There are any number of reasons that a position can be vacant, that have nothing to do with program need. So what do we recommend? We recommend the legislature maintain the special funded positions. Not only do these not help with the state's budget situation, but they serve important purposes, and you may have undesirable program impacts.

On this general funded positions, it's slightly trickier because the same logic applies. These are also important positions. But given the state's budget situation, you we recommend that the legislature weigh these against other priorities across the budget. Thank you.

Thank you very much. Thank you very much. And I wanted to move us along because I knew this one was something that was gonna take a little bit more time. So your timing was was fine. Mister March, you have the unenviable position of each week coming to see us to talk about.

But it is the reality that we have to deal with, and and you you have that. But we have some some significant issues being raised by LAO. We have a lot of respect for LAO, so we wanna give you an opportunity to give present the the executive branches positions on this, and then we have some questions for you.

But that's you know, it it reminds me of of something that I heard when I first got here and of talking about being on this position. They said, oh, you don't wanna be on those subcommittees because, when there's tough times, all you have to do is spend all your time talking about cuts.

Great. Good afternoon. Andrew March with the Department of Finance. I won't go over any of the history as the LAO laid it out very well, but I think just two points that we would make. Generally, we think of positions that our department has sort of as a as a as a pool that they have authorized positions rather than thinking about the specific duty of those positions.

So when the the JLBC asked departments what specific what the duties of specific positions were, we provided that information. But that doesn't preclude the department from using another vacant position or reprioritizing positions overall in the positions overall in the department to meet the needs of that.

So I think just generally, I would encourage the legislature to not think of it as if a position is eliminated, that that work is not being done because it could be done by another position that's vacant. And we've generally seen that vacant position level remains steady across the last few years statewide around 60,000 positions. Departments may have vacant positions for a number of reasons.

They may hold positions vacant to cover increased costs elsewhere. There may be unforeseen costs that come up throughout the year that departments may use that flexible funding for. So that's the first point. Second point is, as LAO noted, special funds are still a really important thing. They're funded by fees.

And so in order to vacant positions or the elimination of vacant positions can help reduce fees, prevent the need for fee increases to happen sooner rather than later. Also control maybe unsustainable fee increases that may happen for some of the funds.

Additionally, as LAO noted, some funds are in a structural deficit. So to the extent that we can control costs now, that would help us in the long term. I'm joined by colleagues from the various departments and also my colleagues from the Department of Finance to help answer any questions that the legislature may have today.

Thank you, thank you very much. I'm gonna jump first. You guys have thoughts because I wanna get right to the meat of the matter. You know, LAO, I think appropriately suggest that we should not cut the special funded positions. I hear your your response, but I have to say in terms of weighing both of the arguments, LAO's arguments feel stronger from that standpoint.

So it it begs the question if we've asked these departments if if the legislative intent was we want more enforcement or more regulation or more proactive work here to avoid problems for Californians, that when if the response was, well, the only way you can do that is we need these positions to be filled, and then to turn around and say, well, we can go ahead and cut these positions because we'll do this with somebody else.

And we as LAO points out, there are many reforms that we wanted to make, and we were not happy with what was happening at and what we were told by the departments were we can't do those things because we don't have enough staff.

Number one, when you say these the work being done by these special positions could be done by somebody else. Well, if that was the case, we wouldn't have created the special position in the first place. But we did create the special position in the first place.

The the two simply don't don't match up. The second thing that I think doesn't match up when you say, well, we're trying to keep fees down. Yes. We do have an issue where we're we have an affordability question. But trying to keep fees down when there are special fees defeats our purpose of the polluter pays sort of principle, and it's not always a polluter here.

But, the expenditure of of funds should be matched with the with with the revenue coming from the people causing the expenditure. So if somebody makes a lot of profits because they make widgets, but those widgets pollute the environment, then we should have a fee on the widgets so that the people that pay for the widgets are paying for the pollution that goes along with the environment.

Your idea that eliminating the special position says we're not gonna we're not gonna charge properly the amount of money that it really takes to deal with the pollution caused by the widgets. So for both both of those things, I would respond and say, I I just don't think that they carry the same merit. So I feel strongly.

I don't know where my colleagues are yet, but I think you're gonna find the legislature feeling pretty strongly the LAO is right on the special special funds. When it comes to the the before I get into the general fund, I wanted to ask this question because as I read the report, a few places had alluded that a special fund cutting a special fund will actually save some general fund money also, cutting a special fund position.

Is that correct? Or is is it's $19,000,000 we would have to come up with if we wanna keep all of the positions recommended by the JLRB or what whatever that but, you know, recommended by that committee. We'd have to come up with 19,000,000 in general fund.

Is are any is any of that because we keep the special fund position to keep the special fund positions? Will they are they a 100% funded by special funders as some general fund slipping in there? That's what's a little bit unclear to me.

It it depends on the department. A number of departments do use multiple fund sources for a position. So if the legislature chose or if the ultimate end result was to keep a position Mhmm. It could be multiple special funds that fund it and the general fund. So you're you couldn't necessarily just say, oh, well, we would just wanna fund that position with special funds, then there would be some sort of impact overall.

Great. Thank you. So I'm gonna ask LAO, and then I'm gonna ask you to your your thoughts and response. When you came up with the $19,000,000 in general fund that we would have to come up with, Does that include sort of this partial funding, etcetera, that mister Marsh just referred to?

It's looking at it in the aggregate. So it's taking all the partial you know, there may be 0.2 of a position. Right?

So it's looking at it at the in the aggregate. So departments would have to like, if you wanted to only keep special funded positions, they would have to it'd be sort of a puzzle in the background to figure out how to make that work with just special funds and not having those little pieces of general fund for various positions.

But if we if we wanted to keep the general fund positions also, $19,000,000 will cover putting the putting the whole puzzle back together.

Yeah. Correct. Yeah. With the special funds.

Alright. Great. And I think oh, and then the other thing is the legislature works hard and turned trying to at at budget time, trying to get some of its priorities put into the budget, but it's always been a a chat from my perception of it's a challenge, and we we barely get a little bit in in terms of that.

And so another reason why I'm much more inclined to accept the LAO's recommendation for sure on the special funds and to see if we can advocate to find the $19,000,000 in general funds from other other other sources somewhere.

But we have worked for the reforms and some reforms that have been very important in the last couple of years. And it's sort of a, I think, going through the process, it's been a pretty accurate review of, hey. If you do this, you're basically rejecting the very reforms that the legislature really tried to advocate for in the first place.

Any questions by my colleagues? Yeah. Assembly member Rogers.

In fact, you know, they're not before us today, but CDFW, for instance, has a vacant position in Mendocino County to to approve timber harvest plans. We'll have questions about why some of these positions haven't been filled.

Yeah. Thanks. And I will admit I'm a little bit of a split split brain on this one because I recognize even if the legislature insists on those positions being in there, our tools are limited to force hiring to occur.

So I'm hoping that the LAO can weigh in a little bit about the turn back process, how how can we best try to make sure that even if we find space in the budget to create these positions, how do we make sure that the dollars ultimately are going towards the outcomes, that we are going for?

And how much do we reasonably expect at the end of the year to have saved from vacant positions that we approve the positions for, but then ends up not being sold? Is there some historical data that you can provide there?

But from a budgeting perspective, what I heard is that from Department of Finance is that oftentimes these positions are intentionally held open because they are spending more money on other positions or or other things are costing more money.

But I do think that in the JLBC's review of some of these particular positions, these these a lot of these are positions that the departments want to fill. Like, you raised fish and wildlife, for example. A lot of these positions are sort of law war game wardens.

I I don't have historical data at my fingertips. But, no, you do raise a good question and and as does Department of Finance that sometimes when the legislature authorizes a position, it doesn't necessarily manifest as a filled position at the department, and departments may use some of the funding more flexibly.

A lot they're in law enforcement or they're helping with permitting, and they just need the, you know, the go ahead. This has been sort of this issue has been going on for a couple of years. So there have been you know, departments have held off on hiring.

In addition, I had point out at DTSC and DPR, some of these efforts, reform efforts and the legislation passed in 2024, those are those are recent efforts. So the the, departments only just had these positions authorized in the last couple of years, so they may not have filled all of the positions yet.

But to your point about oversight, I guess the legislature does have sort of limited tools if it can't sort of force the hiring of a position. So I guess that's where legislative oversight will be really important to ensure that you're seeing the outcomes that you're that you're hoping for.

Would love to bring them up and see if they can walk us through for those departments. What can Californians expect to fall off by not having the these positions that are funded, and what priorities are you the prioritizing over them?

Yeah. I I think I I think that getting the folks from each of the individual departments to give us an overview of what will you not be able to do with these positions being eliminated would be helpful. But I know you mentioned that you have those folks in the room.

Certainly, I'd welcome my colleagues from the various departments to come up, and and we can go through those various questions.

So that's DTSC, Waterboard, and DPR.

Happy to start the the conversation here. Alejandra Duran. I'm the deputy director of legislation and policy at the Department of Pesticide Regulation. Thank you for the question. That is certainly a question that GLBC did ask of our department.

And to touch a little bit on that, while the 19 positions that are proposed for elimination are not part of those 117 positions, those the 170 positions that were approved by the legislature were built off of the baseline of having those those 19 positions.

We submitted responses to, and I'll try to be as brief as possible in my response here today given timing. You know, a lot has been referenced in reforms to departments, and DPR did receive a significant amount of resources in 2024. We received a 117 positions, and then that came accompanied by a b 2113 which was an increase in the mill and a number of policy, requirements placed on the department.

And those 19 positions do work directly or indirectly in part of the the new policy requirements placed on the department, specifically in, you know, registration branch, continuous evaluation, reevaluation, all components that are very specific in a b 2113.

For example, in July 2027, a provision of 2113 will go into effect where there's timelines and time frames for when we have to complete registration for a new pesticide product, for example.

Great. Thank you.

Hi. I'm Karen Mogus, chief deputy director at the State Water Board. Thank you.

You're violating the paper between the There you go. Pull that microphone forward now. Right? Thank you.

Alright. I'll just shoot from the hip. Great. So I'll start with the approach that the water board took to make the cuts of the vacancies. As we were asked to make the cuts, it was a snapshot in time of what positions were vacant at that moment.

And so our cuts spread across all of our organizations and many of our program areas. And so when to answer your question, what has been impacted, I'll highlight some of the higher level key ones. Drought response in our water rights and conservation, programs has been a big hit.

We have organizations across our headquarters, state water board, and then the nine regional boards. All were requested sort of proportionally to make cuts to their, current vacancies proportional to the total number of positions that were in their organization.

So when you talk about permitting and, being able to, respond to, applications for projects or, just permitting our regular dischargers, has taken a huge hit. And while we have, in some key areas, been able to redirect staff to cover the workload, that has not been able to be achieved because what happens then is the program they came from is then also impacted by the vacancy cut.

I'm speaking programmatically that actually is spread over a couple of organizations. Our response, our work on the Bay Delta plan amendment also has taken a hit. And then generally speaking, many of our vacancies were in our core regulatory programs.

So it just is a domino effect. So those are the program areas I'd like to highlight and happy to answer any more specific questions.

So in your charge, was there any ever any discussion or ask for you to evaluate whether positions that currently have somebody in the position were less important than some of the vacant positions?

So that's where the redirects occurred. So at the time when we were given, here's our list of vacant positions and they were sort of locked down, then we, at that point, decided for certain key positions, priority positions, could we redirect staff into them? And that happened on a limited basis.

And and was your specific charge to cut a corresponding percentage from each of the different regions? And does that assume then that the amount of work in some areas is is not more substantial or or at the moment more important or more urgent?

I'm sorry. Can you repeat that?

I think you meant I think if I heard you correctly, you said that you had a percentage from each of everybody got a corresponding haircut Yeah. In each of the different regions.

Correct.

But that also assumes that each region doesn't have priorities that are more urgent where you would need to have additional staff and maybe other regions where things are a little bit set for a little while. Is that correct?

Yes. I would say that, again, where the regions had to cut in a priority area because that's where the vacancy was at the time, they were able to redirect other staff into that workload on a limited basis.

Okay. And if I may Yeah. Assembly member, what my colleague from the water board described is how the water board approached this specific exercise. Departments were given flexibility to choose sort of their prioritization for for various vacant positions, but it was based on sort of a June 2024 snapshot.

Because if you remember, this goes back to the 2024 budget when that was proposed in their vision and then adopted in the 2024 budget where the administration was directed to go and find these sort of vacant positions for savings.

Yeah. Gotcha. Yeah. Just just before my time up here. Yeah. Please go ahead.

Alright. Good morning, mister chair members. Brian Brown with the Department of Toxic Substances Control. So it sounds like for DTSC, we took in some ways a pretty similar process to the water board, which is we tried to both balance prioritization of programs and workload with spreading the impact of the reductions somewhat proportionally across our different program.

Because the reality is when you're eliminating over a 100 positions, you there's no way not to impact all of your programs, even the one that are the highest priority or where the workload is greatest.

but is I think an important part of our story is as was referenced earlier, the fiscal and governance reform bill that was passed in 2021 increased revenues, and then allowed us to bring in over 300 new positions in the 2022 fiscal year. So as these cuts were being implemented,

One other so that that ultimately did mean that all of our programs really were impacted, including enforcement and public safety programs, cleanup, oversight, really the gamut. Question about why positions can be vacant. That it might not be unique to DTSC,

we had had about two years to start bringing start filling those positions, which we had been doing. We had brought our vacancy rate when those positions were first authorized and then added to the department.

We were up near, 30% vacancy rate just because of the the sheer number. By the time this, vacancy reduction drill went into place, we had brought that down to about 15%. So we had slowly been making progress and we're still working towards that. But that is why a department of our size did have as many vacancies as we did. Alright. Thank you so much.

Thank you, chair. Good afternoon, everyone. Yeah. I just wanted to kinda take each department in turn starting with DPR. So as you noted, we did approve the increase to the mill fee which was significant. Your response seemed to inject some ambiguity into this, but my understanding our understanding is the mill assessment fee was enacted to help fund the very positions that would be subject to the sweep here. Is that not accurate or is?

I think as my colleague noted is that the positions that are proposed for elimination were not part of the increase that was associated with the mill fee. So there is that the the increase of the mill fee and then a subsequent increase of the number of positions for the department. However, they are supported by the mill fee overall these 19

So there's a connection. Can you describe the kind of work that will be impacted if these positions are eliminated? I'm particularly interested, as I'm sure the public is, is would these positions suites impact DPR's ability to properly approve and regulate pesticides?

I think, overall, there will be a level of of impact to the work that we do in that space even though we have new you know, the rest of the 117 positions that are gonna be coming online this July.

Yeah. The 19 positions are across a number of our branches, including the branches that are responsible for registration, evaluation, enforcement, work health and safety, you name it. We took a similar approach as to our sister BDO here to identify positions to minimize overall impact to our programs and other statutory requirements.

So that's obviously of concern, and we'll continue to evaluate that and and push back as needed. So DTSC, certainly can you describe some of the impacts on the department's work particularly around the 2022 reform goals if these positions, were eliminated as proposed?

Yeah. Thank you. So, of the 112 positions, it's, roughly 20 or so that were funded by the BCPs in 2022 to implement reform. This included some positions to support the cleanup and vulnerable communities initiative. It includes a couple of, criminal investigator positions, as well as some other in enforcement and emergency response.

Great. Our great committee analysis highlights that many of the positions that are proposed for elimination either assist in revenue generation or perform work that is reimbursable. And we're kind of hearing that theme today. Can DTSC elaborate on that and explain what the potential budget impacts could be if these positions are eliminated given that interplay?

Yeah. Certainly. So we do have a couple of the positions that were in or or were assigned to our fees unit. So that is the unit, that in our financial, division that over works with CDTFA, the Department of Tax and Fee Administration, on the collection of some of our core fees that support our programs. So eliminating those positions does have some impact in our ability to do some of that oversight work.

It's been a focus the last couple of years. Even more than that though, we do have quite a few positions in DTSC that are reimbursable through a couple of different mechanisms. A lot of our oversight work in site mitigation, particularly overseeing voluntary agreements to do cleanup work and revitalization work, that work is reimbursable by the, entity requesting, the oversight.

We also, for example, in our permitting division, are many of our permitting staff work directly with facilities, and those facilities pay, what we call the permitting fee for service. And so they directly reimburse us for our cost to, do that permitting work.

And we have a few other areas as well, but a lot of those are probably the core ones.

Thank you. And then finally, State Water Board, you started to talk about a couple of the areas of concern, namely drought and also the permitting process. If you could be more specific on what impact would the proposed sweeps have on California's ability to respond to drought?

Oh, sure. So in particular, the work on drought includes our implementation of the conservation regulations that were adopted a few years ago. That, of course, helps with water supply reliability in local areas. There are also work, permitting work that, ramps up during drought. So water right, water availability analysis, water right curtailment and enforcement of those con curtailments. And, let's see.

I have a number of other things that are related to water quality permitting as well, but, those are the key effects. And just drought planning, being able to do all of the work to, address temporary urgency change petitions and, you know, things that need to happen, when we're in the middle of a drought emergency.

Would it be, fair to ask kind of a similar question around dealing with flooding as well? Is that an issue?

I I don't think the positions that have been, eliminated have an impact on flooding specifically.

Okay. And then on permitting, put simply, how is the elimination of 90 positions, the majority of which are positions relating to permitting going to improve the permit approval process? In fact, won't this slow permitting even more?

Yeah. It's gonna definitely impact our ability to get permits out the door as well as implementing those permits. So that means getting out doing inspections. You heard about the need for additional resources, in response to the socket. Inspections are a huge way that we are able to identify where we have problem areas and conduct enforcement to get people back into compliance.

And that crosses all of our program areas. So when I talk about permitting, I'm talking about facilities that are wastewater treatment plants. I'm talking about, municipalities or industrial sites where stormwater runs off and they need to control the contaminants in their stormwater. I'm talking about, timber harvest and utility work to prepare for wildfire and respond to wildfire. It it is a broad swath of program areas that do similar activities that are gonna be impacted.

Great. Thanks. And then maybe one last to the administration. At some point, these vacant positions were deemed necessary, by environmental departments. How does the administration plan to balance the needs, that these positions were created to address?

Yeah. So generally, departments operate with some level of vacant positions. So some departments, I think, ideally, we would wanna see a department sort of around 10% or lower to be able to function properly, understanding that there are different, you know, retirements or people leaving the state, people coming out of the state, and just the natural ebb and flow of of how these positions work. The goal of this exercise was really to decrease that number of the amount of vacant positions that departments were were carrying, that they're maybe using for other activities or that were long time vacant positions. So the goal was not to impact the amount of the work being done because ultimately those positions were vacant and so they by virtue were not doing work.

So the goal was really to sort of shrink that overall pool and be able to reduce the amount of ongoing funding and ongoing employee compensation adjustments that the state continues to provide for positions that are vacant and where the funding may not be used or the position is not filled.

Thank you. I one final question for DPR. You know, we we had a pretty good battle on the Mil fee. I believe we lost the part of the battle that I think was most important, which was to have it be adjusted for inflation each year, which means the mil fee each year is going to collect less and less money even though the cost to implement the the the regulations, etcetera, will will go up. So we're already sort of starting to fall a year behind.

We will be falling more behind. But it was a battle, and we had lots of opponents to the increase in the mil fee. What can you please share what the response is from those people that are paying a higher mil fee to the proposal to eliminate the positions that were funded by the higher mil fee?

I'm not sure I understand your question, mister Bennett.

Okay. We there are people that are paying a higher mil fee. Right? They we convinced them that they that we needed this for these positions. And so therefore, they should go along with it.

They dropped their opposition to the higher mil fee in exchange for us dropping the consumer price index being the inflation factor added to the mil fee, which would have kept the mil fee then mil fee, which would have kept the mil fee then current. So they dropped their opposition because they thought they were getting these positions that would increase permitting and speed things up and, you know, get them answers at least. Now we're cutting those positions. What are they saying about it?

Yeah. I know there's been a lot of interest, of course, in keeping the department whole by stakeholders. I think we appreciate the advocacy that you especially did here in in your house when a very difficult two thirds boat bill was was in front of you. You know, we we have communicated out that, you know, while these positions are critical in supporting the regulatory, programmatic and statutory work that the department is doing, there's a large focus on AB 2113 requirements that some, like I've mentioned, are still coming online July of next year specifically on the registration time frames. In the absence of these 19 positions, we will still work towards meeting those statutory requirements and, you know, working internally, you know, where we can build efficiencies.

So you said there's been quite a bit of interest. What kind of comments? What are you hearing from them? Can you share what what they're what what are they saying to you guys about this proposal?

I believe it's my understanding that, stakeholders that were involved in the AB 2113 conversations, would like to keep the department whole. I think they've made that public.

Thank you. Thank you. I appreciate that. And I just try to put this into context. You know, we started with 6,000 vacant positions to be cut.

And we we were as LAO pointed out, we were asked to do that last May in the May revise, which did not give us very much time, weeks to try to analyze 6,000 positions. We worked out a compromise, and we analyzed a thousand of those 6,000 positions. We knocked it down to 600. So out of 6,000 positions, if if 10% of them don't get cut, we're still cutting 90% of the vacant position. That's a that's a significant impact.

So I know you're trying to come up with $19,000,000 now. Sounds like a lot to try to come up with in terms of general fund. When you think about the, you know, 90% of the 6,000 positions that were not not being challenged in in terms of moving forward. Still a big issue, but I hope that the administration will view this as as a significant improvement from the administration standpoint. And I would like to offer my my perception from years of trying to work with government agencies and stuff is that we can never from the dais, even you folks at your level, you can't get in there and micromanage these departments about how efficiently each position is being.

You know? Well, if you change that person over there, you just can't. You what you do is you you you squeeze a little bit, and then they they have to adjust. And then you squeeze a little bit more, and they have to adjust. And if they adjust inappropriately, and we start to find real problems, and we step in and go, no.

You have to do this, and that's sort of what has happened. Now we weren't squeezing before because we were coming from all those big budget surplus times. But this is a squeeze down with a little bit of a of an adjustment to try to take care of what we think are legislative priorities that that are out there. And so I hope we view it as a pretty good win in terms of going from 6,000 positions to essentially 5,400 positions being cut, you know, in in in in rough figures and stuff as we go forward. But I think there's going to be significant concern in the legislature about these these these last cuts, and we appreciate you being here again and having this conversation with us.

We must be out of this room soon, but we're going to go to question issue seven, and then we're going to go to issue 10 assembly at the request of Assemblymember Conley. And then we will go back to issues eight and nine. So for everybody in the audience, if you wanna be aware of that, we're going 7, 10, 8 and nine. Alright? And we're still going to have to move quickly.

Alright? Even with this. So question seven, it's the implementation of, SB 54. We have a lot of concerns about implementation of SB 54. And I'm going to ask my question in advance and hope that you will answer it in your comments so that I think it might be more efficient.

And that is we're really concerned about the finalized regulations regarding the unauthorized category for exclusion of food and agricultural packaging. Seems like a big exclusion. The treatment of chemical recycling vis a vis management of hazardous waste rather than the state standard of avoiding generation of hazardous waste in the first place, and the exemption of over the counter medication packaging. The other big one is under the categorical exclusion process. If the final regulations continue to allow it, we'll produce or the PRO will pay for the cost of CalRecycle's review and evaluation of exclusion claims, Or will taxpayers be on the hook for that work?

And if CalRecycle's determines an exclusion is not merited, is the producer required to pay fees retroactively to the PRO or to pay for CalRecycle's efforts? I wanted to read those two into the record here so that the public listening would know that we're asking you to answer those two things, in your responses right now if you can. So go ahead. You're on.

Sounds great. Thank you, chair. And good afternoon, members.

Good afternoon.

Appreciate the opportunity to be here today. I'll keep my opening remarks short so I can jump right into responses to those questions.

Okay.

I'm Zoe Heller. I'm the director of the Department of Resources Recovery and Recycling. I'm joined by chief deputy Mindy McIntyre. I'm just gonna jump right in. So I'm gonna quickly orient you as to where we are in implementation of 54 and then go into the responses to your questions.

We closed the fifteen day comment period on February 13. We are in the process of reviewing the hundreds of comments that came in. The, main change that was made in the last draft of the regulations was specific to the exclusion for food and ag commodities as you just asked about. Our goal is

Say that again, please.