DATE: January 19, 2021
SUBJECT:
Title
PRESENTATION ON 2021-2022 PORT OF SAN DIEGO LEGISLATIVE PRIORITIES AND DIRECTION TO STAFF
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EXECUTIVE SUMMARY:
The 2021-2022 Legislative Priorities encompass the Port of San Diego’s policy goals and potential legislative priorities at the state and federal level for a two-year timeframe, concurrent with the 2021-2022 California legislative session. This document is guided by the District’s Compass Strategic Plan, the 2018-2022 Legislative Platform, existing Board Policies and direction, and the District’s Executive Leadership Group and staff input. Legislative priorities are identified at the local, state, and federal levels of government. Efforts to advance these priorities will range from the District acting as the lead entity in moving legislation to collaborative efforts with multiple stakeholders in which the District is a participant.
RECOMMENDATION:
Recommendation
Receive the presentation on the New Legislation for 2019-2020 Port of San Diego Priorities and give direction to staff.
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FISCAL IMPACT:
This presentation has no fiscal impact.
Compass Strategic Goals:
This agenda item supports the following Strategic Goal(s).
• A Port that the public understands and trusts.
• A thriving and modern maritime seaport.
• A vibrant waterfront destination where residents and visitors converge.
• A Port with a healthy and sustainable bay and its environment.
• A Port that is a safe place to visit, work and play.
• A financially sustainable Port that drives job creation and regional economic vitality.
DISCUSSION:
Review of 2020
The year 2020 saw the District continue its very active federal advocacy program targeting federal appropriations, advancing regional priorities, and providing technical assistance to federal agencies and Congress, notably with respect to several COVID-19 relief bills. Below are highlighted initiatives achieved in collaboration with Carpi & Clay, the District’s federal advocates based in Washington, DC.
1) COVID-19 and Emergency Relief for Ports -- With the onset of COVID-19, seaports requested federal relief to manage revenue losses and budget impacts. In contrast to authorities managing roads and airports, there is no federal mechanism in place to make such payments. Recognizing this, ports nationwide worked very closely with members of Congress to introduce the Maritime Transportation Sector Emergency Relief Act (MTSERA) and establish a grant program within MARAD for which the District would be eligible. The District was a strong advocate for the MTSERA and worked to have the bill included in the recently passed National Defense Authorization Act (NDAA). GCR anticipates the MTSERA provisions will be retained and therefore be an avenue for financial relief as funds become available.
To date, Congress has passed four pieces of coronavirus-related legislation. Of these, the CARES Act offered the best opportunity to advance the District’s interests. Through our advocacy, the bill’s provisions and definitions were amended with the intention of giving the District and similarly situated special districts access to relief through the CARES Act’s lending provisions. Unfortunately, the Treasury Department and the Federal Reserve, as fund administrators, limited access to these programs which closed-off relief to many entities. Meanwhile, members of Congress also lobbied the Treasury Department to expand program availability.
As Congress enters a new legislative session, there is some hope agreements can be reached on new COVID-19 relief/stimulus measures. One area of disagreement has been additional assistance to states and local governments. However, it appears resistance to this aid may soften in the new Congress. In addition to pushing for changes to the lending programs, the District is advocating on behalf of specific bills that target special districts for assistance.
2) Tijuana River Valley/Border Sewage -- The District’s sustained advocacy over the past several years has delivered meaningful results. Last December, the District’s congressional delegation secured over $300 million in direct appropriations to fund a regional response to the Tijuana River Valley sewage spills. These funds are provided through the US-Mexico-Canada Agreement Implementation Act (USMCA) and are in addition to the $25 million appropriated to the Environmental Protection Agency’s Border Water Infrastructure Program (BWIP), which represents an increase of $10 million from the previous fiscal year. District commissioners and staff were active participants in these funding successes. Meanwhile, this summer, the House of Representatives passed the EPA’s FY21 funding bill with an additional $25 million for this need. With the funds in place, the challenge has become program implementation and delivering measurable progress. Critical to the implementation discussion and project considerations is having a seat at the table. In this regard, the District representatives participate in the USMCA Eligible Public Entities Coordinating Group, which provides input on EPA’s evaluation of projects for a comprehensive solution to the ongoing transboundary wastewater and stormwater pollution in the Tijuana River Valley.
In early September, the EPA announced two initiatives to temporarily increase treatment of sewage flows. EPA indicated it would enter a Memorandum of Understanding (MOU) with the International Boundary and Water Commission (IBWC) to divert additional water for treatment at the IBWC International Treatment Plant. In addition, the EPA is working with the City of San Diego to better prevent sediment and trash from a tributary to the Tijuana River from flowing into the ocean and reduce the risk of flooding in nearby communities.
In a further effort to guide implementation, Senator Feinstein and Congressman Vargas, joined by all members of the San Diego Delegation and with endorsement from the District and several local stakeholders, introduced the Border Water Quality Restoration and Protection Act. Based on recommendations put forward by the Government Accountability Office, the bill’s major provisions:
o Designate the EPA as the lead agency to address border pollution along the U.S.-Mexico Border and improve water quality of the Tijuana and New Rivers entering the United States.
o Require the EPA, along with its federal, state and local partners, to identify a list of priority projects and would authorize EPA to accept and distribute federal, state, and local funds to build, operate and maintain those projects.
o Codify the existing BWIP to manage stormwater runoff and water reuse projects.
o Require the IBWC to participate in the construction of projects identified in the Tijuana and New Rivers comprehensive plans and specifically authorizes the commission to address stormwater.
3) Aquaculture -- The District continued to advance its federal profile on aquaculture and blue economy issues on the legislative front and within NOAA.
Legislatively, the District continued to advocate for new federal legislation to establish a regulatory system for sustainable offshore aquaculture and promote aquaculture interests. Over a period of months dating back to 2019, District staff served as a technical resource to staff of the US Senate Commerce Committee during redrafting of the AQUAA Act. As a result of several drafting sessions, the Committee accepted the District’s language recommendations. The revised, bipartisan bill was introduced by Senators Wicker (R-MS) and Schatz (D-HI) in September.
While the legislative process will play out over coming months and into the next session of Congress, the District has enjoyed success working with NOAA directly and can point to two key developments of direct interest.
In May, President Trump signed an Executive Order to promote regulatory reform and streamline aquaculture development by directing greater coordination among federal agencies. It sets a two-year time limit for federal agencies to review projects and designates NOAA as the lead agency. Among its many provisions, the EO directs the Secretary of Commerce to identify Aquaculture Opportunity Areas, which are locations suitable for commercial aquaculture. On August 20, NOAA announced the selection of federal waters off southern California (and in the Gulf of Mexico) as the areas of focused evaluation for the first two of ten Aquaculture Opportunity Areas in the United States.
4) Port Security -- The District continued its support for Port Security Grant program appropriations and has ensured an ongoing dialogue with the Department of Homeland Security regarding specific project requests. Current-year funding for the program is $100 million. On June 30, the Department of Homeland Security announced approximately $1 million in port security grant funding for the District. The House is proposing increased funding to $110 million for FY20 while the pending Senate bill would continue the program at $100 million. We are anticipating a final budget agreement before the end of the calendar year.
Meanwhile, state government issues in 2020 were dominated by COVID-19 as both the Governor and Legislature grappled with impacts of the pandemic as a public health emergency and a budget crisis. Executive orders and legislation were focused almost exclusively on COVID-19 response, and GCR succeeded in communicating with policymakers about how the pandemic was affecting the District as a provider of essential and critical services. Highlighted below are initiatives achieved in collaboration with JGC Government Relations, the District’s state advocates based in Sacramento.
1) Legislative and Regulatory Engagement -- In late 2019 and early 2020, the District worked with California Association of Port Authorities (CAPA), labor and other industries involved in goods movement to work with California Air Resources Board on the development of At-Berth regulations. Discussions at CARB continued through the first part of 2020, even as the pandemic took hold in California, and the District worked closely with a coalition of similarly interested parties to engage CARB. The District strengthened its close working relationship with labor and coordinated efforts to ensure that their combined voices were heard at CARB.
In late February, Port Commissioners met with the State Treasurer, the Lt. Governor’s office, State Lands Commission and State Legislative offices to discuss the District’s priorities for 2020.
2) COVID-19 -- Once COVID-19 began to shut down California, the District conveyed information to the State regarding the impacts that COVID-19 was having on the operations of the Port of San Diego. Many of the early interactions with State officials and staff revolved around impacts related to the closure of the California economy, how to handle issues such as cruise ship berthing, and asking for a pause for a variety of laws and regulations that were necessary as District operations fundamentally changed.
In late spring, the District engaged with state officials including the State Treasurer’s office and the State Lands Commission on State budget issues and the roll-out of federal relief funds, including understanding State efforts related to tenant/landlord relief. As the State began to reopen, the District navigated the reopening process and worked with State regulators to seek clarification on the State released reopening plans and how those plans impacted the District and tenant operations.
3) Tidelands Trust -- The District sought clarification in the final months of the shortened legislative session on implementation on SB 507 (Atkins - 2019) and on AB 3030 related to conserved lands and waters. Efforts to clarify SB 507 legislatively were not successful in the final weeks of the Legislative Session and the District is now working with Senate Pro Tempore Atkins’ staff to seek the needed clarification via alternative means. The District also tracked and shared information related to new workers compensation provisions, tenant relief and COVID-19 reporting requirements.
In short, the District engaged legislative, regulatory bodies and executive offices, and accomplished numerous goals as a result of that direct engagement in Sacramento.
Overview of Current and New Legislation
As the District looks ahead to the new 2021-2022 legislative session, staff proposes an agenda that encompasses the District’s policy goals and potential legislative priorities at the state and federal levels. The development of these proposed legislative priorities was guided by the Compass Strategic Plan, the 2018-2022 Legislative Platform, existing Board Policies and direction, and District’s Executive Leadership Group and staff input. Efforts to advance these priorities will range from the District acting as the lead entity in moving legislation to collaborative efforts with multiple stakeholders in which the District is a participant.
As in the past, when appraising the legislative areas of focus for the year, GCR staff employs five main criteria to determine the value and wisdom of including a proposal or policy option:
1. Does the proposal fit within the 2018-2022 Legislative Platform?
2. Does the proposal increase the District’s ability to serve those who visit or work on the Tidelands?
3. Does the proposal enhance public safety on the Tidelands?
4. Does the proposal assist the District in meeting environmental goals or complying with state or federal regulations?
5. Does the proposal provide necessary revenue or funding opportunity to the District, which is a public agency that is self-sustaining, without the benefit of taxpayer money?
As the first year of this legislative timeframe begins, new policy goals and potential legislative priorities at the state and federal level have been identified. Those items are featured in italicized text at the end of each section. Items preceded by an asterisk are highest priority.
Environmental Leadership
1. * Develop a marketplace for blue carbon credits and advance/monetize carbon sequestration via seagrass mitigation banking.
2. Seek Air Resources Board funding for vessel speed reduction incentives after requiring the Air Resources Board to develop and implement a voluntary vessel speed reduction incentive program.
3. * Seek expanded parameters for Air Resources Board grant solicitations to allow funding for infrastructure projects that advance the state’s electrification and clean energy goals and enhance compliance with those standards.
4. * Develop state budget request for funds for blue carbon assessment of San Diego Bay eelgrass beds to support executive order for action on natural solutions for climate resiliency and carbon sequestration.
5. Continue support for the Diesel Emission Reduction Act, its reauthorization, and funding appropriations.
6. Create the California Clean Truck, Bus, and Off-Road Vehicle and Equipment Technology Program to provide funding for commercial adoption of zero-emission equipment.
7. Support legislative efforts that would require California Air Resources Board and California Public Utilities Commission to conduct at least two joint meetings per calendar year to coordinate implementation of state climate goals and alignment of electrification objectives.
8. Support legislative efforts to clarify the applicability of the California Environmental Quality Act to approval of updates to climate action plans.
9. Provide statutory CEQA streamlining for infrastructure projects to expedite environmental improvement and protection projects, save limited resources, and hasten efforts to bring shore power, electric cranes, and other clean technology online.
10. Support legislative efforts that would remove barriers-of-entry to a flourishing market of locally grown macro- and micro-algae.
11. Support a state fee on container and roll-on/roll-off carrier vessels - split between local/regional remediation fund for infrastructure, efficiencies, supply chain improvements, and environmental justice programs.
12. Support legislative efforts that would further the establishment of submerged and non-submerged land mitigation banks.
13. Support legislative efforts to fund environmental and blue technology education curriculum in schools.
14. Continue support for state and federal legislative efforts and budget appropriations to plan, design, operate, and/or maintain infrastructure to eliminate sewage and other waste discharges into the Tijuana River Valley and the Pacific Ocean, and support related investigations and remediations of contamination existing on and near Tidelands.
Infrastructure and Transportation
1. Streamline potential disbursement of federal grant monies for Harbor Drive mobility projects and improvements, such as Harbor Drive 2.0.
2. * Request ongoing infrastructure funding and other grant money for maritime cargo terminal infrastructure enhancements, especially as they relate to strategic port and core cargo business capabilities.
3. Build support for state investments in marine highway network.
4. Request grant programs capable of supporting retrofitting, repowering, or replacement of commercial harbor craft engines and support expansion of the Low Carbon Fuel Standard’s Shore Power Program to include those harbor craft vessels.
5. Seek a statewide, holistic evaluation of commercial electric truck parking/charging capacity.
Maritime and Trade
1. Support state legislative efforts or state administrative action that would establish marine utility rates for cruise and cargo operations, to help cruise and cargo industries remain competitive in the California market.
2. Support state funding for a study of the value of California ports to the California and national economy.
3. Support administrative actions and legislative efforts that would provide regulatory pathways at the state and federal level of government to advance sustainable aquaculture and other blue economy goals.
4. Support legislative efforts that would temper impacts of tariffs or trade restrictions upon maritime business.
5. Support implementation of, and appropriations for, the federal Water Resources Development Act, while protecting the ‘donor port’ provisions beneficial to the District.
6. * Urge federal agencies to evenly and consistently apply aggressive environmental protection standards, promoting environmental excellence.
7. * Advocate for discretionary grant parity among state agencies to ensure a level playing field among California’s ports of varying scale and type, making the statewide system of ports more economically resilient and competitive.
8. Support budget appropriations to Governor’s Office of Business and Economic Development (GO-Biz) for international trade exposure for blue economy ventures.
Public Safety and Access
1. * Support funding for parks and public amenities to enhance public access to the Bay, particularly in disadvantaged communities.
2. Support continuation of, and appropriations for, the federal Port Security Grant Program.
3. Support administrative actions to advance a federal cybersecurity pilot at District level and deployment of additional security measures for strategic ports.
4. Support legislative efforts that would improve public safety and alleviate impacts of homelessness among the District’s 22 public parks.
5. Support state legislative efforts that would protect public access and govern street parking to maximize that access and use.
6. Support funding for resiliency project planning.
7. Establish classification of living shorelines as a natural solution for resiliency and bioremediation.
8. Extend pilot project of enforcement of City of San Diego ordinance regulating anchoring or mooring in Zuniga Jetty Shoals.
Economic Vitality and Development
1. * Continue to request federal and state funds for stabilization, relief, and recovery from economic damage caused by the COVID-19 pandemic on San Diego’s tourism sector.
2. Seek legislative efforts to encourage the growth of San Diego’s blue tech economy including policies that ease funding, development and commercialization of these technologies, modernize the permitting process for new blue technologies.
3. Continue support for legislative efforts that would enhance District tenants’ ability to conduct commerce and sustain business operations along the Tidelands.
4. Support establishment of a statewide California Aquaculture Advisory Council.
5. Support direction of appropriate state entities to begin creation of a fee-for-service model of shellfish testing, to allow for expedited testing when needed to avoid harvests going bad.
6. Support funding for spatial analysis tools, under the direction the State Lands Commission, in consultation with appropriate state agencies for National Centers for Coastal Ocean Science consultation with appropriate state agencies, and for National Centers for Coastal Ocean Science to begin a spatial mapping process of state waters in order to create a comprehensive map of different locations’ suitability for aquaculture.
7. Direct the state to create a template or checklist for all other agencies which would be crafted in tandem with the development of best management practices so that as long as a grower is in compliance with those and other parameters (approved species, etc.), the California Department of Food and Agriculture would not need to “reinvent the wheel” for every application.
6. Support funding for community colleges for programs related to aquaculture, fisheries, or maritime studies, and promote workforce development in maritime trades, particularly near disadvantaged communities.
Real Estate and Land Use
1. Create port infrastructure fund within existing state incentive programs to facilitate upfront investments required for large-scale capital projects, including planning and design.
2. Support state legislative efforts to provide that acceptance of a federal grant award does not constitute predetermination under the California Environmental Quality Act.
3. Clarify statutory language relating to the administration of District payments to the state for leaseholds on submerged lands within San Diego Bay.
4. Continue to monitor legislation for opportunities to assist Chula Vista Bayfront Plan, including securing additional infrastructure funding.
General Administration
1. * Continue to request financial assistance to ports as frontline providers of critical infrastructure and essential services in California’s COVID-19 response and recovery.
2. Support state legislative efforts to protect local tax revenue generated on Tidelands, as well as generate more funding for District infrastructure and priorities.
3. Drive a sustained state and federal funding push for infrastructure projects to help accomplish expensive climate goals and continue the District’s environmental leadership.
4. Support legislative efforts that would protect the workforce stability of the District and ensure security and sustainability of pensions.
5. Support state legislative efforts that would improve administration of citation payments.
6. Support expansion of the state’s Strategic Growth Council membership to include ports and harbors.
7. Continue to monitor legislation relating to public works contracting, pensions, records retention and release process requirements.
8. * Expand government funding of environmental projects to include those that accelerate progress to meet state goals.
General Counsel’s Comments:
The Office of the General Counsel reviewed this agenda as to form and legality.
Environmental Review:
The proposed presentation and Board direction do not constitute a “project” under the definition set forth in California Environmental Quality Act (CEQA) Guidelines Section 15378 because no direct or indirect changes to the physical environment would occur. CEQA requires that the District adequately assess the environmental impacts of projects and reasonably foreseeable activities that may result from projects prior to the approval of the same. Any project developed as a result of Board’s direction that requires the District or the Board’s discretionary approval resulting in a physical change to the environment will be analyzed in accordance with CEQA prior to such approval. CEQA review may result in the District, in its sole and absolute discretion, requiring implementation of mitigation measures, adopting an alternative, including without limitation, a “no project alternative” or adopting a Statement of Overriding Consideration, if required. The proposed presentation and Board direction in no way limit the exercise of this discretion. Therefore, no further CEQA review is required.
The proposed presentation and Board direction comply with Section 35 of the Port Act, which allows for the Board to do all acts necessary and convenient for the exercise of its powers. The Port Act was enacted by the California Legislature and is consistent with the Public Trust Doctrine. Consequently, the presentation and Board direction are consistent with the Public Trust Doctrine.
The proposed presentation and Board direction do not allow for “development,” as defined in Section 30106 of the California Coastal Act, or “new development,” pursuant to Section 1.a. of the District’s Coastal Development Permit (CDP) Regulations because they will not result in, without limitation, a physical change, change in use or increase the intensity of uses. Therefore, issuance of a Coastal Development Permit or exclusion is not required. However, development within the District requires processing under the District’s CDP Regulations. Future development, as defined in Section 30106 of the Coastal Act, will remain subject to its own independent review pursuant to the District’s certified CDP Regulations, PMP, and Chapters 3 and 8 of the Coastal Act. The proposed presentation and Board direction in no way limit the exercise of the District’s discretion under the District’s CDP Regulations. Therefore, issuance of a CDP or exclusion is not required at this time.
Equal Opportunity Program:
Not applicable.
PREPARED BY:
David Yow
Legislative Policy Administrator, Government & Civic Relations
Attachment(s):
Attachment A: 2018-2022 Legislative Platform