BILL ANALYSIS Ó AB 426 Page 1 ASSEMBLY THIRD READING AB 426 (Salas) As Amended April 23, 2013 Majority vote WATER, PARKS & WILDLIFE 10-5 APPROPRIATIONS 12-5 ----------------------------------------------------------------- |Ayes:|Rendon, Blumenfield, |Ayes:|Gatto, Bocanegra, | | |Bocanegra, Fong, Frazier, | |Bradford, | | |Gatto, Gomez, Gray, | |Ian Calderon, Campos, | | |Yamada, Bloom | |Eggman, Gomez, Hall, | | | | |Rendon, Pan, Quirk, Weber | | | | | | |-----+--------------------------+-----+--------------------------| |Nays:|Bigelow, Allen, Dahle, |Nays:|Harkey, Bigelow, | | |Beth Gaines, Patterson | |Donnelly, Linder, Wagner | | | | | | ----------------------------------------------------------------- SUMMARY : Allows a party with a water right that was decreed through a statutory adjudication prior to January 1, 1981, to use an alternative voluntary method for seeking a temporary, long-term, or permanent transfer of that water right. Allows that party, instead of going back to court, to seek a change through the same administrative processes at the State Water Resources Control Board (State Water Board) that are available to parties with statutorily adjudicated water rights that date after January 1, 1981, or who hold permits or licenses, regardless of the date. EXISTING LAW : 1)Requires, since 1914, that a party seeking to appropriate surface waters of the state apply to the State Water Board for a permit or license and empowers the State Water Board with continuing jurisdiction over those permits and licenses. Grants continued recognition to other types of water rights that existed at the time the permit system was created including riparian rights, pre-1914 appropriative rights, and others, subject to certain conditions. 2)Allows a water rights applicant, permittee, or licensee to petition the State Water Board in order to make a change in the point of diversion, place of use, or purpose of use from that AB 426 Page 2 specified in a water rights application, permit, or license (change petition). 3)Allows the State Water Board to approve a valid change petition as long as, among other requirements, the change would not result in substantial injury to any legal user of water and would not unreasonably affect fish, wildlife, or other instream beneficial uses. 4)Establishes procedures for determining all of the water rights on a stream system, including rights based on appropriation, riparian right, or other basis, pursuant to administrative proceedings before the State Water Board followed by judicial proceedings and the issuance of a decree that is conclusive as to the rights of all existing claimants or would-be claimants upon that stream system (statutory adjudication decree). 5)Allows, for a water right obtained pursuant to a statutory adjudication decree issued after January 1, 1981, or for a water right pursuant to a statutory adjudication decree but that is based on a permit or license, regardless of the date of the decree, the water right holder to seek a change to that water right through a change petition to the State Water Board. 6)Requires, if the statutory adjudication decree was issued before January 1, 1981, and the water right is not based on a permit or license, the water right holder to seek a change to that water right by petitioning the court with jurisdiction over the decreed rights. FISCAL EFFECT : According to the Assembly Appropriations Committee, there are minor, absorbable costs associated with this bill. COMMENTS : The original statute first allowing the holder of rights under a statutorily adjudicated decree to transfer them by voluntarily going to the State Water Board, instead of a court, was enacted on January 1, 1981. What is less clear is why the statute, by its own terms, only applied to decrees that were issued after its enactment. A severe drought and significant water shortages between 1976 and 1977 highlighted the strengths and weaknesses of the state's water rights laws, then-Governor Jerry Brown created the Governor's AB 426 Page 3 Commission to Review California Water Rights Law (Commission) and mandated it review existing law and propose modifications. The Final Report issued by that Commission contained detailed legal analyses and recommendations for both administrative actions and statutory changes to the Water Code. One major area of the Final Report focused on improving efficiencies in water use, including encouraging voluntary short-term and long-term transfers. Those sections were enacted, together with several other provisions, in AB 1147 (Filante), Chapter 933, Statutes of 1980. AB 1147 addressed water rights; clarified the ownership of waste water and waste water facilities; and allowed for the transfer of water rights, including rights held subject to a statutory adjudication decree. In the March 19, 1979, digest to AB 1147, the Legislative Counsel's office stated that AB 1147 would permit the transfer of any water right, including riparian rights, which has been quantified after the effective date of the bill pursuant to a statutory adjudication. Eight years later, AB 982 (Costa), Chapter 1145, Statutes of 1988, amended, repealed, and reordered several of the Water Code Sections created under AB 1147. In the reorder, AB 982 moved the provisions related to transferring rights subject to a statutory adjudication decree from Water Code Section 1745 to Water Code Section 1740 but left the statutory language virtually unchanged, including the old effective date. That date was carried forward by deleting "subsequent to the enactment of this legislation" and inserting "after January 1, 1981." No reason for maintaining that effective date was provided. According to the author, this bill provides an optional, voluntary process for water right holders to gain permission from the State of California to transfer their water rights to other parties but does not mandate that such water rights holders go to the State Water Board for permission. The author states that by authorizing an additional, voluntary process through an administrative agency, that this bill encourages water transfers because it allows those with old water rights to participate in the transfer market through a simpler process than petitioning a court to reopen an entire adjudication. The author adds that the effect of the limitation to post-1981 decrees has severely limited the applicability of this water transfer section to all but a few adjudication decrees that were entered before that date. AB 426 Page 4 Analysis Prepared by : Tina Cannon Leahy / W., P. & W. / (916) 319-2096 FN: 0000584