(a) The division shall not make expenditures from the Oil, Gas, and Geothermal Administrative Fund pursuant to this article that exceed the following sum any one fiscal year:

(1) Three million dollars ($3,000,000), commencing on July 1, 2018, for the 2018-19 fiscal year, and continuing for three fiscal years thereafter.

(2) Commencing with the 2022-23 fiscal year, and each fiscal year thereafter, five million dollars ($5,000,000). On a one-time basis, the division may also expend each of the following amounts:

(A) For the 2024-25 fiscal year, seven million five hundred thousand dollars ($7,500,000), as a match to the dedicated General Fund appropriation for the 2022-23 fiscal year for the purposes of plugging and abandoning wells, decommissioning facilities, and site remediation pursuant to this article.

(B)  For the 2025-26 fiscal year, seven million five hundred thousand dollars ($7,500,000), only if there is a dedicated General Fund appropriation for the 2023-24 fiscal year for the purposes of plugging and abandoning wells, decommissioning facilities, and site remediation pursuant to this article.

(b) (1) The expenditure limits of subdivision (a) also apply to expenditures by the division from the Oil, Gas, and Geothermal Administrative Fund pursuant to Section 3226, unless the division obtains a lien against real or personal property of the operator. If the division obtains a lien against real or personal property of greater value than the amount of the expenditure, then the amount of the expenditure shall not count against the expenditure limit of subdivision (a). If the division obtains a lien against real or personal property of lesser value than the amount of the expenditure, then only the difference between the amount of the expenditure and the value of the property counts against the expenditure limit of subdivision (a). Any moneys recovered by the division pursuant to Section 3226 shall be deposited in the Oil and Gas Environmental Remediation Account, unless the moneys are recovered against expenditures that have been or will be made from the Hazardous and Idle-Deserted Well Abatement Fund.

(2) (A) Commencing with the 2023-24 fiscal year, in any fiscal year that the division makes expenditures that are less than the amount appropriated in the annual state Budget Act or any other law related to the expenditures described in subdivision (a), the Controller shall transfer from the Oil, Gas, and Geothermal Administrative Fund to the Oil and Gas Environmental Remediation Account, established pursuant to Section 3261, an amount equal to the difference between what was appropriated and what was encumbered pursuant to this article by the division for that fiscal year, unless there is more than two hundred million dollars ($200,000,000) in the account.

(B) Upon the order of the Department of Finance, the Controller shall transfer the unencumbered amount from the Oil, Gas, and Geothermal Administrative Fund to the Oil and Gas Environmental Remediation Account.

(c) Moneys expended pursuant to this article shall be used exclusively for plugging and abandoning hazardous or idle-deserted wells, decommissioning hazardous or deserted facilities, or otherwise remediating well sites of hazardous or idle-deserted wells.

(d) The division shall develop criteria for determining the priority of plugging and abandoning hazardous or idle-deserted wells and decommissioning hazardous or deserted facilities to be remediated pursuant to this article and performing work pursuant to Section 3226. The criteria shall consider the information required to be reported pursuant to subdivision (e). The Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code) does not apply to the development of criteria by the division pursuant to this subdivision.

(e) (1) (A) On April 1, 2021, the department shall report to the Legislature on the number of hazardous wells, idle-deserted wells, deserted facilities, and hazardous facilities remaining, the estimated costs of abandoning and decommissioning those wells and facilities, and a timeline for future abandonment and decommissioning of those wells and facilities with a specific schedule of goals. By April 1, 2022, the department shall report to the Legislature the location of the applicable wells and facilities, including the county in which they are located, if the information is not otherwise included in the April 1, 2021, report described in this paragraph.

(B) As part of the report required in subparagraph (A), the department shall provide recommendations to the Legislature for improving and optimizing the involvement of local agencies in the process of plugging and abandoning wells and decommissioning facilities. In drafting these recommendations, the department shall consider factors unique to each of the division’s districts, and shall consult with local agencies in developing recommendations.

(C) In collecting the information for the report required in subparagraph (A), the division shall conduct field inspections of hazardous wells, idle-deserted wells, deserted facilities, and hazardous facilities and include information in the report from the field inspections that can be used to prioritize those wells and facilities in the specific schedule of goals.

(2) On October 1, 2023, and annually thereafter, the department shall provide to the Legislature an update on the report required in paragraph (1) that describes the total costs, average costs per well and facility, the number of wells plugged and abandoned, the number of facilities decommissioned, the total number of projects completed, and any additional wells and facilities identified by the department requiring abandonment or decommissioning. The update shall include the location, including the county, of applicable wells, facilities, and projects identified in the report.

(3) The report and update to the report required to be submitted under this subdivision shall be submitted in compliance with § 9795 of the Government Code.

(Amended by Stats. 2023, Ch. 51, Sec. 19. (SB 122) Effective July 10, 2023.)