The 2021-22 Spending Plan: Natural Resources and Environmental Protection

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See More Publications Like This Back to the Top --> Tweet October 18, 2021 The 2021-22 California Spending Plan Natural Resources and Environmental Protection Overview The 2021 22 budget package provides a total of $21.7 billion from various fund sources—the General Fund, bond funds, and various special funds—for programs administered by the California Natural Resources and Environmental Protection Agencies. This is a net increase of $4.8 billion (22 percent) compared to 2020 21 estimated expenditures. This increase is primarily due to two factors. First, the approved budget includes roughly $6.9 billion for various natural resources and environmental programs in several “packages” related to climate change, drought, wildfires, and other issues. Second, the budget includes a $1.5 billion discretionary cap-and-trade expenditure plan that is significantly larger than the one approved in 2020 21. (The 2020 21 budget included lower expenditures from cap-and-trade auction revenues because of significant uncertainty regarding the amount of revenues that would be generated during the year.) Notably, these funding increases are partially offset by a reduction in projected spending from natural resources bond funds. However, estimated bond expenditures for 2020 21 are somewhat inflated because of how prior-year bond appropriations are reflected in budget documents, making year-over-year comparisons of bond spending difficult. Figures 1 and 2 display total funding provided for major departments overseen by the California Natural Resources and Environmental Protection Agencies, respectively. Figure 1 Natural Resources Budget Summary (Dollars in Millions) 2019 20 Actual 2020 21 Estimated 2021 22 Enacted Change From 2020 21 Amount Percent Total $7,143 $10,663 $11,974 $1,310 12% By Department Forestry and Fire Protection $2,024 $2,900 $2,582 $318 11% Water Resources 804 2,303 2,245 58 3 Parks and Recreation 868 1,266 1,697 431 34 Energy Commission 502 811 1,320 509 63 General obligation bond debt service 1,057 1,300 1,309 9 1 Fish and Wildlife 590 549 816 267 49 Natural Resources Agency 396 304 394 89 29 State Lands Commission 85 51 343 292 576 Wildlife Conservation Board 165 339 338 1 — Conservation 126 232 241 9 4 Conservation Corps 158 156 158 2 1 Coastal Conservancy 111 74 75 1 1 Coastal Commission 29 27 71 44 164 Sierra Nevada Conservancy 42 33 69 36 109 Tahoe Conservancy 13 29 52 24 84 Other a 173 289 262 27 9 By Funding Source General Fund $3,836 $5,033 $8,659 $3,626 72% Special funds 1,823 2,081 1,719 362 17 Bond funds 1,244 3,256 1,030 2,226 68 Federal funds 240 294 565 272 93 a Includes certain state conservancies and other departments. Figure 2 Environmental Protection Budget Summary (Dollars in Millions) 2019 20 Actual 2020 21 Estimated 2021 22 Enacted Change From 2020 21 Amount Percent Total $6,900 $6,140 $9,694 $3,554 58% By Department Water Resources Control Board $2,723 $1,065 $3,937 $2,872 270% Air Resources Board 1,552 677 2,940 2,264 335 CalRecycle 2,173 3,905 1,796 2,109 54 Toxic Substances Control 301 338 815 477 141 Pesticide Regulation 105 112 139 28 25 CalEPA 20 16 35 19 117 OEHHA 24 24 27 3 12 General obligation bond debt service 3 3 4 1 22 By Funding Source General Fund $775 $2,495 $3,240 $745 30% Special funds 4,318 3,248 5,067 1,819 56 Bond funds 1,451 32 17 15 47 Federal funds 356 365 1,370 1,005 276 CalRecycle = California Department of Resources Recycling and Recovery; CalEPA = California Environmental Prot3ection Agency; and OEHHA = Office of Environmental Health Hazard Assessment. In addition to the amounts included in the tables, the budget includes control section provisions providing funding for a number of local and regional projects to be administered by various natural resources and environmental departments, particularly the California Natural Resources Agency (CNRA) and the Department of Parks and Recreation (Parks). Cross-Cutting Issues Climate Resilience Package As summarized in Figure 3, the budget package adopted in September 2021 appropriates $369 million for climate change related activities in 2021 22, all from the General Fund. Moreover, the budget agreement includes intent to provide additional General Fund for climate resilience activities in the coming years—$2.1 billion in 2022 23 and $1.2 billion in 2023 24—for a three-year total of $3.7 billion. As shown in the figure, funds will support multiple activities across several departments and respond to various climate change impacts, including extreme heat, sea-level rise along the coast, and threats to the state’s biodiversity. While certain activities will be undertaken by state departments—such as the California Department of Fish and Wildlife’s (CDFW’s) efforts to protect the state’s fish and wildlife from changing conditions—the majority of the funds will be allocated through grant programs to local governments or nongovernmental organizations. Because several of the funded activities represent new programs or initiatives, in many cases, budget trailer legislation includes language guiding specifically how funds should be prioritized and allocated. Figure 3 Climate Resilience Package General Fund (In Millions) Program Department 2021 22 2022 23 2023 24 Totals Multibenefit and Nature Based Activities $46 $975 $350 $1,371 Multibenefit and nature based activities and projects Various — $593 $175 $768 Protect fish and wildlife from changing conditions WCB $31 222 100 353 Habitat restoration projects DWR — 125 75 200 Protect fish and wildlife from changing conditions CDFW 15 35 — 50 Community and Regional Activities $240 $325 $255 $819 Transformative Climate Communities Program SGC $115 $165 $140 $420 Regional climate adaptation planning and implementation grants OPR/SGC 25 125 100 250 Resilience projects on state conservancy lands Conservancies 60 — — 60 Climate adaptation planning grants OPR 10 10 5 25 Environmental Justice Initiative CalEPA 10 10 5 25 Grants to build local capacity for climate projects (SB 1072) a SGC 10 10 — 20 California Climate Action Corps Cal Volunteers 5 5 5 14 Develop vulnerable communities platform and enhance Cal Adapt website OPR 5 — — 5 Extreme Heat Activities $50 $325 $425 $800 Activities to mitigate extreme heat Various — $150 $150 $300 Urban greening and forestry programs CNRA $50 100 100 250 Community resilience centers SGC — 25 75 100 Extreme heat grant program SGC — 25 75 100 Low income weatherization program CSD — 25 25 50 Ocean and Coastal Resilience Activities $12 $400 $200 $612 Coastal protection projects SCC — $350 $150 $500 Coastal protection activities and projects OPC — 50 50 100 Implement Parks sea level rise adaptation strategy Parks $12 — — 12 Other Climate Resilience Activities $22 $65 — $87 Biomass to hydrogen/biofuels pilot project DOC — $50 — $50 Fifth California Climate Assessment Various $22 — — 22 Fluorinated gas reduction incentive program CARB — 15 — 15 Totals $369 $2,090 $1,230 $3,689 a Chapter 377 of 2018 (SB 1072, Leyva). WCB = Wildlife Conservation Board; DWR = Department of Water Resources; CDFW = California Department of Fish and Wildlife; SGC = Strategic Growth Council; OPR = Governor’s Office of Planning and Research; CalEPA = California Environmental Protection Agency; CNRA = California Natural Resources Agency; CSD = Department of Community Services and Development; SCC = State Coastal Conservancy; OPC = Ocean Protection Council; Parks = Department of Parks and Recreation; DOC = Department of Conservation; and CARB = California Air Resources Board. Drought and Water Resilience Package $4.6 Billion Over Three Years for Drought and Water-Related Activities. As shown in Figure 4, the budget package includes $3.3 billion for water and drought-related activities in 2021 22, primarily from the General Fund, spread across numerous departments and activities. (The totals shown in the figure do not include funding approved by the Legislature for water-related activities outside of the Drought and Water Resilience Packages approved in July and September 2021.) A total of $437 million is for activities intended to respond to emergency drought conditions over the coming year and likely will be expended immediately, such as for the State Water Resources Control Board (SWRCB) and CDFW to oversee and enforce regulatory restrictions on water diversions and fishing in certain streams. In contrast, some of the activities—such as allocating grants for water supply and ecosystem restoration projects—likely will take multiple years to complete. Consequently, for many of the activities, statutory language allows the funding to be expended or encumbered over the course of two or three years. As shown, the largest funding allocation is $1.3 billion for SWRCB to allocate grants for improvements to drinking and wastewater systems. The budget agreement between the Legislature and Governor also includes the intent to provide an additional $1.4 billion—$880 million in 2022 23 and $500 million in 2023 24—to continue some activities over the coming years. While most of the funded programs and activities build upon existing state efforts, some represent new initiatives—such as providing funding to the Wildlife Conservation Board to ensure additional streamflow for the environment, and to the Department of Conservation to establish a land repurposing program that improves groundwater sustainability. For new programs such as these, budget trailer legislation provides some guidance to implementing departments. Figure 4 Drought and Water Resilience Package (In Millions) a Activity Department 2021 22 2022 23 2023 24 Totals Water Supply and Reliability, Drinking Water, and Flood $2,376 $420 $220 $3,016 Drinking water and wastewater projects SWRCB $1,300 — — $1,300 Multibenefit water projects DWR 200 — — 200 SGMA implementation DWR 180 $60 $60 300 Groundwater cleanup and water recycling projects SWRCB 150 100 100 350 Flood management DWR 130 110 60 300 Water conveyance repairs DWR 100 100 — 200 Data, research, and communications DWR 91 — — 91 SWEEP CDFA 50 50 — 100 San Diego Pure Water project SWRCB 50 — — 50 Multibenefit land repurposing program DOC 50 — — 50 Water rights modernization SWRCB 30 — — 30 Watershed climate studies DWR 25 — — 25 Aqueduct solar panel pilot study DWR 20 — — 20 Water Quality and Ecosystem Restoration $456 $460 $280 $1,196 Water resilience projects CNRA $165 b $100 $180 $445 Streamflow for the environment WCB 100 150 — 250 Resilience projects for fish and wildlife WCB 65 40 — 105 Salton Sea DWR 40 100 80 220 Funding to address PFAs contamination SWRCB 30 50 20 100 Urban rivers and streams Various 30 20 — 50 Water quality improvements for border rivers SWRCB 20 — — 20 Clear Lake rehabilitation CNRA 6 — — 6 Immediate Drought Response $437 — — $437 Community water projects DWR $300 — — $300 Drought support for fish and wildlife CDFW 33 — — 33 Drought emergency response Various 25 — — 25 Drought permitting compliance and enforcement SWRCB 18 c — — 18 Drought permitting compliance and enforcement CDFW 8 — — 18 Drinking water emergencies SWRCB 12 — — 12 Drought technical assistance DWR 10 d — — 10 Salinity barrier DWR 10 — — 10 Data, research, and communications Various 6 — — 6 Agriculture technical assistance CDFA 5 — — 5 Totals $3,269 $880 $500 $4,649 a All from the General Fund unless otherwise noted. Does not include funding approved by the Legislature for water related activities outside of the Drought and Water Resilience packages approved in July and September 2021. b Includes $125 million from Proposition 68. c Includes $2 million from the Safe Drinking Water Account. d Includes $7 million from Proposition 1. SWRCB = State Water Resources Control Board; DWR = Department of Water Resources; SGMA = Sustainable Groundwater Management Act; SWEEP = State Water Efficiency and Enhancement Program; DOC = Department of Conservation; CNRA = California Natural Resources Agency; WCB = Wildlife Conservation Board; PFAs = per and polyfluoroalkyl substances; CDFW = California Department of Fish and Wildlife; and CDFA = California Department of Food and Agriculture. Statutory Provisions for Immediate Drought Response Spending. Budget trailer legislation—Chapter 115 of 2021 (AB 148, Committee on Budget)—includes provisions applicable to drought response expenditures. In particular, the language allows implementing departments to make direct expenditures to provide immediate relief for drought conditions—rather than being subject to typical statutory requirements for competitive grant or bid processes—if the Governor has declared a drought state of emergency or SWRCB determines that urgent actions are needed to respond to drought impacts on drinking water, public safety, or fish and wildlife. Such expenditures could include providing emergency drinking water supplies, drilling new wells, or rescuing and relocating at-risk fish and wildlife. The legislation also allows departments to provide local grantees that have demonstrated cash flow problems with advance payments for up to 25 percent of the costs of their emergency drought response projects in lieu of relying completely on the traditional cost reimbursement process. Wildfire and Forest Resilience Package The budget provides a total of $988 million on a one-time basis for various departments to implement a package of proposals focused on wildfire prevention and improving landscape health. As shown in Figure 5, the package includes $758 million from the General Fund and $230 million from the Greenhouse Gas Reduction Fund (GGRF) for roughly 30 different programs managed by 18 departments. Over half of the funds—$541 million—support programs designed to promote resilient forests and landscapes, generally by removing hazardous fuels. This funding will support projects on state-owned lands, as well as grants to local governments, nonprofits, and tribes. Just under one-third of the funds—$282 million—support installation and maintenance of wildfire fuel breaks. The remaining funds—totaling $164 million—support projects to encourage forest sector economic stimulus, science-based forest management, community hardening, and other activities. Figure 5 Wildfire and Forest Resilience Package (In Millions) a Program Department Amount Resilient Forests and Landscapes $541.3 Forest Health Program CalFire $159.3 b Stewardship of state owned land Parks 105.0 Project implementation SNC 50.0 Stewardship of state owned land CDFW 40.0 Forest Improvement Program CalFire 40.0 Stewardship of state owned land TC 36.0 Urban forestry CalFire 20.0 Tribal engagement CalFire 19.0 Project implementation RMC 15.0 Project implementation SMMC 15.0 Project implementation SDRC 13.0 Project implementation SCC 10.0 Forest Legacy Program CalFire 10.0 Reforestation nursery CalFire 9.0 Wildfire Fuel Breaks $282.0 Fire prevention grants CalFire $120.0 c Regional Forest and Fire Capacity Program DOC 60.0 CalFire unit fire prevention projects CalFire 40.0 Prescribed fire and hand crews CalFire 35.0 d Forestry Corps and residential centers CCC 27.0 e Forest Sector Economic Stimulus $51.0 Climate Catalyst Fund & market strategy Ibank, Go Biz $33.0 Workforce development CalFire 18.0 Science Based Management $49.0 Remote sensing CNRA $25.0 Monitoring, research, and management CalFire 20.0 Permit efficiencies CARB 2.0 Permit efficiencies SWRCB 2.0 Community Hardening $20.0 Defensible space inspectors CalFire $13.0 Land use planning & public education UC ANR/CalFire 7.0 Other $44.3 Prescribed Fire Liability Pilot CalFire $20.0 Contract counties CalFire 14.3 Interagency data hub CalFire 10.0 Total $987.6 a Fund source is General Fund, unless otherwise noted. b Includes $110 million GGRF. c Includes $80 million GGRF. d Includes $35 million GGRF. e Includes $5 million GGRF. CalFire = California Department of Forestry and Fire Protection; Parks = Department of Parks and Recreation; SNC = Sierra Nevada Conservancy; CDFW = California Department of Fish and Wildlife; TC = Tahoe Conservancy; RMC = San Gabriel & Lower LA Rivers & Mountains Conservancy; SMMC = Santa Monica Mountains Conservancy; SDRC = San Diego River Conservancy; SCC = State Coastal Conservancy; DOC = Department of Conservation; CCC = California Conservation Corps; IBank = California Infrastructure and Economic Development Bank; Go Biz = Governor’s Office of Business and Economic Development; CNRA = California Natural Resources Agency; CARB = California Air Resources Board; SWRCB = State Water Resources Control Board; UC ANR = University of California Agriculture and Natural Resources; and GGRF = Greenhouse Gas Reduction Fund. The budget package also includes language continuously appropriating $200 million annually for forest health and wildfire prevention from 2022–23 through 2028 29. Additionally, the budget package includes language requiring the administration to report certain information annually on all programs related to wildfires and forest resilience that were funded in the 2020 21 and 2021 22 budgets. (The 2020 21 Budget Act was amended in April 2021 to add “early action” funding totaling $536 million for similar wildfire and forest resilience projects, which we describe further here .) Outdoors for All Package As shown in Figure 6, the budget includes $256 million in 2021 22 for a package aimed at expanding park access. Of this amount, $253 million is provided from the General Fund on a one-time basis in 2021 22. The remaining $3.2 million in 2021 22 is provided from the Environmental License Plate Fund (ELPF) ($2.4 million of which is ongoing). Most of the funding in the package—$155 million—is to support the Statewide Parks Program, which is an existing competitive grant program focused on creating new local parks and improving existing local parks in the state’s most disadvantaged communities. The package also includes $40 million for the Outdoor Equity Grants Program authorized by Chapter 675 of 2019 (AB 209, Limón). This program, which also received one-time funding in 2020 21, provides grants to local public entities and nonprofit organizations to provide outdoor educational experiences to underserved and at-risk youth. Figure 6 Outdoors for All Package (In Millions) a Program/Purpose Department Amount Statewide Parks Program Parks $155.0 Outdoor Equity Grants Program Parks 40.0 India Basin project Parks 25.0 Explore the Coast Program SCC 14.0 Whale Tail Program Coastal Commission 10.0 Various pilot programs Parks 9.1 K 12 access expansion Parks 3.2 b Total $256.3 a Fund source is General Fund, unless otherwise noted. b Environmental License Plate Fund. Parks = Department of Parks and Recreation and SCC = State Coastal Conservancy. Zero-Emission Vehicle Package As shown in Figure 7, the 2021 22 budget plan provides $2.7 billion—and $3.9 billion over three years—for programs intended to promote zero-emission vehicles (ZEVs) and other low-emission transportation programs. Of the total in 2021 22, $2.9 billion comes from the General Fund, with the remainder coming from federal funds and special funds. In most cases, the budget provides flexibility to spend the funds over the next few years. We describe some of the key components of the package below. Figure 7 Zero Emission Vehicle Package (In Millions) a Program Department 2021 22 2022 23 2023 24 Total Clean Vehicle Rebate Project CARB $525 b — — $525 Fueling Infrastructure Grants CEC $500 — — $500 Clean Trucks, Buses and Off Road Equipment Incentives CARB $500 c — — $500 Drayage Trucks & Infrastructure Incentives CARB/CEC $160 $160 $150 $470 Vehicle incentives 75 75 70 220 Fueling infrastructure 85 85 80 250 School Buses & Infrastructure Incentives CARB/CEC $150 $150 $150 $450 Vehicle incentives 130 135 135 400 Fueling infrastructure 20 15 15 50 Rail and Transit Equipment and Infrastructure Incentives Cal STA $407 — — $407 Intercity rail and buses 200 d — — 200 Rail and transit demonstrations 100 — — 100 Intercity service expansions 80 e — — 80 Fueling infrastructure 27 — — 27 Clean Cars 4 All & Other Equity Projects CARB $150 f $125 $125 $400 Transit Buses & Infrastructure Incentives CARB/CEC $100 $100 $90 $290 Vehicle incentives 70 70 60 200 Fueling infrastructure 30 30 30 90 Manufacturing Grants CEC $125 $125 — $250 Drayage Trucks & Infrastructure Pilot CARB/CEC $65 — — $65 Vehicles 40 — — 40 Fueling infrastructure 25 — — 25 Near Zero Heavy Duty Trucks (Carl Moyer) CARB $45 — — $45 Market Development Strategy GO BIZ $5 — — $5 Totals $2,732 $660 $515 $3,907 a Fund source is General Fund, unless otherwise noted. b Includes $100 million GGRF. c Includes $315 million GGRF and $86.5 million APCF. d Public Transportation Account. e Federal Trust Fund. f GGRF. CARB = California Air Resources Board; CEC = California Energy Commission; CalSTA= California State Transportation Agency; GO BIZ= Governor’s Office of Business and Economic Development; and GGRF = Greenhouse Gas Reduction Fund. Funding for Clean Vehicle Rebate Project (CVRP), but Rebates Phased Down as Cumulative Sales Increase. The budget provides $525 million to CVRP, which provides customer rebates for new ZEV purchases. Although all of the funding is allocated in 2021 22, the funding is available to be spent until June 30, 2024. The budget also directs the California Air Resources Board (CARB) to develop CVRP rebate levels that phase down as cumulative sales volumes increase. These rebate levels must be consistent with a goal of 1 million total ZEVs on the road by January 1, 2023 and 5 million ZEVs by 2030. Additionally, of the $525 million provided to CVRP, the budget specifies that $10 million General Fund is available to establish a new Electric Bicycle Incentives Project to provide financial incentives for purchasing electric bicycles. Substantial Increase in Funding for ZEV Fueling Infrastructure Grants. The budget includes $500 million on a one-time basis from the General Fund for ZEV fueling infrastructure, including electric vehicle charging stations and hydrogen fueling stations. This funding will be administered through the California Energy Commission’s (CEC’s) Clean Transportation Program. Funding is available for both light- and heavy-duty vehicles. (This augments base Clean Transportation Program funding of about $100 million [Alternative and Renewable Fuel and Vehicle Technology Fund].) Carve-Out for Specific Types of Heavy-Duty Vehicles. In past years, funding for heavy-duty vehicles has been allocated to programs—such as the Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project–that make funding available for a wide range of heavy-duty vehicles. The 2021 22 budget, however, makes allocations for three specific vehicle types: drayage trucks ($225 million), school buses ($150 million), and transit buses ($100 million). These vehicle types are prioritized because they have a disproportionate impact on disadvantaged communities (such as drayage trucks operating in heavily polluted communities), affect sensitive populations (such as school-aged children), and/or are needed to achieve existing regulatory goals (such as the Innovative Clean Transit regulation that requires transit agencies to adopt ZEV transit buses). In addition to these vehicle-specific allocations, the budget also includes a significant amount of funding for existing programs that support other heavy-duty vehicle types. Energy Package As shown in Figure 8, the budget includes $172 million for various energy-related activities, including programs intended to promote building electrification, planning and permitting renewable energy projects, and activities intended to ensure electric reliability. This total includes $170 million one time from the General Fund and $2 million ongoing from the Public Utilities Commission Utilities Reimbursement Account. The largest pieces of funding go to support the following programs: Rebates for All Electric Homes. The budget provides $75 million to CEC to expand the existing Building Initiative for Low-Emissions Development (BUILD) program. The BUILD program provides incentives to construct new residential buildings as all-electric or with energy storage systems. The current program is limited to low-income housing in investor-owned utility territories. This funding would be used to expand the program to market rate residential buildings in all areas of the state, including publicly owned utility territories. Support for Local Government Solar Permitting. The budget provides $20 million to support a new grant program for cities establishing an online solar permitting system. Figure 8 2021 22 Energy Package (In Millions) a Program Department Amount BUILD expansion CEC $75 Grants for cities to establish online solar permitting CEC 20 SB 100 interagency planning CEC/CPUC 18 Terrestrial renewable energy permitting and review DFW 15 Humbolt Offshore Wind Port development CEC 11 Supplementary Funding for Flex Alert CPUC 10 Wildfire operational observer (Filsinger Energy Partners) OES 9 Marine renewable energy permitting and review DFW 4 Offshore Wind Environmental and Port Analyses OPC/CCC 3 SB 100 grants for local and tribe participation CEC 2 Energy Division management and support CPUC 2 b Study for North Coast offshore wind project CEC 2 Energy emergency planning CEC 2 Offshore wind community outreach CEC 1 Total $172 a One time General Fund, unless otherwise noted. b Ongoing funding from Public Utilities Commission Utilities Reimbursement Account. BUILD = Building Initiative for Low Emissions Development; CEC = California Energy Commission; SB 100 = Chapter 312 of 2018 (SB 100, de León); CPUC = California Public Utilities Commission; DFW = Department of Fish and Wildlife; OES = Office of Emergency Services; OPC = Ocean Protection Council; and CCC = California Coastal Commission. Cap-and-Trade Expenditure Plan State cap-and-trade auction revenue is deposited in GGRF. As shown in Figure 9, the 2021 22 budget allocates $3.4 billion from GGRF for various programs. This plan includes (1) $1.8 billion in continuous appropriations, (2) $186 million in other existing spending commitments, and (3) $1.5 billion in discretionary spending. The plan assumes about $2.8 billion in auction revenue in 2021 22, about $700 million carried over from the end of 2020 21, and $60 million in interest income accrued to the fund. Based on this revenue assumption and expenditure plan, we estimate there would be a $60 million GGRF fund balance at the end of 2021 22. Figure 9 2021 22 Cap and Trade Expenditure Plan (In Millions) Program Department Amount Existing Spending Commitments $1,939 Continuous Appropriations a $1754 High speed rail High Speed Rail Authority 677 Affordable housing and sustainable communities Strategic Growth Council 541 Transit and intercity rail capital Transportation Agency 271 Transit operations Caltrans 135 Safe drinking water program State Water Board 130 b Statutory Allocations and Administrative Costs $186 SRA fee backfill CalFire/CCC 77 Manufacturing sales tax exemption backfill N/A 53 State administrative costs Various 56 Discretionary Expenditures $1,510 Low Carbon Transportation $565 Clean Trucks, Buses, and Off Road Freight Equipment Air Resources Board 315 Transportation equity projects Air Resources Board 150 Clean Vehicle Rebate Project Air Resources Board 100 Community Air Protection (AB 617) $320 Incentives for emission reduction projects Air Resources Board 260 Local air district implementation Air Resources Board 50 Community technical assistance Air Resources Board 10 Healthy and Resilient Forests (SB 901) $230 Forest health and fire prevention grants CalFire 190 Prescribed fire and hand crews CalFire 35 Forestry Corps and CCC residential centers Conservation Corps 5 Agriculture $195 Agricultural diesel engine replacements Air Resources Board 170 Healthy Soils Food and Agriculture 25 Organic Waste Diversion and Recycling $130 Grants for infrastructure and projects CalRecycle 70 Support for local implementation of SB 1383 CalRecycle 60 Other $70 Safe and Affordable Drinking Water c State Water Board 20 Small off road engines Air Resources Board 30 Low income Weatherization Program CSD 15 Woodstove replacements Air Resources Board 5 Total $3,449 a Based on $2.8 billion estimated auction revenue in 2021 22. b Current law limits continuous appropriation to $130 million annually. c Amount needed to repay 2020 21 loan from Greenhouse Gas Reduction Fund to Underground Storage Tank Clean Up Fund. CalFire = California Department of Forestry and Fire Protection; CCC=California Conservation Corps; N/A = not applicable; AB 617 = Chapter 136 of 2017 (AB 617, C. Garcia); SB 901 = Chapter 626 of 2018 (SB 901, Dodd); CalRecycle = Department of Resources Recycling and Recovery; SB 1383 = Chapter 395 of 2016 (SB 1383, Lara); and CSD = Community Services and Development. GGRF Supports Other “Packages” in the Budget. Some of the discretionary expenditures are for programs that we discuss in this and other spending plan posts. For example, low carbon transportation spending is part of the Zero-Emission Vehicle Package, healthy and resilient forest spending is part of the Wildfire and Forest Resilience Package, and agriculture spending is part of the Sustainable Agricultural Package. Allocations Largely Go to Existing Programs. The vast majority of allocations support programs that received GGRF in prior years. Some key exceptions are: Support for Local Implementation of SB 1383. Chapter 395 of 2016 (SB 1383, Lara) established several goals aimed at reducing short-lived climate pollutants, such as methane. In 2020, the California Department of Resources Recycling and Recovery (CalRecycle) adopted regulations requiring local jurisdictions to reduce methane emissions from organic waste. The budget provides $60 million from GGRF for grants to local governments to assist in the development and implementation of local programs needed to comply with the SB 1383 regulations. (The cap-and-trade expenditure plan also includes $70 million for an existing program that provides grants for organic waste diversion and recycling infrastructure.) Small Off-Road Engines. The budget provides $30 million from GGRF to provide incentives for small professional landscaping services to purchase zero-emission small off-road equipment, such as electric leaf blowers and lawn mowers. $200 Million Annual Continuous Appropriation for Forest Health Beginning in 2022 23. As discussed in the Wildfire and Forest Resilience Package section above, budget-related legislation establishes a $200 million annual continuous appropriation from 2022 23 through 2028 29 for various forest health activities (also known as Senate Bill 901 funding). Similar to certain existing ongoing expenditures, the $200 million will be taken “off the top” of annual auction revenue before the existing continuous appropriations are determined. Natural Resources California Natural Resources Agency The budget includes a total of $394 million from various funds to support CNRA, including $232 million from the General Fund. This total is a net increase of $89 million, or 29 percent, from the estimated 2020 21 level. This increase is primarily due to funding included for CNRA in the Drought and Water Resilience ($171 million), Climate Resilience ($56 million), and Wildfire and Forest Resilience ($25 million) packages discussed in the “Cross-Cutting Issues” section of this post, as well as the augmentations discussed below. These increases are partially offset by lower appropriations of Proposition 68 (2018) bond funds in 2021 22 than in 2020 21. Museum Funding. The budget provides $62.5 million from the General Fund on a one-time basis to CNRA for various museum projects. This includes $50 million for a museum grant program, $10 million for the Museum of Tolerance, and $2.5 million for the Holocaust Museum. Presidio Improvement Project. The budget provides $27.5 million from the General Fund on a one-time basis to convert an existing parking lot in the Presidio in San Francisco into parkland. This parkland will include interpretive works on the historic Buffalo Soldiers stables site, picnic sites, a family play meadow, and new paths and bikeways. California Department of Forestry and Fire Protection (CalFire) The budget includes a total of $2.6 billion from various funds to support CalFire, including $2.2 billion from the General Fund. This total is a net decrease of $318 million, or 11 percent, from the estimated 2020 21 level. This decrease is primarily due to one-time increases in Emergency Fund expenditures in 2020 21—totaling $1.1 billion after anticipated federal reimbursements—as a result of large wildfires in 2020. The 2021 22 budget includes significant augmentations for CalFire, including $559 million from the Wildfire and Forest Resilience Package (see the “Cross-Cutting Issues” section of this post), as well as for other programmatic expansions and facility projects described in more detail below. Emergency Response and Preparedness: Fire Crews . The budget provides $137 million from the General Fund in 2021 22 ($116 million and 591 positions ongoing) to support 16 new CalFire hand crews staffed by seasonal firefighters to undertake vegetation management and fuel reduction projects, and assist with wildfire suppression. (In addition to this funding for CalFire fire crews, the budget includes $5.9 million from the General Fund in 2021 22, rising to $8.1 million ongoing to support eight year-round and six seasonal California Conservation Corps hand crews.) Short-Term Fire Protection Augmentation. The budget provides $39 million from the General Fund on a one-time basis to support fire crews staffed by CalFire and California Military Department personnel from July through December 2021. Most of this funding—$27 million—will extend support for eight CalFire crews that were funded through the Emergency Fund from April through June 2021. Direct Mission Support. The budget supports 85 additional positions in 2021 22 (87 positions on an ongoing basis), which will provide additional administrative support for CalFire, such as in the areas of accounting, budgets, communications, and information technology. The total estimated cost of these additional positions is $15.8 million in 2021 22 ($15.7 million ongoing). In 2021 22, the cost of these positions is supported by $1.5 million from the General Fund, as well as assumed savings of $14.3 million, mostly from the Emergency Fund. (The budget assumes that the savings to the Emergency Fund will occur because higher levels of ongoing administrative staffing will reduce the need to use firefighters to perform administrative tasks, thereby reducing the level of overtime within the department’s fire protection program.) On an ongoing basis, the budget assumes that an additional $1.5 million in savings associated with terminating the leases of two existing office spaces will offset the remaining cost to the General Fund. Implementation of Recent Legislation. The budget provides $19.1 million and 37 positions for CalFire to implement various wildfire-related bills that were recently adopted by the Legislature. Specifically, it provides (1) $8.3 million ($6.1 million ongoing) from the General Fund and 26 positions for the defensible space inspection program in accordance with Chapter 391 of 2019 (AB 38, Wood); (2) $5.6 million from the General Fund ($3.6 million ongoing) and 11 positions to support the implementation of the Wildfire Forecast and Threat Intelligence Integration Center established by Chapter 405 of 2019, (SB 209, Dodd); and (3) $3.2 million one time from the General Fund to support the development of regulations and public education related to the establishment of a five-foot ember-resistant zone around certain structures, consistent with Chapter 259 of 2020 (AB 3074, Friedman). Capital Outlay Projects. The budget provides $59.8 million from the General Fund on a one-time basis to implement various capital outlay projects, including the relocation and repairs at various helitack bases, fire stations, and other facilities. In many cases, this funding supports the early stages of projects. Upon completion, the total estimated cost of these projects is anticipated to be roughly $750 million. Deferred Maintenance. The budget provides $50 million from the General Fund on a one-time basis for deferred maintenance projects at CalFire facilities. The department has reported that it has a backlog of deferred maintenance totaling $157 million. Department of Water Resources (DWR) The budget package includes $2.2 billion from various sources for DWR. This is slightly less ($58 million, or 3 percent) than the amount provided in 2020 21. (These totals exclude the roughly $1.9 billion in annual payments from water contractors for DWR’s work on the State Water Project [SWP], as those funds are not appropriated through the annual budget act.) About half of DWR’s funding is included in the Drought and Water Resilience Package described above. These limited-term funding increases are offset by year-to-year decreases in bond expenditures. Flood Management Planning and Projects. As summarized in Figure 10, the budget package includes $576 million from different fund sources—mostly General Fund and bond funds—for various flood management projects and programs. All of these funds are proposed on a one-time or limited-term basis. This includes $130 million for unspecified flood projects as part of the Drought and Water Resilience Package. (That package includes an additional $170 million across 2022 24 and 2023 24 for flood management projects). Additionally, as shown in the figure and noted in our “Other Provisions” spending plan post, the budget package includes $237 million from the General Fund for deferred maintenance projects on levees in the Central Valley. The budget agreement also includes $67 million from the General Fund in 2021 22 and an additional $158 million over the following three years for the state’s remaining share of costs for the American River Common Features project. The 2018 federal budget authorized funding for the U.S. Army Corps of Engineers to undertake this $1.8 billion project in the Sacramento region, consisting of a number of levee improvement, erosion control, and flood bypass widening efforts. Figure 10 2021 22 Flood Management Funding (In Millions) Project Amount Source Deferred maintenance on Central Valley levees $237 General Fund Various flood projects (Drought and Water Resilience Package) 130 General Fund Delta levee projects 102 Propositions 1 and 68 American River Common Features project 67 General Fund Statewide floodplain risk management studies and grants 29 Proposition 68 Delta flood emergency preparedness 7 Proposition 1 San Joaquin basin flood risk assessment and strategy 4 Proposition 68 and ELPF Lower Yolo Bypass project 1 Proposition 1 Total $576 ELPF = Environmental License Plate Fund. SWP Aging Infrastructure. The budget authorizes DWR to add 67 new positions in 2021 22 with an associated cost of $15 million—growing to 150 new positions with a cost of $31 million by 2024 25—to conduct maintenance and repairs on aging SWP infrastructure such as canals and dams. The positions will be funded outside of the state budget process by SWP water users. Department of Parks and Recreation The budget includes a total of $1.7 billion from various funds to support Parks, including $1.2 billion from the General Fund. This total is a net increase of $431 million, or 34 percent, from the estimated 2020 21 level. This increase primarily is due to $232 million provided for the department in the Outdoors for All Package (discussed in the “Cross-Cutting Issues” section of this post), as well as the augmentations we discuss below. Fiscal Stability for Boating. The budget provides $30 million annually from the General Fund through 2024 25 to provide temporary fiscal solvency to the Harbors and Watercraft Revolving Fund. To facilitate the development of a permanent solution, the budget includes provisional language requiring a stakeholder process to develop a proposal to address the fund’s structural deficit by January 2023. Statewide Urban Rivers and Waterways Program. The budget includes a total of $154.2 million from the General Fund to establish a new Statewide Urban Rivers and Waterways Program. This program will fund state and local park facilities and partnerships and will prioritize under-resourced, underserved, or park-poor urban communities with a connection to the rivers, waterways and water systems. Alameda-Tesla Expansion Area. The budget includes a total of $30.8 million from the General Fund related to a portion of the existing Carnegie State Vehicular Area known as the Alameda-Tesla Expansion Area. This funding includes a transfer of $1 million to the State Parks and Recreation Fund to support planning to identify the best use of the Expansion Area where off-highway vehicle use will be prohibited, as well as a transfer of $29.8 million to the Off-Highway Vehicle Trust Fund to support the acquisition of an alternative location for off-highway vehicle use. Wildfire Repairs. The budget includes a total of $250.4 million on a one-time basis ($123.5 million from the General Fund and $126.9 million in reimbursement authority) for wildfire-related repairs to state parks. Specifically, this includes $113.5 million from the General Fund ($103.5 million in reimbursement authority) for projects to address damage from the 2020 wildfires to various state parks, including Big Basin Redwoods State Park. The above total also includes $10 million from the General Fund ($23.4 million in reimbursement authority) for the continuation of projects at the Malibu Creek State Park and Leo Carrillo State Park to repair damage from the Woolsey fire. Capital Outlay and Related Projects. The budget provides $147.8 million from various sources on a one-time basis to support several capital outlay projects at various state parks, such as the creation of a new California Indian Heritage Center ($95.3 million) and the renovation of the Boiler Shop at the Old Sacramento State Historic Park in the Sacramento Railyards ($22.6 million). In addition to the $147.8 million for capital outlay projects, the budget also includes $30 million from the General Fund on a one-time basis for the Sacramento Railyards, which could be used for capital outlay, local assistance, or state operations, such as additional improvements in and around the Old Sacramento State Historic Park. Deferred Maintenance. The budget provides $185 million from the General Fund on a one-time basis for Parks-related deferred maintenance projects. The department has reported that it has a backlog of deferred maintenance totaling $1.27 billion. Department of Fish and Wildlife The 2021 22 budget package includes $816 million from various sources for CDFW. This represents a $267 million (49 percent) increase compared to the 2020 21 level, primarily due to one-time funding augmentations provided as part of the Drought and Water Resilience, Wildfire and Forest Resilience, and Energy packages described earlier, as well as the augmentations described below. The budget also provides CDFW with $15 million in one-time General Fund for deferred maintenance projects as well as $61 million from cannabis tax revenues—and 29 new positions—for ongoing cannabis-related regulatory and enforcement activities. Additionally, the budget authorizes 139 new permanent positions, including the conversion of 26 positions that were originally authorized only on a limited-term basis to permanent status. The budget package also authorizes CDFW to hire 102 new positions on a limited-term basis—47 for wildfire-related activities and 55 for drought-related activities. Biodiversity and Endangered Species. The budget includes $64.6 million ($59.6 million General Fund and $5 million ELPF) in one-time funds to be expended over five years for four initiatives to help protect California’s biodiversity: Threatened and Endangered Species ($54 Million). This funding will support 31 new permanent positions to conduct activities that protect threatened and endangered species, such as reviewing petitions to list species for protected status, and monitoring the status of and developing recovery plans for species that have already been listed. A new funding source will need to be identified to support these ongoing staff costs and activities after five years. Infrastructure Management ($7.5 Million). This funding will support eight new permanent positions to enhance management of CDFW’s lands, including improving maintenance practices and oversight and upgrading facilities. A new funding source will need to be identified to support ongoing staff costs and activities after five years. Wolf Conflict Program ($3 Million). The department will use these funds to establish a limited-term program that compensates livestock owners for losses due to the return of grey wolves to Northern California. Wildlife Health Laboratory Feasibility Study ($350,000). This will fund a feasibility study for a state of the art Wildlife Health Laboratory to address and care for wildlife, including animal holding and care facilities and research space. Future funding would be needed to build the facility. One-Time Upgrades. The 2021 22 provides $45 million—$42 million from the General Fund and $3 million from Proposition 12 (2000)—to purchase equipment and conduct activities across a number of CDFW’s services. This includes funding to upgrade water conveyance systems and maintenance at state-owned wetlands ($9.8 million) and equipment at fish hatcheries ($7 million), to purchase equipment—such as flagging for fences to protect livestock from wolves and traps to catch and relocate wildlife—to prevent and address negative interactions between wildlife and people ($7 million), and for a new fixed-wing aircraft ($4.5 million) and marine patrol boat ($4.5 million) to assist in wildlife monitoring and law enforcement. The funding will also enhance amenities—such as adding restrooms—at CDFW lands ($6 million), with a focus on sites with high visitation rates near under-served communities. Additionally, the total includes $5.5 million to make progress on an existing CDFW initiative to develop a statewide fine-scale vegetation map, which will be used for multiple planning and habitat conservation efforts. Cutting the Green Tape Initiative. The budget makes permanent 18 positions and provides $3.8 million from the General Fund for ongoing support of the Cutting the Green Tape Initiative. This funding, which was initially provided on a one-time basis in 2020 21, supports staff to work with stakeholders on expediting restoration projects, such as through developing and implementing efficiencies for awarding grants and issuing regulatory permits. The budget also includes language requiring CDFW to report annually through 2026 on the outcomes of the initiative, including restoration permit processing times, lessons learned, and specific strategies employed. Oil Spill Prevention and Response Fee. Budget trailer legislation makes three changes to the existing fee that contributes revenues to the Oil Spill Prevention and Administration Fund. (CDFW’s Office of Spill Prevention and Response uses the revenues in this fund for oil spill prevention and preparedness activities, such as inspections and trainings.) These changes would address the operating shortfall that the fund has experienced in recent years as increasing costs—primarily for employee compensation—have outpaced growth in revenues. First, legislation increases the fee from 6.5 cents per barrel to 8.5 cents per barrel. This fee is paid by owners of crude oil or petroleum products for each barrel they transport through marine terminals or refineries in California. Second, the legislation authorizes the state to annually adjust fee levels beginning in 2023 to keep pace with inflation, based on the California Consumer Price Index. Third, the legislation expands the fee to apply not only to petroleum but also fuels made from renewable sources—such as plant and animal oils and fats—in recognition that these fuels also pose a risk of spilling and causing environmental damage as they are transported by rail and ship across the state. The department projects that these changes will increase revenues into the fund by a combined $12 million annually in 2021 22, growing to $14 million in the ensuing years. State Lands Commission (SLC) The budget package includes $343 million for SLC, including $93 million from the General Fund and $250 million in federal funds. This represents a $292 million increase (or almost six times more) compared to the 2020 21 funding level, due to the following two one-time augmentations. Funding Backfill for Ports. The budget package includes $250 million in federal American Rescue Plan Act of 2021 (ARPA) funding to help support the state’s 11 public seaports. Budget trailer legislation directs the commission to allocate the funding to the ports based on their revenue losses resulting from the coronavirus disease 2019 (COVID-19) pandemic. This is because the pandemic disrupted the operations of California’s ports, and some ports sustained substantial financial impacts. Abandoned Oil and Gas Wells. The budget provides $50 million from the General Fund in 2021 22 for SLC to continue work on plugging and securing Platform Holly, an offshore oil and gas site in Santa Barbara County. SLC assumed control and responsibility for the facilities at this site in 2017 after the lessee declared fiscal insolvency and relinquished the lease it had held with the state. The wells and facilities are located on state lands and will continue to pose risks to the environment and public health until they are fully plugged and secured. Together with an additional $2.5 million to be provided in 2022 23, SLC anticipates that this funding will (1) conclude Phase 1 of the South Ellwood decommissioning project, which includes plug and abatement of the offshore wells at Platform Holly and addressing the associated pier and onshore facilities, and (2) initiate a feasibility study and Environmental Impact Report for ultimate abandonment and repurposing of the site. Multiple complications with the project—including degraded equipment at the site left by the lessee—have led to an increase in costs and extended the time line for completing Phase 1 compared to prior estimates. The state previously provided a combined $58 million for this project in 2018 19 and 2019 20. Long Beach Tidelands Oil Revenues. Budget trailer legislation includes language governing revenues generated from oil and gas production in the tidelands off the coast of Long Beach. Existing state law grants use of these tidelands to the City of Long Beach, and a portion of resulting oil and gas production revenues is shared by the city and the state through a series of statutory agreements. These agreements are overseen by SLC on behalf of the state. To generate additional revenue for city activities, the city assesses various per-barrel taxes on the oil production that occurs within city limits. Over the past several decades, the city has applied these taxes to the state’s share of tidelands revenue, reducing the amount of revenue the state receives. Budget trailer legislation specifies that the state “consents” to those previous city taxes but prohibits the state’s share of revenues from being subject to any future local taxes, fees, or assessments without explicit statutory authorization. Coastal Commission The budget package includes $71 million for the Coastal Commission, mostly from the General Fund. This represents a $44 million (164 percent) increase compared to the 2020 21 funding level, primarily due to one-time General Fund provided for Local Coastal Program (LCP) updates ($31 million), as well as $10 million for Whale Tail grants which is included in the Outdoors for All Package described above. As noted earlier, the Energy Package also provides the commission with $875,000 on a one-time basis to review offshore wind projects. LCP Updates. The budget provides $30 million on a one-time basis for the commission to provide grants to local governments to update their LCPs for sea-level rise and climate change. LCPs are required plans that guide development along California’s coast, and most of them were developed before a broad awareness of the changes that sea-level rise will bring. The commission can use the funds over five years. This represents a significant expansion of the current LCP grant program—which is typically supported with $1.5 million annually from GGRF—and is intended to expand the number of updates undertaken across coastal jurisdictions. In addition to providing local assistance grants, the commission can allocate a portion of this funding to hire staff to review draft plans and provide technical assistance to the local governments undertaking LCP updates. The budget also includes a one-time $1 million General Fund augmentation for state operations to support these activities. Office of Energy Infrastructure Safety (OEIS) OEIS Establishment and Transfer of Wildfire Safety Division (WSD) and Dig Safe Board. The budget includes resources to support the creation of OEIS, effective July 1, 2021. Chapter 81 of 2019 (AB 111, Committee on Budget) and Chapter 307 of 2020 (SB 865, Hill) required the transfer of WSD from the California Public Utilities Commission (CPUC) and the California Underground Facilities Safe Excavation Board from CalFire to OEIS. In total, the budget provides $18 million—all from special funds—and 81 positions to support OEIS. Additionally, the budget package includes budget trailer legislation transferring some authority WSD had under CPUC to OEIS. Environmental Protection California Environmental Protection Agency (CalEPA) The budget provides $35 million from the General Fund and special funds to support CalEPA, an increase of $19 million (117 percent) from the estimated 2020 21 spending level. The year-over-year increase largely reflects (1) $10 million from the General Fund for an Environmental Justice Initiative included in the Climate Resilience Package and (2) $5 million from the General Fund for the California Green Business Program (discussed in more detail below). Green Business Program. The one-time $5 million augmentation for the California Green Business Program will be available to the California Green Business Network to provide incentives to help businesses conserve energy and water, minimize waste, prevent pollution, and shrink their overall carbon footprint. State Water Resources Control Board The budget package includes $3.9 billion from various sources for SWRCB. This represents an increase of $2.9 billion (270 percent) compared to the amount provided in 2020 21, including $1.6 billion more from the General Fund and $1 billion more in federal funds. The year-to-year increase in funding primarily reflects various one-time augmentations, including $1.6 billion in the Drought and Water Resilience Package described above, along with the activities discussed below. This total also includes $130 million from GGRF for the SWRCB-administered Safe and Affordable Drinking Water Fund. Federal Funding to Address Water Arrearages. The budget package includes $1 billion in federal ARPA funds to address unpaid water bills that have accrued as a result of households struggling with the financial impacts of the COVID-19 pandemic. The funds will be provided to operators of water systems to backfill their revenue losses, and also are intended to help customers by retiring their debt. Budget trailer legislation requires that SWRCB conduct a survey of community water systems to assess the magnitude of water bill arrearages and revenue shortfalls across the state and to allocate funds to those systems accordingly, with funding distribution to begin no later than November 1, 2021. Should the survey indicate that total arrearages exceed $1 billion, the board will allocate the funds on a prorated basis proportional to each water system’s share of the estimated statewide total. If statewide community water system arrearages are less than $1 billion, SWRCB must use remaining funds to address wastewater treatment provider arrearages. Budget trailer legislation also extends the state’s temporary moratorium on shutting off water service due to unpaid bills until December 31, 2021. Moreover, to the degree that some customers still have debt remaining after these funds have been disbursed, the legislation requires water systems to work with them to develop payment plans and prohibits water shutoffs for customers who remain current on their plans. (As described in our “Human Services” spending plan post, the budget also provides the Department of Community Services and Development with some complementary federal funding to address utility bill arrearages and unpaid water bill debt for low-income households.) New Underground Storage Tank Spending. The budget includes four changes related to the Underground Storage Tank Cleanup Fund (USTCF): (1) a one-time appropriation of $200 million for reimbursing a backlog of cost claims associated with cleaning up leaking petroleum underground storage tanks, (2) an ongoing increase of $17.5 million ($16.7 million local assistance and $804,000 state operations) from the Site Cleanup Subaccount and four new permanent positions for technical and administrative workload associated with investigating surface or groundwater contamination at private sites, (3) a one-time appropriation of $2 million from the School District Account to reimburse cost claims for cleaning up contamination of leaking underground storage tanks at school districts, and (4) an ongoing increase of $728,000 and five new permanent positions for SWRCB’s accounting office to improve tracking of USTCF claims and payments. Air Resources Board The budget provides $2.9 billion, primarily from the General Fund and various special funds, to support CARB. This total is an increase of $2.3 billion (335 percent) from the estimated 2020 21 spending level. The year-over-year increase largely reflects (1) $1.5 billion for programs included in the Zero-Emission Vehicle Package; (2) $350 million for programs included in the Sustainable Agriculture Package; and (3) $320 million for community air protection in the Cap-and-Trade Expenditure Package. We discuss other notable budget adjustments below. Various Regulatory Implementation and Enforcement Activities. The budget includes a total increase of $3.5 million from the Air Pollution Control Fund (APCF) for various regulatory activities. This includes (1) $2.9 million and 14 positions (increasing to $9.9 million and 33 positions ongoing) to enhance heavy-duty mobile sources testing and enforcement, (2) $386,000 ongoing and two permanent positions to implement the Advanced Clean Trucks regulation, and (3) $201,000 and one position ($962,000 and five positions ongoing) to implement and enforce a new regulation for Ocean-Going Vessels at Berth, Continuing Resources for AB 617 Implementation. The budget provides $4 million annually from APCF for 22 positions at CARB to continue implementing Chapter 136 of 2017 (AB 617, C. Garcia), also known as the Community Air Protection Program. Previously, the funding for these positions came from GGRF and was authorized only through 2020 21. (Permanent funding had already been authorized for 50 other positions implementing the program.) CalRecycle The budget provides $1.8 billion primarily from special funds to support CalRecycle, a decrease of $2.1 billion (54 percent) from the estimated 2020 21 level. The year-over-year net decrease largely reflects $2.3 billion in one-time General Fund costs related to wildfire debris clean-up activities in 2020 21. (Additional expenditures for wildfire clean-up activities that have occurred or will occur in 2021 22 will be authorized through a separate process for funding emergency activities.) This decrease is partially offset by a $130 million GGRF increase for waste reduction activities included in the Cap-and-Trade Expenditure Package and a $75 million increase related to the Circular Economy Package. We describe the Circular Economy Package, and other notable budget adjustments in more detail below. Circular Economy Package. As shown in Figure 11, the budget plan provides $75 million in 2021 22—and $65 million 2022 23—primarily from the General Fund, to support various recycling and waste reduction programs. Most of the funding goes to existing programs. Notable new programs or program expansions include: Recycling Market Development Zone (RMDZ) Loan Program. The budget plan provides $50 million from the General Fund over two years to the existing RMDZ loan program, which provides loans to recycling businesses that prevent, reduce, or recycle recovered waste materials. Budget-related legislation makes changes to the RMDZ loan program to allow eligibility for certain facilities that are outside of RMDZs. Co-Digestion at Waste Water Treatment Plants. The budget plan includes $20 million from the General Fund over two years to expand an existing greenhouse gas reduction grant program to include food waste co-digestion projects at waste water treatment plants. Quality Incentive Payments for Sorting Plastic Containers. The 2021 22 budget includes $10 million from the Beverage Container Recycling Fund (BCRF) to provide quality incentive payments to curbside recycling programs for the sorting and separation of clean polyethylene terephthalate plastic containers. Circular Economy Development. The budget plan includes a total of $15 million from the General Fund over two years for a new program that will provide grants to entities that are in the research, development, feasibility assessment, and pilot phases of new recycling technologies and projects. Figure 11 Circular Economy Package (In Millions) a Program b 2021 22 2022 23 Total RMDZ loan program $25 $25 $50 Organics infrastructure grants 20 15 35 Co digestion at waste water treatment plants 10 10 20 Circular economy development 2 13 15 Quality incentive payments for sorting plastic containers 10 c — 10 Community composting 5 — 5 Food waste prevention and rescue program 3 2 5 Totals $75 $65 $140 a General Fund, unless otherwise noted. b Budget also includes $130 million Greenhouse Gas Reduction Fund for organic waste programs. c Beverage Container Recycling Fund. RMDZ = Recycling Market Development Zone. Expansion of Beverage Container Recycling Pilots. The budget includes $10 million (BCRF) to expand pilot programs intended to test alternative beverage container redemption options to increase beverage container redemption rates. Strategies that could be funded include bag drop service, reverse vending machines, mobile collection programs, and fixed recycling centers at nontraditional locations (such as city parks). SB 1383 Implementation. The budget provides five permanent positions and $782,000 from the Cost of Implementation Account (increasing to 9 positions and $1.4 million ongoing) to implement organic waste reduction regulations pursuant to SB 1383. CalRecycle also plans to redirect 38 existing positions from its local assistance and market development programs to instead focus on compliance and enforcement of SB 1383 regulations. Department of Toxic Substances Control (DTSC) The budget includes $815 million from various sources (including $389 million from the General Fund) to support DTSC. The total funding level is an increase of $477 million (141 percent) from the revised 2020 21 spending level. The net change primarily reflects augmentations for (1) brownfield investigations and cleanups and (2) cleanup and cost recovery efforts related to the Exide Technologies facility in Vernon, California. Governance and Fiscal Reform. Budget trailer legislation includes several governance and fiscal reform provisions for DTSC. First, the legislation establishes the Board of Environmental Safety within the department, which would set fees through regulation, hear permit appeals, and provide strategic guidance to the department. The budget provides $3 million in 2021 22 from the General Fund to establish the new board. Second, the legislation restructures and increases charges that support the Hazardous Waste Control Account (HWCA) and the Toxic Substances Control Account (TSCA)—the department’s two major fund sources. The changes to the charges that support HWCA include (1) replacing several tiered fees with a new generation and handling fee that will charge hazardous waste generators based on a price-per-ton model and (2) increasing the existing facility fee—a charge placed on entities that treat, store, or dispose of hazardous waste. In addition, the legislation restructures the environmental tax that supports TSCA by (1) increasing rates charged to businesses with more than 500 employees and (2) providing exemptions to businesses with fewer than 100 employees (exemptions previously applied to businesses with less than 50 employees). The additional revenues from the above changes will be realized beginning in 2022 23 and will eliminate the structural deficits in both accounts, as well as fund the new Board of Environmental Safety on an ongoing basis. The board will be authorized to adjust charges consistent with legislatively approved appropriation levels beginning in 2023 24. This provision will allow for additional revenues in future years to address cost increases and expand programs. Special Fund Backfills. As mentioned above, revenues from the fiscal reform will not be realized until 2022 23. Accordingly, the budget includes one-time General Fund resources of $11.5 million to backfill TSCA and $22.5 million to backfill HWCA, in order to keep both funds solvent in 2021 22 and allow the department to maintain current service levels. (We note that an additional $6.5 million from the General Fund was provided to HWCA to expand various programs and activities, such as the positions needed to implement federal requirements.) Brownfield Cleanups. The budget provides $300 million in 2021 22 and $100 million in 2022 23 and 2023 24 from the General Fund to clean up brownfields—properties underutilized due to the presence or potential presence of hazardous contaminants. The funds would be allocated for the following purposes in 2021 22: (1) state site investigations and cleanup projects ($221.5 million); (2) a new competitive grant program and technical assistance to support local governments, tribes, and nonprofit organizations in investigating and cleaning up brownfield sites and supporting impacted communities ($70.5 million); (3) a new workforce development program ($4 million); (4) development of a state hazardous waste management plan ($3.5 million); and (5) the development of a forum to provide environmental justice advice and recommendations to the director of DTSC and the Board of Environmental Safety ($0.5 million). Exide Technologies Facility. The budget plan includes several expenditures related to the Exide Technologies facility, a former lead-acid battery recycling plant in the City of Vernon that ceased operations in 2014. First, the budget provides a General Fund loan of $131.4 million in 2021 22 ($322.4 million in total over three years) to clean up approximately 3,000 residential properties near the Exide facility with lead contamination. This would bring the total number of residential properties cleaned up to roughly 6,000. Second, the budget provides a General Fund loan of $132 million in 2021 22 to continue closure and cleanup activities at the Exide Technologies facility. Third, the budget includes a total of $16.5 million—including $14 million one time from the General Fund and $2.5 million ongoing from the Lead-Acid Battery Cleanup Fund—to support litigation efforts related to recovering cleanup costs from responsible parties that have contributed to contamination. Most of this funding would support the Attorney General’s Office and outside bankruptcy counsel. Department of Pesticide Regulation (DPR) The budget plan includes $139 million from various funds (including $20 million from the General Fund) to support DPR. The total funding amount is an increase of $28 million (25 percent) from the revised 2020 21 spending level. This increase is largely due to (1) augmentations for programs related to safe and sustainable pest management and (2) one-time funding to support the development of a statewide pesticide notification network. Safe and Sustainable Pest Management. The budget includes limited-term General Fund augmentations of $10.3 million in 2021 22 and $8.8 million in 2022 23 for various activities intended to support safe and sustainable pest management practices, including (1) research and demonstration grants that support alternatives to pesticides, (2) ecosystem and air monitoring, (3) community engagement, (4) increased enforcement funding for County Agricultural Commissioners, and (5) a study to identify options to implement a tiered pesticide mill assessment—a special sales tax applied to pesticides. (We note that the 2021 22 budget does not include a proposal by the Governor to restructure and increase the mill assessment over a four-year period.) Pesticide Notification Network. The budget includes $10 million from the General Fund on a one-time basis to support the beginning planning and development stages of an information technology project that would create a statewide pesticide notification network. The network would notify communities in advance when certain pesticides are going to be applied within a certain proximity, such as on nearby farms. A future proposal is expected for the costs associated with completing the development of the network. Subscribe | California State Legislature | Online Voter Registration | Privacy Policy | Accessibility Legislative Analyst's Office | The California Legislature's Nonpartisan Fiscal and Policy Advisor 925 L Street, Suite 1000 Sacramento, CA 95814 | (916) 445-4656