BILL ANALYSIS Ó
AB 30
Page 1
ASSEMBLY THIRD READING
AB 30 (Perea)
As Amended May 24, 2013
Majority vote
ENVIRONMENTAL SAFETY 5-0
APPROPRIATIONS 17-0
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|Ayes:|Alejo, Dahle, Bloom, |Ayes:|Gatto, Harkey, Bigelow, |
| |Stone, Ting | |Bocanegra, Bradford, Ian |
| | | |Calderon, Campos, |
| | | |Donnelly, Eggman, Gomez, |
| | | |Hall, Ammiano, Linder, |
| | | |Pan, Quirk, Wagner, Weber |
|-----+--------------------------+-----+--------------------------|
| | | | |
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SUMMARY : Removes the sunset date for the Small Community Grant
(SCG) Fund, which provides grants to small communities for the
construction of wastewater collection, treatment, or disposal
projects. Specifically, this bill :
1)Eliminates the sunset date of December 31, 2013, from the
State Water Resources Control Board's (SWRCB's) authorization
to collect a charge on specified loans in lieu of interest
that provides revenue to the SCG Fund.
2)Removes the current $50 million limitation on the total
revenue that can be allocated to the SCG Fund.
3)Requires that funds in the SCG be spent within four years of
the time the funds are encumbered.
EXISTING LAW :
1)Authorizes SWRCB to assess a surcharge on loans issued from
the Clean Water State Revolving Fund (CWSRF), in lieu of
interest on the loans.
2)Requires revenue from the surcharge to be deposited into the
SCG fund for the purpose of providing grants to small
communities for the construction of wastewater collection,
treatment, or disposal projects.
AB 30
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FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Potentially millions of dollars could shift from the CWSRF to
the SCG fund. The bill would also result in on-going,
absorbable costs for the SWRCB to continue administering the
SCG program that would otherwise be spent administering the
CWSRF.
2)Annual interest from CWSRF loans is deposited back into the
fund to be available for future loans. The potential effect
of removing the $50 million cap may at some point result in
insufficient funds in the CWSRF.
COMMENTS :
Need for the bill . According to sponsors of the bill, a
coalition of community and environmental groups, "Many
disadvantaged communities are in dire need of new wastewater
facilities to protect drinking water and deal with an aging
wastewater system. These small communities lack sufficient
funds needed to independently finance wastewater projects and
are dependent upon the timely disbursement of approved state and
federal grant and loan funds to improve and replace inadequate
wastewater systems.
"Unfortunately, there is little funding available to assist
these communities. The Clean Water State Revolving Fund (CWSRF)
has historically been a loan-only program, and therefore
inaccessible to low-income communities. To address those
community needs, the State Water Board created the Small
Community Wastewater Grant Fund in 1984. Over the years, bond
funding was made available to address projects in the fund, but
no funding has been made available since the passage of
Proposition 50 in 2002, and more than $1 billion in projects are
currently on the waiting list."
AB 2356 (Arambula), Chapter 609, Statutes of 2008 , created the
Clean Water State Revolving Fund (CWSRF) Small Community Grant
(SCG) Fund, which authorized the SWRCB to assess an annual
AB 30
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charge on existing CWSRF financing agreements for deposit into
the SCG Fund. The annual charge is in lieu of interest that
would otherwise be charged in association with a CWSRF financing
agreement. AB 2356 authorizes the SWRCB to deposit up to $50
million into the SCG Fund by 2014.
Due to restrictions on federal funding and bond revenues,
provisions regarding collection of the annual charge can only be
incorporated into CWSRF financing agreements funded solely by
CWSRF repayments resulting in approximately $12 million in
deposits through the end of 2011-12, and approximately $30
million in deposits projected by the December 2014 sunset date.
The SWRCB will be unable to collect the full $50 million without
legislative action to extend the deadline.
Status of the SCG program . According to the SWRCB, as of
December 31, 2012, there was a total of $16,413,960 in the Small
Community Wastewater Grant Fund. Of that amount, $4 million was
earmarked for a loan to the General Fund, and $1,163,100 is
going to impending disbursements. In addition, $6,145,301 is
committed to projects, but has not yet been disbursed.
The SWRCB had the authority to spend $1 million in SCG funds
during 2010-11, plus $1 million in 2011-12. The SWRCB is
authorized to commit $12 million in SCG funds during fiscal year
(FY) 2012-13.
The SWRCB collected approximately $5 million in FY 2010-11 and
$7 million in FY 2011-12 in fees. The SWRCB is projected to
collect a total of approximately $30 million by the end of 2014.
With the assumption of collecting at least $5 million per year
in 2015 and subsequent years, the fund will reach $50 million at
the end of 2018.
Analysis Prepared by : Bob Fredenburg / E.S. & T.M. / (916)
319-3965
FN: 0000821