BILL ANALYSIS
AB 975
Page 1
Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON WATER, PARKS AND WILDLIFE
Jared William Huffman, Chair
AB 975 (Fong) - As Amended: April 22, 2009
SUBJECT : Public Utilities: water meters
SUMMARY : Requires water corporations regulated by the Public
Utilities Commission (Commission) to install water meters on new
service connections and on unmetered connections by 2020.
Specifically, this bill :
1)Repeals current law limiting the Commission authority to
require water corporations to instill water meters unless
certain conditions are fulfilled.
2)Requires water corporations with 500 or more service
connections, and that are not subject to Water Code
requirements to install water meters, to:
a) Install a meter on all new service connections after
January 1, 2010.
b) Install a water meter on all unmetered service
connection by January 1, 2020
c) Charge customers for potable water based on the actual
volume of deliveries on and after January 1, 2015.
3)Requires water corporations that reach 500 or more service
connections after this year to install water meters on each
unmetered connection within 10 years of attaining 500
connections and charge its customers based on the actual
volume of potal water deliveries.
4)Allows water corporations to delay, for one year, volumetric
charging of customers converting from non-volumetric billing.
5)Allows water corporations to recover the costs of water meter
installation through rates, fees and charges, subject to the
approval of the Commission.
6)Requires Commission to ensure compliance with metering
requirements.
7)Authorizes Commission to require a water corporation with less
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than 500 service connections to install water meters if the
Commission finds that metering:
a) Will be cost-effective within the service area.
b) Will result in a reduction of water use within the
service area.
c) Costs will not impose an unreasonable financial burden
on customers within the service area, unless it is found to
be necessary to ensure continued adequate water service.
8)Finds that no reimbursement of local agency costs is required
because the only local costs will arise out of creation of a
new crime or penalty.
EXISTING LAW prohibits the Public Utilities Commission from
requiring installation of water meters unless metering will be
cost effective, reduce water consumption, and not impose an
unreasonable financial burden on customers.
FISCAL EFFECT : Unknown
COMMENTS : This bill applies contemporary legal requirements
for water meters to the public utilities that serve water to
many Californians, replacing previous restrictions on water
meter requirements dating to the 1970's. This change reflects
the legal trend requiring water meters throughout California.
Historically, some city charters barred use of water meters. In
1992, state law required all new water connections to have a
water meter and Congress required users of water from the
federal Central Valley Project (CVP) - mostly agricultural users
- to use some form of water measurement. The City of Fresno, a
CVP contractor, resisted that requirement but state legal
changes led to Fresno installing water meters and require
charges to residential customers by volume by 2013. A 2004 law
(AB 2572/Kehoe) required all urban water suppliers to charge for
water by volume by 2025. This bill requires public utilities to
begin charging by volume in 2015.
Current law limiting the Commission's authority to require water
meters reflects an earlier time, when communities, such as
Sacramento, refused to use water metering to charge by volume.
This refusal reflected a belief that the communities in the
north where water originated (i.e. areas of origin) should not
be limited in water use, as California was considering how to
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increase water exports to Southern California through the
Peripheral Canal. Some cities had charter provisions barring
water meters.
The current Public Utilities Code Section 781 bars the
Commission from requiring water meters unless it could determine
that water meter installation would be cost effective, reduce
water consumption, and not impose an unreasonable financial
burden. The financial burden standard, which the Commission
bases on net present value of future cost-savings, impairs the
Commission's ability to require meters, particularly in areas
where water costs are low. According to the author, the
Commission identified this issue in determinations in Lake Tahoe
and Bakersfield. This bill eliminates and replaces these
limitations with required water meters for utilities with more
than 500 service connections and authority to require water
meters on smaller water utilities if the Commission can make
these findings.
REGISTERED SUPPORT / OPPOSITION :
Support
Friends of the River
Sierra Club California
Opposition :None submitted
Analysis Prepared by : Alf W. Brandt / W., P. & W. / (916)
319-2096