APRIL 16, 2004

The Assembly and Senate approved major legislation that provides for significant reform to California’s troubled Workers’ Compensation System. The Governor will sign the bill on Monday at 1:00 p.m. This will effectively preclude the need for the initiative to be placed on the November ballot but be assured that if it wasn’t for the initiative effort, with the Governor’s support the Legislature would not have acted. County Farm Bureau’s played a major role in collecting signatures for the initiative and in lobbying legislators for the needed reforms. CFBF participated in coalitions supporting the changes and was involved in many meetings including two conference calls this week with the Governor’s office.

The legislation, SB 899 authored by Senator Chuck Poochigian (R-Fresno) is designed to reduce system costs while ensuring that injured workers receive quality medical care at a fair basis for compensation. It creates economic incentives to motivate injured employees to return to work as soon as possible. SB 899 will also ensure that injured employees receive quality medical care while giving employers the tools to discourage doctor shopping and discourage lawyers from gaming the system to leverage settlements. Additionally, the legislation addresses the permanent disability system-the most critical area of reform by providing greater objectivity and consistency in permanent disability evaluations.

Governor Schwarzenegger says this reform package "signals strong progress toward a better business climate. The agreed upon bill will lighten the cost of doing business in California and help heal our economic climate, making our state more competitive in attracting companies and expanding job growth."

Senator Poochigian stated: "Reaching a compromise agreement on an issue as complex and far reaching as workers’ compensation has been a monumental undertaking. We were up against a myriad of special interests jockeying to protect their turf and maintain the status quo, but produced a bill that will bring change for the better. …Staking all hopes for reform on a costly ballot initiative that could delay savings until 2005 would not be prudent except as a last resort at a time when many employers cannot wait another day. Additional reforms will undoubtedly still be needed, but the time for legislative action has come. I believe that what we have accomplished will streamline the system, bring cost relief to employers, and stimulate job creation in California."

The Schwarzenegger Administration has submitted a revised budget proposal for the State Water Resources Control Board for the upcoming fiscal year 2004-2005 to hire an additional 22 staff to implement permit waiver programs for timber and irrigated agriculture statewide. The budget proposal includes $3.1 million dollars in fee collections to pay for these staff positions. According to testimony from the Water Board’s Executive Director, a fee in the range of $50 to $100 is anticipated. However, the Board may try to collect the fee for five years in advance, to "maximize administrative efficiency." This would suggest that fee bills up to $500 might be going out soon. Farm Bureau will be watching this process closely. Since no case has been made for the need for these additional staff or fee, Farm Bureau will be opposing the fee increases.

Senate Bill 1477 (Byron Sher, D-Stanford) would establish a new state wetlands permitting program that would require farmers and ranchers to get permits from and pay fees to the regional water boards for any impacts to wetlands on their property. The new program would likely result in use restrictions that would prevent farming and ranching uses of property with wetlands characteristics. Farm Bureau is opposed.

Senate Bill 1374 (Machado, D-Linden) would require the State Water Board to ensure that a long term water transfer did not cause substantial unmitigated third party economic impacts. Farm Bureau is supportive of protecting third parties from the full range of economic impacts from negative economic impacts caused by water transfers. Farm Bureau does not consider the current bill to be adequately protective of these interests, and is not currently supporting the bill.

AB 2422 (Doug LaMalfa, R-Richvale) would have repealed the new water rights fees that were adopted last year. Farm Bureau recently filed suit to have the these fees invalidated as illegal taxes. The bill to repeal the fees was voted down in the Assembly Water Parks and Wildlife Committee this week.

SB 1479 (Byron Sher, D-Stanford) deals with membership on the state’s Regional Water Quality Control Boards. As introduced, it would have reduced the total membership from nine to five, and combined the irrigated agriculture position with another position, jeopardizing agricultural representation on many of the Boards. In response to opposition from Farm Bureau and others, the bill’s author amended the bill during a hearing this week in the Senate Environmental Quality Committee. As amended the bill would reduce the Board membership to seven instead of five, and would retain the irrigated agriculture position on all of the Boards. Based upon the amendment, Farm Bureau has removed its opposition to the bill in its current form, and track the bill as it continues through the legislature.

SB 1552 (Mike Machado, D-Linden), which would allow the State Water Board to set minimum instream flows for impaired water bodies, was passed by the Senate Environmental Quality Committee over strong opposition from Farm Bureau and many water and agricultural interests. If passed, the bill could ultimately allow the Water Board to curtail diversions to meet minimum flow standards. Farm Bureau continues to oppose the bill.

The bill to require mandatory testing of every beef slaughtered or imported into the state for commercial purposes for bovine spongiform encephalopathy (BSE) was heard in the Senate Health and Human Services Committee and passed with several courtesy votes. SB 1425 by Senators Mike Machado (D-Linden) and Jackie Speier (D-Hillsborough) would require every licensed slaughterer to test each beef processed, be responsible for any fees associated with such testing and maintain records on the results of that testing for no less than one-year. The measure is now supposed to move to the Senate Agriculture and Water Committee and could be heard as early as April 20. There is no scientific basis for mandatory testing of every bovine slaughtered for reasonable protection of our food supply. CFBF is opposed. We urge you to contact the Senate Agriculture and Water Committee by phone: 916-445-2206 or email the Chair, Senator Mike Machado: Senator.Machado@sen.ca.gov expressing your opposition.

As expected Senator Rico Oller's (R-San Andreas) bill to repeal the SRA fees went down to defeat in the Senate Natural Resources and Wildlife Committee on a partisan vote of 3 to 5. What was surprising was the opposition from the environmental organizations such as the Sierra Club, Planning and Conservation League, Native Plant Society, League of Conservation Voters and Defenders of Wildlife. A cynical observer might suspect that the Committee's consultant and principal drafter of the SRA fee bill, SB 1049, encouraged opposition from the environmental community to give cover for the Democrat members of the committee who killed the bill. The fact that the SRA fee is an unconstitutional special tax that was not approved by the required two-thirds vote of both houses of the Legislature still didn't resonate with Democrats. Although Senator Byron Sher, Chair of the Senate Budget Subcommittee that oversees CDF's budget, repeatedly referred to so-called "fees" as "parcel taxes." In addition to making the numerous Freudian slips Senator Sher did suggest that he would consider repealing the fees if the proponents of SB 1460 could find an alternative way to recover some General Fund money for CDF's fire protection budget. The roll call on SB 1460 was "AYES": Oller, Denham, and Hollingsworth and "NOES": Kuehl, Alpert, Bowen, Sher and Torlakson.

Two measures designed to elevate consideration of farmland protection in the planning process won approval by the Assembly Local Government Committee. AB 2055 by Assemblymember Lois Wolk (D-Davis) would rename the "Open Space Element" the "Agricultural and Open Space Element" and include much of the same permissive planning language contained in the two previous attempts to rename the Open Space Element by Assemblymember Matthews (D-Tracy). The bill is supported by the Farm Bureau, Community Alliance with Family Farmers (CAFF), American Planning Association, Sierra Club, and a smart growth coalition known as the California Futures Network.

Assemblymember Joe Canciamilla (D-Pittsburg) is authoring AB 2808 that would add consideration of agricultural resources in the Governor's Environmental Goals and Policy Report (EGPR). Since 1970 state law has required that an EGPR be prepared and updated every four years. Various governors ignored that law since 1978 until former Governor Davis instructed his Office of Planning and Research to prepare an update. Although drafted prior to the October Recall Election, the updated EGPR was never accepted by Governor Schwarzenegger. The impetus for the Davis' action was the adoption in 2002 of "State Planning Priorities." In summary those priorities include promoting of infill development, protecting of agricultural and environmental resources, and encouraging efficient development patterns. Farm Bureau supports.

A bill to create a new administrative tax appeals board was narrowly approved by the Assembly Judiciary Committee despite vociferous opposition of taxpayers and the State Board of Equalization (BOE). AB 2472 (Lois Wolk, D-Davis) would create a so-called "Tax Court," although it would be part of the executive branch of state government and not the judiciary. The new tax appeals body would be made up of five gubernatorial appointments requiring Senate confirmation and would usurp some, but not all, of the authority of the BOE. The bill's support is coming from academics and some members of the State Bar, who obviously have a financial interest in its creation. Tellingly, the public employees unions, which stand to gain the most from this distinctly anti-taxpayer measure, also support the bill. Farm Bureau is opposed to the bill for numerous reasons, not the least of which is that the state is broke and cannot afford to create another duplicative state agency. From a tax policy perspective, we also oppose the fact that the bill would grant new authority to the Franchise Tax Board to appeal BOE decisions to the District Court of Appeals, thus getting a second bite at the taxpayers and dragging out the appeals process even further. We also favor the fairness and accountability of the elected members of the BOE in hearing tax appeals compared to an appointment process that will no doubt become highly politicized. The bill will be heard next week in the Assembly Revenue and Taxation Committee.

The Board of Forestry and Fire Protection has announced a two-day public scoping session to gain information regarding the management of oak woodlands across the state of California. Over the past 20 years the Board has received many requests to regulate oak woodlands. In addition, two key pieces of legislation, SB 711 and SB 1334, have surfaced in this legislative session, which, if passed, would require mandatory statewide mitigation for conversion of oak woodlands.

The Public Scoping Session will be held April 26 and 27, 8:00 a.m. to 5:00 p.m., at the Resources Agency Auditorium, 1416 9^th Street, Sacramento. Written comments can be submitted prior to the session to: Jeff Stephens, Executive Secretary, Range Management Advisory Committee, Board of Forestry and Fire Protection, P.O. Box 944246, Sacramento, CA 94244-2460. We urge you and your affected members to either submit written comments, or to attend one of the two- day sessions and provide verbal comments. Items that should be addressed in your comments are: