New Greenhouse Gas Legislation Affecting Agriculture SB 32, AB 197 SB 1383

By Lee N. Smith & Craig A. Tristao

The new Greenhouse gas legislation “package” extends California’s  Gas Cap & Trade program and sets   new emission  reduction goals for 2030. It further sets emission reductions for methane.  The legislation has the potential to impact dairies, landfills and composting operations. The attached powerpoint which was originally presented at the  Manufacturers’ Council of the Central Valley September meeting, provides a review of California legislation regarding climate change law (SB32, AB 197 and SB 1383) together with an explanation of what it means to the Dairy Industry.  2016-09-21-mccv-presentation-sb-32-ab-197-cat-and-lns

New Prop 65 Regulations have Been Approved

In August 2016 OEHHA finalized the new Prop 65 Warning regulations.

• In summary, there is new safe harbor language, a new website for consumers, and attempts to clarify liability as between manufacturers and retailers. The new regulations go into effect on August 30, 2018, new labels can however be used before that time. The language required by Consent Judgments is considered within safe harbor. The new labels contain language that requires the identification of at least one of the Proposition 65 chemicals in the product.The language for each of the types of warnings (i.e. environmental vs. product) has changed.
• The emphasis is for liability to the manufacturer; along with additional duties toward vendors.
• There is new web Proposition 65 site sponsored by OEHHA.
• There are new symbols required on the safe harbor labels.
• Manufacturer/Retail Seller Responsibilities
  • Product manufacturers have primary responsibility for warning.
  • Manufacturer can label product or provide notice to distributor/importer/retail seller that a product may cause an exposure to a listed chemical.
  • Provide warning signs, materials (unless they make other arrangements via contract).
    • Retail sellers confirm receipt of notice act as “pass-through” for warning.
  • Provide non-English language warnings in certain situations.
  • Safe Harbor Content and Methods
• “This product contains….”
  • “This product can expose you to….”
  • The name of at least one chemical in the warning.
  • Warning required for chemicals A and B.  Business can include the name of A or B, or both.
  • Named chemicals are those for which warning is being provided.
  • Business selects which chemical(s) to include in warning.
  • Answers question: “What am I being exposed to?”
  • OEHHA web site URL
  • Warning symbol

• Phase In:
• Two-year phase-in period.
• Effective date of regulation: August 30, 2018.
• Consumer products manufactured prior to the effective date will not require new warnings if they meet existing safe harbor requirements.
• Court-approved warnings expressly recognized and considered “clear and reasonable” for parties to litigation.
• Tailored Warnings; in addition to the specific warnings listed above, the code has modified the warnings for the following categories:
• Environmental Exposure
• Occupational Exposure
• Specific Product, Chemical and Area Exposure Warnings
• Food
• Alcoholic Beverages
• Food and Non-Alcoholic Beverages
• Prescription Drug Exposure and Emergency Medical or Dental Care Exposure
• Dental Care
• Raw Wood Products
• Furniture Products
• Diesel Engines
• Vehicles
• Recreational Vessels
• Enclosed Parking Facilities
• Amusement Parks
• Petroleum Products
• Service Station and Vehicle Repair
• Designated Smoking Areas

Prop 65 Rules Finalized ? Current Revisions

Oeeha has revised the new notice regulations requesting comments by June 6, 2016.

following is quoted from the Oehha site.

The The most significant changes are summarized below:

• In Section 25600(e) the term “fully” was removed.  This provision is intended to be a statement of current law.  Specifically, if a party to a court-ordered settlement or judgement complies with the order requiring a particular method or content for a warning, the warnings provided are clear and reasonable as a matter of law.  Commenters asked that OEHHA clarify its intent that this provision is not intended to provide a new avenue for enforcement of the law through this provision.
• Section 25600(f) was moved from Section 25601(b) and slightly modified to clarify that businesses are free to provide a warning that is different from the safe harbor methods and content specified in Subarticle 2 as long as the warning complies with Section 25249.6 of the Act.
• Section 25600.1(c) was revised by removing the phrase, “but is not limited to” and adding the words, “company name, location of manufacture” as additional exceptions to the definition of “consumer information”.
• In Section 25600.1(e) the word “consumer” was added to clarify the type of product intended to be included.
• In response to several comments, section 25600.1(f) was revised to delete the words “medium, including but not limited to”, add the term “source, such as”, and add the phrase “or objects”, to better clarify the sources of exposure that should be identified in an environmental exposure warning.
• In Section 25600.2(a) the phrase, “to the extent practicable” was added to parallel the statutory requirement concerning adopting regulations concerning clear and reasonable warnings.
• Section 25601(b) (formerly numbered as subsection (c)) was revised to remove, “for which the person has determined a warning is required” and replaced with, “in the consumer product or affected area for which the warning is being provided” to clarify that the regulation does not impose any new testing or burden of proof requirements for a business.  This regulation only applies where a business has already decided to provide a warning; it does not determine when a warning is required.
• Sections 25602(d) and 25607.1(c) were revised to better clarify the circumstances under which a warning must be provided in a language other than English.
• Based on several comments, clarifying changes were made for consistency throughout the regulation to terms that were being used inconsistently including “label”, “warning labels”, “warning materials” and “warning information”.
• The uniform resource locators (URLs) for the general warning content were shortened to “WWW.P65Warnings.ca.gov” for simplicity and consistency with the existing structure of the warnings website.
• In Section 25603(a)(2) and throughout the regulations the term, “such as” was replaced with “including” for the warning content in response to comments suggesting the word is more clear.
• Section 25603(a)(2)(E) was added to allow a business to provide a consumer product warning for a single chemical exposure, by allowing the business to delete the words “chemicals including” from the safe harbor warning content.
• Section 25604(a) was revised to ensure consistency in the format, structure and requirements for environmental warnings.
• Section 25605(a) was revised for readability and clarity.  An example of the text of a compliant warning is as follows:

WARNING: Entering this area can expose you to chemicals known to the State of California to cause cancer, including asbestos, from construction debris. For more information go to www.P65Warnings.ca.gov(link is external).

• Section 25605(a) was modified to allow a business to provide an environmental warning for a single chemical exposure.
• Section 25606(b) was added to clarify that occupational exposure warnings for chemicals that are not covered under subsection (a) can be provided using the methods and content requirements set out in the regulations for consumer product or environmental exposures.
• Section 25607.2(a)(4) was revised for consistency with the other consumer product warnings.
• Section 25607.2(a)(6) was added to allow a business to provide a food product  warning for a single chemical exposure, by allowing the business to delete the words “chemicals including” from the safe harbor warning content.
• Section 25607.23(a)(3) the warning content for the amusement park tailored warning was revised to replace “[Name of one or more exposure source(s)]” with “Some areas or features” in consideration of the unique characteristics of environmental exposure scenarios in amusement parks.  OEHHA intends to develop more information for its website concerning the most common sources of exposures, the chemicals that are likely to be present at amusement parks, and ways patrons can reduce or avoid exposures in order to supplement this warning, just as OEHHA plans to provide more detailed website information for all of the tailored warnings.

Amended Notice Regulations for Prop 65

OEHHA,  the Office of Environmental Health Hazard Assessment, has released yet another iteration of the “fair and reasonable” standard for Prop 65 warnings. This March draft contains numerous changes mostly minor changes to try to increase the clarity of the language. Originally in March of 2014, OEHHA i

ssued a “pre-regulatory draft” of the regulations, and after several iterations OEHHA issued a revised formal proposal in January of 2016. These changes are a result of comments on that version. The Website called for in the original revision of the regulations to clarify warnings is already online see:

Among the more substantive changes are the following:

• The last version allowed supplemental language in the warning as long as it does not contradict the language in the warning. However, with these changes the Supplemental information can be used as part of a warning only to the extent that it explains the source of the exposure or provides information on how to avoid or reduce the exposure.

• The new draft eliminates the option that was previously provided that would allow a manufacturer to meet its labeling requirements by providing labeling materials and/or signs to downstream suppliers, now however the responsible party (manufacturer, importer, supplier, etc.) must actually provide those materials unless there is an agreement otherwise.

• Retail seller is responsible for internet warnings.

• The November draft imposed the warning obligation on the retailer where it has “actual knowledge” of the potential consumer product exposure and where there is no manufacturer or other responsible party available to provide the warning. The draft defined “actual knowledge” as occurring within two days after the retailer receives a Prop. 65 notice intent-to-sue notice, this period has been extended to five days. A retailer may label during that period and avoid liability.

• A business may satisfy its warning obligation by including by name only one of the chemicals for which the business has determined that a warning is required.

• Where there are chemicals in the product with different warning requirements (i.e., a carcinogen and a reproductive toxicant) then the warning must include one chemical from each group. OEHHA has also dropped language requiring that the named chemical actually be present in levels above the safe harbor level for that chemical.

• A warning provided before the two year effective date will be deemed to be clear and reasonable.

• OEHHA has also added new sections defining “consumer product exposure” and “environmental exposure” and the requisite warnings that must be displayed. They also eliminated any requirement for type size beyond requiring the warnings to be “conspicuous” in relation to other product label or sign language.

PME Speakers at Cal. League of Food Processor’s Food Safety, Nutrition and Labeling Committee

   PME lawyers Lee Smith and Craig Tristao spoke at the CLFP’s Food Safety Nutrition and Labeling Committee, on May 16, 2016. They covered the topics of the State Water Board’s Proposed General Order for Recycled Water and on the use of Production Water on Agricultural. If you are interested in the PowerPoints or having a repeat performance of the presentation please contact us.

Prop 65: Revisions to Proposed Regulations

By: Lee N. Smith

California’s Office of Environmental Health Hazard Assessment (“OEHHA”) has released a new, revised version of the proposed Proposition 65 warning regulations apparently because they could

not finish their rulemaking within one year, as required by law.  The delay was caused reportedly by problems that the Agency was having in reconciling the diverse views demonstrated by the public comments and surveys generated by the last round of regulations.  The Agency announced over the 2015 Thanksgiving holiday weekend that it was withdrawing the January 2015 proposal for the warning regulations and replacing it with this alternate proposal. Although the new regulations attempt to address some of the more controversial issues that were contained in the earlier versions there are still some portions of the revised regulations that will continue to trouble industry.  Comments are due on January 22, 2016. The Notice can be found here:

http://oehha.ca.gov/prop65/CRNR_notices/WarningWeb/2NPRArticle112715.html

The new regulations revise the proposed safe harbor warning language to include the statement that the chemical “can” expose a person to proposition 65 chemicals and substances as opposed to the “will” expose language that had been suggested earlier. They also eliminated the regulation that would have required that the 12 most common Proposition 65 chemicals and the related compounds to be set out in the warning. The proposal provides little guidance or definition of what constitutes a clear and reasonable warning but does suggest that manufacturers and retailers name one of the chemicals subject to the warning and potential liability for failing to identify other chemicals that may be present.

The generic safe harbor warning has the following elements:

1. A symbol consisting of a black exclamation point in a yellow equilateral triangle.  Where the sign, label or labeling for the product is not printed using the color yellow, the symbol may be printed in black and white. The symbol shall be placed to the left of the text of the warning, in a size no smaller than the height of the word “WARNING”.

2.  The word “WARNING” in all capital letters and bold print, and

(A)  For exposures to listed carcinogens, the words, “This product can expose you to [name of one or more chemicals], a chemical [or chemicals] known to the State of California to cause For more information go to www.P65Warnings.ca.gov/product.”

(B)  For exposures to listed reproductive toxicants, the words, “This product can expose you to [name of one or more chemicals], a chemical [or chemicals] known to the State of California to cause birth defects or other reproductive harm. For more information go to www.P65Warnings.ca.gov/product.”

(C)  For exposures to listed carcinogens and reproductive toxicants, the words, “This product can expose you to [name of one or more chemicals] a chemical [or chemicals] known to the State of California to cause cancer and birth defects or other reproductive harm. For more information go to www.P65Warnings.ca.gov/product.”

The Agency set forth an example in its Power Points for a January meeting:

Warnings provided pursuant to a court approved settlement or by a filed consent judgment are presumed to be “clear and reasonable” This provision does not apply to out-of-court settlements making that avenue of settlement even less attractive than before.

Another change in the proposal would prevent unnecessary labeling of mandatory inventory by dropping the sell through limitations. This was an issue because parts manufactured before the adoption would have to be relabeled if they were manufactured two years after adoption of these regulations. The November draft fixes this problem by providing that products manufactured prior to the deadline considered clear and reasonable if it is in compliance with the prior 2008 regulations.

The following is a summary of the significant revised regulations:

1)         Two Years before it becomes effective;

2)        An interested party can request approval of a warning method or content specific to a content area pursuant to Section 25607;

3)         Supplemental information from the labeling can be provide to consumers, but it cannot contradict the warning;

4)        A person is not required to provide separate warnings to each exposed individual;

5)         A person that is a party to a court order settlement of final judgment establishing a method or content for a consumer product of environmental warning is deemed to be clear and reasonable;

6)          Provides a method for the manufacturers to provide warning and instructions to retailers;

7)          The regulation provides circumstances under which retailer is required to provide their own labels;

8)         Retail seller is required to provide information to various parties as to the identity of manufacturers;

9)         Parties can enter into agreements allocating liability for warnings;

10)      Except as provided in Section 25603(c), a warning meets the requirements of this article if the name of one or more of the listed chemicals for which the warning is being provided is included in the text of the warning, to the extent that an exposure to that chemical or chemicals is at a level that requires a warning;

11)     The regulations contain specific requirements for the new labels, including point type;

12)      There are requirements for sales over the internet and catalog purchases;

13)      If any label, labeling or sign that provides consumer information about a product is provided in a language or languages other than or in addition to English, then a warning for that product meets the requirements of this article only if the warning is also provided in the same language or languages on that label, labeling or sign.

Section 25607 provides warning methods and content for specific types of exposures that are subject to the warning requirements of Section 25249.6 of the Act, and must be used for the indicated products in order to meet the safe harbor requirement.   These products include:

1. Food
2. Alcohol Specific warning requirements for alcohol products,
3. Wood Dust
4. Raw wood products
5. Furniture

The specific warnings for these products can be found in the direct regulations at Section 25607.  Initial public comments are due on January 22, 2016.

Prop 65: Acrylamide in your Coffee ? Court Issues Tentative Order

by Lee N. Smith  In a case that has been widely watched, a Central Los Angeles Superior Court has issued a tentative ruling in the Phase One portion of a case that was originally filed against coffee purveyors, alleging that the acrylamide levels in their coffee products exceed the Prop 65 levels that require warnings.  Acrylamide is an interesting chemical as many times it is created when the product is cooked or prepared rather than contained in volume in the original product. One of the original Prop 65 cases involved whether potatoes and subsequent products were regulated under Prop 65 as the acrylamide was generated during cooking.

The case CERT v. Starbucks BC 435759 expanded to include a larger group of manufacturers and retailers. Phase I of the case was to address three issues. The first issue was whether the products created a significant risk of cancer, the second and third issues were whether there was first amendment right, or federal preemption issues that govern Prop 65 labels. The last two issues have been unsuccessfully argued in the past.

In this case the court has tentatively found that the defendants have not proven that the levels in their products are below the threshold and therefore do not present a significant risk of cancer. Defendants argued that the coffee as a whole, including a myriad of other chemical was not a cancer risk. The Court disagreed and defendants have until July 16 to finalize any objection to his conclusion. The phase II portion of the case then relates to whether any Proposition 65 labelling requirements were violated. The Court also found against defendants on the other two issues as well.

Additional Revisions to Prop 65 Regulations

Written by Lee Smith

The recent revisions of the Prop 65 regulation have been revised, again. Proposed Section 25205 concerns the content of the Lead Agency Website. Under this section the agency is to maintain a web-based portal to collect and display information provided to the agency by manufacturers related to exposures. These regulations require a manufacturer, producer, distributor or importer of a product, including food, to provide details of the product including information concerning the listed chemical and the labels. Information such as the concentration of the chemical may be required. The particular change at issue is to remove the ability of the supplier of that information to include a disclaimer. It also specifies no additional laboratory work should be required to comply with this section. This is a small portion of the larger changes that are expected to be approved with the new rule that changes the warning requirements as to the more common Prop 65 Chemicals. The revised rule can be found here.

State Water Board Uses Term 91 as the Basis for Curtailment Orders to Water Right Permit and License Holders

On April 30, 2015 the State Water Resources Control Board declared that (1) water being released from state and federal water projects is being released in the Sacramento-San Joaquin Delta Watershed (Delta Watershed) and (2) the Delta is in Balanced Condition. It then issued curtailment notices to 88 holders of post 1914 water rights permits and licenses in the Delta Watershed whose permit or license contains Term 91.

So, what is Term 91: when did it come into effect, what water right permits or licenses does it apply to, what is its purpose, and when can the State Water Resources Board issue curtailments under Term as it did on April 30th?

On March 25, 1980 the State Water Resources Control Board adopted term No. 91. Term 91 applies to permits or licenses obtained after August 16, 1978 that (1) authorize the diversion of water within the Delta Watershed at a rate greater than one cubic foot per second or (2) authorize the collection to storage within the Delta of more than 100 acre-feet of water per year. Its purpose is to allow for the improvement of water quality in the Delta. Term 91 prohibits, via curtailment orders, water right permit holders or licensees that contain the provision from diverting water when the amount of water being released from “the Shasta, Oroville, and Folsom reservoirs, plus the amount of water the Bureau of Reclamation is importing from the Trinity River, exceeds the amount of water the projects are exporting from the Delta plus “carriage water,” which is “the amount of additional Delta outflow required to compensate for currents created by the export pumps.” (El Dorado Irr. Dist. v. State Water Resources Control Bd. (2006) 142 Cal.App.4th 937, 951.) When such circumstances exist the water that the state and federal governments are releasing is considered their “own stored or imported water” and that its use is to meet water quality objectives or other in basin demands. (Ibid.)

The State Water Resources Control Board consults with the U.S Bureau of Reclamation and the California Department of Water Resources to determine when to curtail water rights subject to Term 91. Curtailments under Term 91 can be issued when the following conditions exist:
The Projects are releasing previously stored Supplemental Project Water to meet water quality objectives and in basin entitlements in the Delta.
The condition of the Delta is declared to be “Balanced” by the U.S Bureau of Reclamation and the California Department of Water Resources. The condition of the Delta is generally declared to be “Balanced” when water quality objectives and in basin entitlements are only being met because of the release of previously stored Supplemental Project Water. When there is sufficient flow through the Delta to meet water quality objectives and in basin entitlements without requiring the release of Supplemental Project Water, the condition of the Delta is declared to be “Excess.”
If you have any questions concerning Term 91, or other methods available to the State Water Resources control Board to curtail your use of water please feel free to contact me at (559) 447-5700.

The curtailment notice can be viewed here.
The source data used to determine if Supplemental Project Water is being released into the Delta can be viewed here.

The source used to determine if the condition of the Delta is “Balanced” or “Excess” can be viewed here.

Additional Sources: http://www.waterboards.ca.gov/board_info/agendas/2012/dec/120412_10.pdf, http://www.waterboards.ca.gov/waterrights/water_issues/programs/applications/docs/term9193.pdf

The State Water Board has Curtailed All Post-1914 Water Rights Permits, Licenses, Registrations and Certificates.

On May 1, 2015 the State Water Resources Control Board issued an immediate curtailment notice to those diverting water from the Sacramento River Watershed and Delta under a Post-1914 water right permit, license, registration or certificate.

This curtailment follows several issued in April:

• 3rd: Curtailment order concerning diversions from the Antelope Creek Watershed.
• 17th: Curtailment order concerning diversions from the Deer Creek Watershed.
• 23rd: Curtailment notice concerning diversions from the Scott River Watershed.
• 23rd: Curtailment notice concerning diversions from the San Joaquin River Watershed.
• 30th: Term 91 curtailment notice concerning diversions from the San Joaquin Delta Watershed.

The curtailment orders, while issued purportedly in accordance with state law, have issued in such a way that their purpose is to create debate about the supremacy of Pre-1914 rights.

Concurrently during April the Department of Water Resources (DWR) held listening sessions concerning the Sustainable Groundwater Management Act have yielded discussion from the public, primarily environmental activists, about groundwater sustainability agencies (GSAs) regulating agricultural uses of water through groundwater sustainability plans (GSPs) – either by decreasing extractions by blaming agriculture for water quality issues or setting tiered extraction fees based on the commodity grown. These ideas, unfortunately, are not being rebuffed by DWR as an appropriate exercise of power by GSAs.

The above combines to create great turmoil for agriculture: pitting farmers, ranchers and dairymen with junior rights against those who hold senior pre-1914 rights, and pitting all agricultural users against new local agencies that environmental activists will try to influence to further choke out agriculture.