BILL NUMBER: SB 59 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Cogdill
(Principal coauthor: Senator Ackerman)
(Coauthors: Senators Cox, Denham, and Runner)
(Coauthors: Assembly Members Aghazarian, Arambula, Benoit,
Berryhill, Fuller, Galgiani, Houston, La Malfa, Maze, and Parra)
JANUARY 11, 2007
An act to add Division 32 (commencing with Section 82000) to the
Water Code, relating to financing a water supply program, by
providing the funds necessary therefor through the issuance and sale
of bonds of the State of California and by providing for the handling
and disposition of those funds.
LEGISLATIVE COUNSEL'S DIGEST
SB 59, as introduced, Cogdill. Reliable Water Supply Bond Act of
2008.
Under existing law, various bond acts have been approved by the
voters to provide funds for water projects, facilities, and programs.
This bill would enact the Reliable Water Supply Bond Act of 2008
which, if approved by the voters, would authorize, for purposes of
financing a water supply program, the issuance, pursuant to the State
General Obligation Bond Law, of bonds in the amount of
$3,950,000,000. The bill would require the Secretary of State to
submit the bond act to the voters at the November 4, 2008, statewide
general election.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Division 32 (commencing with Section 82000) is added to
the Water Code, to read:
DIVISION 32. RELIABLE WATER SUPPLY BOND ACT OF 2008
CHAPTER 1. SHORT TITLE
82000. This division shall be known and may be cited as the
Reliable Water Supply Bond and Financing Act of 2008.
CHAPTER 2. FINDINGS
82001. The Legislature finds and declares all of the following:
(a) California must make substantial investments to provide
reliable water for a growing population and meet future water
management needs.
(b) It is in the interests of all Californians to provide a safe,
clean, affordable, and sufficient water supply to meet the needs of
residents, farms, businesses, and the environment.
(c) Recent studies indicate that California will experience
decreasing snow pack, changing run-off patterns, rising sea levels,
and changes in water use. The state has determined that no single
approach to water management will adequately address these changes in
a way that meets the state's current and future needs. It will be
necessary to invest in additional water infrastructure such as
expanded water storage and improved water conveyance, as well as
improving water use efficiency, in order to protect California's
environment and economy.
(d) The Sacramento-San Joaquin Delta Estuary, including Suisun Bay
and Suisun Marsh, is a unique and irreplaceable combination of
environmental and economic resources.
(e) Current management and use of the delta is not sustainable,
and results in a high level of conflict among various interests.
(f) Future management of the delta must improve delta ecosystem
health, improve the means of delta water conveyance in order to
protect drinking water quality, improve water supply reliability,
restore ecosystem health, and preserve agricultural and recreational
values in the delta.
(g) Sustainable economic development requires that water resources
planning be integrated with the management of other natural
resources.
CHAPTER 3. DEFINITIONS
82002. Unless the context otherwise requires, the definitions set
forth in this section govern the construction of this division, as
follows:
(a) "CALFED" means the consortium of state and federal agencies
with management and regulatory responsibilities in the San Francisco
Bay/Sacramento-San Joaquin Delta Estuary.
(b) "CALFED Bay-Delta Program" means the undertaking by CALFED to
develop and implement, by means of the final programmatic
environmental impact statement/environmental impact report, the
preferred programs, actions, projects, and related activities that
will provide solutions to identified problem areas related to the San
Francisco Bay/Sacramento-San Joaquin Delta Estuary ecosystem,
including, but not limited to, the bay-delta and its tributary
watersheds.
(c) "Committee" means the Reliable Water Supply Finance Committee
created by Section 82082.
(d) "Delta" means the Sacramento-San Joaquin Delta as defined in
Section 12220.
(e) "Department" means the Department of Water Resources.
(f) "Director" means the Director of Water Resources.
(g) "Fund" means the Reliable Water Supply Bond Fund of 2008
created by Section 82020.
(h) "Integrated regional water management plan" means a
comprehensive plan for a defined geographic area, the specific
development and content of which shall be defined by guidelines
adopted by the department. At a minimum, an integrated regional water
management plan describes the major water-related objectives and
conflicts within a region; considers a broad variety of water
management strategies; and identifies the appropriate combination of
water demand and supply management alternatives, water quality
protections, and environmental stewardship actions to provide
long-term, reliable, and high quality water supplies and to protect
the environment at the lowest reasonable cost and with the highest
possible benefits to the environment and to water users.
(i) "Nonprofit organization" means any nonprofit public benefit
corporation formed pursuant to the Nonprofit Corporation Law
(Division 2 (commencing with Section 5000) of Title 1 of the
Corporations Code) and qualified under Section 501(c)(3) of Title 26
of the United States Internal Revenue Code.
(j) "Public agency" means a state agency or department, district,
joint powers authority, city, county, city and county, or other
political subdivision of the state.
(k) "Secretary" means the Secretary of the Resources Agency.
() "State General Obligation Bond Law" means the State General
Obligation Bond Law (Chapter 4 (commencing with Section 16720) of
Part 3 of Division 4 of Title 2 of the Government Code).
CHAPTER 4. GENERAL PROVISIONS
82010. An amount that equals not more than 5 percent of the funds
allocated for a grant program pursuant to this division may be used
to pay the costs to administer that program.
82011. 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 or implementation of programs or projects authorized or
funded under this division.
82012. (a) Prior to disbursing grants pursuant to this division,
the department shall develop project solicitation and evaluation
guidelines. The guidelines may include a limitation on the dollar
amount of grants to be awarded.
(b) Prior to disbursing grants, the department shall conduct two
public meetings to consider public comments prior to finalizing the
guidelines. The department shall publish the draft solicitation and
evaluation guidelines on its Internet Web site at least 30 days
before the public meetings. One meeting shall be conducted at a
location in northern California and one meeting shall be conducted at
a location in southern California. Upon adoption, the department
shall transmit copies of the guidelines to the fiscal committees and
the appropriate policy committees of the Legislature.
82013. It is the intent of the people that the investment of
public funds pursuant to this division should result in public
benefits.
CHAPTER 5. RELIABLE WATER SUPPLY BOND FUND OF 2008
82020. The proceeds of bonds issued and sold pursuant to this
division shall be deposited in the Reliable Water Supply Bond Fund of
2008, which is hereby created.
CHAPTER 6. WATER STORAGE DEVELOPMENT PROJECTS
82030. (a) For the purposes of this chapter, "account" means the
Water Storage Development Account created by subdivision (b).
(b) The Water Storage Development Account is hereby created in the
fund.
(c) The sum of two billion five hundred million dollars ($2,
500,000,000) is hereby transferred from the fund to the account.
Notwithstanding Section 13340 of the Government Code, the funds in
the account are hereby continuously appropriated to the department,
without regard to fiscal years, as follows:
(1) Two billion dollars ($2,000,000,000) for the design,
acquisition, and construction of surface water storage projects
identified pursuant to subdivision (a) of Section 82031 to finance
the state's cost share in accordance with subdivision (b) of Section
82033.
(2) Five hundred million dollars ($500,000,000) for grants and
expenditures for the planning, design, and construction of locally
managed conjunctive use and groundwater storage projects described in
subdivision (b) of Section 82031.
(d) This section shall not be amended or repealed unless approved
by the Legislature with two-thirds of the members of each house
voting in favor thereof.
82031. To assist in the development of facilities to increase
water storage capacity in the state, funds provided pursuant to this
chapter shall be for the design, acquisition, and construction of the
following water storage projects:
(a) Surface water storage projects being investigated by the
department under the CALFED Bay-Delta Program, as follows:
(1) Sites Reservoir located in the Counties of Colusa and Glenn,
as identified in the North-of-the-Delta Offstream Storage
Investigation Initial Alternatives Information Report, dated May
2006.
(2) Temperance Flat Reservoir located in the Counties of Fresno
and Madera, as identified in the Upper San Joaquin River Basin
Storage Investigation Initial Alternatives Information Report, dated
June 2005.
(3) If the surface water storage projects identified in paragraphs
(1) and (2) are deemed infeasible by the department, alternate
surface water storage projects, as determined by the department, that
are included in the CALFED Bay-Delta Program Programmatic Record Of
Decision, dated August 28, 2000.
(b) Locally managed conjunctive use and groundwater storage
projects that are consistent with an adopted integrated regional
water management plan and provide any of the following benefits:
(1) Interregional water supply benefits, including, but not
limited to, evaluation of the groundwater resources of the Sacramento
Valley.
(2) Mitigation of conditions of groundwater overdraft, saline
water intrusion, groundwater quality degradation, or subsidence.
(3) Replacement of water supplies that were previously committed
or that will be committed for environmental benefits.
(4) Contribution to any of the objectives described in paragraphs
(1) to (4), inclusive, of subdivision (b) of Section 82033.
82032. Any new surface water surface storage capacity funded
pursuant to this chapter shall be operated in conjunction with
existing storage and conveyance facilities to develop greater and
more diverse benefits and to offset the impacts of changing hydrology
and decreasing snow pack on California's water and flood management
systems.
82033. (a) Expenditure of any portion of the funds provided
pursuant to this chapter for any surface water storage project is
contingent upon all of the following actions:
(1) A finding by the director and the secretary that the project
is feasible, consistent with all applicable laws and regulations, and
will advance the objectives of the CALFED Bay-Delta Program.
(2) Development of a comprehensive financing plan for the project
that includes the state's cost share for the project benefits
described in subdivision (b), any cost sharing by the federal
government for federal interests identified in the project, and any
other state or local public agency or private cost share for water
supply, power generation, or other benefits generated by the project.
The comprehensive financing plan shall allocate all project costs
among all project beneficiaries in relation to the benefits received.
The state's cost share for the project benefits described in
subdivision (b) shall not exceed 50 percent of the total project
costs for projects funded under this chapter.
(3) Agreements with potential water users to contract and pay for
not less than 75 percent of the agricultural and urban water supply
benefits of the project.
(b) Funds described in paragraph (1) of subdivision (c) of Section
82030 shall only be available to finance any of the following:
(1) Major ecosystem restoration, including improvements to
riverine ecosystems and fisheries habitat through flow, temperature,
and diversion management.
(2) Water quality improvement of a major river or water body that
serves as a water supply source for more than one region of the state
and provides significant public trust resources.
(3) Flood control benefits, including, but not limited to,
increases in flood reservation space in existing reservoirs by
exchange for capacity in a new offstream reservoir.
(4) Emergency response, including securing emergency water
supplies and flows for dilution and salinity repulsion following
natural disasters or acts of terrorism.
(5) Response to the effects of changing hydrology and decreasing
snow pack on California's flood management systems.
(6) Recreational purposes, including, but not limited to, those
recreational pursuits generally associated with the out-of-doors,
such as camping, picnicking, fishing, hunting, wildlife viewing,
water contact sports, boating, and sightseeing, and the associated
facilities of campgrounds, picnic areas, water and sanitary
facilities, parking areas, view points, boat launching ramps, and any
others necessary to make project land and water areas available for
use by the public.
(c) The expenditure of funds described in paragraph (1) of
subdivision (c) of Section 82030 shall be prioritized based upon the
expected return for public investment as measured by the magnitude
and diversity of benefits pursuant to subdivision (b) that would be
provided by the proposed expenditure. For the purposes of carrying
out this subdivision, the department shall consult with the
Department of Fish and Game, the State Water Resources Control Board,
the California regional water quality control boards, the State
Department of Public Health, the Department of Parks and Recreation,
the California Bay-Delta Authority or its successor, and other
relevant state agencies.
82034. Any surface water storage facility constructed with funds
made available pursuant to this chapter shall be made a part of the
State Water Resources Development System and shall be acquired,
constructed, operated, and maintained pursuant to Part 3 (commencing
with Section 11100) of Division 6.
82035. (a) To provide funding to pay the share of costs of
surface water storage projects allocated to providing agricultural
and urban water supply benefits, the department may issue revenue
bonds pursuant to Chapter 8 (commencing with Section 11700) of Part 3
of Division 6.
(b) The total amount of revenue bonds issued pursuant to
subdivision (a) shall not exceed two billion dollars
($2,000,000,000).
CHAPTER 7. DELTA SUSTAINABILITY
82050. (a) The Sacramento-San Joaquin Delta Estuary, including
Suisun Bay and Suisun Marsh, is a unique and irreplaceable
combination of environmental and economic resources. Current
management and use of the delta is not sustainable, and results in a
high level of conflict among various interests. Future delta
sustainability is threatened by changing hydrology, decreasing snow
pack, flood risk, seismic events, and environmental problems. Future
management of the delta must improve delta ecosystem health and
improve the means of delta water conveyance in order to protect
drinking water quality, improve a water supply reliability, restore
ecosystem health, and preserve agricultural and recreational values
in the delta. Many sources of funding will be needed to implement
improved delta management.
(b) This chapter provides state funding for public benefits
associated with projects needed to assist in the delta's
sustainability as a vital resource for fish, wildlife, water quality,
water supply, agriculture, recreation, and enjoyment of the people
of the State of California.
(c) The sum of one billion dollars ($1,000,000,000) shall be
available for appropriation by the Legislature from the fund to the
department for grants and direct expenditure, as follows:
(1) Five hundred million dollars ($500,000,000) shall be available
for the development and implementation of a bay delta conservation
plan. The plan shall identify projects for the enhancement and
sustainability of selected fish species. The projects shall be
implemented through a cooperative effort among regulatory agencies,
regulated and potentially regulated entities, and affected parties,
including state and federal water contractors. These funds may be
expended for the preparation of environmental documentation and
environmental compliance, and for implementing projects identified in
the plan.
(2) Three hundred million dollars ($300,000,000) shall be
available to implement the Strategic Plan required by Governor's
Executive Order S-17-06, and projects to implement the options
identified by the department and the Department of Fish and Game
pursuant to Sections 139.2 and 139.4.
(3) Two hundred million dollars ($200,000,000) shall be available
to implement the water quality component of the CALFED Bay-Delta
Program.
82051. Funds provided by this chapter may not be expended for any
of the following:
(a) The design or construction of delta water transfer facilities.
(b) Any action identified in the plan as the responsibility of any
party or project, including the State Water Project and the federal
Central Valley Project, to provide for the mitigation of impacts or
to provide for the conservation of a species identified in the plan
described in paragraph (1) of subdivision (c) of Section 82050.
82052. For the purposes of preparing the plan described in
paragraph (1) of subdivision (c) of Section 82050, the fishery
enhancements and sustainability projects shall be identified in
consultation with stakeholders and relevant state agencies. The
projects financed under this chapter shall include comprehensive
project assessments, and represent significant consensus in the
scientific community, including the CALFED Independent Science Board,
or its successor, and shall provide targeted benefits as a result of
these expenditures.
CHAPTER 8. WATER USE EFFICIENCY PROGRAM
82060. The sum of two hundred million dollars ($200,000,000)
shall be available for appropriation by the Legislature from the fund
to the department for competitive grants for agricultural and urban
water use efficiency projects in accordance with this chapter.
82061. (a) The department shall award grants to eligible projects
consistent with an adopted integrated regional water management
plan.
(b) An urban water supplier that does not prepare, adopt, and
submit its urban water management plan in accordance with the Urban
Water Management Planning Act (Part 2.6 (commencing with Section
10610) of Division 6) is ineligible to receive funds made available
pursuant to this chapter until the urban water management plan is
submitted.
(c) For the purposes of awarding a grant under this chapter, the
department may require cost sharing or donated services from nonstate
sources.
(d) Eligible projects include agricultural and urban water use
efficiency implementation projects, as well as feasibility studies,
technical assistance, education, and public outreach, and projects
that result in water savings, increased instream flow, improved water
quality, or increased energy efficiency.
(e) Eligible applicants are public agencies, investor-owned
utilities, and mutual water companies. To be eligible for funding
under this chapter, projects proposed by investor-owned utilities
that are regulated by the Public Utilities Commission and mutual
water companies shall have a clear and definite public purpose and
shall benefit the customers of those respective water systems.
CHAPTER 9. RESOURCE STEWARDSHIP AND ENVIRONMENTAL RESTORATION
PROGRAM
82070. The sum of two hundred fifty million dollars
($250,000,000) shall be available for appropriation by the
Legislature from the fund to the secretary for expenditures and
grants for resource stewardship and ecosystem restoration, including
any of the following:
(a) Restoration of the San Joaquin River system.
(b) Restoration of the Sacramento River corridor.
(c) Restoration of the Salton Sea.
(d) Other ecosystem restoration projects and programs.
CHAPTER 10. FISCAL PROVISIONS
82080. (a) Bonds in the total amount of three billion nine
hundred fifty million dollars ($3,950,000,000), not including the
amount of any refunding bonds issued in accordance with Section
82092, or so much thereof as is necessary, may be issued and sold to
provide a fund to be used for carrying out the purposes expressed in
this division and to reimburse the General Obligation Bond Expense
Revolving Fund pursuant to Section 16724.5 of the Government Code.
The bonds, when sold, shall be and constitute valid and binding
obligations of the State of California, and the full faith and credit
of the State of California is hereby pledged for the punctual
payment of both principal of, and interest on, the bonds as the
principal and interest become due and payable.
(b) The Treasurer shall sell the bonds authorized by the committee
pursuant to this section. The bonds shall be sold upon the terms and
conditions specified in a resolution to be adopted by the committee
pursuant to Section 16731 of the Government Code.
82081. The bonds authorized by this division shall be prepared,
executed, issued, sold, paid, and redeemed as provided in the State
General Obligation Bond Law, and all of the provisions of that law
apply to the bonds and to this division and are hereby incorporated
in this division as though set forth in full in this division, except
that Section 16727 of the Government Code shall not apply to the
extent that it is inconsistent with any other provision of this
division.
82082. (a) Solely for the purpose of authorizing the issuance and
sale, pursuant to the State General Obligation Bond Law, of the
bonds authorized by this division, the Reliable Water Supply Finance
Committee is hereby created. For purposes of this division, the
Reliable Water Supply Finance Committee is "the committee" as that
term is used in the State General Obligation Bond Law.
(b) The committee consists of the Director of Finance, the
Treasurer, the Controller, the Director of Water Resources, and the
Secretary for the Resources Agency. Notwithstanding any other
provision of law, any member may designate a deputy to act as that
member in his or her place for all purposes, as though the member
were personally present.
(c) The Treasurer shall serve as chairperson of the committee.
(d) A majority of the members of the committee shall constitute a
quorum of the committee, and may act for the committee.
82083. The committee shall determine whether or not it is
necessary or desirable to issue bonds authorized pursuant to this
division to carry out the actions specified in this division and, if
so, the amount of bonds to be issued and sold. Successive issues of
bonds may be authorized and sold to carry out those actions
progressively, and it is not necessary that all of the bonds
authorized to be issued be sold at any one time.
82084. "Board," as defined in Section 16722 of the Government
Code for the purposes of compliance with the State General Obligation
Bond Law, means the department.
82085. There shall be collected each year and in the same manner
and at the same time as other state revenue is collected, in addition
to the ordinary revenues of the state, a sum in an amount required
to pay the principal of, and interest on, the bonds each year, and it
is the duty of all officers charged by law with any duty in regard
to the collection of the revenue to do and perform each and every act
which is necessary to collect that additional sum.
82086. Notwithstanding Section 13340 of the Government Code,
there is hereby appropriated from the General Fund in the State
Treasury, for the purposes of this division, an amount that will
equal the total of the following:
(a) The sum annually necessary to pay the principal of, and
interest on, bonds issued and sold pursuant to this division, as the
principal and interest become due and payable.
(b) The sum that is necessary to carry out the provisions of
Section 82089, appropriated without regard to fiscal years.
82087. The board may request the Pooled Money Investment Board to
make a loan from the Pooled Money Investment Account in accordance
with Section 16312 of the Government Code for the purpose of carrying
out this division. The amount of the request shall not exceed the
amount of the unsold bonds that the committee has, by resolution,
authorized to be sold for the purpose of carrying out this division.
The board shall execute those documents required by the Pooled Money
Investment Board to obtain and repay the loan. Any amounts loaned
shall be deposited in the fund to be allocated by the department in
accordance with this division.
82088. Notwithstanding any other provision of this division, or
of the State General Obligation Bond Law, if the Treasurer sells
bonds that include a bond counsel opinion to the effect that the
interest on the bonds is excluded from gross income for federal tax
purposes under designated conditions, the Treasurer may maintain
separate accounts for the bond proceeds invested and for the
investment earnings on those proceeds, and may use or direct the use
of those proceeds or earnings to pay any rebate, penalty, or other
payment required under federal law or take any other action with
respect to the investment and use of those bond proceeds, as may be
required or desirable under federal law in order to maintain the
tax-exempt status of those bonds and to obtain any other advantage
under federal law on behalf of the funds of this state.
82089. For the purposes of carrying out this division, the
Director of Finance may authorize the withdrawal from the General
Fund of an amount or amounts not to exceed the amount of the unsold
bonds that have been authorized by the committee to be sold for the
purpose of carrying out this division. Any amounts withdrawn shall be
deposited in the fund. Any money made available under this section
shall be returned to the General Fund, with interest at the rate
earned by the money in the Pooled Money Investment Account, from
proceeds received from the sale of bonds for the purpose of carrying
out this division.
82090. All money deposited in the fund that is derived from
premium and accrued interest on bonds sold pursuant to this division
shall be reserved in the fund and shall be available for transfer to
the General Fund as a credit to expenditures for bond interest.
82091. Pursuant to Chapter 4 (commencing with Section 16720) of
Part 3 of Division 4 of Title 2 of the Government Code, the cost of
bond issuance shall be paid out of the bond proceeds. These costs
shall be shared proportionately by each program funded through this
division.
82092. The bonds issued and sold pursuant to this division may be
refunded in accordance with Article 6 (commencing with Section
16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the
Government Code, which is a part of the State General Obligation Bond
Law. Approval by the electors of the state for the issuance of the
bonds under this division shall include approval of the issuance of
any bonds issued to refund any bonds originally issued under this
division or any previously issued refunding bonds.
82093. The Legislature hereby finds and declares that, inasmuch
as the proceeds from the sale of bonds authorized by this division
are not "proceeds of taxes" as that term is used in Article XIII B of
the California Constitution, the
disbursement of these proceeds is not subject to the
limitations imposed by that article.
SEC. 2. The Secretary of State shall submit Section 1 of this act
to the voters at the November 4, 2008, statewide general election in
accordance with the provisions of the Government Code and the
Elections Code governing the submission of a statewide measure to the
voters.
SEC. 3. (a) Notwithstanding any other provision of law, with
respect to the Reliable Water Supply Bond Act of 2008, as set forth
in Section 1 of this act, all ballots of the November 4, 2008,
statewide general election shall have printed thereon and in a square
thereof, exclusively, the words: "Reliable Water Supply Bond Act of
2008" and in the same square under those words, the following in
8-point type:
"This act will provide financing necessary for projects to improve
statewide water supply reliability, respond to changing hydrology
and decreasing snow pack, and provide adequate water supplies to meet
the needs of California's residents, farmers, businesses, and
environment by authorizing a $3.95 billion dollar bond act."
(b) Opposite the square, there shall be left spaces in which the
voters may place a cross in the manner required by law to indicate
whether they vote for or against the act.
(c) Where the voting in the election is done by means of voting
machines used pursuant to law in the manner that carries out the
intent of this section, the use of the voting machines and the
expression of the voters' choices by means thereof are in compliance
with this section.
SEC. 4. Section 1 of this act shall take effect only upon the
approval by the voters of the Reliable Water Supply Bond Act of 2008,
as set forth in that section.