Laws, Regulations & Annotations

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Oil Spill Response, Prevention, and Administration Fees Law and Government Code

Government Code

Chapter 7.4. Oil Spill Response and Contingency Planning

Article 7. Oil Spill Response Trust Fund

Section 8670.48

8670.48. Oil Spill response fee; definitions; authorization of refunds; legislative intent. (a) (1) A uniform oil spill response fee in an amount not exceeding twenty-five cents ($0.25) for each barrel of petroleum products, as set by the administrator pursuant to subdivision (f), shall be imposed upon a person who owns petroleum products at the time the petroleum products are received at a marine terminal within this state by means of a vessel from a point of origin outside this state. The fee shall be remitted to the State Board of Equalization by the terminal operator on the 25th day of each month based upon the number of barrels of petroleum products received during the preceding month.

(2) An owner of petroleum products is liable for the fee until it has been paid to the state, except that payment to a marine terminal operator registered under this chapter is sufficient to relieve the owner from further liability for the fee.

(b) An operator of a pipeline shall also pay a uniform oil spill response fee in an amount not exceeding twenty-five cents ($0.25) for each barrel of petroleum products, as set by the administrator pursuant to subdivision (f), transported into the state by means of a pipeline operating across, under, or through the marine waters of the state. The fee shall be paid on the 25th day of each month based upon the number of barrels of petroleum products so transported into the state during the preceding month.

(c) (1) An operator of a refinery shall pay a uniform oil spill response fee in an amount not exceeding twenty-five cents ($0.25) for each barrel of crude oil, as set by the administrator pursuant to subdivision (f), received at a refinery within the state. The fee shall be paid on the 25th day of each month based upon the number of barrels of crude oil so received during the preceding month.

(2) The fee shall not be imposed by a refiner, or a person or entity acting as an agent for a refiner, on crude oil produced by an independent crude oil producer as defined in paragraph (3). The board shall not identify a company as exempt from the fee requirements of this section if that company was reorganized, sold, or otherwise modified with the intent of circumventing the requirements of this section.

(3) For purposes of this chapter, "independent crude oil producer" means a person or entity producing crude oil within this state who does not refine crude oil into a product, and who does not possess or own a retail gasoline marketing facility.

(d) A marine terminal operator shall pay a uniform oil spill response fee in an amount not exceeding twenty-five cents ($0.25), in accordance with subdivision (g), for each barrel of crude oil, as set by the administrator pursuant to subdivision (f), that is transported from within this state by means of a marine vessel to a destination outside this state.

(e) An operator of a pipeline shall pay a uniform oil spill response fee in an amount not exceeding twenty-five cents ($0.25), in accordance with subdivision (g), for each barrel of crude oil, as set by the administrator pursuant to subdivision (f), transported out of the state by pipeline.

(f) (1) The fees required pursuant to this section shall be collected during any period for which the administrator determines that collection is necessary for any of the following reasons:

(A) The amount in the fund is less than or equal to 95 percent of the designated amount specified in subdivision (a) of Section 46012 of the Revenue and Taxation Code.

(B) Additional money is required to pay for the purposes specified in subdivision (k).

(C) The revenue is necessary to repay a draw on a financial security obtained by the Treasurer pursuant to subdivision (o) or borrowing by the Treasurer pursuant to Article 7.5 (commencing with Section 8670.53.1) including any principal, interest, premium, fees, charges, or costs of any kind incurred in connection with those borrowings or financial security.

(2) The administrator, in consultation with the State Board of Equalization, and with the approval of the Treasurer, may direct the State Board of Equalization to cease collecting the fee when the administrator determines that further collection of the fee is not necessary for the purposes specified in paragraph (1).

(3) The administrator, in consultation with the State Board of Equalization, shall set the amount of the oil spill response fees. The oil spill response fees shall be imposed on all feepayers in the same amount. The administrator shall not set the amount of the fee at less than twenty-five cents ($0.25) for each barrel of petroleum products or crude oil, unless the administrator finds that the assessment of a lesser fee will cause the fund to reach the designated amount specified in subdivision (a) of Section 46012 of the Revenue and Taxation Code within four months. The fee shall not be less than twenty-five cents ($0.25) for each barrel of petroleum products or crude oil if the administrator has drawn upon the financial security obtained by the Treasurer pursuant to subdivision (o) or if the Treasurer has borrowed money pursuant to Article 7.5 (commencing with Section 8670.53.1) and principal, interest, premium, fees, charges, or costs of any kind incurred in connection with those borrowings remain outstanding or unpaid, unless the Treasurer has certified to the administrator that the money in the fund is not necessary for the purposes specified in paragraph (1).

(g) The fees imposed by subdivisions (d) and (e) shall be imposed in any calendar year beginning the month following the month when the total cumulative year-to-date barrels of crude oil transported outside the state by all feepayers by means of vessel or pipeline exceed 6 percent by volume of the total barrels of crude oil and petroleum products subject to oil spill response fees under subdivisions (a), (b), and (c) for the prior calendar year.

(h) For purposes of this chapter, "designated amount" means the amounts specified in Section 46012 of the Revenue and Taxation Code.

(i) The administrator, in consultation with the State Board of Equalization and with the approval of the Treasurer, shall authorize refunds of any money collected that is not necessary for the purposes specified in paragraph (1) of subdivision (f). The State Board of Equalization, as directed by the administrator, and in accordance with Section 46653 of the Revenue and Taxation Code, shall refund the excess amount of fees collected to each feepayer who paid the fee to the state, in proportion to the amount that each feepayer paid into the fund during the preceding 12 monthly reporting periods in which there was a fee due, including the month in which the fund exceeded the specified amount. If the total amount of money in the fund exceeds the amount specified in this subdivision by 10 percent or less, refunds need not be ordered by the administrator. This section does not require the refund of excess fees as provided in this subdivision more frequently than once each year.

(j) The State Board of Equalization shall collect the fee and adopt regulations implementing the fee collection program. All fees collected pursuant to this section shall be deposited in the Oil Spill Response Trust Fund.

(k) The fee described in this section shall be collected solely for any of the following purposes:

(1) To provide funds to cover promptly the costs of response, containment, and cleanup of oil spills into marine waters, including damage assessment costs, and wildlife rehabilitation as provided in Section 8670.61.5.

(2) To cover response and cleanup costs and other damages suffered by the state or other persons or entities from oil spills into marine waters, which cannot otherwise be compensated by responsible parties or the federal government.

(3) To pay claims for damages pursuant to Section 8670.51.

(4) To pay claims for damages, except for damages described in paragraph (7) of subdivision (h) of Section 8670.56.5, pursuant to Section 8670.51.1.

(5) To pay for the cost of obtaining of financial security in the amount specified in subdivision (b) of Section 46012 of the Revenue and Taxation Code, as authorized by subdivision (o).

(6) To pay indemnity and related costs and expenses as authorized by Section 8670.56.6.

(7) To pay principal, interest, premium, if any, and fees, charges, and costs of any kind incurred in connection with moneys drawn by the administrator on the financial security obtained by the Treasurer pursuant to subdivision (o) or borrowed by the Treasurer pursuant to Article 7.5 (commencing with Section 8670.53.1).

(8) To pay for the costs of rescue, medical treatment, rehabilitation, and disposition of oiled wildlife, as incurred by the network of oiled wildlife rescue and rehabilitation stations created pursuant to Section 8670.37.5.

(l) (1) The interest that the state earns on the funds deposited into the Oil Spill Response Trust Fund shall be deposited in the fund and shall be used to maintain the fund at the designated amount specified in subdivision (a) of Section 46012 of the Revenue and Taxation Code. Interest earned until July 1, 1998, on funds deposited pursuant to subdivision (a) of Section 46012 of the Revenue and Taxation Code, as determined jointly by the Controller and the Director of Finance, shall be available upon appropriation by the Legislature in the Budget Act to establish, equip, operate, and maintain the network of rescue and rehabilitation stations for oiled wildlife as described in Section 8670.37.5 and to support technology development and research related to oiled wildlife care. Interest earned on the financial security portion of the fund, required to be accessible pursuant to subdivision (b) of Section 46012 of the Revenue and Taxation Code shall not be available for that purpose. If the amount in the fund exceeds that designated amount, the interest not needed to equip, operate, and maintain the network of rescue and rehabilitation stations, or for appropriate technology development and research regarding oiled wildlife care, shall be deposited into the Oil Spill Prevention and Administration Fund, and shall be available for the purposes authorized by Article 6 (commencing with Section 8670.38).

(2) (A) For each fiscal year, consistent with this article, the administrator shall submit, as a proposed appropriation in the Governor's Budget, an amount up to two million dollars ($2,000,000) of the interest earned on the funds deposited into the Oil Spill Response Trust Fund, for the purpose of equipping, operating, and maintaining the network of oiled wildlife rescue and rehabilitation stations and proactive oiled wildlife search and collection rescue efforts established pursuant to Section 8670.37.5 and for support of technology development and research related to oiled wildlife care. The remaining interest, if any, shall be deposited into the Oil Spill Prevention and Administration Fund pursuant to paragraph (1).

(B) The administrator shall report to the Legislature not later than June 30, 2002, on the progress and effectiveness of the network of oiled wildlife rescue and rehabilitation stations established pursuant to Section 8670.37.5, and the adequacy of the Oil Spill Response Trust Fund to meet the purposes for which it was established.

(C) At the administrator's request, the funds made available pursuant to this paragraph may be directly appropriated to a suitable program for wildlife health and rehabilitation within a school of veterinary medicine within this state, provided that an agreement exists, consistent with this chapter, between the administrator and an appropriate representative of the program for carrying out that purpose. The administrator shall attempt to have an agreement in place at all times. The agreement shall ensure that the training of, and the care provided by, the program staff are at levels that are consistent with those standards generally accepted within the veterinary profession.

(D) The funds made available pursuant to this paragraph shall not be considered an offset to any other state funds appropriated to the program, the program's associated school of veterinary medicine, or the program's associated college or university, and the funds shall not be used for any other purpose. If an offset does occur or the funds are used for an unintended purpose, expenditure of any appropriation of funds pursuant to this paragraph may be terminated by the administrator and the administrator may request a reappropriation to accomplish the intended purpose. The administrator shall annually review and approve the proposed uses of any funds made available pursuant to this paragraph.

(m) The Legislature finds and declares that effective response to oil spills requires that the state have available sufficient funds in a response fund. The Legislature further finds and declares that maintenance of that fund is of utmost importance to the state and that the money in the fund shall be used solely for the purposes specified in subdivision (k).

(n) It is the intent of the Legislature, in enacting this section, that the fee shall not be imposed by a refiner, or a person or entity acting as an agent for a refiner, on crude oil produced by an independent crude oil producer.

(o) The Treasurer shall obtain financial security, in the designated amount specified in subdivision (b) of Section 46012 of the Revenue and Taxation Code, in a form which, in the event of an oil spill, may be drawn upon immediately by the administrator upon making the determinations required by paragraph (2) of subdivision (a) of Section 8670.49. The financial security may be obtained in any of the forms described in subdivision (b) of Section 8670.53.3, as determined by the Treasurer.

(p) This section does not limit the authority of the administrator to raise oil spill response fees pursuant to Section 8670.48.5.

History.—Stats. 2004, Ch. 796 (SB 1742), renamed former subparagraph (i)(1) as subdivision (i), deleted ", for reporting periods after January 31, 1991," after "any money collected" in the first sentence, and deleted ", and only for those periods which commenced on or after January 31, 1991" after "exceeded the specified" in the second sentence of subdivision (i), deleted subparagraph (i)(2) which read: "(2) Any amount of fees collected in excess of the specified amount for periods prior to February 1, 1991, shall be refunded as follows: (A) First, to feepayers who paid oil spill response fees under subdivision (d) or (e) of Section 8670.48. (B) Second, to feepayers in proportion to the amount each feepayer paid into the fund for the period from September 24, 1990, to January 31, 1991, inclusive, less any amounts refunded pursuant to paragraph (1).", deleted "as specified in subdivision (b)," after "into marine waters," in subdivision (l), deleted "provide emergency loans and to" before "cover response and" and deleted "as specified in subdivision (b)," after "into marine waters," in subparagraph (l)(2), substituted "subdivision (g)" for "subdivision (h)" in subparagraph (l)(4), substituted "For each fiscal year, consistent with this article, the administrator shall submit for appropriation through the Governor's Budget," for "For the fiscal year beginning July 1, 1998, and each year thereafter, consistent with this article, the administrator shall submit for appropriation, through the Governor's budget," at the beginning of subparagraph (l)(2), deleted former subdivision (n) which read: "For the purpose of paragraphs (1) and (2) of subdivision (k) waterways used for waterborne commercial vessel traffic to the Port of Stockton and the Port of Sacramento.", relettered former subdivisions (o), (p), and (q) as (n), (o), and (p), respectively, and deleted "of the Government Code" after "to Section 8670.48.5" in subdivision (p). Stats. 2007, Ch. 373 (AB 1220), in effect January 1, 2008, substituted "for which" for "that," added "collection is necessary for any of the following reasons:," and added subparagraphs (A), (B), and (C) in paragraph (f) (1); revised former subdivision (f)(2) to read, "The administrator, in consultation with the State Board of Equalization, and with the approval of the Treasurer, may direct the State Board of Equalization to cease collecting the fee when the administrator determines that further collection of the fee is not necessary for the purposes specified in paragraph (1)."; added "specified in subdivision (a) of Section 46012 of the Revenue and Taxation Code" before "within four months.", added "administrator has drawn upon the financial security obtained by the Treasurer pursuant to subdivision (o) or if the" before "Treasurer has borrowed money", substituted "incurred" for "imposed" before "in connection with", substituted "necessary" for "required" before "for the purposes specified", and substituted "(1)" for "(7) of subdivision (k)" in subdivision (f)(3); added ", in consultation with the State Board of Equalization and with the approval of the Treasurer,", added "that is not necessary for the purposes specified in paragraph (1) of subdivision (f)", deleted "in excess of the designated amount specified . . . as being required for the purposes specified in paragraph (7) of subdivision (k)" in subdivision (i); substituted "cost of obtaining" for "arrangement of" and "(o)" for "(p)" in paragraph (k)(5); substituted "incurred" for "imposed", before "in connection with", added "moneys drawn by the administrator on the financial security obtained by the Treasurer pursuant to subdivision (o) or" and deleted "funds" before "borrowed", and added "by the Treasurer" before "pursuant to Article 7.5 (commencing with Section 8670.53.1)." in paragraph (k)(7); added "specified in subdivision (a) of Section 46012 of the Revenue and Taxation Code" in the first sentence and added "the amount in" before "the fund exceeds that designated" in the fourth sentence in paragraph (l)(1); added ", as a proposed" after "administrator shall submit", deleted "for" before "appropriation", substituted "in" for "through" before "the Governor's", substituted "budget," for "Budget,", substituted "five" for "three" before "hundred thousand dollars", substituted "($1,500,000)" for "($1,300,000)" before "of the interest earned", and deleted the next-to-last sentence "Through the budget process, the Legislature shall review and approve the appropriation." in subparagraph (l)(2)(A); substituted "obtain" for "purchase" after "The Treasurer shall", substituted "in a form which, in the event of an oil spill," for "which" before "may be drawn upon", deleted "as" before "required by", added "paragraph (2) of subdivision (a) of" before "Section 8670.49.", substituted "may" for "shall" after "The financial security", added "obtained" before and "any of" after "in", substituted "forms" for "form", deleted "as", substituted "(b)" for "(a)", and added ", as determined by the Treasurer" in subdivision (o); and deleted "the" before "oil spill response fees" in subdivision (p). Stats. 2008, Ch. 565 (AB 2911), in effect January 1, 2009, substituted "a" for "every" after "imposed upon" and substituted "who owns" for "owning" after "upon a person" in subdivision (a)(1); substituted "An" for "Every" in subdivisions (a)(2), (b), and (c)(1); substituted "a" for "any" after "means", substituted "does not refine" for "performs no refining of" after "this state who", added "a" after "crude oil into", substituted "does not possess or own a" for "possesses or owns no" after ", and who", and substituted "facility" for "facilities" after "retail gasoline marketing" in subdivision (c)(3); substituted "A" for "Every" before "marine terminal operator" and added "a" after "by means of" in subdivision (d); substituted "An" for "Every" before "operator of a pipeline" in subdivision (e); substituted "a" for "any" after "necessary to repay" and deleted "any" after "subdivision (o) or" in subparagraph (C) of paragraph (1) of subdivision (f); substituted "exceed" for "exceeds" after "vessel or pipeline" in subdivision (g); substituted "This" for "Nothing in this" before "section" and substituted "does not" for "shall" before "require the fund" in the last sentence of subdivision (i); substituted "two million dollars ($2,000,000)" for "one million five hundred thousand dollars ($1,500,000)" after ", an amount up to", deleted a comma after "Oil Spill Response Trust Fund", added "and proactive oiled wildlife search and collection rescue efforts" after "rehabilitation stations", and added ", if any," after "The remaining interest" in paragraph (2)(A) of subdivision (l); and substituted "This" for "Nothing in this" after "(p)" and substituted "does not limit" for "limits" after "section" in subdivision (p).