BILL ANALYSIS AB 1975 Page 1 ASSEMBLY THIRD READING AB 1975 (Fong) As Amended June 1, 2010 Majority vote WATER, PARKS & WILDLIFE 13-0 APPROPRIATIONS 12-2 ----------------------------------------------------------------- |Ayes:|Huffman, Fuller, Bill |Ayes:|Fuentes, Ammiano, | | |Berryhill, Arambula, Tom | |Bradford, | | |Berryhill, Blumenfield, | |Charles Calderon, Coto, | | |Caballero, Ruskin, | |Davis, Monning, Ruskin, | | |Fletcher, Bonnie | |Skinner, Solorio, | | |Lowenthal, Salas, Yamada, | |Torlakson, Torrico | | |Fong | | | | | | | | |-----+--------------------------+-----+--------------------------| | | |Nays:|Nielsen, Norby | | | | | | ----------------------------------------------------------------- SUMMARY : Requires water submetering on multiunit structures. Specifically, this bill : 1)Requires multiunit residential structures or mixed use residential and commercial structures that are permitted after January 1, 2013, to add, as a condition of new service, water meters or submeters that measure the water supplied to each individual unit. 2)Suspends the requirement to install submeters if the Department of Weights and Measures has not approved a sufficient number of qualifying submeters. 3)Requires the owner or operator of a multiunit residential structure with meters or submeters on each dwelling unit to charge tenants for water and sewer based on actual water usage. Disallows charges pursuant to this bill if the meter or submeter is not of an approved type or installed or operated in compliance with existing law. 4)Allows property owners to recover actual monthly cost from each tenant for submeter monitoring and billing, but not more than $2. AB 1975 Page 2 5)Requires property owners to ensure that each submeter complies with all laws and regulations governing the installation, certification, maintenance, billing, and testing of water submeters. 6)Prohibits a water purveyor from imposing a fee for water meter installation when the water meter or submeter is installed by the property owner or his or her agent. 7)Creates an exception to the metering requirement where a structure is greater than four stories high and plumbed in a configuration that makes individual unit metering infeasible. EXISTING LAW : 1)Requires urban water suppliers that do not get water from the federal Central Valley Project to install water meters on all municipal and industrial service connections and to charge each customer based on actual volume of water delivered. 2)Each water corporation with 500 or more service connections that is not already subject to water metering requirements under the existing Water Measurement Law must currently install a water meter on each new service connection and must retrofit each unmetered service connection by January 1, 2025. FISCAL EFFECT : Negligible state costs, if any. Costs to local governments of an unknown amount to ensure installation of meters in affected new units and for county sealers to periodically calibrate meters and submeters. These local costs will be fully covered by fees paid by building owners and operators. AB 1173 (Keene, 2007) was similar to this bill in that it, too, would have required a building owner or operator to charge for water and sewage an individual unit in a multi-unit building based on that unit's water use. However, AB 1173, unlike this bill, would have allowed an alternative method of determining an individual unit's water charge based upon the relative square-foot area of the unit. This alternative method was controversial because some feared it would lead to water charges disproportionate to water use and be especially harmful to low-income residents. Because of this controversy, the Division AB 1975 Page 3 of Measurement Standards at the Department of Food and Agriculture (CDFA) assumed it would need to resolve disputes about meters and submeters. (CDFA indicates it anticipates no such costs associated with this bill.) COMMENTS : As California attempts to manage its scarce water supplies, the installation of water meters on multiunit residential and mixed use commercial buildings will encourage increased conservation by making homeowners, business owners, or renters aware of the amount of water they are utilizing. Charging based on actual usage will reward those who conserve. Conceptually, this legislation is similar to a draft ordinance requiring submetering that was adopted by the City of San Diego on April 5, 2010. San Diego adopted its ordinance after a report from the City of San Diego Office of the Independent Budget Analyst found that multifamily units currently comprise 44% of the total housing in San Diego, the trend is increasing, and multifamily properties achieve a 15% to 39% water savings when submetered. An environmental justice group who supports this bill's goals opposes its language empowering landlords to submeter and bill tenants fearing this would lead to abuses. They state that over-charging, failing to maintain systems, and denying access to records are just a few of the problems currently being experienced as a result of landlords taking on the role of utilities in mobilehome parks, many of which are submetered. They suggest amending the bill to require submetered tenants to be the direct customers of the water utilities just as single-family homeowners are. One county advises this bill would likely encourage water conservation and efficiency but opposes the provision requiring submetering to be a condition of new water service to the property. This county wants to eliminate water purveyor responsibility for ensuring submetering and shift the requirement to a construction permit condition of approval. Analysis Prepared by: Tina Cannon Leahy / W., P. & W. / (916) 319-2096 AB 1975 Page 4 FN: 0004764