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AB-721 Metal plating facilities: pollution prevention fund.(2005-2006)

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AB721:v94#DOCUMENT

Assembly Bill No. 721
CHAPTER 695

An act to add and repeal Chapter 2 (commencing with Section 42100) of Part 3 of Division 30 of the Public Resources Code, and to repeal Section 80 of Chapter 74 of the Statutes of 2005, relating to metal plating facilities, and making an appropriation therefor.

[ Approved by Governor  October 07, 2005. Filed with Secretary of State  October 07, 2005. ]

LEGISLATIVE COUNSEL'S DIGEST


AB 721, Nunez. Metal plating facilities: pollution prevention fund.
(1) The California Integrated Waste Management Act of 1989 establishes a comprehensive program implemented by the California Integrated Waste Management Board and local agencies to reduce, recycle, and reuse solid waste in an efficient and cost-effective manner.
Existing law creates the Chrome Plating Pollution Prevention Fund in the State Treasury for the purpose of receiving deposits of moneys for expenditure, upon appropriation by the Legislature, by the Business, Transportation and Housing Agency.
This bill would require the Business, Transportation and Housing Agency, in collaboration with the Department of Toxic Substances Control, the State Air Resources Board, the State Water Resources Control Board, and the Financial Development Corporations, as defined, to develop a loan guarantee program for chrome plating facilities to assist those facilities to purchase high performance environmental control equipment or technologies. The bill would require the department to establish the Model Shop Program in northern California by replicating the existing Chrome Plating Model Shop Pilot Program, which is currently available only to southern California chrome plating facilities. The bill would require the money in the Chrome Plating Pollution Prevention Fund to be expended by the agency, upon appropriation by the Legislature, to make specified loan guarantees, and for administrative costs. The bill would require the agency to make loan guarantees available only to a generator that is a small business and meets other requirements.
The bill would authorize the agency, in collaboration with the Department of Toxic Substances Control, the State Air Resources Board, and the State Water Resources Control Board, to adopt regulations to implement the bill’s requirements and to adopt emergency regulations to implement the loan guarantee program. The bill would require the agency, by January 1, 2007, and every odd‑numbered year thereafter, to post a report on its Internet Web site and to provide notification to the Legislature concerning the performance of the loan guarantee program. The bill would also require the department to provide an evaluation of the Model Shop Program as a supplement to the report.
This bill would be repealed, by its own provision, on January 1, 2012, unless extended. This repeal would not terminate the obligation to repay loans, outstanding as of January 1, 2012, that are due payable to the relevant financial companies, or impair the authority to initiate and resolve any cost recovery action.
(2) Existing law transfers the amount remaining in the Hazardous Waste Reduction Loan Account on January 1, 2006, to the Chrome Plating Pollution Prevention Fund. Existing law provides that the transfer of money and creation of the fund would become operative only if legislation is enacted and becomes operative on or after June 1, 2005, but before July 1, 2006, that requires the funds so transferred to be expended for environmental control technologies for chrome and metal plating and related activities.
This bill would repeal and reenact, without that condition, those transfer provisions, and would appropriate the money to the agency for expenditure pursuant to this bill.
Vote: 2/3   Appropriation: YES   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 (a) The Legislature hereby finds and declares all of the following:
(1) Metal plating facilities are primarily engaged in all types of electroplating, plating, anodizing, coloring, and finishing of metals and formed products. Facilities conducting metal plating activities include small, low-volume operations as well as large, high‑volume production lines.
(2) The metal plating industry provides significant support to the manufacturing sector, particularly in the automotive, electronics, machine equipment, and defense areas.
(3) According to the Department of Toxic Substances Control, there are approximately 875 metal plating facilities in the State of California, 67 percent of which are located in the five-county Los Angeles area, the largest concentration of metal platers anywhere in the United States. There are also large numbers of metal platers located in the San Francisco Bay Area, San Diego County, and Central Valley regions of the state.
(4) The metal plating process impacts the environment in a very intensive manner. The process involves the use of toxic materials, and generates significant amounts of solid and hazardous waste that affect the air, water, and soil. In particular, hexavalent chromium, a chemical compound intrinsic to the chrome plating process, is a known human carcinogen and a potent toxic air contaminant.
(5) Metal plating operations are regulated by various federal, state, and local agencies, including the United States Environmental Protection Agency, the State Air Resources Board, the State Water Resources Control Board, the Department of Toxic Substances Control, California regional water quality control boards, local air quality management districts and air pollution control districts, as well as certified unified program agencies (CUPAs), and municipal waste water treatment agencies.
(6) A number of technical assistance programs have been developed to assist the industry in meeting new or exceeding existing environmental regulations, or both, including the Department of Toxic Substances Control’s Metal Finishing Recognition and Compliance Assistance Program. Specifically, this “model shop” program will provide pollution prevention training and technical assistance to metal platers in southern California.
(7) New standards for the industry are under development by the State Air Resources Board and the federal Occupational Safety and Health Administration. These standards may require existing chrome plating facilities to purchase new environmental control equipment in order to maintain compliance status.
(8) The vast majority of metal platers in California are small businesses, and the metal plating industry’s limited ability to access capital to invest in environmental improvements has been identified by the United States Environmental Protection Agency as one of the industry’s biggest obstacles in meeting and exceeding current environmental requirements.
(b) The Legislature hereby further declares that it is in the best interest of the people of California to address the environmental issues posed by the metal plating industry in order to preserve its economic vitality. Specifically, funds should be provided to support environmental compliance, pollution prevention, and emission reduction measures.

SEC. 2.

 Chapter 2 (commencing with Section 42100) is added to Part 3 of Division 30 of the Public Resources Code, to read:
CHAPTER  2. Metal Plating Facilities

42100.
 For purposes of this chapter, the following definitions apply:
(a) “Agency” means the Business, Transportation and Housing Agency.
(b) “Air board” means the State Air Resources Board.
(c) “Applicant” means a small business that is a chrome plating business that produces hazardous waste and applies for financial assistance pursuant to this chapter to reduce the generation of hazardous waste.
(d) “Chrome plating” has the same meaning as “decorative chromium electroplating” as defined in the regulations specifying a hexavalent chromium toxic control measure for chrome plating adopted by the air board and contained in Section 93102 of Title 17 of the California Code of Regulations.
(e) “Department” means the Department of Toxic Substances Control.
(f) “Emission reduction” has the same meaning as “airborne toxic risk reduction measure,” as defined in subdivisions (a) and (b) of Section 44390 of the Health and Safety Code.
(g) “Financial company” is defined pursuant to Section 14010 of the Corporations Code.
(h) “Financial Development Corporation (FDC)” means a corporation formed under the California Small Business Financial Development Corporations Law (Ch. 1 (commencing with Sec. 14000) Pt. 5, Div. 3, Corp. C.).
(i) “Green business program” means a program coordinated by a local, state, or federal agency for the purposes of assisting and recognizing businesses that are in compliance with all environmental laws and regulations, and taking additional steps to conserve natural resources and prevent pollution.
(j) “Metal plating facility” means an establishment primarily engaged in all types of electroplating, plating, anodizing, coloring, and finishing of metals and formed products for the trade.
(k) “Model Shop Program” means the voluntary pollution prevention program developed by the Department of Toxic Substances Control with assistance from the Los Angeles City Bureau of Sanitation, Sanitation Districts of Los Angeles County, and the Metal Finishing Association of Southern California, to assist the metal plating industry in identifying possible sources of pollution and developing alternative business practices in order to run cleaner, safer shops.
(l) “National Metal Finishing Strategic Goal Program” means the voluntary program established through a partnership between the United States Environmental Protection Agency and the metal finishing industry that encourages companies to move beyond environmental compliance by offering participants incentives, resources, and means for removing regulatory and policy barriers as they work to achieve specific environmental goals.
(m) “Pollution prevention” means the same as source reduction, as defined by subdivision (e) of Section 25244.14 of the Health and Safety Code.
(n) “Sensitive receptor” means a school, general acute care hospital, long-term health care facility, and child day care facility. For purposes of this subdivision, “general acute care hospital” has the meaning provided by subdivision (a) of Section 1250 of the Health and Safety Code, “long-term health care facility” has the meaning provided by subdivision (a) of Section 1418 of the Health and Safety Code, and “child day care facility” has the meaning provided by Section 1596.750 of the Health and Safety Code.
(o) “Water board” means the State Water Resources Control Board.

42101.
 (a) The agency shall work with the department, the air board, and the water board to develop a loan guarantee program, through its existing relationship with the Financial Development Corporations (FDCs) located throughout the state, to assist chrome plating facilities in purchasing high performance environmental control equipment or technologies that will enable that facility to meet new or exceed existing regulatory requirements, or both, and implement additional pollution prevention opportunities.
(b) In establishing the loan guarantee program pursuant to subdivision (a), the agency shall make every effort to integrate and leverage existing financing mechanisms for this new program, including the Treasurer’s California Pollution Control Financing Authority California Capital Access Program (CalCAP), and the California Infrastructure and Economic Development Bank’s (I-Bank) Revenue Bond program.

42101.1.
 The agency shall only make loan guarantees available to applicants that meet all of the following eligibility requirements:
(a) The applicant is a small business, as defined in subdivision (d) of Section 14837 of the Government Code.
(b) The applicant owns or operates a chrome plating facility.
(c) The applicant satisfies one of the following conditions:
(1) Has completed or is currently participating in the Model Shop Program for chrome platers.
(2) Has completed or is currently participating in the National Metal Finishing Strategic Goals Program.
(3) Is participating in a green business program whose goals are consistent with the pollution prevention and natural resource conservation elements of the Model Shop Program.
(4) Is certified as a green business whose goals are consistent with the pollution prevention and natural resource conservation elements of the Model Shop Program.
(d) Funds are not obtainable, upon reasonable terms, from financial companies, without a loan guarantee.
(e) The applicant demonstrates that the facility meets new or exceeds existing regulatory requirements, or both, has no pending local, state, or federal enforcement or correction actions, and is participating in or has completed additional pollution prevention activities.

42101.2.
 (a) The maximum amount the agency may guarantee for one applicant is one hundred thousand dollars ($100,000).
(b) All other terms and conditions are defined pursuant to Article 9 (commencing with Section 14070) of Chapter 1 of Part 5 of the Corporations Code.

42101.3.
 The agency shall carry out all of the requirements of this chapter and shall consult with the California Environmental Protection Agency, local environmental regulatory agencies, and other interested parties, as needed.

42102.4.
 (a) Notwithstanding Section 16305.7 of the Government Code, all interest or other increments resulting from the investment of the moneys in the Chrome Plating Pollution Prevention Fund pursuant to Article 4 (commencing with Section 16470) of Chapter 3 of Part 2 of Division 4 of Title 2 of the Government Code shall be deposited in the fund.
(b) The money in the fund shall be expended by the agency, upon appropriation by the Legislature, to make loan guarantees, to support the Model Shop Program pursuant to this chapter, and to pay for administrative costs associated with the implementation of this chapter. No more than 5 percent of moneys deposited into the fund may be used for administrative purposes.
(c) Loan guarantees shall be secured by a reserve of at least 25 percent.

42102.7.
 (a) On January 1, 2006, all moneys remaining in the Hazardous Waste Reduction Loan Account, created pursuant to Section 14096 of the Corporations Code, are hereby transferred to the Chrome Plating Pollution Prevention Fund created pursuant to Section 42102, and are hereby appropriated from that fund to the agency for expenditure pursuant to this chapter. Those moneys are subject to all encumbrances on those moneys made prior to January 1, 2005, and to all legal restrictions on their use other than by state statute.
(b) All moneys paid on or after January 1, 2006, to the Hazardous Waste Reduction Loan Account, for a loan issued pursuant to former Article 13 (commencing with Section 14095) of Chapter 1 of Part 5 of Division 3 of Title 1 of the Corporations Code, shall be transferred to the Chrome Plating Pollution Prevention Fund, and shall be subject to this chapter.

The agency, in collaboration with the air board, water board,, the department, and the FDCs, shall prepare and adopt criteria and procedures for evaluating applications for loan guarantees awarded pursuant to this chapter, as well as establish the appropriate requirements to determine that the equipment proposed to be purchased assists the small business in meeting new or exceeding existing applicable environmental standards. In developing these criteria, the agency shall specifically consider proximity of the facility to sensitive receptors and residences and coordinate with existing enforcement activities.

The department shall establish the Model Shop Program in northern California by replicating the existing Chrome Plating Model Shop Pilot Program, which is currently available only to southern California chrome plating facilities. In selecting participants for inclusion in the Model Shop Program, the department shall specifically consider proximity of the facility to sensitive receptors and residences and coordinate with existing enforcement activities.

42104.1.
 Not more than two hundred thousand dollars ($200,000) of the funds deposited in the Chrome Plating Pollution Prevention Fund may be used for administration and support of the Model Shop Program.

42105.
 On or before January 1, 2007, and every odd‑numbered year thereafter, the agency shall prepare a report concerning the performance of the loan guarantee program established by this chapter, including the number and size of loan guarantees made, statewide distribution of applicants, level of participation and performance of each of the FDCs, characteristics of recipients, and the amount of money spent on administering the program. This report shall be posted on the agency’s Internet Web site and notification provided to the appropriate fiscal and policy committees of the Legislature, and, upon request, to individual Members of the Legislature. The department shall provide, as a supplement to this report, an evaluation of the Model Shop Program , including recommendations for its improvement and expansion, as well as coordination with existing enforcement activities.

The agency in consultation with the air board, water board and the department, may adopt regulations to implement this chapter. The agency may adopt emergency regulations to implement the loan guarantee program in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, and for the purposes of that chapter, including Section 11346.1 of the Government Code, the adoption of these regulations is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health, and safety, and general welfare. Notwithstanding Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code, an emergency regulation adopted by the board pursuant to this section shall be filed with, but not repealed by, the Office of Administrative Law, and shall remain in effect until revised by the agency.

(a) This chapter shall remain in effect only until January 1, 2012, and as of that date is repealed, unless a later enacted statute, which is enacted before January 1, 2012, deletes or extends that date.

42107.
 (b) All unencumbered moneys in the Chrome Plating Pollution Prevention Fund on January 1, 2012, shall be transferred to the General Fund.
(c) The repeal of this chapter does not terminate any of the following rights, obligations, or authorities, or any provision necessary to carry out these rights, obligations, and authorities:
(1) The repayment of loans, outstanding as of January 1, 2012, due and payable to the relevant financial company.
(2) The resolution of any cost recovery action.

SEC. 3.

 Section 80 of Chapter 74 of the Statutes of 2005 is repealed.