• Major Issues

  • Overview

  • Spending by Major Program
  • Major Budget Changes

Major Issues

Lack Defined Objectives

• The Governor's coastal, watershed, and land acquisition initiatives need (1) better defined objectives and measurable goals, (2) coordination with existing state programs and policies, (3) identification of long-term costs and funding sources, and (4) greater legislative oversight over policy direction. (See page B-13.)

Expansion of NCCP Program Needs

Legislative Policy Review

• We recommend that increased funding for the Natural Community Conservation Planning (NCCP) Program be denied because the policy of the state's funding land acquisition for the program ought to first be determined statutorily by the Legislature. (See page B-50.)

River Parkway Program Lacks Goals and Criteria

To Prioritize Projects

• Although the budget proposes to spend all Proposition 204 funds available for the River Parkway Program ($27 million) in 1997-98, the program's goals are not yet defined and criteria to prioritize funding of the projects are lacking. (See page B-23.)

Proposed Fire-Related Reductions

Are "Penny-Wise, Pound Foolish"

• Proposed reductions in funding for fire protection and vegetation management by the California Department of Forestry and Fire Protection are likely to result in increased General Fund expenditures for emergency fire suppression and inmate custody. (See page B-46.)

Waste Board Makes Late Decisions

• Historically, the Integrated Waste Management Board waits until after the budget is enacted to make decisions about tire recycling program priorities, thereby reducing legislative oversight and delaying program implementation. With no proposal for 1997-98 allocation of grants and contracts, we recommend the proposed increase of $5.4 million be denied. (See page B-79.)

Fee Changes Should Be Considered

For Hazardous Material Cleanup

• The Legislature should (1) reinstate a fee on railroad and trucking companies that carry hazardous materials in order to fund the "RAPID" emergency response program (see page B-85), and (2) consider using broad-based fees to supplement the General Fund to meet increasing funding requirements for direct site cleanup at "orphan" hazardous waste sites (see page B-87).

Overview

Expenditures for resources and environmental protection programs from the General Fund and various special funds are proposed to total $2.3 billion in 1997-98, which is 3.5 percent of all state-funded expenditures proposed for 1997-98. This level is an increase of $56.7 million, or 2.5 percent, above estimated expenditures for the current year. About 63 percent ($1.4 billion) of state support for these programs will come from special funds, including the Motor Vehicle Account, Environmental License Plate Fund, bond funds, funds generated by beverage container recycling fees, and an "insurance fund" for the cleanup of leaking underground storage tanks. The General Fund supports the remaining 37 percent of these expenditures.

Figure 1 (see next page) shows that state expenditures for resources and environmental protection programs increased by approximately $618.5 million since 1990-91, representing an average annual increase of approximately 4.6 percent. This increase primarily reflects the establishment of various programs to address environmental problems such as leaking underground tanks, hazardous waste sites, and solid waste generation. When adjusted for inflation, these expenditures increased at an average annual rate of 2.2 percent. General Fund expenditures increased at an average annual rate of about 0.9 percent over this period. When adjusted for inflation, these expenditures decreased at an average rate of 1.4 percent per year.

Spending by Major Program

Figure 3 (see page 8) shows similar information for major environmental protection programs--those programs within the jurisdiction of the Secretary for Environmental Protection and the California Environmental Protection Agency.

Spending for Resources Programs. Figure 2 shows that the General Fund provides a relatively small proportion of total support for resources programs except in the case of the California Department of Forestry and Fire Protection (CDFFP) and the Department of Parks and Recreation (DPR). For 1997-98, the budget proposes $298.8 million (65 percent) of CDFFP's support and capital outlay expenditures from the General Fund. For DPR, the General Fund will constitute about 30 percent of the department's expenditures in 1997-98.

Figure 2 also shows that the budget proposes a significant reduction in the 1997-98 expenditures for CDFFP in 1997-98. The reduction reflects primarily a base level of funding for emergency firefighting of $20 million

Figure 2
Resources Budget Summary Selected Funding Sources 1995-96 Through 1997-98
(Dollars in Millions)
Department	Actual 1995-96	Estimated 1996-97	Proposed 1997-98	Change From 1996-97
				Amount	Percent
Conservation
General Fund	$14.5	$15.1	$16.3	$1.2	7.9%
Recycling funds	343.2	379.3	381.0	1.7	0.4
Other funds	14.2	16.2	19.6	3.4	30.0
Totals	$371.9	$410.6	$416.9	$6.3	1.5%
Forestry and Fire Protection
General Fund	$321.8	$387.4	$298.8	-$88.6	-22.9%
Forest Resources Improvement Fund	14.9	14.7	14.5	-0.2	-1.4
Environmental License Plate Fund	4.0	4.0	0.8	-3.2	-80.0
Other funds	102.5	139.0	142.9	3.9	2.8
Totals	$443.2	$545.1	$457.0	-$88.1	-16.2%
Fish and Game
General Fund	$3.1	$3.1	$5.1	$2.0	64.5%
Fish and Game Preservation Fund	83.4	77.0	85.4	8.4	10.9
Environmental License Plate Fund	9.9	11.3	10.7	-0.6	-5.3
Other funds	70.1	77.1	92.2	15.1	19.6
Totals	$166.5	$168.5	$193.4	$24.9	14.8%
Parks and Recreation
General Fund	$49.8	$73.0	$72.0	-$1.0	-1.4%
State Parks and Recreation Fund	90.8	81.7	81.4	-0.3	-0.4
Park bond funds	21.6	25.7	7.1	-18.6	-72.4
Other funds	57.6	86.5	81.6	-4.9	-5.7
Totals	$219.8	$266.9	$242.1	-$24.8	-9.3%
Water Resources
General Fund	$19.8	$29.1	$27.2	-$1.9	-6.5%
State Water Project funds	798.2	699.5	633.1	-66.4	-9.5
Delta Flood Protection	5.7	9.1	15.4	6.3	69.2
Other funds	34.8	172.8	184.3	11.5	6.6
Totals	$858.5	$910.5	$860.0	-$50.5	-5.5%

Figure 3
Environmental Protection Budget Summary Selected Funding Sources 1995-96 Through 1997-98
(Dollars in Millions)
Department/Board	Actual 1995-96	Estimated 1996-97	Proposed 1997-98	Change From 1996-97
				Amount	Percent
Air Resources
Motor Vehicle Account	$74.5	$74.4	$74.3	-$0.1	-0.1%
Other funds	35.1	35.9	35.2	-0.7	-1.9
Totals	$109.6	$110.3	$109.5	-$0.8	-0.7%
Waste Management
Integrated Waste Management Account	$33.6	$33.4	$31.4	-$2.0	-6.0%
Used Oil Recycling Fund	24.8	24.1	23.9	-0.2	-0.8
Tire Recycling Management Fund	3.7	5.5	8.8	3.3	60.0
Other funds	6.9	18.1	12.9	-5.2	-28.7
Totals	$69.0	$81.1	$77.0	-$4.1	-5.1%
Pesticide Regulation
General Fund	$10.6	$10.9	$10.9	--	--
Pesticide Regulation Fund	30.8	33.6	30.6	-$3.0	-8.9%
Other funds	5.0	6.5	5.6	-0.9	-13.8
Totals	$46.4	$51.0	$47.1	-$3.9	-7.6%
Water Resources Control
General Fund	$28.2	$28.6	$36.7	$8.1	28.3%
Underground Storage Tank Cleanup Fund	140.8	154.1	244.0	89.9	58.3
Waste Discharge Permit Fund	16.7	14.1	12.1	-2.0	-14.2
Bond funds	32.0	57.5	90.3	32.8	57.0
Other funds	183.4	58.8	51.4	-7.4	-12.6
Totals	$401.4	$313.1	$434.5	$121.4	38.8%
Toxic Substances Control
General Fund	$2.6	$15.7	$41.6	$25.9	165.0%
Hazardous Waste Control Account	57.7	54.4	51.1	-3.3	-6.1
Other funds	58.0	66.5	50.1	-16.4	-24.7
Totals	$118.3	$136.6	$142.8	$6.2	4.5%

in the budget year rather than anticipated expenditures. As actual emergency firefighting expenditures exceed that base amount, additional funds will be provided through subsequent deficiency appropriations. The budget also proposes reductions in DPR's 1997-98 expenditures by 9.3 percent and reductions of 5.5 percent in the Department of Water Resources (DWR) expenditures. For DPR, the reductions are mainly in park development due to the depletion of park bond funds. In the case of DWR, reductions are due to an anticipated decline in expenditures for construction and operation of the State Water Project.

For the Department of Fish and Game (DFG), the budget proposes higher expenditures in 1997-98. The increased expenditures will be primarily from the Fish and Game Preservation Fund and bond funds authorized by Proposition 204, passed by voters in November 1996.

In addition to the major programs shown in Figure 2, the budget proposes expenditures by other resources programs totaling $269.7 million, an increase of $50.2 million (23 percent) over current-year estimated expenditures. These programs include various land conservancies, commissions, the Department of Boating and Waterways, and the California Conservation Corps. Specifically, the budget proposes significant increases in the State Coastal Conservancy ($12.8 million, or 61 percent over current-year estimated expenditures); the Department of Boating and Waterways ($19.6 million, or 41 percent); and the California Conservation Corps ($11.4 million, or 18 percent).

Spending for Environmental Protection Programs. As Figure 3 shows, the budget proposes significant increases in the State Water Resources Control Board (SWRCB) expenditures in 1997-98. Specifically, the budget proposes increases in payments to tank owners for underground storage tank cleanup and in local loans and grants for water quality and treatment projects funded from Proposition 204 bonds. The budget also proposes to increase the SWRCB's General Fund support by $8.1 million.

Similarly, the budget proposes General Fund support for the Department of Toxic Substances Control (DTSC) to increase significantly (by $41.6 million), to 29 percent of the department's total 1997-98 expenditures. The increase is due to costs to clean up two hazardous disposal sites (Stringfellow and Casmalia) where the state has been found responsible for the contamination.

For the Department of Pesticide Regulation, the budget proposes to keep General Fund support for the department at $10.9 million, the same level as in the current year. This is about 23 percent of total support of the department.

Major Budget Changes

As Figure 4 shows, the budget proposes various increases in land stewardship programs, including habitat conservation planning and the Natural Community Conservation Planning program under DFG. The budget also proposes significant increases in funding for fish and wildlife habitat preservation and restoration. Specifically, the budget proposes $13.4 million for salmon restoration by DFG. In addition, $24 million in Proposition 204 bond funds is proposed for fish and wildlife habitat restoration by DWR.

For DWR, the budget also proposes to increase expenditures for various water conservation and development projects as well as local flood control and levee rehabilitation in 1997-98. Funding for these increases will mainly come from Proposition 204 bond funds. At the same time, due to the completion of construction of portions of the State Water Project, the budget proposes to reduce departmental engineering and design accordingly.

Figure 5 shows that the budget proposes reductions in the Air Resources Board (ARB) and the California Integrated Waste Management Board (CIWMB) as a result of fee expiration or a decline in revenues. In the case of ARB, the budget proposes a reduction of $3 million in stationary source pollution control to reflect the expiration of fees on nonvehicular sources imposed by the California Clean Air Act. For CIWMB, the budget proposes various support and local assistance reductions of $2.2 million due to the continued decline in revenues to the Integrated Waste Management Account. The budget, however, proposes to increase waste tire cleanup by CIWMB by $5.4 million in 1997-98.

Figure 5 also shows that the budget proposes significant increases in the expenditures of the SWRCB. In particular, the budget proposes an increase of $90 million to reimburse tank owners for the costs of cleaning up underground storage tanks. The budget also proposes $7.4 million from the General Fund to restore funding for water quality planning, permitting, and enforcement. Additionally, the budget proposes expenditures of $54 million from Proposition 204 bond funds for local water quality projects.

For the DTSC, the budget proposes General Fund expenditures of $6 million for direct site cleanup at hazardous waste sites.

Figure 4
Resources Programs Proposed Major Changes for 1997-98
	Forestry and Fire Protection	Requested:	$457 Million
		Decrease:	$88.1 Million	(-16.2%)
	+$15.2 million for locally reimbursed fire protection services
	+$4.4 million to refurbish airtankers
	-$2.5 million in fire protection activities including support of conservation camp crews
	Fish and Game	Requested:	$193.4 Million
		Increase:	$24.9 Million	(+14.8%)
	+$13.4 million for salmon restoration
	+$3.1 million for support and local assistance of the Natural Community Conservation Planning program
	+$3 million to develop the California oiled wildlife care network
	+$2.6 million for habitat conservation planning, land stewardship, and riparian programs
	Parks and Recreation	Requested:	$242.1 Million
		Decrease:	$24.8 Million	(-9.3%)
	-$19.2 million in state park capital outlay
	Water Resources	Requested:	$860 Million
		Decrease:	$50.5 Million	(-5.5%)
	+$39.9 million for water development, ground water recharge and conservation, and Bay-Delta water quality control projects
	+$24 million for fish and wildlife habitat
	+$24 million for local flood control and levee subventions
	-$54.9 million in State Water Project design, construction, operations, and maintenance

Figure 5
Environmental Protection Programs Proposed Major Changes for 1997-98
	Air Resources Board	Requested:	$109.5 Million
		Decrease:	$0.8 Million	(-0.7%)
	+$1.2 million to retire high polluting light-duty vehicles
	-$3 million to reflect sunset of California Clean Air Act nonvehicular fees
	Integrated Waste Management Board	Requested:	$77.0 Million
		Decrease:	$4.1 Million	(-5.1%)
	+$5.4 million for tire recycling and waste tire site remediation
	-$2.2 million in various programs due to declining solid waste disposal fee revenues
	State Water Resources Control Board	Requested:	$434.5 Million
		Increase:	$121.4 Million	(+38.8%)
	+$90 million to pay tank owners for underground tank cleanup
	+$54 million for local wastewater treatment, recycling, drainage, and other water projects
	+$7.4 million for water quality planning, permitting, and enforcement
	-$5 million to reflect a drop in federal funds and reimbursements
	Toxic Substances Control	Requested:	$142.8 Million
		Increase:	$6.2 Million	(+4.5%)
	+$6 million for state costs of hazardous waste site remediation
	-$4.2 million in federal grants for military base cleanup