sr-051380-13dCA:SSS:se
Council Meeting 05-13-80
Santa ri7onica, California
STAFF REPORT
To: Mayor and City Council
From: City Atttornev
Subject; Proposed Toxic Chemicals and. Hazardous Wastes
Disclosure Law
INTRODUCTION
This report analyzes a proposed ordinance that would
require persons doing business in Santa Monica to disclose
to the City certain toxic chemicals and hazardous wastes
stored or used by them in the conduct of their businesses.
LEGAL ANALYSIS
1. LEGALITY OF THE PROPOSED ORDINANCE
The proposed ordinance is clearly within the City°s
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powers to regulate public health and safety. The protection
of public health and the local environment is deemed to be
a "municipal affair" and of ".,peculiar-local concern" for.
purposes of_ ''determining whether a local law is preempted
by State or Federal law. Since there is no direct conflict
with any State or Federal law, nor disruption of any uniform
State or' Federal regulatory scheme, we conclude that the
proposers ordinance is not preempted. It is believed this con-
clusion will also apply to the new E. P. A. regulations, to be
published this week and to pending State legislation. i~7h;le
the ordinance may have some marginal impact on commerce,. it
does not discriminate against or substantially burden interstate
commerce, and thus does net violate the Commerce Clause.
The disclosure requirements are reasonably adapted to
achiwe the ends of the ordinance - - to allow the City government and
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the public to have information concerning potentially
hazardous substances. There is a rational basis for requiring
disclosure. The threat to public health from toxic chemicals
br hazar_dous wastes is real, there is some probability of the
recurrence of an incident of chemical pollution, and the
consequences of an undetected incident --are-severe. The require-
ment of disclosure by businesses but not by other residents
is a rational classification, and is not invidiously discrim-
inatory. Similarly, the classifications suggested in the
alternatives mentioned in the City Staff Report are also
rational. The burden imposed upon persons subject to the law
does not appear "unreasonable" as a matter°of :law. Thus;' we
conclude that the proposed'ordnance'does not 'violate'. the con-
stitutional guarantee of-Equal Protection of Law.
The City may lawfully impose a fee upon those subject to
disclosure to cover the cost of processing the information and
inspection of business establishments to insure compliance with
the law. It is inappropriate to consider the costs of prosecution
in computing the fee; such costs should be borne by the
public generally, and not imposed upon the target population.
It is not believed that the proposed ordinance will require
additional personnel in the City Attorney's office.
It is proper to impose civil or criminal penalties for a
violation of the proposed ordinance. A?hile Section 1200 of the
?~Tunicipal Code makes any violation of the Code a misdemeanor,
it is appropriate to specify misdemeanor penalties in the
ordinance itself. The persons who enforce the ordinance should
be specifically given the power to request inspection warrants
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in those cases where entry is refused, and the power to issue
citations to violators rather than effecting custodial arrests.
2. SECTION-BY-SEC`_J'ION ANALYSIS, WITH ALTERNATIVES
Section 5300 of the .ordinance contains legislative findings
and a statement of purpose. The Council should review the in-
dividual findings to determine if it is in accord with them.
Section 5301 defines those toxic chemicals and hazardous
wastes that are subject to disclosure requirements. '?`he
proposed draft requires disclosure of chemicals and wastes
regulated by the State Department of Health and the iJnited
States Environmental Protection Agency. As indicated in the
City Staff Report, the. E. P. A. is promulgating new toxic chemical
and waste regulations; alternatively, it would. be appropriate
to require local disclosure of the chemcials regulated in this
new law.
Section 5301 requires the Director of the Department of
General Services to maintain and update a list of chemicals
and wastes subject to disclosure, and to make the list available
to the public.. This requirement is legally unobjectionable.
Section 5302 of the propsed ordinance sets forth its
disclosure requirements. It provides that within ninety (90)
days of the adoration of the ordinance, any person who handles,
stores, uses, processes or disposes of any toxic chemicals or
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hazardous wastes in the conduct of any business in the City
to identify such chemicals and wastes on a form prepared by
the Director of General Services. Thus, the disclosure
requirement applies to all businesses and does not apply
to private residential uses. There are numerous exemptions
and qualifications that may be made to this section. The
Council may exempt certain types of businesses, such as
apartment houses or retail rises, from dsolosure requirements.
It`may establish-a minimuM quantity of chemicals as a threshold
for disclosure. It may exempt particular chemicals or
common substances containing toxic chemicals from disclosure.
Additional exemptions or qualifications ma_y be set forth in the
main disclosure section:bf.the ordinance, or .may be stated'in
a separate section.
Section 5303 concerns compliance. Holders of existing
business licenses must complete disclosure within ninety (90}
days of the adoption of the ordinance. Applicants for new
business licenses must complete a disclosure form before
the license will be issued. The ordinance does not call
for revocation of existing business licenses; however, business
licenses shall not be renewed if the business has not filed
a disclosure form. Persons subject to the ordinance must
amend their disclosure forms with thirty (30) days of the
date of any changed uses.
Thus, if a business fails to disclose its chemicals and
wastes, the City may refuse to issue a business license and,
presumably, enjoin the operation of the business until disclosure
is completed and a license issued. The ordinance is silent as to
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what will occur in the event of incomplete or inaccurate
disclosure. The City would presumably argue that incomplete
or inaccurate disclosure is equivalent to no disclosure, and
attempt to revoke existing business licenses through the
administrative mechanism of_ the License Review Board. There
are numerous variations of problems that might occur if
existing business licensees do not fully comply with the
disclosure law. Primary among these is the question whether
a person has a right to continue in business notwithstanding
violation of a law that does not directly regulate the conduct
of that business. These questions might ultimately have to
be resolved in the courts.
Section 5304 of the ordinance states that any person
may inspect and copy any toxic chemicals and hazardous wastes
disclosure form on file with the City. This Section should be
amended to incorporate the provisions of the Puhlic Records
Act, Government Code Section 6250, et seq. This act contains
specific exemptions to public disclosure requirements, and
incorporates common law privileges against the disclosure of
particular information. Of primary importance are the dis-
closure of those chemicals which form the basis of trade
secrets, which are exempt by common law from disclosure, and
those chemicals which may not_ be disclosed for reasons of national
security, such as materials used in defense contracts. It seems
appropriate that the person claiming the privilege of non-
disclosure of a substance for. trade secret or national
security reasons should bear the burden of proof; the
ordinance should specifically
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address this problem, and should contain a specific procedure
for determining the validity of such claims. with respect to
national security, there are several acts. of Congress that
prohibit any disclosure of certain classified information;
to the extent our ordinance .requires such disclosure, it_ raay
be preempted by Federal Law. This question is of considera~le
complexity,. and requires further research. It is unknown
whether this problem would in fact arise in the City of.
Santa nq.onica.
with. the exception.. of the areas mentioned above, the
disclosure of toxic chemicals and wastes does not appear
to intrude upon any protected area of privacy; the information
is appropriately required to be disclt~sed to the public.
Section 5305 makes a violation of the ordinance a
misdemeanor. As previously indicated, this is appropriate.
'Phe ordinance does not deal with the question of who conducts
inspections or with the related questions of inspection
warrants or citations. G^?hile the City may contract with
another government entity to perform police power services
such as health inspection, it may not lawfully delegate these
duties to a private entity. Thus, inspections would have to
be carried out by City staff, or by such governmental entities
as the State, the County, or the City of Los Angeles. Similarly,
only appropriate govern.=nental officials may be given the
authority to write citations fqr_violation of the ordinance.
(Any citizen may effect a "citizens's arrest".)
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Civil penalties are not mentioned in the proposed
ordinance. It would be appropriate, and perhaps effective,
to impose an civil fine for each day of non-compliance. This
would require an admininstrative proceeding.
3. DUE PRZ)CESS OF LA?tiT AND DAPQAGE LIABILITY
The ordinance as drafted does not require exemption
procedures, as it applies to all persons holding a`,buSiness
license and using specified chemicals. If a person is
believed to be using a chemical requiring disclosure, and
does not disclose, an action to revoke the business license
through existing- administrative procedures would he appropriate.
If the ordinance is drafted to contain exemptions, a procedure
for determining exemptions should be established. This could
involve an existing administrative agency such as the License
Review Board, or a procedure specially written into the ordinance.
A business license is a property right that cannot'be
revoked, or in the case of a renewal, denied, without notice
of the adverse action and a fair opportunity to be heard. The
nature and scope of the hearing required depends on the
circumstances; cities are given fairly wide latitude in
designing fair hearing procedures. If the City wrongfully
denies a persan of a property right such as a business license,
or wrongfully discloses a trade secret, it may be liable in
damages for the value of the right destroyed. The City may
also experience liability under the Federal Civil Rights Act
for damages occasioned by denial by due process of law.
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It is conceivable that, if_ an incident involving an
undisclosed toxic chemical occurs and the City has failed
to inspect and require disclosure, some liability for
ensuing damage could be attributed to the City.
CONCLUSSON
A chemical disclosure law is a valid exercise of
the police power. Enforcement presents some problems,
particualrly respecting the effect of the Iaw on existing
business licenses and on trade secrets.
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