BILL ANALYSIS Ó
AB 983
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator S. Joseph Simitian, Chairman
2011-2012 Regular Session
BILL NO: AB 983
AUTHOR: Perea
AMENDED: May 5, 2011
FISCAL: Yes HEARING DATE: June 20, 2011
URGENCY: No CONSULTANT:
Rachel Machi Wagoner
SUBJECT : SAFE DRINKING WATER REVOLVING FUND
SUMMARY :
Existing law :
1) Under the California Safe Drinking Water Act (SDWA):
a) Requires the Department of Public Health (DPH) to
regulate drinking water and enforce the federal Safe
Drinking Water Act and other regulations.
b) Requires DPH, in administering programs to fund
improvements and expansions of small community water
systems, to give priority to funding projects in
disadvantaged communities, and encourage the
consolidation of small community water systems that
serve disadvantaged communities in instances where
consolidation will help the affected agencies and the
state to meet specified goals.
c) Defines a "small community water system" as a
community water system that serves no more than 3,300
service connections or a yearlong population of no more
than 10,000 persons.
2) Under the Safe Drinking Water State Revolving Fund Law of
1997:
a) Authorizes DPH to implement the Safe Drinking Water
State Revolving Fund (SDWSRF), as defined.
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b) Requires DPH to establish a priority list of proposed
projects to be considered for funding. Requires DPH, in
doing so, to determine if improvement or rehabilitation
of the public water system is necessary to provide pure,
wholesome, and potable water in adequate quantity at
sufficient pressure for health, cleanliness, and other
domestic purposes. Requires DPH to establish criteria
for placing public water systems on the priority list
for funding.
c) Requires that not more than 30% and not less than 15%
of the total amount deposited in the SDWSRF may be
expended for grants.
d) Requires that not less than 15% of the total amount
deposited in the SDWSRF shall be expended for providing
loans and grants to public water systems that regularly
serve fewer than 10,000 persons, to the extent those
funds can be obligated for eligible projects.
e) Authorizes DPH to enter into contracts with
applicants for grants or loans in accordance, with the
SDWSRF.
This bill :
1) Authorizes DPH, when implementing the SDWA, to improve
access to financial assistance for projects serving small
community water systems by establishing a payment process
by which the recipient of financial assistance would
receive funds within 30 days of project payment request and
by utilizing wire transfers or other expedited payment
procedures.
2) Requires DPH, in establishing the priority list categories
for funding projects from the fund, to give priority to
projects that include consolidation with a small water
system that will enable the system to meet drinking water
standards.
3) Makes small water systems serving severely disadvantaged
communities eligible to receive up to 100% of their project
costs in the form of principal forgiveness or grant from
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the fund.
4) Authorizes DPH, for disadvantaged communities, to extend
the term of a loan from the SDWSRF beyond 20 years, but not
beyond the life of the project, in order to improve the
affordability of the project.
5) Changes the definition of "cost-effective project" to mean
one that provides long-term access to safe drinking water
at a reasonable cost, which shall be calculated based upon
the capital costs and long-term viability of the project as
well as the affordability of continuing operation and
maintenance charges to ratepayers.
COMMENTS :
1) Purpose of Bill . According to supporters, the Federal
Drinking Water State Revolving Fund was established to
allow states the ability to provide loans to their most
disadvantage communities for safe drinking water
infrastructure projects that prevent pollution and ensure
long-term sustainability. Supporters argue that this
funding is not accomplishing what it was intended for and
that under the current system, DPH loans communities up to
80% of the cost of the project. Unfortunately, this would
require communities to pay the other 20% leaving the most
disadvantaged and poor communities unable to pay for the
cost and be ineligible for the project. In addition, the
support adds, that projects that are often approved are
well-water projects that do not ensure long-term
sustainability due to ground water pollution, resulting in
communities having to deal with the same water quality
issues in the future.
2) SDWSRF : Congress established the SDWSRF as part of the
1996 Safe Drinking Water Act Amendments to better enable
public water systems to comply with national primary
drinking water standards and to protect public health. The
SDWSRF provides financial assistance in the form of
capitalization grants to states to provide low-interest
loans and other assistance to public water systems. In
order to receive these funds, states must provide a state
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match equal to 20 percent of the federal capitalization
grants and must create a drinking water state revolving
fund program for public water system infrastructure needs
and other drinking water-related activities. In response,
California established the SDWSRF through SB 1307 (Costa)
Chapter 734, Statutes of 1997, to help fund the state's
drinking water needs.
3) Prior legislation :
AB 2515 (V.M. Perez) Chapter 601, Statutes of 2010,
authorizes DPH to provide a grant from the SDWSRF for
point-of-entry and point-of-use water treatment systems.
AB 2356 (Arambula) Chapter 607, Statutes of 2008, requires
the State Water Resources Control Board (SWRCB) to take
specified actions when allocating funds to small,
disadvantaged communities for wastewater collection,
treatment or disposal projects and establishing a payment
process pursuant to which the recipient of financial
assistance receives funds within 30 days of the date on
which the SWRCB receives a project payment request.
AB 783 (Arambula) Chapter 614, Statutes of 2007, directs
DPH to prioritize funding of water projects in
disadvantaged communities; and directs DPH to promote,
provide funds for studies on, and prioritize funding for
projects which consolidate small public water systems in
certain situations.
4) Higher Loans - Less Projects . The Assembly Appropriations
Committee analysis states that AB 983 would create cost
pressure to DPH of an unknown amount, but potentially in
the millions of dollars, to fund up to 100%, rather than up
to 80%, of project costs for small water systems serving
severely disadvantaged communities. The loan program only
has a finite amount of money in it. If the state starts
funding 100% of project costs, that will result in less
money available for other projects.
5) Conflict. This bill amends the same statute as AB 1292
(Hernandez). The author should work with Assemblymember
Hernandez's office to include double-jointing language to
address the conflict.
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SOURCE : California Rural Legal Assistance Foundation
SUPPORT : Alta Irrigation District
Asociación de Gente Unida por el Aqua
(AQUA)
California League of Conservation Voters
Catholic Charities Diocese of Stockton
Clean Water Action
Committee for a Better Seville
Community Water Center
County of Tulare
Environmental Justice Coalition for Water
Environmental Working Group
Food and Water Watch
Fresno Irrigation District
Friant Water Authority
Kings River Water Association
Kings River Conservation District
Natural Resource Defense Council
Planning and Conservation League
Self Help Enterprises
Southern California Watershed Alliance
Unitarian Universalist Legislative Ministry
Action Network, CA
Unitarian Universalist Service Committee
United for Change in Tooleville
Urban Semillas
Vecinos Unidos (United Neighbors)
Winnemem Wintu Tribe
J. Steven Worthley, Tulare County Board of
Supervisors
Several individuals
OPPOSITION : None on file