1:00 p.m. - 2:50 p.m. Thursday, January 19, 2012 Indian Wells, California
Land Use & Environment Committee Mission Statement: This Committee is a Policy committee. Its mission is to develop C.A.R.'s land use and environmental policy. It has original jurisdiction to evaluate legislation and regulation in the following issue areas as they relate to real estate: Environmental, Land Use and Zoning, Property Rights, Resources, and Subdivision and Development.
Presiding: Shari Setser, Chair Peter Morris, Vice Chair
Issue Chairs: Nick Lymberis, Environmental Barbara Delgleize, Land Use and Zoning Kim Tucker, Property Rights Sandy Darling, Resources Steven Rice, Subdivision and Development
Staff Coordinator: Jelisaveta Gavric Federal Committee Staff: Matthew Roberts
I. Welcome and Opening Remarks - Shari Setser, Chair
II. Informational Items: C.A.R. Policy Development - Peter Morris, Vice Chair
III. Environmental - Nick Lymberis, Issue Chair A. State Wetland Issues C.A.R. has been working with a coalition to interface with the State Water Resources Control Board (SWRCB) to develop an acceptable definition of "wetlands" and subsequent regulatory program for the past several years. New discussions with the Governor's office indicate that an expansion of the definition (thus increase in areas considered wetlands) is consistent with the Administration’s goals.
B. Carbon Dioxide Regulations and Related Research Activity If energy efficiency were federally mandated, property owners’ ability to sell their home or building would be at risk without first having to conduct energy audits and improve its heating and cooling system, windows, insulation and/or lighting.
NAR supports improving energy efficiency through voluntary incentives, commercially reasonable approaches and education in lieu of individual building mandates. The policy opposes applying existing laws/regulations that are not designed for global climate change; provisions that impose undue economic burdens on property owners or managers; or triggering such requirements at the time when real property is sold.
The Environmental Protection Agency (EPA) has begun to phase-in regulations of CO2 from large emitters, such as power plants and manufacturing facilities, although legislation and lawsuits to stop them are now pending. Phase 2 of these regulations, when finalized in 5 to 7 years, could begin to regulate relatively smaller emitters, including commercial and apartment buildings depending on where EPA sets a revised regulatory threshold. Under the Clean Air Act, a building owner would be required to obtain federal construction and operating permits including the installation of “Best Available Control Technologies.”
NAR filed multiple comment letters against the EPA regulating CO2 from commercial or residential buildings. While Phase II of these regulations could be delayed, due to pending litigation, EPA nevertheless will continue to move forward with Phase I and will begin to collect and analyze data on revising the CO2 thresholds at some point in the future.
In order to further explore the impacts of CO2 regulation on buildings, NAR has commissioned a report to explore how this kind of regulation would impact the real estate sector. This report will provide an analysis of the regulation, focusing on its relationship to real estate and will provide a case study and analysis of how a building, if required to obtain a permit to release CO2, might do this and related expenses and administrative costs. This report should be completed by December 2012.
C. Lead Paint RRP Proposed Rule for Commercial Buildings To limit exposure of humans, especially children, to lead-based paint hazards, Congress in 1992 enacted the Residential Lead-Based Paint Hazard Reduction Act (Title X of Public Law 102-550). Section 1018 of Title X regulates disclosure of lead-based paint in sales and lease transactions involving pre-1978 residential properties.
The most recent EPA rule in this area regulates the creation of lead hazards during renovation, repair and painting activities in residential property. EPA is requiring contractors and renovators to comply with additional regulatory procedures before, during and after any remodeling or renovation activity to reduce the creation of lead dust. EPA is now beginning to develop proposed regulations that address RRP activities in commercial buildings.
Similar rules for commercial buildings could impose increased regulatory burdens and costs on commercial property managers and Realtors with commercial property management responsibilities.
REALTORS® oppose mandatory testing for lead-based paint tied to the transaction process and supports property condition disclosure and education. NAR also opposed the renovation, repair and painting rule due to its costs and administrative burdens.
The rulemaking process for the proposed commercial RRP rule has just begun. EPA is required by a court settlement to propose a rule regulating RRP activities on the exterior of commercial buildings by December 2011 and finalize this exterior rule by July 2013.
The agency is required to propose a rule that addresses RRP activities for the interior of commercial buildings, but the timing of that proposed interior rule is contingent upon additional research and the collection of scientific information. The EPA may propose a rule for reducing lead hazards inside commercial buildings by December, 2013, with a finalized rule at some point in 2015.
To address these proposed rulemakings, NAR has convened meetings with EPA staff, hired legal counsel to provide strategic advice on how to best have EPA address our concerns, and is working in coalition with other regulated stakeholders to ensure our concerns are heard by EPA and Members of Congress. NAR will also comment on the proposed commercial building RRP exterior rule when it is published in the Federal Register.
D. Questions on Reported Items or Other Business?
IV. Land Use and Zoning - Barbara Delgleize, Issue Chair A. Rural Property Fire Fees - On November 9, 2011, the California Board of Forestry and Fire Protection passed an emergency regulation that will assess a fee of up to $150 per structure in the State Responsibility Areas across California. An estimated 800,000 structures in rural areas, including homes and office buildings, will be subject to the fee.
B. National Flood Insurance Program On Dec. 17, 2011, Congress extended National Flood Insurance Program (NFIP) authority through May 31, 2012. This latest extension was a part of H.R. 2055, the so-called megabus conference report combining the remaining nine appropriations bills to fund the federal government for FY2012. NAR is urging Congress to use the additional time to complete work on a 5-year NFIP re-authorization bill (H.R. 1309) to provide certainty and avoid further disruption to real estate markets.
C. Questions on Reported Items or Other Business?
V. Property Rights - Kim Tucker, Issue Chair A. AB 742 (Lowenthal) Surface Mining: Indian reservation and sacred sites - OPPOSE: This bill amends the Surface Mining and Reclamation Act of 1975 to add new prohibitions to conducting surface mining near Indian reservation and Native American sacred sites, thereby creating state circumvention of local land use decision making.
B. SB 588 (Evans) Coastal resources: California Coastal Act of 1976: enforcement: penalties - OPPOSE. This bill would give the California Coastal Commission authority to pursue and retain the penalties collected and to pursue a judicial action and obtain judgment liens to collect those penalties.
C. Questions on Reported Items or Other Business?
VI. Resources - Sandy Darling, Issue Chair A. XB XXX (XXXXX) Energy Resources: energy savings program - SPONSORED This bill is being introduced to address the burdensome retrofit standards being written by the California Energy Commission in the AB 758 regulatory development process. AB 758 (Skinner), which passed into law in 2009, prohibits any required energy efficiency retrofits from unreasonably or unnecessarily affecting the home purchase process. The CEC considers POS audit and retrofit requirements reasonable and necessary. This bill will define “unreasonable or unnecessary effects” for the purposes of this existing law to include any additional upfront costs, time delays or retrofits where the cost of implementation cannot be recovered over the life of the retrofit.
B. AB 904 (Skinner) Energy Efficiency - SUPPORT. This bill will require the Public Utilities Commission to substantiate the efficacy of energy efficiency programs and evaluate all reasonable alternatives for financing residential energy efficiency retrofits.
C. AB 1054 (Skinner) Energy: clean energy financing - SUPPORT. Creates a functional alternative to the Property Assessed Clean Energy (PACE) Reserve Program to assist with the financing of renewable energy sources or energy or water efficiency.
D. AB 1370 (Hernandez) Public Utilities Commission: ratepayer's interest - SUPPORT IF AMENDED. This bill would revise the definition of utility ratepayer benefit using a cost-benefit ratio. C.A.R. has submitted language to the author to also add the definition of "cost effective" as defined by HUD. If the author amends the bill to include the HUD definition, C.A.R. will support the bill.
E. Energy Use Labeling Programs The U.S. Department of Energy (DOE or the Department) seeks to develop a voluntary National Asset Rating Program for Commercial Buildings (AR Program). The AR Program would establish an Asset Rating system for commercial buildings based on a national standard and would evaluate the physical characteristics and as-built energy efficiency of these buildings. It would also identify potential energy efficiency improvements. The goal is to facilitate cost-effective investment in energy efficiency and reduce energy use in the commercial building sector.
F. Questions on Reported Items or Other Business?
VII. Subdivision & Development - Steven Rice, Issue Chair A. AB 49 (Gatto) Development: expedited permit review - SUPPORT. AB 49 will require the State to assist developers of commercial or industrial projects with the permitting process and meeting environmental quality requirements. The bill also helps city and county agencies create an expedited development permit process.
B. Earthquake Insurance California Senators Dianne Feinstein and Barbara Boxer in March introduced S. 637, the Earthquake Insurance Affordability Act, and California Congressman John Campbell has signaled his intention to introduce companion legislation in the House before the end of the year. The legislation would authorize the Treasury to guarantee debt issued by qualified state earthquake insurance programs such as the California Earthquake Authority (CEA). The purpose of this legislation is to allow the CEA to avoid paying the high cost of re-insurance premiums. It has been estimated that if this legislation passes the CEA would be able to reduce their premiums by up to 30 percent or cut their deductible by up to 50 percent.
C.A.R. has supported the involvement of the federal government in backstopping the CEA through previous bill that would have created a federal reinsurance program. It is unclear if this policy covers the guaranteeing of CEA debt by the Treasury as proposed in these bills.
C. Questions on Reported Items or Other Business?
VIII. New Business / Other?
IX. REALTOR® Committee on Air Quality
X. Closing Remarks
"*" indicates that issue briefing materials are included with the reporting committee's agenda materials.