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SB-709 Oil spill response and contingency planning.(2017-2018)

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Date Published: 03/23/2017 09:00 PM
SB709:v98#DOCUMENT

Amended  IN  Senate  March 23, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Senate Bill No. 709


Introduced by Senator Wiener
(Coauthors: Senators Allen, Beall, Hill, McGuire, Skinner, and Stern)

February 17, 2017


An act to amend Sections 8670.2, 8670.3, 8670.29, 8670.30, and 8670.35 of 8670.35, and 8670.37.53 of, and to add and repeal Section 8574.9 of, the Government Code, relating to oil spills.


LEGISLATIVE COUNSEL'S DIGEST


SB 709, as amended, Wiener. Oil spill response and contingency planning.
The Lempert-Keene-Seastrand Oil Spill Prevention and Response Act generally requires the administrator for oil spill response, acting at the direction of the Governor, to implement activities relating to oil spill response, including emergency drills and preparedness, and oil spill containment and cleanup, and to represent the state in any coordinated response efforts with the federal government. Existing law requires the Governor to establish a California oil spill contingency plan that provides for an integrated and effective state procedure to combat the results of major oil spills within the state and that specifies state agencies to implement the plan. Existing law requires the administrator to submit to the Governor and the Legislature an amended California oil spill contingency plan that addresses marine oil spills, by January 1, 1993, and to submit revised plans every 3 years thereafter. Beginning January 1, 2017, and every 3 years thereafter, the administrator is required to submit an amended California oil spill contingency plan that addresses both marine and inland oil spills. Existing law requires the administrator to adopt and implement regulations governing the adequacy of oil spill contingency plans to be prepared and implemented and requires the regulations to provide for the best achievable protection of coastal and marine waters. Existing law requires an owner or operator of a facility, small marine fueling facility, or mobile transfer unit, or an owner or operator of a tank vessel, nontank vessel, or vessel carrying oil as secondary cargo, while operating in the waters of the state or where a spill could impact waters of the state, to have an oil spill contingency plan that complies with the rules, regulations, and policies established by the administrator, that meets specified minimum requirements, and that has been submitted to, and approved by, the administrator.
This bill would revise the act’s definition of “oil” to include both “floating oil,” as defined, and “nonfloating or potentially nonfloating oil,” as defined. The bill would require the administrator, by December 31, 2019, to establish an effective system for nonfloating or potentially nonfloating oil data collection and public reporting. The bill would require the administrator, in consultation with the Department of Fish and Wildlife, the United States Fish and Wildlife Service, the United States Coast Guard, the United States Environmental Protection Agency, and National Marine Fisheries Service, and based on the best available science, to develop and submit to the Legislature by January 1, 2019, new criteria for oil spill contingency plans applicable to nonfloating or potentially nonfloating oils and for an oil spill response organization (OSRO) that is responsible for remediating a nonfloating or potentially nonfloating oil spill necessary to protect state waters. The bill would, if nonfloating oil, such as tar sand, or potentially nonfloating oil is present, require that the oil spill contingency plan that is filed with and approved by the administrator identifies one oil spill response organization (OSRO) OSRO capable of oil spill response activities related to that nonfloating or potentially nonfloating oil. The bill would additionally require the oil spill contingency plan to describe procedures, techniques, and demonstrated technologies effective for responding to a spill of the nonfloating or potentially nonfloating oil. The bill would require that the 3-year update to the California oil spill contingency plan that addresses marine and inland oil spills that is to be revised and submitted to the Governor and the Legislature by January 1, 2020, include consideration of nonfloating or potentially nonfloating oils.
Existing law authorizes an OSRO to apply to the administrator for a rating of that OSRO’s response capabilities. Upon receiving a completed application for rating, the administrator is required to review the application and rate the OSRO based on the OSRO’s satisfactory compliance with criteria established by the administrator, including specified elements.
This bill would require that those elements include the type of oil, including nonfloating oils, such as tar sands, or potentially nonfloating oil, the OSRO is capable of recovering and containing. The bill would require any OSRO seeking a nonfloating or potentially nonfloating oil response capability rating to explain, in detail, the tools, technologies, and techniques it will deploy, including how these tools, technologies, and techniques will overcome identified challenges in remediating spills of nonfloating or potentially nonfloating oils, in order to meet the criteria developed for remediating a nonfloating or potentially nonfloating oil spill necessary to protect state waters. The bill would require that certain regulations adopted by the administrator be consistent with the 2016 United States Coast Guard OSRO classification program. program and the criteria developed for remediating nonfloating or potentially nonfloating oil spills.
The Lempert-Keene-Seastrand Oil Spill Prevention and Response Act prohibits a person from operating a marine facility, as defined, unless the owner or operator of the marine facility has obtained a certificate of financial responsibility. To receive a certificate of financial responsibility from the administrator for oil spill response, the act requires the owner or operator of a marine facility to make a specified showing of financial resources to the satisfaction of the administrator. The act authorizes the administrator to issue a certificate of financial responsibility on a lesser showing of financial resources for a period of not longer than 3 years if the administrator makes specified findings.
This bill would require that the administrator, when determining whether to issue a certificate of financial responsibility on a lesser showing of financial resources, to consider the particular risks posed by the type of oil proposed to be carried and to differentiate the risk based upon whether the oil is floating oil or nonfloating or potentially nonfloating oil.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 8574.9 is added to the Government Code, to read:

8574.9.
 (a) Using the criteria developed pursuant to subdivision (n) of Section 8670.30, the administrator shall include consideration of nonfloating or potentially nonfloating oils as part of the California oil spill contingency plan to be revised and submitted on or before January 1, 2020, that addresses marine and inland oil spills.
(b) This section shall remain in effect only until January 1, 2024, and as of that date is repealed, unless a later enacted statute that is enacted before January 1, 2024, deletes or extends that date.

SEC. 2.

 Section 8670.2 of the Government Code is amended to read:

8670.2.
 The Legislature finds and declares as follows:
(a) Each year, billions of gallons of crude oil and petroleum products are transported by vessel, railroad, truck, or pipeline over, across, under, and through the waters of this state.
(b) Recent accidents in southern California, Alaska, other parts of the nation, and Canada, have shown that transportation of oil can be a significant threat to the environment of sensitive areas.
(c) Existing prevention programs are not able to reduce sufficiently the risk of significant discharge of petroleum into state waters.
(d) Response and cleanup capabilities and technology are unable to remove consistently the majority of spilled oil when major oil spills occur in state waters.
(e) California’s lakes, rivers, other inland waters, coastal waters, estuaries, bays, and beaches are treasured environmental and economic resources that the state cannot afford to place at undue risk from an oil spill.
(f) Because of the inadequacy of existing cleanup and response measures and technology, the emphasis must be put on prevention, if the risk and consequences of oil spills are to be minimized.
(g) Improvements in the design, construction, and operation of rail tank cars, tank trucks, tank ships, terminals, and pipelines; improvements in marine safety; maintenance of emergency response stations and personnel; and stronger inspection and enforcement efforts are necessary to reduce the risks of and from a major oil spill.
(h) A major oil spill in state waters is extremely expensive because of the need to clean up discharged oil, protect sensitive environmental areas, and restore ecosystem damage.
(i) Immediate action must be taken to improve control and cleanup technology in order to strengthen the capabilities and capacities of cleanup operations.
(j) California government should improve its response and management of oil spills that occur in state waters.
(k) Those who transport oil through or near the waters of the state must meet minimum safety standards and demonstrate financial responsibility.
(l) The federal government plays an important role in preventing and responding to petroleum spills and it is in the interests of the state to coordinate with agencies of the federal government, including the Coast Guard and the United States Environmental Protection Agency, to the greatest degree possible.
(m) California has approximately 1,100 miles of coast, including four marine sanctuaries that occupy 88,767 square miles. The weather, topography, and tidal currents in and around California’s coastal ports and waterways make vessel navigation challenging. The state’s major ports are among the busiest in the world. Approximately 700 million barrels of oil are consumed annually by California, with over 500 million barrels being transported by vessel. The peculiarities of California’s maritime coast require special precautionary measures regarding oil pollution.
(n) California has approximately 158,500 square miles of interior area where there are approximately 6,800 miles of pipeline used for oil distribution, 5,800 miles of class I railroad track, and 172,100 miles of maintained roads.
(o) California must plan for the increased transport of novel crude oils, likely consisting primarily of bitumen and diluted bitumen, through its waters to reach California’s heavy oil refineries. Without immediate action to plan for this increased transport, the state’s coast and San Francisco Bay are at risk of costly and possibly irreparable bitumen or diluted bitumen spills.
(p) Immediate action must be taken to improve control and cleanup technology for nonfloating or potentially nonfloating oil spills in order to strengthen the capabilities and capacities of cleanup operations for nonfloating or potentially nonfloating oils like bitumen and diluted bitumen.
(q) The potential bioavailability and toxicity of metals, such as cadmium, copper, lead, mercury, nickel, silver, vanadium, and zinc in diluted bitumen remains little studied in contrast to the characteristics of commonly transported crudes. Some of these metals are found at higher levels in bitumen and diluted bitumen compared to other crude oils. Immediate action must be taken to better understand the toxicity, both chronic and acute, of fresh and weathered diluted bitumen and its residues to freshwater, estuarine, and marine species at various life stages. Immediate action must be taken to better understand the bioaccumulation and impacts to the food web and trophic transfer issues for diluted bitumen.

SEC. 3.

 Section 8670.3 of the Government Code is amended to read:

8670.3.
 Unless the context requires otherwise, the following definitions shall govern the construction of this chapter:
(a) “Administrator” means the administrator for oil spill response appointed by the Governor pursuant to Section 8670.4.
(b) (1) “Best achievable protection” means the highest level of protection that can be achieved through both the use of the best achievable technology and those manpower levels, training procedures, and operational methods that provide the greatest degree of protection achievable. The administrator’s determination of which measures provide the best achievable protection shall be guided by the critical need to protect valuable natural resources and state waters, while also considering all of the following:
(A) The protection provided by the measure.
(B) The technological achievability of the measure.
(C) The cost of the measure.
(2) The administrator shall not use a cost-benefit or cost-effectiveness analysis or any particular method of analysis in determining which measures provide the best achievable protection. The administrator shall instead, when determining which measures provide best achievable protection, give reasonable consideration to the protection provided by the measures, the technological achievability of the measures, and the cost of the measures when establishing the requirements to provide the best achievable protection for the natural resources of the state.
(c) (1) “Best achievable technology” means that technology that provides the greatest degree of protection, taking into consideration both of the following:
(A) Processes that are being developed, or could feasibly be developed anywhere in the world, given overall reasonable expenditures on research and development.
(B) Processes that are currently in use anywhere in the world.
(2) In determining what is the best achievable technology pursuant to this chapter, the administrator shall consider the effectiveness and engineering feasibility of the technology.
(d) “California oil spill contingency plan” means the California oil spill contingency plan prepared pursuant to Article 3.5 (commencing with Section 8574.1) of Chapter 7.
(e) “Dedicated response resources” means equipment and personnel committed solely to oil spill response, containment, and cleanup that are not used for any other activity that would adversely affect the ability of that equipment and personnel to provide oil spill response services in the timeframes for which the equipment and personnel are rated.
(f) “Environmentally sensitive area” means an area defined pursuant to the applicable area contingency plans or geographic response plans, as created and revised by the Coast Guard, the United States Environmental Protection Agency, and the administrator.
(g) (1) “Facility” means any of the following located in state waters or located where an oil spill may impact state waters:
(A) A building, structure, installation, or equipment used in oil exploration, oil well drilling operations, oil production, oil refining, oil storage, oil gathering, oil processing, oil transfer, oil distribution, or oil transportation.
(B) A marine terminal.
(C) A pipeline that transports oil.
(D) A railroad that transports oil as cargo.
(E) A drill ship, semisubmersible drilling platform, jack-up type drilling rig, or any other floating or temporary drilling platform.
(2) “Facility” does not include any of the following:
(A) A vessel, except a vessel located and used for any purpose described in subparagraph (E) of paragraph (1).
(B) An owner or operator subject to Chapter 6.67 (commencing with Section 25270) or Chapter 6.75 (commencing with Section 25299.10) of Division 20 of the Health and Safety Code.
(C) Operations on a farm, nursery, logging site, or construction site that are either of the following:
(i) Do not exceed 20,000 gallons in a single storage tank.
(ii) Have a useable tank storage capacity not exceeding 75,000 gallons.
(D) A small craft refueling dock.
(h) “Local government” means a chartered or general law city, a chartered or general law county, or a city and county.
(i) (1) “Marine terminal” means any facility used for transferring oil to or from a tank ship or tank barge.
(2) “Marine terminal” includes, for purposes of this chapter, all piping not integrally connected to a tank facility, as defined in subdivision (n) of Section 25270.2 of the Health and Safety Code.
(j) “Marine waters” means those waters subject to tidal influence, and includes the waterways used for waterborne commercial vessel traffic to the Port of Sacramento and the Port of Stockton.
(k) “Mobile transfer unit” means a vehicle, truck, or trailer, including all connecting hoses and piping, used for the transferring of oil at a location where a discharge could impact waters of the state.
(l) “Nondedicated response resources” means those response resources identified by an Oil Spill Response Organization for oil spill response activities that are not dedicated response resources.
(m) “Nonpersistent oil” means a petroleum-based oil, such as gasoline or jet fuel, that evaporates relatively quickly and is an oil with hydrocarbon fractions, at least 50 percent of which, by volume, distills at a temperature of 645 degrees Fahrenheit, and at least 95 percent of which, by volume, distills at a temperature of 700 degrees Fahrenheit.
(n) “Nontank vessel” means a vessel of 300 gross tons or greater that carries oil, but does not carry that oil as cargo.
(o) “Oil” includes both floating oil and nonfloating or potentially nonfloating oil. For these purposes, “floating oil” means any kind of petroleum, liquid hydrocarbons, or petroleum products or any fraction or residues therefrom, including, but not limited to, crude oil, bunker fuel, gasoline, diesel fuel, aviation fuel, oil sludge, oil refuse, oil mixed with waste, and liquid distillates from unprocessed natural gas. therefrom with a specific gravity less than one that has also been shown to float in saline and fresh waters, despite the weathering process. For these purposes, “nonfloating or potentially nonfloating oil” means any kind of petroleum, liquid hydrocarbons, or petroleum product or any fraction or residue therefrom with a specific gravity greater than one, or that has been shown to behave like such products after the weathering process has begun. “Nonfloating or potentially nonfloating oil” include, but is not limited to, diluted bitumen, synbit, rawbit, bitumen, Venezuelan crude, Mexican Maya crude, asphalt, coal tar, carbon black, No. 5 (Bunker B) and No. 6 (Bunker C) fuel oils, and all Group V oils as defined by Section 155.1020 of Title 33 of the Code of Federal Regulations.
(p) “Oil spill cleanup agent” means a chemical, or any other substance, used for removing, dispersing, or otherwise cleaning up oil or any residual products of petroleum in, or on, any of the waters of the state.
(q) “Oil spill contingency plan” or “contingency plan” means the oil spill contingency plan required pursuant to Article 5 (commencing with Section 8670.28).
(r) (1) “Oil spill response organization” or “OSRO” means an individual, organization, association, cooperative, or other entity that provides, or intends to provide, equipment, personnel, supplies, or other services directly related to oil spill containment, cleanup, or removal activities.
(2) “OSRO” does not include an owner or operator with an oil spill contingency plan approved by the administrator or an entity that only provides spill management services, or who provides services or equipment that are only ancillary to containment, cleanup, or removal activities.
(s) (1) “Owner” or “operator” means any of the following:
(A) In the case of a vessel, a person who owns, has an ownership interest in, operates, charters by demise, or leases the vessel.
(B) In the case of a facility, a person who owns, has an ownership interest in, or operates the facility.
(C) Except as provided in subparagraph (D), in the case of a vessel or facility, where title or control was conveyed due to bankruptcy, foreclosure, tax delinquency, abandonment, or similar means to an entity of state or local government, a person who owned, held an ownership interest in, operated, or otherwise controlled activities concerning the vessel or facility immediately beforehand.
(D) An entity of the state or local government that acquired ownership or control of a vessel or facility, when the entity of the state or local government has caused or contributed to a spill or discharge of oil into waters of the state.
(2) “Owner” or “operator” does not include a person who, without participating in the management of a vessel or facility, holds indicia of ownership primarily to protect the person’s security interest in the vessel or facility.
(3) “Operator” does not include a person who owns the land underlying a facility or the facility itself if the person is not involved in the operations of the facility.
(t) “Person” means an individual, trust, firm, joint stock company, or corporation, including, but not limited to, a government corporation, partnership, and association. “Person” also includes a city, county, city and county, district, and the state or any department or agency thereof, and the federal government, or any department or agency thereof, to the extent permitted by law.
(u) “Pipeline” means a pipeline used at any time to transport oil.
(v) “Railroad” means a railroad, railway, rail car, rolling stock, or train.
(w) “Rated OSRO” means an OSRO that has received a satisfactory rating from the administrator for a particular rating level established pursuant to Section 8670.30.
(x) “Response efforts” means rendering care, assistance, or advice in accordance with the National Contingency Plan, the California oil spill contingency plan, or at the direction of the administrator, the United States Environmental Protection Agency, or the United States Coast Guard in response to a spill or a threatened spill into waters of the state.
(y) “Responsible party” or “party responsible” means any of the following:
(1) The owner or transporter of oil or a person or entity accepting responsibility for the oil.
(2) The owner, operator, or lessee of, or a person that charters by demise, a vessel or facility, or a person or entity accepting responsibility for the vessel or facility.
(z) “Small craft” means a vessel, other than a tank ship or tank barge, that is less than 20 meters in length.
(aa) “Small craft refueling dock” means a waterside operation that dispenses only nonpersistent oil in bulk and small amounts of persistent lubrication oil in containers primarily to small craft and meets both of the following criteria:
(1) Has tank storage capacity not exceeding 20,000 gallons in any single storage tank or tank compartment.
(2) Has total usable tank storage capacity not exceeding 75,000 gallons.
(ab) “Small marine fueling facility” means either of the following:
(1) A mobile transfer unit.
(2) A fixed facility that is not a marine terminal, that dispenses primarily nonpersistent oil, that may dispense small amounts of persistent oil, primarily to small craft, and that meets all of the following criteria:
(A) Has tank storage capacity greater than 20,000 gallons but not more than 40,000 gallons in any single storage tank or storage tank compartment.
(B) Has total usable tank storage capacity not exceeding 75,000 gallons.
(C) Had an annual throughput volume of over-the-water transfers of oil that did not exceed 3,000,000 gallons during the most recent preceding 12-month period.
(ac) “Spill,” “discharge,” or “oil spill” means a release of any amount of oil into waters of the state that is not authorized by a federal, state, or local government entity.
(ad) “Tank barge” means a vessel that carries oil in commercial quantities as cargo but is not equipped with a means of self-propulsion.
(ae) “Tank ship” means a self-propelled vessel that is constructed or adapted for the carriage of oil in bulk or in commercial quantities as cargo.
(af) “Tank vessel” means a tank ship or tank barge.
(ag) “Vessel” means a watercraft or ship of any kind, including every structure adapted to be navigated from place to place for the transportation of merchandise or persons.
(ah) “Vessel carrying oil as secondary cargo” means a vessel that does not carry oil as a primary cargo, but does carry oil as cargo. The administrator may establish minimum oil volume amounts or other criteria by regulations.
(ai) “Waters of the state” or “state waters” means any surface water, including saline waters, marine waters, and freshwaters, within the boundaries of the state but does not include groundwater.

SECTION 1.SEC. 4.

 Section 8670.29 of the Government Code is amended to read:

8670.29.
 (a) In accordance with the rules, regulations, and policies established by the administrator pursuant to Section 8670.28, an owner or operator of a facility, small marine fueling facility, or mobile transfer unit, or an owner or operator of a tank vessel, nontank vessel, or vessel carrying oil as secondary cargo, while operating in the waters of the state or where a spill could impact waters of the state, shall have an oil spill contingency plan that has been submitted to, and approved by, the administrator pursuant to Section 8670.31. An oil spill contingency plan shall ensure the undertaking of prompt and adequate response and removal action in case of a spill, shall be consistent with the California oil spill contingency plan, and shall not conflict with the National Oil and Hazardous Substances Pollution Contingency Plan (NCP).
(b) An oil spill contingency plan shall, at a minimum, meet all of the following requirements:
(1) Be a written document, reviewed for feasibility and executability, and signed by the owner or operator, or his or her designee.
(2) Provide for the use of a recognized incident command system to be used during a spill.
(3) Provide procedures for reporting oil spills to local, state, and federal agencies, and include a list of contacts to call in the event of a drill, threatened spill, or spill.
(4) Describe the communication plans to be used during a spill, if different from those used by a recognized incident command system.
(5) Describe the strategies for the protection of environmentally sensitive areas.
(6) Identify at least one rated OSRO for each rating level established pursuant to Section 8670.30. Each identified rated OSRO shall be directly responsible by contract, agreement, or other approved means to provide oil spill response activities pursuant to the oil spill contingency plan. A rated OSRO may provide oil spill response activities individually, or in combination with another rated OSRO, for a particular owner or operator. If nonfloating oil, such as tar sand, or potentially nonfloating oil is present, the contingency plan shall identify at least one OSRO capable of oil spill response activities related to that nonfloating or potentially nonfloating oil.
(7) Identify a qualified individual.
(8) Provide the name, address, and telephone and facsimile numbers for an agent for service of process, located within the state and designated to receive legal documents on behalf of the owner or operator.
(9) Provide for training and drills on elements of the plan at least annually, with all elements of the plan subject to a drill at least once every three years.
(10) If nonfloating oil, such as tar sand, or potentially nonfloating oil is present, describe procedures, techniques, and demonstrated technologies effective for responding to a spill of the nonfloating or potentially nonfloating oil, including a description of any limitations of those procedures, techniques, and technologies and alternative procedures, techniques and demonstrated technologies that can overcome these limitations.
(c) An oil spill contingency plan for a vessel shall also include, but is not limited to, all of the following requirements:
(1) The plan shall be submitted to the administrator at least seven days prior to the vessel entering waters of the state.
(2) The plan shall provide evidence of compliance with the International Safety Management Code, established by the International Maritime Organization, as applicable.
(3) If the oil spill contingency plan is for a tank vessel, the plan shall include both of the following:
(A) The plan shall specify oil and petroleum cargo capacity.
(B) The plan shall specify the types of oil and petroleum cargo carried.
(4) If the oil spill contingency plan is for a nontank vessel, the plan shall include both of the following:
(A) The plan shall specify the type and total amount of fuel carried.
(B) The plan shall specify the capacity of the largest fuel tank.
(d) An oil spill contingency plan for a facility shall also include, but is not limited to, all of the following provisions, as appropriate:
(1) Provisions for site security and control.
(2) Provisions for emergency medical treatment and first aid.
(3) Provisions for safety training, as required by state and federal safety laws for all personnel likely to be engaged in oil spill response.
(4) Provisions detailing site layout and locations of environmentally sensitive areas requiring special protection.
(5) Provisions for vessels that are in the operational control of the facility for loading and unloading.
(e) Unless preempted by federal law or regulations, an oil spill contingency plan for a railroad also shall include, but is not limited to, all of the following:
(1) A list of the types of train cars that may make up the consist.
(2) A list of the types of oil and petroleum products that may be transported.
(3) A map of track routes and facilities.
(4) A list, description, and map of any prestaged spill response equipment and personnel for deployment of the equipment.
(f) The oil spill contingency plan shall be available to response personnel and to relevant state and federal agencies for inspection and review.
(g) The oil spill contingency plan shall be reviewed periodically and updated as necessary. All updates shall be submitted to the administrator pursuant to this article.
(h) In addition to the regulations adopted pursuant to Section 8670.28, the administrator shall adopt regulations and guidelines to implement this section. The regulations and guidelines shall provide for the best achievable protection of waters and natural resources of the state. The administrator may establish additional oil spill contingency plan requirements, including, but not limited to, requirements based on the different geographic regions of the state. All regulations and guidelines shall be developed in consultation with the Oil Spill Technical Advisory Committee.
(i) Notwithstanding subdivision (a) and paragraph (6) of subdivision (b), a vessel or facility operating where a spill could impact state waters that are not tidally influenced shall identify a rated OSRO in the contingency plan no later than January 1, 2016.

SEC. 2.SEC. 5.

 Section 8670.30 of the Government Code is amended to read:

8670.30.
 (a) An oil spill response organization may apply to the administrator for a rating of that OSRO’s response capabilities. The administrator shall establish rating levels for classifying OSROs pursuant to subdivision (b).
(b) Upon receiving a completed application for rating, the administrator shall review the application and rate the OSRO based on the OSRO’s satisfactory compliance with criteria established by the administrator, which shall include, but is not limited to, all of the following elements:
(1) The geographic region or regions of the state where the OSRO intends to operate.
(2) Timeframes for having response resources on-scene and deployed.
(3) The type of equipment that the OSRO will use and the location of the stored equipment.
(4) The volume of oil that the OSRO is capable of recovering and containing.
(5) The type of oil, including nonfloating oils, such as tar sands, or potentially nonfloating oil, the OSRO is capable of recovering and containing.
(c) The administrator shall not issue a rating until the applicant OSRO completes an unannounced drill. The administrator may call a drill for every distinct geographic area in which the OSRO requests a rating. The drill shall test the resources and response capabilities of the OSRO, including, but not limited to, on water containment and recovery, environmentally sensitive habitat protection, and storage. If an OSRO fails to successfully complete a drill, the administrator shall not issue the requested rating, but the administrator may rate the OSRO at a rating lesser than the rating sought with the application. If an OSRO is denied a requested rating, the OSRO may reapply for rating.
(d) A rating issued pursuant to this section shall be valid for three years unless modified, suspended, or revoked. The administrator shall review the rating of each rated OSRO at least once every three years. The administrator shall not renew a rating unless the OSRO meets criteria established by the administrator, including, at a minimum, that the rated OSRO periodically tests and drills itself, including testing protection of environmentally sensitive sites, during the three-year period.
(e) The administrator shall require a rated OSRO to demonstrate that the rated OSRO can deploy the response resources required to meet the applicable provisions of an oil spill contingency plan in which the OSRO is listed. These demonstrations may be achieved through inspections, announced and unannounced drills, or by any other means.
(f) (1) Except as provided in paragraph (6), each rated OSRO shall satisfactorily complete at least one unannounced drill every three years after receiving its rating.
(2) The administrator may modify, suspend, or revoke an OSRO’s rating if a rated OSRO fails to satisfactorily complete a drill.
(3) The administrator may require the satisfactory completion of one unannounced drill of each rated OSRO prior to being granted a modified rating, and shall require satisfactory completion of one unannounced drill for each rated OSRO prior to being granted a renewal or prior to reinstatement of a revoked or suspended rating.
(4) A drill for the protection of environmentally sensitive areas shall conform as close as possible to the response that would occur during a spill but sensitive sites shall not be damaged during the drill.
(5) The response resources to be deployed by a rated OSRO within the first six hours of a spill or drill shall be dedicated response resources or be owned and controlled by a rated OSRO that are sufficient to meet the spill response planning requirements of the OSRO’s client owner or operator. This requirement does not preclude a rated OSRO from bringing in additional response resources. The administrator may, by regulation, permit a lesser requirement for dedicated or OSRO owned and controlled response resources for shoreline protection.
(6) The administrator may determine that actual satisfactory spill response performance during the previous three years may be substituted in lieu of a drill.
(7) The administrator shall issue a written report evaluating the performance of the OSRO after every unannounced drill called by the administrator.
(8) The administrator shall determine whether an unannounced drill called upon an OSRO by a federal agency during the previous three years qualifies as an unannounced drill for the purposes of this subdivision.
(g) Each rated OSRO shall provide reasonable notice to the administrator about each future drill, and the administrator, or his or her designee, may attend the drill.
(h) The costs incurred by an OSRO to comply with this section and the regulations adopted pursuant to this section, including drills called by the administrator, shall be the responsibility of the OSRO. All local, state, and federal agency costs incurred in conjunction with participation in a drill shall be borne by each respective agency.
(i) (1) A rating awarded pursuant to this section is personal and applies only to the OSRO that receives that rating and the rating is not transferable, assignable, or assumable. A rating does not constitute a possessory interest in real or personal property.
(2) If there is a change in ownership or control of the OSRO, the rating of that OSRO is null and void and the OSRO shall file a new application for a rating pursuant to this section.
(3) For purposes of this subdivision, a “change in ownership or control” includes, but is not limited to, a change in corporate status, or a transfer of ownership that changes the majority control of voting within the entity.
(j) The administrator may charge a reasonable fee to process an application for, or renewal of, a rating.
(k) The administrator shall adopt regulations to implement this section as appropriate. At a minimum, the regulations shall appropriately address all of the following:
(1) Criteria for successful completion of a drill.
(2) The amount and type of response resources that are required to be available to respond to a particular volume of spilled oil during specific timeframes within a particular region.
(3) Regional requirements.
(4) Training.
(5) The process for applying for a rating, and for suspension, revocation, appeal, or other modification of a rating.
(6) Ownership and employment of response resources.
(7) Conditions for canceling a drill due to hazardous or other operational circumstances.
(l) Any letter of approval issued from the administrator before January 1, 2002, that rates an OSRO shall be deemed to meet the requirements of this section for three years from the date of the letter’s issuance or until January 1, 2003, whichever date occurs later.
(m) By December 31, 2018, the administrator shall establish an effective system for nonfloating and potentially nonfloating oil data collection and public reporting.
(n) Pursuant to Section 8670.37, the administrator, in consultation with the Department of Fish and Wildlife, the United States Fish and Wildlife Service, the United States Coast Guard, the United States Environmental Protection Agency, and the National Marine Fisheries Service, and based on the best available science, shall develop and recommend to the Legislature new criteria for oil spill contingency plans applicable to nonfloating or potentially nonfloating oils and for an OSRO that is responsible for remediating a nonfloating or potentially nonfloating oil spill necessary to protect state waters. The recommendations shall be developed and submitted to the Legislature by January 1, 2019. Upon appropriation by the Legislature, the administrator may expend moneys from the Oil Spill Prevention and Administration Fund as necessary for the purpose of carrying out this article.
(o) The administrator shall require any OSRO seeking a nonfloating or potentially nonfloating oil response capability rating to explain, in detail, the tools, technologies, and techniques it will deploy, including how these tools, technologies, and techniques will overcome identified challenges in remediating spills of nonfloating or potentially nonfloating oils, in order to meet the criteria developed pursuant to subdivision (n).

SEC. 3.SEC. 6.

 Section 8670.35 of the Government Code is amended to read:

8670.35.
 (a) The administrator, taking into consideration the California oil spill contingency plan, shall promulgate regulations regarding the adequacy of oil spill elements of area plans required pursuant to Section 25503 of the Health and Safety Code. In developing the regulations, the administrator shall consult with the Oil Spill Technical Advisory Committee.
(b) The administrator may offer, to a unified program agency with jurisdiction over or directly adjacent to waters of the state, a grant to complete, update, or revise an oil spill element of the area plan.
(c) Each oil spill element established under this section shall include provisions for training fire and police personnel in oil spill response and cleanup equipment use and operations.
(d) Each oil spill element prepared under this section shall be consistent with the local government’s local coastal program as certified under Section 30500 of the Public Resources Code, the California oil spill contingency plan, the National Contingency Plan, and the 2016 United States Coast Guard OSRO classification program. program, to the extent this program is consistent with the criteria developed pursuant to subdivision (n) of Section 8670.30.
(e) If a grant is awarded, the administrator shall review and approve each oil spill element established pursuant to this section. If, upon review, the administrator determines that the oil spill element is inadequate, the administrator shall return it to the agency that prepared it, specifying the nature and extent of the inadequacies, and, if practicable, suggesting modifications. The unified program agency shall submit a new or modified element within 90 days after the element was returned, responding to the findings and incorporating any suggested modifications.
(f) The administrator shall review the preparedness of unified program agencies to determine whether a program of grants for completing oil spill elements is desirable and should be continued. If the administrator determines that local government preparedness should be improved, the administrator shall request the Legislature to appropriate funds from the Oil Spill Prevention and Administration Fund for the purposes of this section.

SEC. 7.

 Section 8670.37.53 of the Government Code is amended to read:

8670.37.53.
 (a) To receive a certificate of financial responsibility for a tank vessel or for all of the oil contained within that vessel, the applicant shall demonstrate to the satisfaction of the administrator the financial ability to pay at least one billion dollars ($1,000,000,000) for any damages that may arise during the term of the certificate.
(b) The administrator may establish a lower standard of financial responsibility for small tank barges, vessels carrying oil as a secondary cargo, and small marine fueling facilities. The standard shall be based on the quantity of oil that can be carried or stored stored, the particular risks posed by the type of oil proposed to be carried, and the risk of spill into waters of the state. The administrator shall not set a standard that is less than the expected costs from a reasonable worst case oil spill into waters of the state.
(c) (1) To receive a certificate of financial responsibility for a facility, the applicant shall demonstrate to the satisfaction of the administrator the financial ability to pay for any damages that might arise during a reasonable worst case oil spill into waters of the state that results from the operations of the facility. The administrator shall consider criteria including, but not necessarily limited to, the amount of oil that could be spilled into waters of the state from the facility, the cost of cleaning up spilled oil, the frequency of operations at the facility, and the damages that could result from a spill.
(2) When making financial responsibility determinations pursuant to this section, the administrator shall differentiate the risk based upon whether the oil is floating oil or nonfloating or potentially nonfloating oil.

(2)

(3) The administrator shall adopt regulations to implement this section.