BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 808
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          SENATE THIRD READING
          SB 808 (Wolk)
          As Amended  January 25, 2010
          2/3 vote.  Urgency 

           SENATE VOTE  :35-0  
           
           WATER, PARKS & WILDLIFE  11-0   APPROPRIATIONS      16-0        
           
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          |Ayes:|Huffman, Fuller,          |Ayes:|Fuentes, Conway, Hill,    |
          |     |Anderson, Arambula, Tom   |     |Bradford, Charles         |
          |     |Berryhill, Blumenfield,   |     |Calderon, Coto, Davis,    |
          |     |Caballero, Fletcher,      |     |Hall, Harkey, Miller,     |
          |     |Bonnie Lowenthal, Feuer,  |     |Nielsen, Norby, Skinner,  |
          |     |Yamada                    |     |Solorio, Torlakson,       |
          |     |                          |     |Torrico                   |
           ----------------------------------------------------------------- 
           SUMMARY  :  Extends the inoperative date on the current Delta  
          levee maintenance subvention program from July 1, 2010 to July  
          1, 2013.  Specifically,  this bill  :

          1)Extends the current reimbursement rates, which allow the State  
            to pay local agencies up to 75% of levee maintenance costs  
            which exceed $1,000 per mile, to July 1, 2013.  

          2)Requires reimbursements to reflect the priorities of, and be  
            consistent with, the Delta Plan.

          3)Amends the existing inoperative date of July 1, 2010 as an  
            urgency statute to take effect immediately.

           EXISTING LAW  :
           
           1)Requires DWR to study the risks posed to the integrity of the  
            Delta by various hazards and to prioritize options for their  
            mitigation.  This effort is known as the Delta Risk Management  
            Strategy (DRMS).

          2)Establishes a planning framework for the Delta: the Delta  
            Plan.  The Delta Plan is due January 2012 and will likely  
            incorporate the DRMS levee risk management results.   

           FISCAL EFFECT  :  According to the Assembly Appropriations  








                                                                  SB 808
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          Committee, cost pressures of an unknown amount, potentially in  
          the hundreds of thousands of dollars annually, to fund local  
          levee maintenance projects.  That is because this bill maintains  
          the current cost-share ratio for local levee maintenance of 75%  
          state funds to 25% local funds.  Absent this bill, the program  
          converts to a lower 50-50 cost-share ratio for local levee  
          maintenance.  (Most likely bond funds, though subvention  
          payments could come from the General Fund.)

          DWR reports that, last year, local agencies did not claim all  
          available state funds (bond funds) for levee maintenance  
          projects because they could not meet the 25% match.  DWR  
          concludes that, should the program convert to a 50-50 cost-share  
          ratio, locals would be even less able undertake levee  
          maintenance projects and the state may have to spend more money  
          then it would have spent on subvention payments in order to  
          address emerging or acute levee failures.

           COMMENTS  :  The Delta levees are the key physical element  
          maintaining the Delta in its current state and are essential for  
          the protection from flooding of human life, property (e.g.  
          buildings, equipment, and crops, among others), water quality  
          and wildlife habitat.  While the Delta levees are mostly  
          private, the State and Federal governments also rely upon them  
          to maintain the use of the Delta as a water conveyance system  
          for the State Water Project (SWP) and the federal Central Valley  
          Project (CVP).

          The Delta levee maintenance subvention program was created by SB  
          541 ((Way) Chapter 717, Statutes of 1973).  The program has been  
          modified periodically since its inception and currently provides  
          reimbursement funds to local agencies for costs incurred in any  
          year for the maintenance or improvement of project or  
          non-project levees.  Currently, the reimbursement rate is zero  
          if the entire cost incurred per mile of levee is $1,000 or less.  
           For the costs incurred in excess of $1,000 per mile of levee,  
          the State can pay up to 75% based upon an assessment of the  
          agency's ability to pay.  In the absence of this legislation, on  
          July 1, 2010, the reimbursement rate paid by the State will, for  
          any costs incurred in excess of $1,000 per mile, decrease to  
          50%.

          According to the author, "the Delta levee system serves both  
          local and substantial State interests.  Regardless of future  








                                                                  SB 808
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          decisions on [water] conveyance within the Delta, in the near  
          term, Delta levees will continue to be the sole tool for water  
          conveyance for the SWP and CVP.  The Delta Levee Subvention  
          Program's 75-25 cost-sharing formula has allowed local  
          reclamation districts to afford to maintain and improve their  
          levees, thereby protecting the system.  If the formula returns  
          to a 50-50 split, then the many small districts with a limited  
          economic base would not be able to afford to maintain the Delta  
          levees adequately."

          Last year's historic Delta legislation, SB 1 (Simitian), Chapter  
          5, Statutes of 2009-10 Seventh Extraordinary Session, creates  
          the Delta Stewardship Council (Council) and requires the Council  
          to develop a Delta Plan which includes priorities for levee  
          investments within the Delta.  The Delta Plan is due January 1,  
          2012.  Although the author's office originally sought a 6-year  
          extension of the program, "in order to sustain Delta maintenance  
          programs" during the transition to the Delta Plan, the author's  
          office subsequently amended the bill to extend the date to 2013  
          and include Delta Plan consistency language.  As the author  
          states, SB 808 continues the Delta Levee Subventions program and  
          supports levee maintenance while "the State reassesses the  
          direction it will pursue in protecting the Delta."

          General Fund contributions to this program are capped at $2  
          million per year.

          There is no known opposition to this bill.


           Analysis Prepared by  :    Tina Cannon Leahy / W., P. & W. / (916)  
          319-2096 
                                                               FN:  0004432