BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 21
                                                                  Page  1

          Date of Hearing:   April 10, 2013

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

           AB 21 (Environmental Safety and Toxic Materials) - As Amended:   
                                  February 14, 2012

          Policy Committee:                              Environmental  
          Safety and Toxic Materials                    Vote: 6-0

          Urgency:     No                   State Mandated Local Program:   
          No     Reimbursable:              

           SUMMARY  

          This bill creates the Safe Drinking Water Small Community  
          Emergency Grant Fund and authorizes the Department of Public  
          Health (DPH) to assess an annual charge to be deposited in this  
          fund in- lieu of interest that would otherwise be charged on  
          Safe Drinking Water State Revolving Fund (SDWSRF) loans.  

          The annual charge a SDWSRF loan recipient pays would be in an  
          amount identical to the amount of annual interest owed.  Rather  
          than pay the interest to SDWSRF, the equivalent fee would be  
          deposited in the newly created grant fund.  

          This bill establishes a program and funding source for safe  
          drinking water grants to disadvantaged and severely  
          disadvantaged communities.

           FISCAL EFFECT
           
          1)Potentially millions of dollars could shift from the SDWSRF to  
            the newly created Safe Drinking Water Small Community  
            Emergency Grant Fund.

          2)On-going absorbable costs to DPH to administer the new grant  
            program that would otherwise be spent administering the  
            SDWSRF.

           COMMENTS

          1)Purpose.   This bill provides a renewable funding source for  
            emergency drinking water projects and targets the funds to  








                                                                  AB 21
                                                                  Page  2

            disadvantaged and severely disadvantaged communities.  The  
            creation of the new program will allow DPH to disburse  
            emergency grant funds to communities currently without access  
            to safe drinking water.  

            This bill shifts funds from a program that is very difficult  
            for disadvantaged communities to access and creates a new  
            program specific for that population.   

            This bill is consistent with the highest priority  
            recommendation in the February 20, 2013 State Water Resources  
            Control Board report "Recommendations Addressing nitrate in  
            groundwater."  


          2)Background.   The SDWSRF provides loans to public water systems  
            to finance drinking water infrastructure projects in  
            compliance with state and federal law.  The state provides a  
            20% match to draw-down federal funds from the US EPA.  The  
            SDWSRF is a loan program that is typically inaccessible to  
            disadvantaged communities who cannot meet the requirement of  
            the program or cannot afford loans.    

           3)Small Community Grant.  This bill creates a program at DPH  
            similar to the wastewater grant program for disadvantaged  
            communities at the SWRCB.

           Analysis Prepared by  :    Jennifer Galehouse / APPR. / (916)  
          319-2081