BILL ANALYSIS Ó AB 467 Page 1 Date of Hearing: May 8, 2013 ASSEMBLY COMMITTEE ON APPROPRIATIONS Mike Gatto, Chair AB 467 (Stone) - As Amended: April 11, 2013 Policy Committee: Environmental Safety Vote: 6-1 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill creates the Freshwater Protection Fund (fund) to provide drinking water solutions for disadvantaged/severely disadvantaged communities, fertilizer management and groundwater quality. Specifically, this bill: 1)Requires the requires the State Water Resources Control Board (SWRCB) to use the funds for: a) Direct and indirect assistance, as defined. b) Emergency response. c) Natural Resource Protection. 1)Allows administrative costs up to 20% of the annual appropriation from the fund. Defines administrative costs as: a) Groundwater monitoring for fertilizers. b) Development and enforcement of natural resource protection rules. c) Coordination of state and federal programs. d) Management of fertilizer sales information. FISCAL EFFECT 1)Cost pressures in the hundreds of millions of dollars to fulfill the activities identified in the bill. This bill does not provide a funding source. 2) Increased administrative costs for SWRCB in the hundreds of thousands of dollars. AB 467 Page 2 Many of the administrative costs and direct actions defined in the bill are statutory activities of other departments such as the Department of Public Health, the Department of Water Resources, and the Department of Food and Agriculture. It is likely that SWRCB would have to contract or enter into memorandums of agreement with other state departments and agencies to fulfill the requirements of this bill. COMMENTS 1)Rationale. According to the author, high concentrations of nitrates in groundwater are primarily caused by human activities including fertilizer application, animal operations, industrial sources and septic systems. Agricultural fertilizers and animal wastes applied to cropland are the largest sources of nitrates in groundwater, although it varies by community. This bill responds to the chronic need for safe drinking water in disadvantaged and severely disadvantaged communities. 2)Background . Nitrate pollution in groundwater is a widespread water quality problem that can pose serious health risks if consumed at specific concentrations. According to a February 20, 2013 SWRCB report to Legislature, Recommendations Addressing Nitrate in Groundwater, it is critical that a new funding source be established to ensure that all Californians, including those in disadvantaged communities, have access to safe drinking water. The Department of Public Health indicates that nitrate contaminated groundwater is a particularly significant problem in the Tulare Lake Basin and Salinas Valley areas, where about 2.6 million people, including many of the poorest communities in California, rely on groundwater for their drinking water. Many other areas of the state also have nitrate contaminated groundwater. Analysis Prepared by : Jennifer Galehouse / APPR. / (916) 319-2081 AB 467 Page 3