BILL NUMBER: AB 2882 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Wolk
FEBRUARY 22, 2008
An act to add Chapter 3.4 (commencing with Section 370) to
Division 1 of the Water Code, relating to water rates.
LEGISLATIVE COUNSEL'S DIGEST
AB 2882, as introduced, Wolk. Allocation-based conservation water
pricing.
Existing law relative to water conservation programs authorizes
any public entity, as defined, that supplies water at retail or
wholesale for the benefit of persons within the service area or area
of jurisdiction of the public entity to adopt and enforce, by
ordinance or resolution, a water conservation program to reduce the
quantity of water used by those persons for the purpose of conserving
the water supplies of the public entity.
This bill would authorize a public entity to adopt
allocation-based conservation water pricing meeting certain
requirements. The bill would require that revenues derived from
allocation-based conservation water pricing not exceed the reasonable
cost of water service, including conservation measure costs and
overuse costs, as defined.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 3.4 (commencing with Section 370) is added to
Division 1 of the Water Code, to read:
CHAPTER 3.4. ALLOCATION-BASED CONSERVATION WATER PRICING
370. The Legislature hereby finds and declares all of the
following:
(a) The use of allocation-based conservation water pricing by
public entities that sell and distribute water is one effective means
by which waste or unreasonable use of water can be prevented and
water can be saved in the interest of the people and for the public
welfare, within the contemplation of Section 2 of Article X of the
California Constitution.
(b) It is the intention of the Legislature that the state take
steps to encourage the voluntary use of allocation-based conservation
water pricing on a regular and ongoing basis as a means of reducing
wasteful or unreasonable use of water under both normal and dry-year
hydrologic conditions.
(c) The Legislature intends that allocation-based conservation
water pricing is an additional option to incentivize water users to
conserve and eliminate waste of water and the Legislature does not
intend to limit the discretion of public entities to evaluate and
select among different methods for conserving water or to create a
presumption that the election to not use a particular method is a
waste or unreasonable use of water by the public entity.
371. For purposes of this chapter, the following terms have the
following meanings:
(a) "Allocation-based conservation water pricing" means a retail
water rate structure that meets all of the criteria in Section 372.
(b) "Basic charge" means a volumetric unit charge for the cost of
water service other than any fixed costs that are recovered through
meter charges or other fixed charges and any conservation measure
costs and costs that are recovered through conservation charges. A
basic charge may include the cost of generally applicable
conservation measures assumed in establishing basic use allocations.
(c) "Conservation charge" means a volumetric unit charge for
conservation measure costs.
(d) "Conservation measure costs" means expenses incurred for water
conservation measures employed by the public entity to reduce the
wasteful or unreasonable use of water, and may include conservation
best management practices, conservation education, irrigation
controls and other conservation devices, water system retrofitting
for production and use of alternative water supplies including
recycled water, energy costs related to water use, and securing
dry-year supply arrangements.
(e) "Overuse costs" means costs incurred as a result of the
wasteful or unreasonable use of water, and may include preventing,
controlling, or treating the runoff of water wasted by irrigation and
other outdoor uses, and procuring water supplies to satisfy
increments of water use in excess of the basic use allocations for
the customers of the public entity.
(f) "Public entity" means a city, whether general law or
chartered, county, city and county, special district, agency,
authority, any other municipal public corporation or district, or any
other political subdivision of the state.
372. (a) A public entity may employ allocation-based conservation
water pricing that meets all of the following criteria:
(1) Billing is based on metered water use.
(2) A basic use allocation is established for each customer
account that provides a reasonable amount of water for the customer's
needs and property characteristics. Factors used to determine the
basic use allocation may include, but are not limited to, the number
of occupants, the type or classification of use, the size of lot or
irrigated area, and the local climate data for the billing period.
(3) A basic charge per volumetric unit is imposed for all water
used within the customer's basic use allocation, except that at the
option of the public entity, a lower rate may be applied to any
portion of the basic use allocation that the public entity has
determined to represent superior or more than reasonable conservation
efforts.
(4) A conservation charge is imposed for increments of water use
in excess of the basic use allocation. The conservation charge for
the increments shall, in the aggregate, provide revenue not to exceed
conservation measure costs and overuse costs. The increments may be
fixed or may be determined on a percentage or other basis, provided
that the conservation charge for the highest-price increment is at
least three times the basic charge.
(b) (1) Except as specified in subdivision (b), the design of an
allocation-based conservation pricing rate structure shall be
determined in the discretion of the public entity.
(2) The public entity may impose meter charges or other fixed
charges to recover fixed costs of water service in addition to the
allocation-based conservation pricing rate structure.
373. (a) Revenues derived from allocation-based conservation
water pricing shall not exceed the reasonable cost of water service
including conservation measure costs and overuse costs. This chapter
does not limit the sources of funding for conservation measure costs
to charges for water use.
(b) Revenues derived from allocation-based conservation water
pricing shall not exceed the proportional cost of service
attributable to the customer's parcel, as determined by giving
consideration to all of the following:
(1) Customer classes established in consideration of service
characteristics, demand patterns, and other factors.
(2) Basic use allocations.
(3) Meter size.
(4) Metered volume of water consumed.
(c) Revenues derived from conservation charges shall not exceed
the proportional cost of service attributable to the increments of
water use subject to conservation charges. Under an allocation-based
conservation water pricing structure, the public entity may establish
proportionality between the cost of service and increments of water
usage subject to conservation charges either on an aggregate basis,
by the total metered volume of water consumed within all increments
subject to conservation charges, or separately within each increment.
374. (a) Allocation-based conservation water pricing under this
chapter may be used on an ongoing basis and shall not require any
finding of emergency or other water shortage conditions.
(b) The authority granted in this chapter is in addition to any
other authority that a public entity has to use rate structure design
to foster the conservation of water.
(c) The imposition and revision of rates and charges by a public
entity under this chapter shall be subject to the procedures
otherwise required by law for the public entity's water rates.