BILL ANALYSIS SB 565 SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator S. Joseph Simitian, Chairman 2009-2010 Regular Session BILL NO: SB 565 AUTHOR: Pavley AMENDED: April 13, 2009 FISCAL: Yes HEARING DATE: April 27, 2009 URGENCY: No CONSULTANT: Bruce Jennings SUBJECT : WATER RECYCLING SUMMARY : Existing law : 1) Establishes a statewide goal to recycle a total of 700,000 acre-feet of water per year by 2000, and one million acre-feet of water by 2010, pursuant to the Water Recycling Act of 1991. 2) Requires urban water management plans to include, to the extent available, information on recycled water and its potential for use as a water source in the service area, pursuant to revisions of the Urban Water Management Planning Act. 3) Requires the state plan to include current and projected supplies of water provided by water recycling and reuse, pursuant to revisions of the California Water Plan. 4) Requires the Department of Water Resources (DWR) to advise DWR concerning opportunities for using recycled water in industrial and commercial applications and in identifying impediments and constraints to increasing the industrial and commercial use of recycled water, pursuant to the AB 331 and the creation of the Recycled Water Task Force (2002). This bill : 1) Requires the State Water Resources Control Board (SWRCB), in collaboration with the Department of Public Health (DPH) and DWR, to adopt a statewide plan to ensure that at least SB 565 Page 2 50 percent of the wastewater annually discharged directly into the ocean, as of the year 2009, is recycled and put to beneficial use by the year 2030. The plan would require the state board to: a) Identify all regulatory, financial, engineering, jurisdictional, and other impediments to meeting the statewide ocean discharge recycling goal. b) Identify all impediments to direct potable reuse of the water. c) Develop specific actions and strategies to remove those impediments. In developing the plan, the SWRCB would be required to seek input from wastewater dischargers, urban water suppliers, local government agencies, and other interested parties. The SWRCB would be authorized to appoint an advisory committee, task force, or any other group or groups that the board deems necessary or desirable to assist the board in carrying out this part. Upon adoption of the plan, the SWRCB would be required to submit copies of the plan to the Governor and the Legislature. 2) Requires the SWRCB, to impose an annual fee on discharges of wastewater into the ocean, to reimburse the SWRCB, DWR, and DPH for the costs of developing the plan and any measures implementing the plan subject to the following requirements: a) The fee would be imposed on each person who discharges wastewater directly into the ocean. b) The fee shall be in addition to any other fees imposed by the SWRCB. The SWRCB would be required to adopt regulations to implement the fee provisions. 3) Makes various findings and declarations regarding the importance of water recycling. COMMENTS : 1) Purpose of Bill . Each year, urban California discharges approximately 3 - 4 million acre-feet of wastewater into SB 565 Page 3 the ocean. Unlike discharges into rivers or streams that can be recaptured downstream and then be reused, ocean discharges are lost to additional use. This water is truly wasted. At the same time, urban California continues to grow. The California Department of Finance projects California's population to reach almost 60 million people by 2050, adding over 25 million since the 2000 decennial census. These new Californians are going to need water. It is critical that California finds new ways to accommodate growth, with its resultant increase in water demand, in as an environmentally benign as possible. It is also critical that we focus on strategies that support greater regional independence. SB 565 does just that. 2) Background . The Recycled Water Task Force was chaired by a member of the SWRCB, with representatives from DWR and the Department of Health Services serving as Co-Vice Chairs. The result of the Task Force was a 2003 report that included recommendations for additional state and federal funding for recycling projects and research, public outreach and education, changes in plumbing codes, and legislation to increase local flexibility to regulate water softeners. On February 3, 2009, the SWRCB adopted a water recycling policy. According to that policy, "The purpose of this Policy is to provide direction to the Regional Water Quality Control Boards (Regional Water Boards), proponents of recycled water projects, and the public regarding the appropriate criteria to be used by the State Water Board and the Regional Water Boards in issuing permits for recycled water projects." 3) Arguments in Support . Natural Resources Defense Council observes, "Water recycling is an important element of California's water future, in light of the likely impacts of climate change and the ecosystem collapse in the Bay-Delta. The Delta Vision Strategic Plan recommended substantial investment in water recycling as part of a package to reduce the state's unsustainable reliance on from the Bay Delta. Orange County's existing water recycling plant currently provides a "drought proof" source SB 565 Page 4 of water for nearly 500,000 people, and the recently enacted Omnibus Public Lands Act authorizes the federal Bureau of Reclamation to assist in development of 7 water recycling projects in California." 4) Arguments In Opposition . Opponents' comments include several issues: the challenge of reaching the target under current law, and the imposition of fees to cover the costs of developing and implementing the plan, and the issues surrounding the use of recycled water. The California Association of Sanitation Districts' (CASD) states: "There are many reasons that we are not achieving our recycling goals, the principle one being a lack of adequate funding for treatment and distribution infrastructure. The State cannot reach the volumes of recycling called for in the bill through irrigation, due to the seasonality of the demand plus the very high cost of dual plumbing systems. Approaching the ambitious goal of recycling 50 percent of the water currently going to the ocean will require that California expand eligible uses of recycled water, to include reservoir augmentation and other potable reuse options? the California Department of Public Health, rather than the State Water Board, would be tasked with developing regulations to govern these uses. We are also concerned about the prospect of yet another regulatory fee being imposed on local governments, which have already been hard hit by the economic climate and are facing staffing decreases, severe budget cuts, and declining revenues." The County Sanitation Districts of Los Angeles argue, in part, that their work to date on water recycling is not properly credited in SB 565, but more largely that achieving the goals of this bill require a very substantial effort: The Sanitation Districts believe that it would be very helpful for this bill to focus on increasing funding for recycled water capital projects via the water bond discussions currently underway and addressing new ways to dramatically increase water recycling in the future, such as through direct potable reuse. The latter will require a whole new regulatory framework?" 5) Water Recycling. The Legacy of Chemical Contaminants . One SB 565 Page 5 of the likely avenues for advancing water recycling involves groundwater storage. In this regard, the author needs to be mindful of the substantial problems with introducing recycled waters to groundwater basins. And even if recycled waters are not stored, there remain complex issues concerning the identification and analysis of chemical contaminants in the state's waters. Identifying chemical contaminants in California's waters - a universe of substances which is not known with any precision -- likely numbers into the many hundreds, if not thousands, of substances. Given this context, it is easy to discern that even a recycled water policy that rests on meeting both drinking water standards as well as other water quality objectives may be wholly inadequate for protecting the quality of California's waters. As a consequence, a policy that simply expedites the recycling of water without providing some basis for rapid diagnostics coupled with a comprehensive analysis of chemical contaminants may well compromise the quality of the state's waters. The recent national reporting on pharmaceutical contaminants illustrates but one dimension of the problem posed by unregulated and uncharacterized contaminants in water. In light of the state board's Recycled Water Policy adopted in February of this year, it may be prudent to amend SB 565 to specifically reference and include the Board's continuing work on Contaminants of Emerging Concern as well as the Office of Environmental Health Hazard Assessment to inform the development of the plan. 6) Clarification: Developing a Plan Consistent with Existing Law . Without question, various authoritative sources note the need for California to better utilize its waters. There may be instances, nevertheless, in which ocean discharges of water may constitute a benefit, such as with respect to the biological impact on aquatic ecology. Since the potential environmental and health consequences of water recycling must be considered in the context of the California Environmental Quality Act (CEQA), the bill should be amended to explicitly note that the development of the statewide plan is consistent with CEQA as well as the State's water quality laws. SB 565 Page 6 SOURCE : Senator Pavley and Planning and Conservation League SUPPORT : California Coastkeeper Alliance Heal the Bay Natural Resources Defense Council Sierra Club California Sonoma County Water Agency 1 Individual OPPOSITION : Association of California Water Agencies California Association of Sanitation Agencies California Chamber of Commerce California Taxpayers' Association Sanitation Districts of Los Angeles County Southern California Water Committee