BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | AB 983| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: AB 983 Author: Perea (D), et al. Amended: 9/2/11 in Senate Vote: 21 SENATE ENVIRONMENTAL QUALITY COMMITTEE : 6-0, 6/20/11 AYES: Simitian, Strickland, Blakeslee, Hancock, Kehoe, Lowenthal NO VOTE RECORDED: Pavley SENATE APPROPRIATIONS COMMITTEE : 9-0, 8/25/11 AYES: Kehoe, Walters, Alquist, Emmerson, Lieu, Pavley, Price, Runner, Steinberg ASSEMBLY FLOOR : 78-0, 6/1/11 - See last page for vote SUBJECT : Safe Drinking Water State Revolving Fund SOURCE : California Rural Legal Assistance Foundation DIGEST : This bill makes several changes to the laws governing the states program for providing grants and loans for safe drinking water projects, including allowing certain disadvantaged communities to be eligible for grants up to 100 percent of project costs. Senate Floor Amendments 9/2/11 make various technical changes to make this bill consistent with federal law and regulation and clarify the Department Public Health's authority in prioritizing consolidation projects and add CONTINUED AB 983 Page 2 double-jointing language to resolve a chaptering conflict with AB 938 (V. Manuel Perez). ANALYSIS : Existing law, the California Safe Drinking Water Act, requires the State Department of Public Health (DPH) to administer provisions relating to the regulation of drinking water to protect public health, including, but not limited to, conducting research, studies, and demonstration programs relating to the provision of a dependable, safe supply of drinking water, enforcing the federal Safe Drinking Water Act, adopting and enforcing regulations, and conducting studies and investigations to assess the quality of water in domestic water supplies. Existing law establishes the Safe Drinking Water State Revolving Fund, which is continuously appropriated to DPH for the provision of grants and revolving fund loans to provide for the design and construction of projects for public water systems that will enable suppliers to meet safe drinking water standards. Existing law requires DPH to establish criteria for projects to be eligible for the grant and loan program. This bill authorizes DPH to take specified actions to improve access to financial assistance for small community water systems and not-for-profit nontransient noncommunity water systems serving severely disadvantaged communities, as defined. The bill requires DPH to give priority in funding to projects that include consolidation with a small community water system that will enable that system to meet drinking water standards, without regard to the project proponent, as provided. Under existing law, not less than 15 percent of the fund is required to be expended for providing loans and grants to eligible projects by public water systems that regularly serve fewer than 10,000 persons. This bill requires small community water systems or nontransient noncommunity water systems, owned by a public agency or private not-for-profit water company, serving severely disadvantaged communities to be eligible to receive up to 100 percent of eligible project costs in the form of a grant to the extent the system cannot afford a CONTINUED AB 983 Page 3 loan. This bill is double-jointed with AB 938 (V. Manuel Perez). FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes Local: No According to the Department of Public Health, the administrative costs to expedite payments and comply with the other requirements of the bill can be absorbed within existing resources. According to the Senate Appropriations Committee, this bill will likely result in cost pressures on the Revolving Fund, because additional funds will be provided as grants rather than loans. This will reduce the amount of funds available to other loan applicants and in the long-run will reduce loan repayment revenues into the Revolving Fund. The extent of this cost pressure is unknown and will depend on particular project applications. Based on the number and size of loans made to disadvantaged communities in past years, the shift in funding from loans to grants may be in the hundreds of thousands per year, with commensurate cost pressures on the fund. SUPPORT : (Verified 9/6/11) California Rural Legal Assistance Foundation (source) Alta Irrigation District Asociacion de Gente Unida por el 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 Conservation District Kings River Water Association Natural Resources Defense Council Planning and Conservation League CONTINUED AB 983 Page 4 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 ARGUMENTS IN SUPPORT : 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 percent of the cost of the project. Unfortunately, this would require communities to pay the other 20 percent 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. ASSEMBLY FLOOR : 78-0, 6/1/11 AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall, Bill Berryhill, Block, Blumenfield, Bonilla, Bradford, Brownley, Buchanan, Butler, Charles Calderon, Campos, Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson, Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Grove, Hagman, Halderman, Hall, Harkey, Hayashi, Roger Hernández, Hill, Huber, Hueso, Huffman, Jeffries, Jones, Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor, Mendoza, Miller, Mitchell, Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan, Perea, Portantino, Silva, Skinner, Smyth, Solorio, Swanson, Torres, Valadao, Wagner, Wieckowski, Williams, Yamada, John A. Pérez CONTINUED AB 983 Page 5 NO VOTE RECORDED: Gorell, V. Manuel Pérez DLW:do 9/6/11 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED