Legislative Analyst's Office Analysis of the 2003-04 Budget Bill

California Coastal Commission (3720)

The California Coastal Commission was created by the State Coastal Act of 1976. In general, the act seeks to protect the state's natural and scenic resources along California's coast. It also delineates a "coastal zone" running the length of the California coast, extending seaward to the state's territorial limit of three miles, and extending inland a varying width from 1,000 yards to several miles. The commission's primary responsibility is to implement the act's provisions. It is also the state's planning and management agency for the coastal zone. The commission's jurisdiction does not include the San Francisco Bay Area, where development is regulated by the Bay Conservation and Development Commission.

The Coastal Commission has its headquarters in San Francisco and six regional offices throughout the coastal zone. The commission proposes expenditures totaling $15.8 million in 2003-04. This represents a decrease of $521,000, or 3 percent, below estimated current-year expenditures. The budget proposes a reduction of $539,000 (General Fund) for the Coastal Management Program and continues the current-year elimination of $500,000 from the General Fund to assist local agencies in developing local coastal plans.

Coastal Commission's Legal Status Is Uncertain

An appeals court recently ruled that the Coastal Commission's membership structure is unconstitutional. A legislative solution has been introduced to address this legal matter.

Court Rules Commission's Membership Structure Unconstitutional. Pursuant to the Coastal Act, the commission consists of 12 voting members, four appointed by the Governor and eight appointed by the Legislature. These appointees serve two-year terms "at the will" of their appointing body. The commission acts on permits and other matters by majority vote of its members, and enforces the Coastal Act as an executive branch agency.

On December 30, 2002, the State Court of Appeals upheld a lower court ruling that the commission's membership structure is unconstitutional. The court specifically referenced how the commission's members are appointed, holding that the "separations of powers" clause of the California Constitution was violated by giving the Legislature "unrestrained power" to replace a majority of the commission's voting members. The current ruling, if upheld, would remove the authority of the commission to exercise its regulatory functions, including issuing cease and desist orders, granting or denying permits, and ruling on coastal development issues.

Practical Implications of the Court Ruling. The Attorney General requested a rehearing to clarify several points of the December 30 ruling. On January 23, 2003, the Court of Appeals denied this request. The Attorney General has indicated his intent to file an appeal of the Court of Appeals decision. Until the legal status of the Commission is finally resolved, the commission continues to exercise its regulatory authority granted to it under the Coastal Act. The legal status could be settled in a number of ways:

• The California Supreme Court could refuse to take up the Attorney General's appeal, meaning that the State Court of Appeals ruling would stand. (The Supreme Court has 90 days from the filing of the appeal to make this decision.)
• The California Supreme Court could accept to hear the Attorney General's appeal, and could later accept or overturn the lower court decision. This could take approximately one year to resolve.
• The Legislature could respond to the constitutional issues raised by the lower court decision by amending the membership structure of the commission. At the time this analysis was prepared, a number of bills had been introduced to revise the Legislature's appointment power by making legislative appointees to the Commission subject to a fixed term rather than "at the will" of the Legislature. These bills are Senate Bill 2x (Kuehl), Assembly Bill 90 (Wyland), and Assembly Bill 2x (Jackson).

Legislature Should Act to Address Coastal Commission's Legal Status. We think that it is important for the issue of the commission's legal status to be resolved in a timely manner. As long as the legality of the commission's current structure is in question, the commission's ability to enforce the Coastal Act effectively is jeopardized. We therefore recommend that the Legislature enact the legislation necessary to address this issue in a timely manner.