BILL ANALYSIS
AB 975
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CONCURRENCE IN SENATE AMENDMENTS
AB 975 (Fong)
As Amended July 15, 2009
Majority vote
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|ASSEMBLY: |54-24|(May 28, 2009) |SENATE: |23-15|(September 1, |
| | | | | |2009) |
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Original Committee Reference: W., P. & W.
SUMMARY : Requires certain water corporations regulated by the
Public Utilities Commission (PUC) to install water meters on new
service connections and on unmetered connections by 2025.
The Senate amendments extend the deadline for water meters and
make clarifications:
1)Extend deadline for specified water corporations to install
water meters from 2020 to 2025.
2)Clarify PUC authority to allow water corporations to impose a
rate, fee or charge in addition to the charge for the actual
volume of water.
3)Require, instead of allow, water corporations to recover the
costs of water meter installation.
4)Clarify that any water purveyor, not just an urban water
purveyor, may impose a rate, fee or charge in addition to the
charge for the actual volume of water if it charges by volume.
AS PASSED BY THE ASSEMBLY , this bill was substantially similar
to the version passed by the Senate.
EXISTING LAW prohibits the PUC 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 : The Assembly Appropriations Committee estimated
minor, absorbable costs to the PUC. According to the Senate
Appropriations Committee, pursuant to Senate Rule 2.8.,
negligible state costs.
AB 975
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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 required
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 PUC'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 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 PUC from
requiring water meters unless it can 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 PUC bases on net present value of
future cost-savings, impairs PUC's ability to require meters,
particularly in areas where water costs are low. According to
the author, the PUC 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 PUC can make these
findings.
Analysis Prepared by : Alf W. Brandt / W., P. & W. / (916)
319-2096
AB 975
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