Assembly Standing Committee on Environmental Safety and Toxic Materials

Like to welcome everyone to the hearing of the Assembly Environmental Safety and Toxic Materials Committee. Sergeants, if you can please call absent members. We're gonna hear three measures today, with two measures on consent.

Also file number two, SB 811 by Senator Caballero has been pulled by the author from today's hearing and will be heard at our next hearing on June 30. Assembly member Castillo will not be present for today's hearing.

We're expecting other members, and a quick review of the committee's policies for testimony are as follows. Primary witnesses and support must be those accompanying the author or who otherwise have registered a support position with the committee.

Primary witnesses in opposition must have their opposition registered with the committee as well. Primary witness testimony is limited to two witnesses in support and two in opposition. Each witness will have two minutes to give their testimony.

All additional witnesses will be limited to stating their name, organization, if they represent one, and their position on the bill. I also wanna note that we are accepting written testimony through the position letter portal on, the committee's website.

So thank you again, everyone. It looks like we currently have the absence of a quorum. We'll defer the consent calendar and dive right into file number one.

We have an author here, Senator Allen. Welcome. You'll be presenting SB 501 dealing with batteries whenever you're ready.

Thank you, Mister chair. I just need to present this bill that seeks to expand California's extended producer responsibility program for loose batteries to include medium format batteries, such as those that you see in e-bikes and outdoor lawn equipment, portable power systems, those kinds of things. So batteries, we all know, are a significant source of household hazardous waste. They certainly, you know, have some real risks associated with them when they're not properly managed.

You know, we've seen small batteries from cell phones, for example, go so far as to cause dangerous trash fires.

You know, our friends in the waste hauler community are find them a real menace, quite frankly. Because they really do create a whole set of safety challenges. We've seen a recent product safety warning that came out of the US Consumer Product Safety Commission with regards to certain e-bike batteries because of the risk of ignition and explosion.

So now adding to that is just the logistics of the consumer experience, which is that, you know, so many consumers that I would dare to say, perhaps most, you know, really don't have adequate access to convenient collection options from the local jurisdiction.

Even those that probably do, probably have no idea. And that, of course, then leads to that helps to exacerbate this culture of inadequate and dangerous disposal where people are tossing this stuff in the trash or elsewhere.

And then local governments and thus our constituents end up paying this inordinate price associated with the proper collection and disposal of these products. It's our constituents that are then having to pay more to try to sort this stuff out to deal with the fires once they happen, the liabilities, the dangers, etcetera.

So our colleague, Assemblymember Irwin, led the effort back in 2022 to pass a bill that established an extended responsibility system for small loose batteries.

And that bill required the producers of household batteries to either comply individually or through a stewardship program for the collection and the recycling of those batteries. And this includes planning for a specific number of collection sites and minimum recycling efficiency rates, outreach education, etcetera.

That same year, Senator Newman did a bill, 1215, SB 1215, that extended the consumer facing fee of the e-waste program to additional, battery embedded products to play pay for disposal costs.

Now medium format batteries, so like, the ebike type batteries that we're talking about, were not included in 2440, the Irwin bill, the loose small loose batteries.

And they're only included in the Newman bill, the SB1215 program, if they're actually embedded in the product, which means that they're not easily removable by the consumer. But we know that many of these medium format batteries are actually designed to be easily removed from by the consumer, so they can be replaced or for various reasons.

And and we see they've been increasing in the marketplace and waste stream as products such as e bikes and and electric scooters and portable power systems become more and more popular.

So this bill seeks to rectify this real gap in the system. It expands the 2440 EPR program beyond just the loose batteries to batteries up to 25 pounds in order to, you know, include those batteries that are typically considered medium format.

Now producers could choose to comply individually as allowed under the current program, or they can create one or more stewardship programs, stewardship organizations. They it's their choice.

The bill also would clarify that a key or a locking device to prevent theft would not be you know, well, that wouldn't preclude a battery from being considered a loose battery covered into the program as long as the battery meets other criteria for be being easily removable by consumer.

I mean, if the consumer's key can unlock it, then it would still count. So here we have, representing voices of local government, John Kennedy with the Rural County Representatives of California. They're the ones bearing the brunt of this big logistical and financial challenge. And then, of course, Heidi Sanborn from the National Stewardship Action Council, and they're here to speak on behalf of the bill.

Great. Welcome.

Sure. Thank you so much, chair and members and staff. Heidi Sanborn with the National Stewardship Action Council, a nonprofit that advocates for circular economy. We are proud to cosponsor SB 501 along with regional or rural counties representatives of California and the Resource Recovery Coalition of California. The RRCC, could not be here today, representative, because they are monitoring the informal rulemaking workshop of the bill AB 2440, which Senator Allen referenced, which passed in 2022.

The reason this is timely is that it's an informal hearing today. They are getting close to getting to the formal hearing process. And one of the efficiencies of this bill is that if we get it done this year, we can actually add these batteries into that rule making so we don't have to spend the money and the time on a second rule making.

I in 2020, I was appointed to the California Statewide Commission on Recycling Markets and Curbside Recycling. And that commission elected me chair, and we came up with 34 policy recommendations for the legislature in two years.

The first one we could agree on, 17 to 0, was that we needed EPR for household hazardous waste, specifically the dangerous products like these types of batteries. These batteries, as you know, lithium ion does get runaway fires. Our trucks are burning. Our insurance costs are going up, and this is affecting the cost of the entire system and really affecting the safety of our workers as well.

In February 2024, we participated in a visit to cow waste, which is a Blue Bin MRF, meaning it only takes recyclables out of blue recycling containers.

And we were shocked to see that in the back lot, they actually had a hazardous waste facility. And I asked them why would they have that there, and they said because we pull so much hazardous waste off the recycling Blue Bin Sort line that we need our own facility to store it.

And when I looked in there, there were medium format batteries. So the bottom line is this is already a problem. Hover hoverboards, ebikes, all these are very large batteries, 300 watts and greater.

If they get into a compactor and they get crushed and damaged, they can start a fire. That is, I predict our industry is very close to becoming uninsurable. That's how many fires we're having. I mean, literally by the week in facilities. So it is we have no time to lose.

This is the most cost effective option is to add these batteries now to the existing program before the rulemaking begins in a formal way. So with that, I just wanna thank you for your consideration. Ask for your aye vote.

Good afternoon. John Kennedy with Rural County Representatives of California. We're pleased to be a cosponsor today. We represent 40 rural counties out of the 58 and as local governments were responsible for solid waste collection and recycling. That includes hazardous waste collection and recycling, and so we include opportunities for managing household hazardous waste and very small quantity generator waste.

We operate over a 150 collection HHW collection facility statewide, not just RCRC counties, but local governments in general. And we try to provide free opportunities for residents to come properly dispose of their hazardous waste.

As the Senator explained, batteries are an increasing problem and cost driver for our facilities, especially with the proliferation of e-bikes, e-scooters. We're also seeing some of these batteries in lawnmowers and other devices.

We support the previous efforts or we supported the previous efforts, establishing PRO programs for loose batteries and battery embedded product.

But unfortunately, there's this gap that the Senator mentioned for medium format batteries. These are valuable commodities, and we do appreciate the work that others have done voluntarily to come out and provide collection opportunities.

But I think we see the value and the benefit of establishing a durable, holistic statewide approach for managing these. We wanna make this simple and implementable, not only for us. We still see ourselves as being part of the system, but for the manufacturers, for collection sites, and others.

We continue to have lots of talks and discussions, including in this room, about establishing recycling depots and trying to increase efficiencies among all the PROs that are out there to have single consolidated points of collection for everything that we're imposing new obligations on manufacturers for.

Happy to continue those discussions. I think this is vital as we move toward that type of system. And for those reasons, we're strongly supportive of the bill today. Thank you.

Thank you. Do we have any remaining members of the audience who wish to indicate support? Come on up.

Good afternoon. Lindsay Gullahorn on behalf of the Resource Recovery Coalition of California, pleased to cosponsor the bill.

Chair member, Jael Dantes, on behalf of Alameda County Board of Supervisors in support.

Tony Hackett, Californians Against Waste in support.

Good afternoon. Charles Delgado, California State Association of Counties in support.

Good afternoon. Melissa Sparks Kranz with the League of California Cities in support.

Ethan Nagler on behalf of the cities of Glendale and Roseville in support. Thank you.

Josh Gauger on behalf of the Santa Barbara County Board of Supervisors in support.

David Creager for Waste Connections in support.

Gwynn Mackellen on behalf of Northern California Recycling Association in support.

Catherine Walsh on behalf of the City of San Jose in support.

Good afternoon. Julie Lachesky on behalf of Rethink Waste in support. Thank you.

Good afternoon. Dylan Hoffman on behalf of the California Product Stewardship Council, the Solid Waste Association of North America's legislative task force, StopWaste, and the counties of Mendocino and Humboldt, all in support.

Michael Brown, in the name of Northern California Recycling Association and Santa Cruz County in support.

Hi. Melissa Cortez on behalf of PRBA, the Rechargeable Battery Association. We actually have a supportive amend position, but we are working closely with the author and his staff to put, guardrails around the program when small and medium formats mix.

Great. Thank you, everyone. Do we have opposition?

Sorry. One more.

I was wondering.

Sierra, like, California in support.

Alright. Opposition to the bill, whether principal or audience. Come on up.

Not so much a lead witness, but, Jack Worston on behalf of the Motorcycle Industry Council. We've met with the author's office a few times. Really just concerned, that this might wrap in some off highway vehicles. We'd just like to get some clarity there. Just remove some ambiguity, as we see it.

So, appreciate your office and would like to continue to work together. Thank you.

Not a lead witness. Just I don't see a lead witness, so I just went up up. Excuse me. California Retailers Association, Sarah Pollo Moo, we were opposed to the bill in its original form when it was a household hazardous waste EPR proposal in its current form after many conversations with the author and his staff. We are neutral now, and we very much appreciate all those conversations. So thank you, Senator.

Thank you. Seeing no one else, we'll bring it back. Any questions, comments from the dias? Assembly member.

Yes. Excuse me. Senator Allen, we're so glad that you you brought this bill. And, just wanna thank you for your body of work in this subject. You've really done a lot of work in this topic, and we appreciate you.

More batteries enter our homes, workplace, and communities. We must ensure that they are safely collected and recycled. This bill helps reduce the risk, protects workers and the environment, and holds producers accountable for the products they place in our marketplace.

So SB 501 is a smart, practical step toward cleaner and safer California, and I thank you for doing the work to make California safer.

Well put. Seeing no others, I'll just add a couple of thoughts. Also, thanking you, Senator for your work in this area and for taking on this issue. Given that we already have the program as you noted for small household batteries in law, I believe it makes sense to incorporate medium format batteries into it as well. I'll be recommending an aye vote.

We will hold off on motion in second till we have a quorum. With that being said, would you like to close?

Yeah. Appreciate all the work and and continue to meet with with all the interested parties and respect for guys trying to vote when appropriate.

Great. Thank you.

We have Senator Menjivar here. Welcome.

File item three.

SB 1125 dealing with Drinking Water Rate Assistance.

Whenever you're ready.

Thank you, Mister chair. If you didn't know, 1 in 8 Californians are dealing with household water debt, partly because our water rates have increased faster than inflation over the past few years. And unlike in the energy space, there isn't any statewide assistance to help individuals who are struggling to pay their water bills.

The IOUs provide some financial relief to their low income rate payers, but public water systems, which a lot of Californians are on, are limited are limited, not partly, but because of Prop 218 that passed in 1996 that imposes limitations on providing a rate payer funded rate assistance to their low income customers. Enter SB 1125.

Now the third or fourth attempt in trying to provide and establish a statewide, funded rate assistance program for low income Californians and to be able to avoid the Prop 218 barriers that exist right now.

While this bill is contingent on funding, this house saw an earlier bill by Assemblymember Soria that is in working in tandem with this bill that creates the funding that could bring in private, additional investments, that could help with this bill.

As this is the third or fourth attempt, we have narrowed it down and decreased the amount of costs that would be associated in establishing this. And I recognize that it is contingent on funding, but we need to get the system up and running so that when we have funding, when the legislature moves forward in ensuring that that we really put our money where our mouth is and saying that water is right here in California, we'll have the system ready to go.

With that, Mister chair, I'd like to now turn over to my one witness here who would speak in support of the bill.

Welcome.

Thank you. Good afternoon, chair, and members of the committee. My name is Danielle Coats. I'm the Director of Government and Public Affairs with the Rancho California Water District, a water, wastewater, and recycled water provider serving, Riverside County, specifically Temecula, and we serve approximately a 150,000 customers.

I'd first like to thank the Senator for her leadership and the bill sponsors for their also their leadership in the water affordability space. And I'm here to express not only my agency's strong support, but to talk a little bit more about the evolution of our collaboration on this bill.

It's been Rancho Water's mission and and responsibility to provide clean, safe, and reliable water, a mission we take very seriously. And as the demands of water providers continue to evolve, from a regulatory climate response and readiness and sustainability standpoint, the cost of water does go up.

Well, water emergencies as the sender indicated very eloquently, the struggles related to Proposition 218, we still have to consider these rising costs of water.

And as an individual that has been personally invested in these conversations for over a decade, I appreciate the work that has been done by the sponsors to evolve the conversation, include the water providers a lot more, and to develop a product that not only acknowledges complements our work with our customers and the trust that we must continue to have to be able to deliver the safe and reliable water.

And by creating by creating the state funded program that it will be administered by the State Water Resources Control Board, SB 1125 provides the framework that makes participation in affordability programs legally sound and operationally feasible for water providers.

So with that being said, again, Rancho California Water District is a proud cosponsor alongside Irvine Ranch Water District of a companion legislation, SB 2739 to fund the low income rate assistance program created by this bill along with the mechanism to address the infrastructure cost pressures on water districts, supporting a comprehensive approach to water affordability.

We believe these two measures together chart a genuine path addressing the interconnected challenges of water affordability and systems stability.

For these reasons and more, we respectfully urge your aye vote. And thank you for your time and commitment to our shared goal of water affordability.

Thank you. If others would like to register their support, come on up.

Good afternoon. Good afternoon. Alfredo Redondo on behalf of the Irvine Ranch Water District and San Diego County Water Authority in support.

Mikayla Bird with The Nature Conservancy in support.

Hi. Mateo Kushner from Community Water Center on behalf of Clean Water Action. Physician for Social Responsibility Los Angeles, commit Center for California Environmental Justice Network, COURAGE California, Monolay Committee, Center for Environmental Health, and Restore the Delta in support.

Hi. Good afternoon. Andrea Abruzzo with the California Municipal Utilities Association in support.

Good afternoon. Charles Delgado, California State Association of Counties in support.

Beth Olaso on behalf of the Municipal Water District of Orange County in support.

Mister chair and members, Debbie Michael on behalf of East Bay Municipal Utility District in support. Also, City of Sacramento throwing in their support as well. Thank you.

Hi. It's Soren Nelson with the Association of California Water Agencies in enthusiastic support. Thank you.

Trevor Taylor with Metropolitan Water District of Southern California in strong support. Thanks.

Kyle Jones on behalf of the San Joaquin Valley Water Collaborative Action Program in support. Thank you.

Mercedes Macias, Sierra Club California in support.

Katie Valenzuela, Center on Race Poverty in the Environment in support.

Ethan Nagler on behalf of the Cities of Roseville and Burbank in support. Thank you.

Hi. Marissa Hagerman for Water Foundation and California environmental voters in strong support.

Alex Loomer on behalf of the Environmental Defense Fund, California Coastkeeper Alliance, and Planning Conservation League in support. Thank you.

Thank you. Do we have witnesses in opposition?

Seeing none, any other audience members for opposition?

Alright. Seeing none.

Do we have questions from committee member?

But have who happens to be the vice chair? Good to see you. Couple quick thoughts and then on by well, actually, do you wanna close?

I yeah. Thank you, Mister chair. You know, we're talking about the affordability crisis in California, and we can't do without water. We need that to sustain ourselves. In fact, the budget has on various occasions, added $10 to people who live in the Central Valley to pay for access to clean water because they don't have it.

Even in the fourth largest economy in the world, people are still going without. And when we are then forced to pay for these bills, other these families have to then think about, maybe I won't buy that extra orange or that extra banana because at minimum, I need water. I think, time enough.

It's passing out of enough time since the report came out back in 2020 that showed what we needed to do to step up and really address the issues that people are dealing with, our access to water, and this is the first step that needs to happen. So I appreciate the support, hopefully to get this out of the committee and continue conversations.

Yeah. No. We definitely thank you for bringing the bill forward. Appreciate your work. I think we all agree that clean, affordable drinking water should be accessible for all Californians.

As you noted, we've seen several iterations of the bill over the years. So, good body of work. Commend you for drafting legislation that has a wide ranging level of support. I wanna thank you for working with us on recent amendments that provide clarity on requirements on the Water Board.

As always, please keep me and the staff in the loop as this bill moves through the process. And as a funding solution is worked out to support the program, I would be recommending an aye vote at the appropriate time as well as a motion and second when our committee members arise arrive.

So thank you again.

Thank you, Mr. Chair.

For your work on this.

Appreciate it.

Yep.

So we have one more bill. Would invite that author and committee members, let the word go forth. We're open for business.

Yeah.

Okay. We're taking up file item four. Senator Blakespear, welcome. This is SB 1259, dealing with oil refineries. I understand there are amendments that you've worked out with committee ahead of today's hearing. You will be accepting those. Great. Whenever you're ready.

Okay. Great. Thank you, Chair. And staffers at the committee. Don't see any Members currently. Right? Okay. Yes. We do have that. Okay. Good. Thank you. Hello. Thank you for the opportunity to present SB 1259, and I'd like to start by accepting the amendments, expressing that verbally.

And I also want to appreciate the Chair and staff's thoughtful input and collaboration in making this an even better bill. Petroleum refineries have been closing across the United States for years, including in California, as an increasingly competitive global market pushes companies to consolidate operations. And the hard truth is that eventually, in California, more will close.

I want them to remain open, obviously, as long as we need fuel from them. I think as does the rest of the state of California. However, when it's time for a refinery to close, we need to be ready. And getting ready takes time and foresight.

We know that personally in our own lives to take care of those who rely on us we need to keep our own selves healthy and we need to make plans for the future that we will not be a part of, and refineries are no different.

We all know that we will leave this life, and we use wills to plan for the inevitable future. And I use this reference because I worked as an estate planning attorney drafting wills and trusts, so this is very much on my mind.

Based on data and trends, we know that refineries will continue to close eventually, and they will need to have their own will. So when a refinery closes, communities are left in the dark, and the state lacks the information needed to plan for land reuse, environmental remediation, and economic transition.

SB 1259 changes that. It does not increase the cost of doing business for refinery operators and owners. These companies either already have this information or they will need it eventually. This simply creates more transparency sooner.

Under SB 1259, the State Water Board will develop an overview of technologies, costs, and timelines associated with refinery cleanups. We can't know with 100% certainty exactly what a given cleanup will cost, but even a ballpark estimate helps for planning. Right now, local governments and communities really don't know anything about the future.

Using the Water Board's overview, the bill then has refineries submit a report to estimate the eventual cleanup timelines and costs. Although this is more information than they are required to disclose today, it is in line with what is already required for other similar types of industries, like power plants, drilling oil wells, and even wind and solar.

And that is really all that the bill does. It asks refineries to provide the same type of transparency that we already expect from other industries in California today. The bill is an important part of California's holistic fossil fuel transition strategy.

Over the coming decades, we are transitioning away from fossil fuels, and we are transitioning toward more climate friendly renewable energy, and this will require thoughtfulness and planning. The Senate Environmental Quality Committee, which I chair, held a hearing on this very topic in February.

Where we spoke at length with Energy Commission Vice Chair Siva Gunda as well as several other experts on the topic. And what we heard over and over again was that communities who have directly experienced refinery closures wanted more information sooner.

Without SB 1259, we'll just keep facing crisis after crisis while delaying our clean energy future and not understanding the risks and opportunities for the future of the land that refineries sit on today. We've had a lot of tough conversations about this bill.

And based on these conversations, I'd like to address some of the misconceptions about it. Some opponents say that the bill is too onerous and that it would leave the state's remaining refineries with no choice but to close. But we also hear that this bill is unnecessary and redundant with what they already do. So it obviously can't be both redundant and overly burdensome and onerous.

And, really, it is far from being either. They also say it's nearly impossible to estimate cleanup costs while a refinery is still in operation and that we should just trust them to know that they will be absolutely accountable and that we should be confident in their ability to pay for the entirety of cleanups.

But the reality that we've seen in other states from other refineries and here in our own state is that communities wish they had more information sooner so that when a refinery does close, it can transition to the next thing faster and doesn't sit there for endless years without being cleaned up.

This bill simply asks for answers to basic questions. And as you'll hear from my lead witness from the Benicia City Council, it's utter chaos for communities and workers involved when they don't have the information.

As the committee analysis notes, the cost associated with cleanup at some of these industrial facilities is truly mind boggling, and so is the risk to the state. This committee is no stranger to the risks that communities in the state face when big industrial facilities closed.

Before it closed, Exide was a 13 acre battery recycling facility in Vernon, and now the name is synonymous with decades of pollution, mismanagement, and broken promises. As lawmakers, we must learn from history and do better.

The Valero Refinery sits on 330 acres right in the heart of Benicia, and we don't want the residents of Benicia talking about Valero decades from now with the same indignity that residents of Vernon talk about Exide today.

Unfortunately, getting the cost and timeline estimates for cleanup still doesn't guarantee that communities will have everything work out. But we know that refiners can make these estimates and the communities want to know them.

So let's start from there. It's our responsibility as a state to have to require these plans and estimates so we can do right by our communities who will be suffering for years without them. With me to testify in support, I have Kari Birdseye, City Council Member in Benicia, and Katherine Chu of the Asian Pacific Environmental Network.

Welcome.

Good afternoon, Chair Connolly and committee. My name is Kari Birdseye, and I currently serve on the Benicia City Council. I very much appreciate the opportunity today to testify in support of SB 1259. As an elected official of a city that's experiencing a refinery closure now in real time, I am acutely aware of the problem that this legislation is addressing and eager for the solution that it offers.

The closure of the refinery will hit our local economy hard in the near future, putting an estimated $10 million hole in our local tax revenue. Our community does not have the luxury of decades to let the site's future play out in slow motion while viable opportunities slip away.

But the planning and coordination we need to be doing right now is extremely difficult in the absence of hard information about the refinery site and what it will take to clean it up. While we are pleased that many prospective businesses have been approaching Benicia to talk about the future use of the refinery site and its supporting infrastructure.

They have so many questions, and we have little to no answers for them. The City of Benicia needs that information now, and this act would provide it, not only to our city, but to local governments who will be in the same position when additional refineries close.

The act will ensure that Richmond, Rodeo, Martinez, Torrance, Carson, Wilmington, and other refinery communities can start now to engage in long term planning. We thank and commend the regional water board for its initial work to assess assignment contamination, but we don't have a complete picture of what's needed to dismantle and redevelop the refinery site.

We are not asking refineries to do anything more than what's already asked of power plants, wind and solar, coal mining, and almost everyone else in the energy industry, which is to provide a closure plan in advance and a way to pay for it. For all these reasons, I respect fully urge your aye vote on SB 1259. Thank you.

Chair Connolly and Member of the Committee, thank you for the opportunity to testify today. I'm Katherine Chu, the Legislative Director of the Asian Pacific Environmental Network Action, or APEN Action, co-sponsor of SB 1259.

Whether our aging refineries close in two or twenty years, the question is what will be done, and will it be done in a way that protects local communities? How long will it take to decommission the facility and remediate the land? How much will it cost and who will pay for it?

Other industries within the energy sector, including coal, wind, and solar, are generally required to prepare and disclose closure and cleanup plans, usually including cost and timeline estimates. Oil refineries are the glaring exception.

Nonrefinery energy companies make these estimates before announcing closures and without knowing closure dates. They use standard and well known accounting methods and probabilities. SB 1259 would simply require refineries to use these same methods.

This is good business scenario planning. This is not speculation. Last year, the legislature asked the California Energy Commission to report on necessary steps to protect the state during the energy transition in SB 237. The CEC recently released their draft report.

And in that report, the CEC states that there is a need for, quote, proactive, reasonable estimates of cleanup cost and durations, end quote. That is exactly what SB 1259 would provide. It does not require setting closure dates.

It does not require promises or guarantees, but it does require transparency. Transparency is critical to ensure communities are kept safe from refineries legacy pollution. A report on the Phillips 66 Carson refinery revealed a 16 foot thick pool of oil underneath the facility, and another report found a funding gap of over $750 million to clean up the whole facility.

This funding gap could end up falling on taxpayers. Sharing this information is not a punishment. It's a basic responsibility to Californians after polluters extract profit from acres of California land. I respectfully urge your aye vote. Thank you.

Do we have any remaining members of the public who wish to indicate their support for this measure?

Alex Leumer on behalf of Earthjustice and Biofuelwatch in strong support. Thank you.

Leo Dale on behalf of The Climate Center in support.

Marie Liu with permission for BSR LA, Courage California, and 350 Bay Area Action. Thank you.

Marquis King Mason with NRDC in strong support. Thank you.

Christina Scaringe with the Center for Biological Diversity in strong support. Thank you.

Mercedes Macias, Sierra Club California, in support.

Hi. Marissa Hagerman with TrattenPrice Consulting for California Environmental Voters in strong support.

Michael Claiborne with Leadership Counsel for Justice and Accountability in support. Thank you.

Good afternoon. Ruth McDonald with Climate Action California in support.

Katie Valenzuela on behalf of Communities for a Better Environment, a proud co-sponsor, as well as the Center on Race, Poverty, and the Environment, as well as the California Environmental Justice Alliance. Thank you.

Jamie Pew on behalf of NextGen California in support. Thank you.

Do we have any anyone in opposition to SB 1259?

Thank you, Members. And behind me here. And, Senator, good to see you today. Keith Dunn here on behalf of the State Building Construction Trades Council. Many of you here, the Building Trades Council support renewable energy. I say it all the time. Our members build the innovation renewable economy that California is the leader in in the world.

But every expert will tell you that we're decades away from a 100% renewable energy. Supporters of 1259, you've heard, will tell you it's a simple planning bill, but the plan you're being asked to support is asking the wrong question. SB 1259 should be asking you to develop a plan to retain the needed energy infrastructure that California relies upon to maintain our economy.

California still needs these refineries for tens of thousands of employees who work at these facilities, but also for the energy that it generates for our overall economy and the men and women who operate in that economy on a day to day basis. SB 1259 is asking you to vote to establish the parameters for which an obituary for California's energy independence will be written.

1259 asks you to plan for a working class tax to be paid by every Californian, rather than plan to lower our energy costs and protect the careers of tens of thousands of workers who support our great state. That's the plan that we should be discussing here today. As you all know, California competes every day against other states and countries for billions of dollars of energy infrastructure investment.

1259, if passed, would become part of California's economic audition, putting us at a disadvantage with 49 other states and many other nations. An economic audition whose central theme asks for you to vote for a plan to require us to tell investors to go build somewhere else.

And by the way, take the jobs with you and the environmental protections that we have here in our state. SB 1259 is asking the wrong question, and it's nothing more than a plan for failure. We'd ask for you to vote no. Thank you.

Thank you, Mr. Chair and Members. Zach Leary on behalf of the Western States Petroleum Association. We are here in strong opposition to SB 1259. Last year, we were directed by Governor Newsom to work with the CEC and other stakeholders on how to stabilize the few remaining refineries.

The legislature, partnering with industry and labor and the administration, took bold steps last year to protect what is left. Unfortunately, this bill takes us backwards and proposes to plan our demise. This bill is onerous. I've heard it repeated it's not. There are provisions in the bill that require us to project out 5, 10, 15, 20 years on what our projected closure costs will be.

And it requires as part of this report that you will consult with all the state and local agencies that you would have to be governed by in your closure process. That is very onerous if you are gonna do that for a report. We do want, as an industry, wanna continue operations in the state, but that will take more collaborations and not bills like this.

The state still has great demand for our products, roughly 13 billion gallons of gasoline a year, and growing demand for jet fuel. Our industry in California is one of the most heavily regulated industries in the entire world. California has a robust framework for refinery closures at every phase of the process.

There are, at minimum, 15 agencies that have oversight over our industry across four levels of government that exercise active enforceable authority at every stage of the closer process. We know this issue is complex and you wanna ensure proper oversight if refineries close.

That is why we did sit down with the author and offer good faith amendments, meaningful amendments that would be useful to both the state and the local communities impacted. Our amendments were fairly simple. Charge the CEC to develop a checklist of all the things refineries have to do in the decommissioning process.

This would have allowed all of us from, to operate from the same set of facts. Unfortunately, these amendments were rejected by the author. It is imperative that you protect the remaining refineries. You have that are providing the affordable and reliable fuel for your constituents. Unfortunately, SB 1259 is yet another example of why operating in the state is too challenging.

Did you both testify or

We have.

Alright. Still

riveting, and you missed

a good chance. Good to be good to be back. Any members of the public in opposition?

Good afternoon. Dawn Kepke on behalf of the California Council for Environmental and Economic Balance in Respectful opposition. Thank you.

Good afternoon. Razi Gonzales on behalf of California's Business Roundtable in opposition.

Good afternoon. John Kendrick from the California Chamber of Commerce in opposition.

Thank you. We'll bring it back. Any questions or comments from committee members, vice chair?

Thank you. I respect where you're going with this, but I I come out of the industry of thirty five years of environmental chemical process work in the refineries, in every refinery in California. And working in these refineries as an environmental engineer, I'll I'll there's two phases here. One is philosophical and one is technical. Philosophically, it sends a wrong message to our existing refiners when we're when we're have 1,300,000 electric cars and 33,000,000 gas and diesel.

So we're a long ways away from electrical and zero emissions. We're just so far away. So we have to encourage our our refiners to stay. I think this sends a wrong message. Let me let me talk technical for a minute because that's my strength.

Years ago, when we started going to oxygen, it's for our fuels. We started with tetraethyl lead, and it sent a message to the DTSC and the regional water quality control board. Hold on, guys. We're gonna put in ground monitoring water wells, and we're gonna we're gonna detect all of the all of your contaminants. Okay?

Then we move to methyl tertiary butyl ethyl for ether for an oxygen. And then and then we move to ethanol. And there are obviously in in any refinery, you have some you have tanks, carbon steel, you have some leakage into the formations. It's been heavily regulated and it's they've been decontaminated over the years. Not to say that there isn't some contamination.

Where I'm going with this is that they already know what the contamination levels are 90%. Okay? They already know. And and guess what? It's public record.

You can go to the DTSC. You can go to the AirBoard. You can go to any of the agencies and find its public record. So they're already complying with this to a certain degree. And I think I think it sends a wrong message, and I think it's overburdensome.

I would defer you. What what would you do to answer her question the senator's question about why is this why is this not important or why is this important?

Yeah. And I think thank you, assembly member, for the question. I think we have to operate from a fundamental grounding in the facts of what is existing law today, both at the federal, state, local, and regional level. There we are, like I said, one of the most heavily regulated industries in the world here in California. And there is already a robust framework that exists.

While some folks may not know that framework or may not acknowledge that framework, it does exist. And so if we're gonna talk about cleanup, if we're gonna talk about mitigation, if we're gonna talk about what the process is, let's understand what the current law is and what are the current requirements. And those I'm telling you here today, those are robust. 15 agencies, four across four levels of government o oversee our industry, and that's at probably the minimum.

We need to start from the fundamentals, which is what is existing.

Everybody start from the facts and then analyze if there are gaps. Because if we're not looking at the whole picture, yeah, you're gonna you're gonna think there are gaps, but you need to look at every level of government, all the requirements to understand before start assuming there's gaps.

Senator, do we obviously, one of my other concerns are it's it's an economical burden as well by the time you hire environmental survey companies and and, you know, go through all of this. If if if you're gonna supply something, you want an independent firm to come in and do it. It it costs a lot of money to each of these, refiners.

I think that would be, you know, because of cap and trade, because of all these other regulations and and, you know, they all have full environmental groups. So the cost, I think, is a concern for me as well.

I just I don't feel this is the right time, but I I appreciate what you're doing. Thank you.

Could could I just respond to the clear wanna respond to that.

Yeah. I mean, it's important to recognize that the the little guys have already closed in California. So these are big multinational companies, and, they're they're operating at a scale that the the amount of money it would cost to have a hire a consultant to do a report like this I mean, I I really think it's important to just put it in the scale of looking at a multinational company. So and then also, companies are always doing their own planning.

So a good amendment from the committee was that, the the reports are are only done based on when the report's produced, it looks out ten years to say, from here, if you were to close in ten years, what would the obligations be?

Not, and what would the cleanup plan be? Not, any it's no longer five years, ten years, twenty years, twenty five years, that kind of thing, which is was a previous version of the bill. And so, you know, making a decision about, for example, investing in a a a $30,000,000 upgrade to some part of the refinery, you know, they're looking forward to say, are we gonna be around? Are we gonna be closing? And they're evaluating the market conditions.

And so it's a worldwide market. So this type of analysis is being done. We don't we don't expect that we're actually asking them to do analyses that they're not already doing internally. We're just asking for that to become public. So there would be some way for our communities and for also the state to be to recognize what is happening because there's an there's an asymmetry to the amount of information right now.

And I think what California doesn't want, because of the scale of magnitude, we don't want, to have a big Superfund site walked away from because it there's a bankruptcy, and there are all sorts of, ways that things devolve to and we've seen this with, like, the orphan oil well situation. And those are small and have less of a impact. But if you have that kind of thing happening potentially with a refinery, it's not good.

You know, it's something that communities are left holding the bag, and we and then at the end, the state really has to be the ones to to to backfill that. And we just wanna make sure that doesn't happen.

I'd I'd like to respond to that, though. They are billion dollar corporations. So I think they're walking away from that. It's pretty, minimal. Sir, for Westpho, what what do you have to say to that?

Yeah. I think, comparing the orphan well problem, which is a problem and it's something that we've tackled as an industry with the state in partnership, that is comparing apples to oranges when you're talking about a refinery. Refineries are in much different locations than a, oil well in the middle of Kern County. Different land, different opportunities. So comparing us to the orphan well problem is completely apples to oranges, completely different regulatory structure, completely different legal framework.

So for us in the refining sector, the we have seen a contraction consolidation from 30 refineries in the eighties to now six major refineries left, two operating in Northern California, four operating in in Southern California. I heard the examples of Exide brought up, but I did not hear examples of those 24 other refineries that have closed, converted, shut down as being a problem for the state, as being pointed to as an example because the process is is robust. The process exists.

And so if you look at the there are 24 other refineries that have closed, converted, or or, went idle, we have not seen the ex side example that the Senator was pointing to.

Thank you. Thank you. Further questions or comments? Why don't we establish a quorum right now?

For purposes of establishing a quorum, Connolly?

Here.

Ellis?

Here. Bara Cahan? Castillo Lee? Here. Mckinner Pappan?

Here. We have a quorum.

Great. Senator, if you'd like to close.

Well, I I did have some questions. You do.

Yes. Great.

you so much,

Thank

Tara. Thank you.

a Attention before then.

Didn't see

Absolutely.

So a couple of things. First of all, thank you to the author. Thank you to the opposition for spending some time on this bill. It's not an easy one. I'm gonna say for for purposes of the author as as well as the opposition.

But as it relates to the author, because we do have this existing structure of a whole lot of regulation. And I I thank you for our brief conversation today too because I understand that there are some required there you only refer to a lot of them, but I don't know actually exceptionally what's out there.

But it seems to me that with the CEC having so many requirements that there might be some plans already mandated as it relates to the environment and and polluting the environment and whatnot. And can we supplement those plans rather than this, let's write your obituary? And I appreciate the ten years out, by the way.

I think that's an improvement because, you know, it's sorta it's hard to be a going concern and then say, oh, by the way, here's this liability on our books for ten years out that may or may not happen, and that can be somewhat difficult as well. I wish this were an easier bill because, of course, everybody says, yeah. I wanna make it so that when you leave town, you don't leave us, you know, high and dry or or polluted and gone, whatever.

You you take your preference. But it doesn't quite work that way, especially with a heavily regulated industry that oftentimes is publicly traded to.

I think most of the big refineries left are, if I'm correct. Okay. And we had talked with your staff about SCC reportings and and what this looks like on the books. So I'm wondering and and what seems to be a big concern, although it was not mentioned today in testimony, but the SCC reportings seem to be somewhat of a concern too. So can we get to the point?

Long story long. Can we get to the point where some of these already required plans can be supplemented? And I I kind of concur. They are multinational corporations. It's not like individual wells.

And you had a whole slew of them that are already up and left, and we didn't have these incidents. So, I don't know if the track record is there, but never say never either. So I and I get that part, which is why you're here today. And you have the likes of Benicia here today. So I get that part of it.

So what I'm saying is if I I it doesn't appear right this second that we can get a handle on. Is there existing plan requirements that can be supplemented to achieve what the author's trying to achieve, but at the same time, you don't have to, you know, report this liability in the books or or whatever it is is really causing seems to be causing a lot of heartburn without a track record that is actually happening. So I'm trying to be as fair as possible.

But if we got things already in place, it seems to me I wanna that's where I wanna get. And I don't know if I can get there today.

I may gonna vote to let you see the light of day so that you can do that. But enough of my babbling. Is there something that you it's not it is a it is sort of a question, but a statement as well.

Yeah. I I think this is getting at, maybe what was referenced in conversations yesterday about the Department of Toxics, DTSC. So there's already some information that's provided to them. And so if you don't mind, I'll ask my witness to just talk about this bill how, is tasking the the the water board, not DTSC with, but we also are open to it being housed wherever it's most appropriate based and potentially tiering or doing other things that would eliminate any redundancies. But I'd like to ask Yeah.

What's the annual plan? To

Thank you. Thank you for the question. I I've heard earlier that there's already a lot of regulations that there that these industries are subject to. And I just wanna point out that the CEC's report did consider all existing regulations when they made the recommendation for this other step.

They called it actually a governance gap in California's petroleum infrastructure, and they said that the state does not currently have the ability to control the timing or sequence of the retirement because these facilities are almost privately are almost entirely privately owned.

Regarding whether, DTSC or the water board should, should essentially have lead jurisdiction in these cleanups, both agencies must work together. It's essentially overlapping jurisdiction. The water board typically has taken lead. We've seen this in other refinery closures because the primary concern is the groundwater. DTSC typically takes lead when straight oil contamination like Exide is the primary concern or when it's a hazardous waste facility.

Refineries as a whole are not deemed hazardous waste facilities, though, and that's why DTSC does not lead. But I will note that SB 1259 does recognize both agencies have roles here, and they do have to inherently work together. So far, the water board has already taken lead jurisdiction in other refinery cleanups, so it makes logical sense for them to use that expertise and experience to continue being the lead agency.

But we are happy for both of them and other agencies as well to work together in whatever way is the most efficient and least duplicative. If I may also assembly member, you mentioned that it may be costly.

One thing that I do wanna point out is that every other energy sector already has this, and you mentioned that the refineries themselves may already have this information. So if they already have this information at hand and other energy systems are able to do this without it being too costly. And as the Senator mentioned, these are very large scale companies. I think it's a drop in the bucket that we need to consider in light of.

I just wanna I wanna hit on some other things. I appreciate you wanna hit on that. We'll stipulate they're big companies. I you did you wanna say something? And then I have some follow-up questions.

Yeah. She If I may

Yeah. Of course.

Reference governance gap. Yes. We are privately held companies and or privately owned companies. But to suggest that the government would come in and are you suggesting the government come in and own one of the refineries? I mean, that was one of the re recommendations that I think was rejected in the transportation fuel assessment.

But, yes, these are companies that are operating, providing fuel to your constituents. What we are telling you and have worked with the CEC and the administration on is it is the policies of the state that have made it so onerous, that have made us the least competitive refineries in the world. No. We need to be competitive so we can stay open.

No. And and just one more. We'll stipulate to the need. We'll stipulate that we haven't gotten off of fossil fuels and refineries. If if they're not here, we're gonna have a a lot of expense in importing fuel.

I I that's not a song we haven't heard by by any means. And I will say your demise will be market driven. Correct? We can all stipulate to that as well. When it happens, we don't really know, but it'll depend on when we get green.

You wanted to say something, sir, if I

state building construction trades council. I'm gonna sing a song that you've heard before, but I represent hundreds of thousands of workers who do the maintenance, repair, shutdowns, and turnarounds on these facilities of which every Californian in this room and in this state depend upon. And and I don't want it to be lost. Again, I'm gonna say what I said in my testimony, and I appreciate the senator's efforts here, but we're asking the wrong question.

We need to be asking what are we gonna do to maintain the six refineries that are still here.

We're asking about planning to join the other 24, and I can't say it enough. You're being asked to plan for the failure of these refineries rather than what can we do as a state and a legislature and and advocates to make sure that we retain them.

So that when we get to that transition, a transition supported by the state building construction trades, that were it's done in a manner that doesn't drive costs, that doesn't lose careers, that we have leakage with no environmental protections that we all hold so dear here. So, again, I that's a very important point that I don't want any of you to miss.

And I wanted to respond to you just said ultimately it's gonna be market driven. So the market is is driving that. But it's kinda combination with the policies. So the we are competing against refineries across the world that don't have the same cost burdens that we do here in California. Protections.

And it's easier to and cheaper to make it somewhere else, ship it here, than it is to make it in California.

Well, it is such that you while you are alive, you have to do these turns. And we didn't talk about that, but I know you and I spoke about that yesterday. And then how do you finance those turns or how do you plan for them if you're also have these end of life considerations that you have to make, which is why I think it's reasonable that the Senator is gonna look at where we might slot you in.

One thing we did not talk about, as I understand it, there are also county filings that you have to do, and they relate to clean water as well. So it might be that that's where we find a home for some of this stuff.

So where I am today is that I'm I think we could find a home for some of this stuff without this bill, and that's what I'd like to see us do. But we're not there right this second, but I do wanna see you live to fight another day. And I think we're all on the same page, at least goal wise. And and, you know, I it's we want the public to know that we care.

We're not gonna let you when you close-up shop, leave us with nothing.

But there's a way many ways to skin a cat, and I think we're not there yet. You know? It wasn't a question pending, but would you like to say something? There's a question.

Yeah. And I I think I wanted to respond to us not leaving high end these properties that exist, I mean, these are much different than an oil field in Kern County. These properties have value. They have infrastructure. They have rights of way.

They have power. So there is a lot of value continuing in the property itself. And so to suggest that we would up and leave, like, an Exide case or in the orphan well case is just not what would take place.

As you'll tell the good people of Benicia right there. Did you have anything else? Okay. Good. I think I'm good.

I appreciate you hearing me out Of course. And knowing that we might find another pot here to place this in. That's right. Thank you for the time.

Of course. No. Always appreciate it. Seeing no other comments, would you like to close?

Well, I think we've covered a lot of ground here, so I will respectfully ask for your aye vote.

Great. Thank you. We have a motion. Do we have a second? I will do the second.

Let's take a roll.

File item number four, SB 1259 by Senator Blake Spear. The motion is do passed as amended to the Assembly Utilities and Energy Committee. Connelly?

Aye.

Ellis?

No.

Barakahian, Castillo, Lee? Aye. Lee, aye. Mckinner, Pappin. Aye.

Pappin, aye. That's three votes.

One other member just walked in. This is file item four.

File item four, SB 1259. The motion is do passes admitted to the Assembly Utilities and Energy Committee. Barakahann? Aye. Barakahann, aye.

That matter carries. We'll keep the vote open for absent networks. Thank you. Yeah. Why don't we circle back, with our quorum now, starting with consent? I need a motion and second. Okay. We have a motion, Lee. Second, Pappen. Roll call, please.

[Roll Call]

K. That carries. We'll leave the vote open. Perhaps, some members, why don't we entertain some add ons? We even need motions. Yeah. Yeah. Why don't we do file item one? And a motion in second. Roll call.

[Roll Call]

Okay. We'll leave that open. File item three. Got a motion in second. Roll call.

[Roll Call]

That matters out. We will leave it open for absent members to vote. Why don't we do add ons for assembly member McKinner?

[Roll Call]

K. That matters out. If we can get Senate member Bauer Kahan

[Roll Call]

We are adjourned.