BILL ANALYSIS
AB 1232
Page 1
ASSEMBLY THIRD READING
AB 1232 (Huffman)
As Amended May 7, 2009
Majority vote
LOCAL GOVERNMENT 5-2
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|Ayes:|Caballero, Arambula, | | |
| |Davis, Krekorian, Skinner | | |
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|Nays:|Knight, Duvall | | |
| | | | |
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SUMMARY : Allows the Marin County Local Agency Formation
Commission (LAFCO), when specific conditions are met, to
initiate and approve the consolidation of small wastewater
agencies, without protest hearings. Specifically, this bill :
1)Provides the Marin LAFCO, after notice and hearing, with the
power to initiate and approve a reorganization or
consolidation of small wastewater agencies, without protest
hearings, if all of the following conditions exist:
a) The Marin LAFCO, in its municipal services review (MSR)
of the wastewater agencies, completed within the last 10
years, makes findings or determinations related to
reorganization or consolidation, that if implemented, would
improve the financial and service level benefits, improve
government accountability, improve operational
efficiencies, and provide cost savings for the ratepayers;
b) The wastewater agencies have not implemented LAFCO's
findings or determinations as provided in the MSR; and,
c) The wastewater agencies affected have had three or more
illegal discharges in the last five years, based on
violations identified by the San Francisco Bay Regional
Water Quality Control Board (SFBRWQCB) that exceed 5,000
gallons of untreated or partially treated wastewater to
waters of the state.
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2)Defines "small wastewater agencies" to mean sanitation
districts and local governments that provide sewer and
wastewater collection or treatment services to 10,000 service
connections or less.
3)States that the provisions of this measure will become
effective on January 1, 2011.
4)Makes findings and declarations about the impact of illegal
sewage spills.
5)Declares that this bill is a special statute because of the
unique circumstances applicable to the County of Marin.
EXISTING LAW :
1)Establishes the procedures for the organization and
reorganization of cities, counties, and special districts
under the Cortese-Knox-Hertzberg Local Reorganization Act of
2000 (Act).
2)Allows a LAFCO to initiate proposals for changes or
organization, including consolidation.
3)Defines "change of organization" in the Act to include
consolidation of cities or special districts.
4)Defines "proceedings" to mean proceedings taken by the LAFCO
for a proposed change of organization or reorganization.
5)Provides for noticing requirements for a protest hearing, and
specifies that during the hearing the LAFCO shall hear and
receive any oral or written protests, objections, or evidence
that is made, presented or filed.
6)Provides that a proposal for change of organization must be
abandoned if a majority protest is deemed to exist.
7)Requires a LAFCO to revisit its municipal service reviews and
adopted spheres of influence every five years.
FISCAL EFFECT : None
COMMENTS : Current law specifies various ways that special
districts and other agencies can be reorganized and modified,
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including consolidation, dissolution, including dissolution with
annexation, a merger, or establishment of a subsidiary district.
This bill focuses on consolidation - the formal restructuring
transactions that would combine two or more agencies into a
single organization and would require a formal LAFCO review and
approval process - as the means to modify special districts. A
consolidation can be initiated by a petition of registered
voters or landowners, by a resolution of the governing body of
an affected local agency, or by LAFCO itself.
This bill originates from problems in eleven sewer services
agencies located in southern Marin County, including six
sanitary districts, three cities, one community services
district and one joint powers agency. Three of the agencies
operate wastewater treatment plants - Sanitary District No. 5
(Tiburon), the Joint Powers Agency (Sewerage Agency of Southern
Marin - SASM), and the Sausalito-Marin City Sanitary District.
Ten of the eleven agencies operate sewerage collection systems
and pumping stations. All of the special districts providing
sanitary sewer services are governed by independent boards,
except for SASM, whose members are appointed by each of its six
member agencies.
The author notes that "the frequency and size of illegal sewage
spills of raw or partially treated sewage are increasing often
because of the improper sewer system maintenance. By providing
limited new authority to a LAFCO, this bill would increase the
cost effectiveness and efficiency of small wastewater agencies
and reduce the impacts on water quality due to illegal sewage
spills. SFBRWQCB reports that over 2,000 separate illegal
sewage spills occurred in the bay and coastline between 2004 and
2007. Over 500 of the spills exceeded 1,000 gallons. One of
the largest spills was 2.5 million gallons in Marin County which
illegally discharged both untreated and partially treated sewage
into the San Francisco Bay."
To reduce water quality problems and to increase system
efficiencies, in 2005 the Marin County LAFCO conducted an MSR
and recommended a consolidation plan for the eleven small
wastewater agencies in southern Marin County. The report
concluded that the operation of numerous separate agencies with
duplicated staff, and over 40 elected officials, is not a cost
effective way to manage the single purpose service of wastewater
collection and treatment. The MSR identified significant cost
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savings for the ratepayers that would occur if agency functions
were consolidated.
This bill sets up a process that would allow Marin LAFCO to
force the consolidation of small wastewater districts, when
specific conditions are met, without protest hearings. Protest
proceedings are established in existing law to allow registered
voters and landowners to give oral or written protests against a
change of organization. This bill removes the ability of the
Marin LAFCO to hold protest hearings for public input and for an
affected district to speak and deliberate in a public forum on
the issue of forced consolidation and whether it is the best
option for the community. Protest proceedings are removed from
the bill because, according to the author, "there has been
strong local agency resistance to consolidation. That
resistance has made it impossible under existing laws to
implement the LAFCO consolidation recommendation because
existing law requires a majority of voters in the affected
districts to approve the consolidation."
There is the potential that a district would be forced, against
its will, under the provisions of this bill, to consolidate with
other districts or agencies. An unwilling district could then
sue LAFCO because LAFCO would be the entity that initiates the
forced consolidation. The Legislature may wish to consider
whether Marin LAFCO would ever use this process, given the legal
implications.
This bill will set a precedent of giving LAFCO more power than
under current law. This bill could pave the way for other
instances where power could be taken away from agencies and
their customers and given to LAFCO. The Legislature may wish to
consider the future implications that this bill may set.
Additionally, the Legislature may wish to consider whether it
makes more sense to have SFBRWQCB serve as the petitioner for
the reorganization or consolidation through Marin LAFCO because
of SFBRWQCB's expertise in water quality issues and enforcement
actions related to sewage spills.
In their initial letter of concern, the California Association
of Sanitation Agencies (CASA), writes: "CASA's major concern is
that LAFCOs have little expertise in water quality or wastewater
treatment issues. CASA feels the more appropriate way to
address sanitary sewer overflows (SSOs) is pursuant to existing
AB 1232
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statutory and regulatory requirement under the Clean Water Act
and Porter Cologne Act, or direct consolidation such as
designating agencies to be consolidated in legislation. To
provide a consistent, statewide regulatory approach to address
SSOs, the State Water Resources Control Board adopted Statewide
General Waste Discharge Requirements for Sanitary Sewer Systems,
Water Quality Order No. 2006-0003 (Sanitary Sewer Order) on May
2, 2006. The Sanitary Sewer Order requires public agencies that
own or operate sanitary sewer systems to develop and implement
sewer system management plans and report all SSOs to the State
Water Board's online SSO database. Consequently, we feel that
the [CAL] EPA, State Water Board, and Regional Boards are in a
far better position to address SSOs than are LAFCOs. In fact it
is our understanding that the particular agencies contributing
to recent spills are currently under EPA orders."
Currently this bill only deals with Marin County, because of the
unique nature of the problems in southern Marin. The
Legislature may wish to ask the author to narrow the scope of
the bill further, specifically to the agencies in southern Marin
County, and provide for a one-time special statute, rather than
setting up a process that can be used in the future anywhere in
Marin County.
In their opposition letter, Ross Valley Sanitation District
(located in central Marin County), notes that "(1) it is unfair
for any LAFCO to impose reorganization or consolidation of any
public agency without the opportunity for a protest hearing, and
(2) if the bill is intended to affect southern Marin then the
language should be explicit to southern Marin."
While consolidation of smaller agencies may increase
administrative effectiveness and provide for better management
of those agencies, there are no guarantees that consolidation is
the answer to the question of how to prevent illegal sewage
discharges. There may be other avenues to pursue that would
help sanitary districts update their aging infrastructure
including federal and state grants or funding, or heavier
enforcement if negligence is found on the part of the sanitary
districts. The Legislature may wish to consider whether the
approach in the bill is the correct approach to address illegal
sewage discharges.
This bill specifies several thresholds and timelines that would
need to be met in order for consolidation to be forced by the
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Marin LAFCO. First, the bill specifies that there must be three
or more sewage discharges of 5,000 gallons in a five-year
period. Second, the definition of small wastewater agencies
applies to those sanitary districts that have 10,000 service
connections or less. Lastly, the municipal services review done
by the commission has to be completed within the prior 10-year
period and make findings that reorganization or consolidation
would improve the financial and service level benefits, increase
operational efficiency, and provide cost savings for the
ratepayers. The Legislature may wish to discuss whether these
thresholds are appropriate.
This bill, if signed into law, will take effect on January 1,
2011. The assumption for the smaller wastewater agencies in
southern Marin is that they have a few years to figure out a
plan to consolidate on their own terms, and then can initiate
consolidation before the bill's effective date. However, this
is not explicitly spelled out in the bill. The Legislature may
wish to consider giving a date certain to have LAFCO start the
consolidation process, but only if a solution has not been
reached locally by the agencies.
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958 FN: 0000775