BILL ANALYSIS AB 301 SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator S. Joseph Simitian, Chairman 2009-2010 Regular Session BILL NO: AB 301 AUTHOR: Fuentes AMENDED: April 1, 2009 FISCAL: Yes HEARING DATE: June 22, 2009 URGENCY: No CONSULTANT: Rachel Machi Wagoner SUBJECT : VENDED WATER SUMMARY : Existing law : 1) Under the Sherman Food, Drug, and Cosmetics Law prescribes various quality, reporting and labeling standards for bottled water and private water sources. 2) Authorizes the state to assume responsibility for managing the safety of its drinking water quality if the state is certified as having a program at least as stringent as the federal program pursuant to the federal Safe Drinking Water Act (SDWA), which establishes the framework for regulating drinking water quality in the United States by the Environmental Protection Agency (EPA). 3) Requires the State Department of Public Health (DPH) to enforce the SDWA and to charge and collect a fee for each license application submitted, in an amount reasonably necessary to produce sufficient revenue for DPH enforcement efforts and in accordance with a prescribed fee schedule. 4) Requires a water-bottling plant to annually prepare a bottled water report as a condition of licensure and to make the report available to each customer. 5) Requires each label on bottled water sold at retail or wholesale in California to report stipulated information, including the source of the bottled water, effective January 1, 2009. AB 301 Page 2 This bill : 1) Requires each applicant for a license as a water-bottling plant or a private water source to provide the DPH with specified information, as follows: a) The total volume of water bottled or sold either for wholesale or retail use as specified, including best estimates of information for new applicants. b) Whether the source of the water bottled or sold is a public or private water agency or an artesian well, lake, river, spring, or well, as appropriate. c) The county in which the source is located and whether the location is privately or publicly held. 2) Requires DPH to annually compile specified information, make it available to the public and to ensure that the compilation of information reported does not contain duplicative data as to applicants applying for both a water-bottling plant and private water source license. COMMENTS: 1) Purpose of Bill . According to the author, there is currently no information available regarding the amount of water pulled from groundwater aquifers or surface water supplies by water bottlers and vending operations. The author states that simple reporting requirements disclosing the amount of water extracted as well as the source of the water would help provide clear and important information on how our state's limited water supplies are put to use. In a time of ongoing state drought and calls for water rationing, it is important that we know how much of our state's most precious resource is bottled and shipped each year. 2) What bottled water companies operate in California and where are they located ? By 2006, the DPH licensed an estimated 181 bottling plants to sell water in California. Of these plants, 112 are located within California, 43 AB 301 Page 3 plants are in other US states, and 26 plants are located outside of the US. Approximately 119 different "companies" operate the 181 plants licensed by DPH. Eighty-six companies operate the bottling plants located in California. Some of these are subsidiaries of larger corporations, so the total number of independent bottlers may be substantially lower. Bottling plants are located in 33 counties throughout California. Bottling plants are concentrated in several counties in Southern California. The number of bottling plants within a single county provides neither an indication of the total quantity of water extracted nor the source or type of water bottled. Because the impact of groundwater extraction depends on site-specific characteristics of the groundwater aquifer, one cannot make any inference on which regions are most heavily impacted. 3) Potential Impacts of Extracted Water . Bottling plants can deplete local groundwater aquifers and associated surface water resources. If the rate of groundwater extraction exceeds the rate of natural replenishment, then groundwater levels decline, posing serious problems for those dependent of wells for their water supply. Continued depletion of groundwater can cause some aquifers to collapse, resulting in permanent loss of the aquifer and land subsidence. In addition, groundwater provides water for local streams, particularly in the summer. As groundwater levels decline, water in local streams can also decline or even run dry. 4) What regions or populations are potentially impacted by the industry ? The bottled water industry claims that they account for less than 0.02% of the United States' total fresh groundwater withdrawals. Yet, many of the concerns about groundwater withdrawals may be local in nature, especially in situations where a bottled water plant may be responsible for a substantial fraction of local groundwater use. The actual impacts will be site-specific and thus using national level data is inaccurate. Bottled water plants are located throughout the state and thus all residents of California are potentially impacted by the bottled water industry. Farmers, fisheries, and rural AB 301 Page 4 communities, however, tend to suffer the greatest impacts. As groundwater levels decline, farmers and municipalities dependent on groundwater are forced to pump water from deeper depths, thereby increasing energy costs. Declining groundwater levels can deplete local streams, thereby placing fish and those dependent on fish at risk. 5) Related Legislation . AB 2275 (Fuentes) of 2008 is substantially similar to AB 301, and required each applicant for a license as a water-bottling plant or a private water source to provide specified information to DPH and required DPH to annually compile a listing of this information and make it available to the public, as provided. Governor Schwarzenegger vetoed AB 2275, with a generic veto message he uniformly applied to several bills that reached his desk in 2008. AB 2186 (Salas) of 2008 required each water-vending machine, retail water facility, and private water source that sells water at retail to display the identity of the source from which the water was last obtained prior to being bottled. The bill was held in Assembly Environmental Safety and Toxic Materials Committee at the request of the author. AB 1521 (Salas) of 2007 required each container of bottled water sold in this state to include on its label the identity of the source from which the water was last obtained prior to being bottled, in compliance with applicable federal regulations. Also required, as a condition of licensure, a water-bottling plant to annually prepare and submit to the department a consumer confidence report. Governor Schwarzenegger vetoed AB 1521. SB 220 (Corbett) Chapter 575, Statutes of 2007, requires a water-bottling plant to annually prepare a bottled water report, including information about the source of the bottled water, (i.e. a spring, drilled well, or municipal water supply), as a condition of licensure. The report must also include a brief description of the treatment process used for producing the bottled water. This bill also enhanced the DPH regulatory process governing water AB 301 Page 5 dispensed from water vending machines and the labeling requirements for bottled water. AB 2644 (Montanez) of 2006 increased the annual license fee for a water-vending machine to $40, and required water-vending machines to be cleaned and serviced at least once every 31 days. The bill would have required that maintenance and complaint records be kept for a minimum of two years and be made available to the department upon request. AB 2644 was held on Senate Appropriations Committee suspense file. SB 1772 (Ashburn) of 2006 required the Department of Health Services to ensure that samples of water-vending machines are inspected annually and would set forth the inspection criteria. This bill also increased the license fee per vending machine from $10.25 to $25, adjusted annually. SB 1772 was held in the Assembly Environmental Safety and Toxic Materials committee without hearing. SB 1302 (Alarcon) of 2004 required the Department of Health Services to conduct annual random inspections of water-vending machines and retail water vendors through visual inspections and the collection and testing of water samples. The bill required the department to make all information collected in the random inspections available to the public, conduct a consumer education program and assess a fee sufficient to pay the costs of the random inspections and the education program. SB 1302 was held on the Assembly Appropriations Committee suspense file. SB 1589 (Denham) of 2004 required that bottled water may not exceed 10 parts per billion of total triahalomethanes or 5 parts per billion of lead, unless the department establishes a lower level by regulation, and vended water may not exceed 10 parts per billion of total triahalomethanes, on average, or 5 parts per billion of lead for public drinking water. The bill was held in the Senate Health and Human Services Committee at the request of the author. AB 83 (Corbett) of 2003 transferred the provisions relating to the licensure and regulation of persons engaged in the AB 301 Page 6 bottled water activities from the Sherman Food, Drug, and Cosmetic Law to the California Safe Drinking Water Act. It required specified information on labeling and in advertising bottled water products; required bottled water licensees to comply with provisions similar to those imposed on public water systems regarding emergency notification plans, consumer confidence reports, and inspections and revised the annual license fee schedule. AB 83 failed passage on the Senate Floor. 6) Arguments in support . Supporters contend that credible and transparent information would help both the public and decision makers to understand more accurately the impacts of proposed bottled-water facilities in California. Without this information, local communities and decision makers may not know exactly how much of their local water supply is sold and transported out of the local area. 7) Arguments in opposition . DPH does not believe that this bill will provide any improvement in public health protection to California consumers. DPH feels that the information they already collect regarding the identity of source water from bottlers is sufficient to ensure quality. DPH also believes the information they are being asked to collect may be considered proprietary, because it can act as an indicator of a company's financial health. DPH also states that this bill places an unfunded mandate on the department. SOURCE : Food and Water Watch SUPPORT : Alliance for Democracy American Federation of State, County and Municipal Amigos de los Rios Employees, AFL-CIO Breast Cancer Fund California Apollo Alliance California Coastkeeper Alliance Center on Policy Initiatives Clean Water Action Concerned Citizen's Coalition of Stockton Concerned McCloud Citizens AB 301 Page 7 East Bay Municipal Utility District Ella Baker Center for Human Rights Environmental Working Group Friends of the Los Angeles River McCloud Watershed Council Movement Generation Planning and Conservation League San Diego Area Municipal Employees Union San Diego Bay Council Santa Clarita Organization for Planning and the Environment Santa Monica Bay Keeper Southern California Watershed Alliance TreePeople Tuolumne River Trust Urban Semillas Wildcoast 1 resident OPPOSITION : California Department of Public Health