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Beverage Container Recycling

February 23, 2006 - As the state’s beverage container recycling rates persist below statutory targets, the balance in the Beverage Container Recycling Fund continues to swell. We recommend that the Legislature consider options to reduce the fund balance, both by reducing monies that flow into the fund and by increasing monies that flow out of the fund to support activities intended to increase the rate of recycling.

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Ensuring Access to Telecommunications Services

February 23, 2006 - The California Public Utilities Commission administers several programs designed to subsidize telecommunications services in order to ensure universal access to these services. One of these is the California Teleconnect Fund (CTF) program, which provides discounts to schools, libraries, public hospitals and clinics, and community-based organizations (CBOs). While most of the eligible schools and libraries participate in the program, many eligible CBOs and public hospitals and clinics do not. We provide options to increase participation in the program by eligible entities.

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School Land Bank Fund Investments

February 23, 2006 - The Legislature intended that the monies in the School Land Bank Fund, managed by the State Lands Commission, be invested in land acquisitions that would generate revenue for the Teachers’ Retirement Fund (TRF). However, our review finds that the commission made no such investments over the past five years, nor does it propose to in the budget year. We therefore recommend that the balance in the School Land Bank Fund be transferred directly to TRF for investment by the California State Teachers’ Retirement System.

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Addressing State’s Flood Management Problems

February 23, 2006 - The budget proposes increased funding for flood management activities in the Department of Water Resources. Due to the critical need to improve the Central Valley flood control system, we recommend approval of this proposal. The Legislature will be evaluating other flood management proposals this session, including the Governor’s in his Strategic Growth Plan ($2.5 billion of bonds). When evaluating these proposals, the Legislature should consider: (1) the role of bond funding, (2) the relationship between land use and flood control, (3) application of “beneficiary pays” financing, and (4) the potential for increased state oversight of levees in the Delta region that are outside the Central Valley flood control system.

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Wildland Firefighters’ Employee Compensation

February 23, 2006 - A contract signed between the state and firefighters in the California Department of Forestry and Fire Protection will result in significantly increased employee compensation costs and additional staffing resources for the department. We think that is important for the Legislature—who must approve labor contracts—to have full information on the fiscal impact of changes to the department’s staffing resources, and whether less costly alternatives exist. We recommend the enactment of legislation to ensure that the Legislature is provided with sufficient information on the fiscal impacts of future contracts.

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Governor’s Hydrogen Highway Initiative

February 23, 2006 - Last year, the Legislature approved $6.5 million as initial, one-time funding for the Governor’s Hydrogen Highway Initiative. The budget proposes to increase funding for the Hydrogen Highway Initiative by an additional $6.5 million in 2006-07. We think that the requested funding is premature until the board submits a statutorily required report that will enable the Legislature to evaluate whether continued funding for this purpose is warranted.

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Governor’s Climate Change Initiative

February 23, 2006 - The budget proposes $7.2 million across several departments to implement the first steps in the Governor’s Climate Change Initiative—a series of strategies designed to reduce the state’s emissions of greenhouse gases (GHG). We recommend that the Legislature provide statutory direction for a state climate change policy that addresses a number of issues, including GHG emission reduction targets, the appropriate mix of regulatory and voluntary strategies, and lead agency designation.

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Fish and Game Fiscal Problems

February 23, 2006 - The budget fails to address the long-term structural deficit in the Fish and Game Preservation Fund (FGPF)—the fund into which revenues from the sales of hunting and fishing licenses are deposited and the department’s largest source of support. We recommend steps for the Legislature to take to address the long-term deficit problem. We further recommend that the Legislature conduct oversight hearings on the department’s fiscal problems and performance in carrying out its program responsibilities.

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Reforming the CALFED Bay-Delta Program

February 23, 2006 - Four independent management and fiscal reviews have come to similar conclusions: (1) the current CALFED governance structure is not working well, (2) state priorities for CALFED are not clear, and (3) meaningful performance measures for the program are lacking. However, the Governor’s CALFED budget proposal is “business as usual.” To accomplish a needed overhaul, we recommend the enactment of legislation addressing the governance problems, setting expenditure priorities, establishing performance measures that tie to the budget process, and defining the beneficiary pays funding principle.

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Analysis of the 2006-07 Budget Bill, Resources Chapter

February 23, 2006 - Analysis of the 2006-07 Budget Bill, Resources Chapter

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Reorganizing California’s Energy-Related Activities

February 22, 2006 - The Governor has proposed to consolidate several energy-related activities in a new Department of Energy, to be headed by a cabinet-level Secretary of Energy. The Governor’s proposal would also transfer the responsibility for permitting new electricity transmission projects from the California Public Utilities Commission to the new department. In his analysis, we describe the existing energy organizational structure in the state, consider concerns raised about the existing structure, examine key points of the Governor’s proposal, and raise issues and make recommendations for reorganizing energy-related activities in California.

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The State’s Infrastructure And the Use of Bonds: A Primer

January 3, 2006 - There has been much interest recently both by the Governor and the Legislature in investing in the state’s infrastructure and using bonds to do so. This reflects both the state’s large current and future infrastructure needs and the key role that bonds will inevitably have to play in financing them. This brief answers a number of common questions related to using bonds to fund infrastructure. These questions include the overall nature of the infrastructure needs facing California, the different options for paying for them, and key issues and concerns associated with using more bonds.review infrastructure

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A Primer: California's Wildland Fire Protection System

April 12, 2005 - California's wildland fire protection system involves multiple levels of government, requires significant levels of personnel and equipment, and relies on a complex series of interagency agreements. This primer is intended to assist the Legislature in understanding how wildland fire protection services are delivered and the major cost drivers affecting spending. We also make recommendations for increasing legislative oversight of state expenditures for wildland fire protection and for reducing these expenditures.

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Pesticide Mill Assessment: Substantial Revenue Undercollection

February 24, 2005 - We find that there has been a substantial undercollection of pesticide mill assessment revenues, and we offer a couple of options for addressing this issue. We recommend that the Department of Pesticide Regulation and the Department of Finance report at budget hearings on the options.

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Fire Protection Budget Issues

February 24, 2005 - We recommend the deletion of $10.8 million from the General Fund requested by the California Department of Forestry and Fire Protection (CDFFP) for fire apparatus and helicopters because the proposal lacks details and the plan to purchase helicopters is premature. We also recommend the deletion of $9 million from the General Fund proposed for year-round firefighting staffing in Southern California because the proposal has not been justified. Finally, we recommend a number of actions to improve legislative oversight over CDFFP’s receipt and use of unanticipated federal funds.