Analysis of the 2004-05 Budget Bill Legislative Analyst's Office February 2004

Department of Fish and Game (3600)

The Department of Fish and Game (DFG) administers programs and enforces laws pertaining to the fish, wildlife, and natural resources of the state. The Fish and Game Commission sets policies to guide the department in its activities and regulates fishing and hunting. The DFG currently manages about 850,000 acres including ecological reserves, wildlife management areas, hatcheries, and public access areas throughout the state.

The budget proposes total expenditures of $274 million from various sources, mainly for support expenditures ($271.1 million). This level of expenditure is about the same as estimated current-year expenditures. However, the current-year budget reflects reductions of about $15 million from 2002-03 expenditure levels. These reductions impact a variety of DFG's activities, including timber harvest plan review, management of marine resources, and resource assessment activities.

The budget includes proposals to expand special-funded programs, including $1.2 million to implement the Marine Invasive Species Act (Chapter 491, Statues of 2003 [AB 433, Nation]) and $2.5 million for restoration and planning efforts related to the Salton Sea. The department also intends to increase revenues to the Fish and Game Preservation Fund by increasing its collection efforts of environmental filing fees for projects subject to the California Environmental Quality Act (CEQA) and by implementing a new fee schedule for streambed alteration permits.

Federal Funds for Fisheries Restoration Require State Match

The budget includes federal funds for the Fisheries Restoration Grant Program, but falls short of the state matching requirement for the receipt of these funds by $2,275,000. We recommend an increase of $2,275,000 from Proposition 40 bond funds to maximize receipt of available federal funds. (Increase Item 3600-001-6029 by $2,275,000).

Background. Since 1981, DFG has provided grant funds through the Fisheries Restoration Grant Program (FRGP) to landowners, public agencies (including DFG), and nonprofit groups to restore salmon and steelhead population through improved habitat. The program funds a variety of different activities including education projects, on-the-ground restoration work, and field surveys by DFG. As shown in Figure 1, the level of expenditures for this program has varied during recent years depending on available funding. There have been three primary sources of funding for FRGP: federal funds, bond funds (Propositions 40 and 13), and tidelands oil revenues.

Budget Proposal Lacks Full Match Requirement. The budget proposes expenditures of $14.1 million ($13.1 million from federal funds and $1 million from Proposition 40) for FRGP in 2004-05, a reduction of about $9 million from the current year. This decrease largely reflects a decrease in bond expenditures. The department indicates that the reduced bond funding in the budget year is due to the administration's decision to defer to later in the spring the submittal of most of its resources bond proposals. (Please see the "Resources Bonds" write-up in the "Crosscutting Issues" section of this chapter.)

The federal funds included in the budget require a match of 25 percent in state funds. However, we find that the budget falls short of that matching requirement by $2,275,000. Without the match, the department will not be eligible to receive the full level of federal funding that is available to the state.

Bond Funding Available to Meet the Match Requirement. Our review of the Proposition 40 fund condition finds eligible funding remaining available—almost $40 million—to fully meet the matching requirements for the federal salmon restoration dollars.

Recommend Increase in Bond Funding to Meet the Match Requirement. In order to maximize the receipt of federal funds available to the state, we recommend that the Legislature, in evaluating the Governor's resources bond proposals to be submitted later in the spring, ensure that an additional $2,275,000 from Proposition 40 bond funds is included so as to fully meet the match requirement.