BILL NUMBER: AB 1445 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY FEBRUARY 14, 2014
INTRODUCED BY Assembly Member Logue
( Principal coauthor: Assembly Member
Gaines )
( Coauthor: Assembly Member
Donnelly )
JANUARY 6, 2014
An act to repeal and add Division 26.7 (commencing with Section
79700) of the Water Code, and to repeal Section 2 of Chapter 3 of the
Seventh Extraordinary Session of the Statutes of 2009, relating to
a public benefits associated with water storage
projects program and water quality
improvement projects , by providing the funds necessary
therefor through an election for the issuance and sale of bonds of
the State of California, and for the handling and disposition of
those funds, and declaring the urgency thereof, to take effect
immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1445, as amended, Logue. California Water Infrastructure Act of
2014.
(1) Existing law creates the Safe, Clean, and Reliable Drinking
Water Supply Act of 2012, which, if approved by the voters, would
authorize the issuance of bonds in the amount of $11,140,000,000
pursuant to the State General Obligation Bond Law to finance a safe
drinking water and water supply reliability program. Existing law
provides for the submission of the bond act to the voters at the
November 4, 2014, statewide general election.
This bill would repeal these provisions.
(2) Under existing law, various measures have been approved by the
voters to provide funds for water supply and protection facilities
and programs.
This bill would enact the California Water Infrastructure Act of
2014, which, if adopted by the voters, would authorize the issuance
of bonds in the amount of $5,800,000,000 pursuant to the State
General Obligation Bond Law to finance a public
benefits associated with water storage and water quality
improvement projects program .
This bill would provide for the submission of this bond act to the
voters at the November 4, 2014, statewide general election.
This bill would declare that it is to take effect immediately as
an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Division 26.7 (commencing with Section 79700) of the
Water Code, as added by Section 1 of Chapter 3 of the Seventh
Extraordinary Session of the Statutes of 2009, is repealed.
SEC. 2. Division 26.7 (commencing with Section 79700) is added to
the Water Code, to read:
DIVISION 26.7. THE CALIFORNIA WATER INFRASTRUCTURE ACT OF 2014
CHAPTER 1. SHORT TITLE
79700. This division shall be known, and may be cited, as the
California Water Infrastructure Act of 2014.
CHAPTER 2. DEFINITIONS
79702. Unless the context otherwise requires, the definitions set
forth in this section govern the construction of this division, as
follows:
(a) "CALFED Bay-Delta Program" means the program described in the
Record of Decision dated August 28, 2000.
(b) "Commission" means the California Water Commission.
(c) "Committee" means the California Water Infrastructure Finance
Committee created by Section 79812.
(d) "Delta" means the Sacramento-San Joaquin Delta, as defined in
Section 12220.
(e) "Delta conveyance facilities" means facilities that convey
water directly from the Sacramento River to the State Water Project
or the federal Central Valley Project pumping facilities in the south
Delta.
(f) "Department" means the Department of Water Resources.
(g) "Director" means the Director of Water Resources.
(h) "Fund" means the California Water Infrastructure Fund of 2014
created by Section 79716.
(i) "Nonprofit organization" means an organization qualified to do
business in California and qualified under Section 501(c)(3) of
Title 26 of the United States Code.
(j) "Public agency" means a state agency or department, district,
joint powers authority, city, county, city and county, or other
political subdivision of the state.
(k) "Secretary" means the Secretary of the Natural Resources
Agency.
(l) "State General Obligation Bond Law" means the State General
Obligation Bond Law (Chapter 4 (commencing with Section 16720) of
Part 3 of Division 4 of Title 2 of the Government Code).
CHAPTER 3. GENERAL PROVISIONS
79705. An amount that equals not more than 5 percent of the funds
allocated for a grant program pursuant to this division may be used
to pay the administrative costs of that program.
79706. Up to 10 percent of funds allocated for each program
funded by this division may be expended for planning and monitoring
necessary for the successful design, selection, and implementation of
the projects authorized under that program. This section shall not
otherwise restrict funds ordinarily used by an agency for
"preliminary plans," "working drawings," and "construction" as
defined in the annual Budget Act for a capital outlay project or
grant project. Water quality monitoring shall be integrated into the
surface water ambient monitoring program administered by the State
Water Resources Control Board.
79709. It is the intent of the people that the investment of
public funds pursuant to this division will result in public
benefits.
79710. The California State Auditor shall annually conduct a
programmatic review and an audit of expenditures from the fund. The
California State Auditor shall report its findings annually on or
before March 1 to the Governor and the Legislature, and shall make
the findings available to the public.
79711. Funds provided by this division shall not be expended to
support or pay for the costs of environmental mitigation measures or
compliance obligations of any party except as part of the
environmental mitigation costs of projects financed by this division.
Funds provided by this division may be used for environmental
enhancements or other public benefits.
79712. Funds provided by this division shall not be expended to
pay the costs of the design, construction, operation, or maintenance
of Delta conveyance facilities. Those costs shall be the
responsibility of the water agencies that benefit from the design,
construction, operation, or maintenance of those facilities.
79713. (a) This division does not diminish, impair, or otherwise
affect in any manner whatsoever any area of origin, watershed of
origin, county of origin, or any other water rights protections,
including, but not limited to, rights to water appropriated
prior to before December 19, 1914, provided
under the law. This division does not limit or otherwise affect the
application of Article 1.7 (commencing with Section 1215) of Chapter
1 of Part 2 of Division 2, Sections 10505, 10505.5, 11128, 11460,
11461, 11462, and 11463, and Sections 12200 to 12220, inclusive.
(b) For purposes of this division, an area that utilizes water
that has been diverted and conveyed from the Sacramento River
hydrologic region, for use outside the Sacramento River hydrologic
region or the Delta, shall not be deemed to be immediately adjacent
thereto or capable of being conveniently supplied with water
therefrom by virtue or on account of the diversion and conveyance of
that water through facilities that may be constructed for that
purpose after January 1, 2015.
(c) Nothing in this division supersedes, limits, or otherwise
modifies the applicability of Chapter 10 (commencing with Section
1700) of Part 2 of Division 2, including petitions related to any new
conveyance constructed or operated in accordance with Chapter 2
(commencing with Section 85320) of Part 4 of Division 35.
(d) Unless otherwise expressly provided, nothing in this division
supersedes, reduces, or otherwise affects existing legal protections,
both procedural and substantive, relating to the state board's
regulation of diversion and use of water, including, but not limited
to, water right priorities, the protection provided to municipal
interests by Sections 106 and 106.5, and changes in water rights.
Nothing in this division expands or otherwise alters the state board'
s existing authority to regulate the diversion and use of water or
the courts' existing concurrent jurisdiction over California water
rights.
79714. Eligible applicants under this division are public
agencies, nonprofit organizations, public utilities, and mutual water
companies. To be eligible for funding under this division, a project
proposed by a public utility that is regulated by the Public
Utilities Commission or a mutual water company shall have a clear and
definite public purpose and shall benefit the customers of the water
system.
79716. The proceeds of bonds issued and sold pursuant to this
division shall be deposited in the California Water Infrastructure
Fund of 2014, which is hereby created in the State Treasury.
CHAPTER 4. CALIFORNIA WATER INFRASTRUCTURE
79740. (a) Notwithstanding Section 162, the commission may make
the determinations, findings, and recommendations required of it by
this chapter independent of the views of the director. All final
actions by the commission in implementing this chapter shall be taken
by a majority of the members of the commission at a public meeting
noticed and held pursuant to the Bagley-Keene Open Meeting Act
(Article 9 (commencing with Section 11120) of Chapter 1 of Part 1 of
Division 3 of Title 2 of the Government Code).
(b) Notwithstanding Section 13340 of the Government Code, the sum
of five four billion eight hundred
million dollars ($5,800,000,000)
($4,800,000,000) is hereby continuously appropriated from the
fund, without regard to fiscal years, to the commission for public
benefits associated with water storage projects that improve the
operation of the state water system, are cost effective, and provide
a net improvement in ecosystem and water quality conditions, in
accordance with this chapter. Funds authorized for, or made available
to, the commission pursuant to this chapter shall be available and
expended only for the purposes provided in this chapter, and shall
not be subject to appropriation or transfer by the Legislature or the
Governor for any other purpose.
(c) Projects shall be selected by the commission through a
competitive public process that ranks potential projects based on the
expected return for public investment as measured by the magnitude
of the public benefits provided, pursuant to criteria established
under this chapter.
(d) Any project constructed with funds provided by this chapter
shall be subject to Section 11590.
79741. Projects for which the public benefits are eligible for
funding under this chapter consist of only the following:
(a) Surface storage projects identified in the CALFED Bay-Delta
Program Record of Decision, dated August 28, 2000, except for
projects prohibited by Chapter 1.4 (commencing with Section 5093.50)
of Division 5 of the Public Resources Code.
(b) Groundwater storage projects and groundwater contamination
prevention or remediation projects that provide water storage
benefits.
(c) Conjunctive use and reservoir reoperation projects.
(d) Local and regional surface storage projects that improve the
operation of water systems in the state and provide public benefits.
79742. A project shall not be funded pursuant to this chapter
unless it provides measurable improvements to the Delta ecosystem or
to the tributaries to the Delta.
79743. (a) Funds allocated pursuant to this chapter may be
expended solely for the following public benefits associated with
water storage projects:
(1) Ecosystem improvements, including changing the timing of water
diversions, improvement in flow conditions, temperature, or other
benefits that contribute to restoration of aquatic ecosystems and
native fish and wildlife, including those ecosystems and fish and
wildlife in the Delta.
(2) Water quality improvements in the Delta, or in other river
systems, that provide significant public trust resources, or that
clean up and restore groundwater resources.
(3) Flood control benefits, including, but not limited to,
increases in flood reservation space in existing reservoirs by
exchange for existing or increased water storage capacity in response
to the effects of changing hydrology and decreasing snow pack on
California's water and flood management system.
(4) Emergency response, including, but not limited to, securing
emergency water supplies and flows for dilution and salinity
repulsion following a natural disaster or act of terrorism.
(5) Recreational purposes, including, but not limited to, those
recreational pursuits generally associated with the outdoors.
(b) Funds shall not be expended pursuant to this chapter for the
costs of environmental mitigation measures or compliance obligations
except for those associated with providing the public benefits as
described in this section.
79744. In consultation with the Department of Fish and Wildlife,
the State Water Resources Control Board, and the department, the
commission shall develop and adopt, by regulation, methods for
quantification and management of public benefits described in Section
79743 by December 15, 2016. The regulations shall include the
priorities and relative environmental value of ecosystem benefits as
provided by the Department of Fish and Wildlife and the priorities
and relative environmental value of water quality benefits as
provided by the State Water Resources Control Board.
79745. (a) Except as provided in subdivision (c), no
funds allocated pursuant to this chapter may
shall not be allocated for a project before
December 15, 2016, and until the commission approves the project
based on the commission's determination that all of the following
have occurred:
(1) The commission has adopted the regulations specified in
Section 79744 and specifically quantified and made public the cost of
the public benefits associated with the project.
(2) The department has entered into a contract with each party
that will derive benefits, other than public benefits, as defined in
Section 79743, from the project that ensures the party will pay its
share of the total costs of the project. The benefits available to a
party shall be consistent with that party's share of total project
costs.
(3) The department has entered into a contract with each public
agency identified in Section 79744 that administers the public
benefits, after that agency makes a finding that the public benefits
of the project for which that agency is responsible meet all the
requirements of this chapter, to ensure that the public contribution
of funds pursuant to this chapter achieves the public benefits
identified for the project.
(4) The commission has held a public hearing for the
purposes purpose of providing an opportunity for
the public to review and comment on the information required to be
prepared pursuant to this subdivision.
(5) All of the following additional conditions are met:
(A) Feasibility studies have been completed.
(B) The commission has found and determined that the project is
feasible, is consistent with all applicable laws and regulations, and
will advance the long-term objectives of restoring ecological health
and improving water management for beneficial uses of the Delta.
(C) All environmental documentation associated with the project
has been completed, and all other federal, state, and local
approvals, certifications, and agreements required to be completed
have been obtained.
(b) The commission shall submit to the Legislature its findings
for each of the criteria identified in subdivision (a) for a project
funded pursuant to this chapter.
(c) Notwithstanding subdivision (a), funds may be made available
under this chapter for the completion of environmental documentation
and permitting of a project.
79746. (a) The public benefit cost share of a project funded
pursuant to this chapter, other than a project described in
subdivision (c) of Section 79741, may shall
not exceed 50 percent of the total costs of any project funded
under this chapter.
(b) A project shall not be funded unless it provides ecosystem
improvements as described in paragraph (1) of subdivision (a) of
Section 79743 that are at least 50 percent of total public benefits
of the project funded under this chapter.
79747. (a) A project is not eligible for funding under this
chapter unless, by January 1, 2022, all of the following conditions
are met:
(1) All feasibility studies are complete and draft environmental
documentation is available for public review.
(2) The commission makes a finding that the project is feasible,
and will advance the long-term objectives of restoring ecological
health and improving water management for beneficial uses of the
Delta.
(3) The director receives commitments for not less than 75 percent
of the nonpublic benefit cost share of the project.
(b) If compliance with subdivision (a) is delayed by litigation or
failure to promulgate regulations, the date in subdivision (a) shall
be extended by the commission for a time period that is equal to the
time period of the delay, and funding under this chapter that has
been dedicated to the project shall be encumbered until the time at
which the litigation is completed or the regulations have been
promulgated.
79748. Surface storage projects funded pursuant to this chapter
and described in subdivision (a) of Section 79741 may be made a unit
of the Central Valley Project as provided in Section 11290 and may be
financed, acquired, constructed, operated, and maintained pursuant
to Part 3 (commencing with Section 11100) of Division 6.
79749. (a) The funds allocated for the design, acquisition, and
construction of surface storage projects identified in the CALFED
Bay-Delta Record of Decision, dated August 28, 2000, pursuant to this
chapter may be provided for those purposes to local joint powers
authorities formed by irrigation districts and other local water
districts and local governments within the applicable hydrologic
region to design, acquire, and construct those projects.
(b) The joint powers authorities described in subdivision (a) may
include in their membership governmental partners that are not
located within their respective hydrologic regions in financing the
surface storage projects, including, as appropriate, cost-share
participation or equity participation. Notwithstanding Section 6525
of the Government Code, the joint powers authorities described in
subdivision (a) shall not include in their membership any for-profit
corporation, or any mutual water company whose shareholders and
members include a for-profit corporation or any other private entity.
The department shall be an ex officio member of each joint powers
authority subject to this section, but the department shall not
control the governance, management, or operation of the surface water
storage projects.
(c) A joint powers authority subject to this section shall own,
govern, manage, and operate a surface water storage project, subject
to the requirement that the ownership, governance, management, and
operation of the surface water storage project shall advance the
purposes set forth in this chapter.
79749.5. (a) In approving the California Water Infrastructure Act
of 2014, the people were informed and hereby declare that the
provisions of this chapter are necessary, integral, and essential to
meeting the single object or work of the California Water
Infrastructure Act of 2014. As such, any amendment of the provisions
of this chapter by the Legislature without voter approval would
frustrate the scheme and design that induced voter approval of this
act. The people therefore find and declare that any amendment of the
provisions of this chapter by the Legislature shall require an
affirmative vote of two-thirds of the membership in each house of the
Legislature and voter approval.
(b) This section shall not govern or be used as authority for
determining whether the amendment of any other provision of this act
not contained in this chapter would constitute a substantial change
in the scheme and design of this act requiring voter approval.
CHAPTER 5. WATER QUALITY AND SAFE DRINKING
WATER
79750. The sum of one billion dollars ($1,000,000,000) shall be
available, upon appropriation by the Legislature, from the fund for
expenditures, grants, and loans for projects to improve water quality
or provide clean or safe drinking water to Californians.
CHAPTER 5. 6. FISCAL PROVISIONS
79810. (a) Bonds in the total amount of five billion eight
hundred million dollars ($5,800,000,000), not including the amount of
any refunding bonds issued in accordance with Section 79822, or so
much thereof as is necessary, may be issued and sold to provide a
fund to be used for carrying out the purposes expressed in this
division and to reimburse the General Obligation Bond Expense
Revolving Fund pursuant to Section 16724.5 of the Government Code.
The bonds, when sold, shall be and constitute valid and binding
obligations of the State of California, and the full faith and credit
of the State of California is hereby pledged for the punctual
payment of both the principal of, and interest on, the bonds as the
principal and interest become due and payable.
(b) The Treasurer shall sell the bonds authorized by the committee
pursuant to this section. The bonds shall be sold upon the terms and
conditions specified in a resolution to be adopted by the committee
pursuant to Section 16731 of the Government Code.
79811. The bonds authorized by this division shall be prepared,
executed, issued, sold, paid, and redeemed as provided in the State
General Obligation Bond Law, and all of the provisions of that law
apply to the bonds and to this division and are hereby incorporated
in this division as though set forth in full in this division, except
that Section 16727 of the Government Code shall not apply to the
extent that it is inconsistent with any other provision of this
division.
79812. (a) Solely for the purpose of authorizing the issuance and
sale, pursuant to the State General Obligation Bond Law, of the
bonds authorized by this division, the California Water
Infrastructure Committee is hereby created. For purposes of this
division, the California Water Infrastructure Committee is "the
committee" as that term is used in the State General Obligation Bond
Law.
(b) The committee consists of the Director of Finance, the
Treasurer, the Controller, the Director of Water Resources, and the
Secretary of the Natural Resources Agency. Notwithstanding any other
law, any member may designate a deputy to act as that member in his
or her place for all purposes, as though the member were personally
present.
(c) The Treasurer shall serve as chairperson of the committee.
(d) A majority of the members of the committee shall constitute a
quorum of the committee, and may act for the committee.
79813. The committee shall determine whether or not it is
necessary or desirable to issue bonds authorized pursuant to this
division to carry out the actions specified in this division and, if
so, the amount of bonds to be issued and sold. Successive issues of
bonds may be authorized and sold to carry out those actions
progressively, and it is not necessary that all of the bonds
authorized to be issued be sold at any one time.
79814. "Board," as defined in Section 16722 of the Government
Code for the purposes of compliance with the State General Obligation
Bond Law, means the department.
79815. There shall be collected each year and in the same manner
and at the same time as other state revenue is collected, in addition
to the ordinary revenues of the state, a sum in an amount required
to pay the principal of, and interest on, the bonds each year, and it
is the duty of all officers charged by law with any duty in regard
to the collection of the revenue to do and perform each and every act
that is necessary to collect that additional sum.
79816. Notwithstanding Section 13340 of the Government Code,
there is hereby appropriated from the General Fund in the State
Treasury, for the purposes of this division, an amount that will
equal the total of the following:
(a) The sum annually necessary to pay the principal of, and
interest on, bonds issued and sold pursuant to this division, as the
principal and interest become due and payable.
(b) The sum that is necessary to carry out the provisions of
Section 79819, appropriated without regard to fiscal years.
79817. The board may request the Pooled Money Investment Board to
make a loan from the Pooled Money Investment Account in accordance
with Section 16312 of the Government Code for the purpose of carrying
out this division. The amount of the request shall not exceed the
amount of the unsold bonds that the committee has, by resolution,
authorized to be sold for the purpose of carrying out this division.
The board shall execute those documents required by the Pooled Money
Investment Board to obtain and repay the loan. Any amounts loaned
shall be deposited in the fund to be allocated in accordance with
this division.
79818. Notwithstanding any other provision of this division, or
of the State General Obligation Bond Law, if the Treasurer sells
bonds that include a bond counsel opinion to the effect that the
interest on the bonds is excluded from gross income for federal tax
purposes under designated conditions, the Treasurer may maintain
separate accounts for the bond proceeds invested and for the
investment earnings on those proceeds, and may use or direct the use
of those proceeds or earnings to pay any rebate, penalty, or other
payment required under federal law or take any other action with
respect to the investment and use of those bond proceeds, as may be
required or desirable under federal law in order to maintain the
tax-exempt status of those bonds and to obtain any other advantage
under federal law on behalf of the funds of this state.
79819. For purposes of carrying out this division, the Director
of Finance may authorize the withdrawal from the General Fund of an
amount or amounts not to exceed the amount of the unsold bonds that
have been authorized by the committee to be sold for the purpose of
carrying out this division. Any amounts withdrawn shall be deposited
in the fund. Any money made available under this section shall be
returned to the General Fund, with interest at the rate earned by the
money in the Pooled Money Investment Account, from proceeds received
from the sale of bonds for the purpose of carrying out this
division.
79820. All money deposited in the fund that is derived from
premiums and accrued interest on bonds sold pursuant to this division
shall be reserved in the fund and shall be available for transfer to
the General Fund as a credit to expenditures for bond interest.
79821. Pursuant to Chapter 4 (commencing with Section 16720) of
Part 3 of Division 4 of Title 2 of the Government Code, the cost of
bond issuance shall be paid out of the bond proceeds. These costs
shall be shared proportionately by each program funded through this
division.
79822. The bonds issued and sold pursuant to this division may be
refunded in accordance with Article 6 (commencing with Section
16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of the
Government Code, which is a part of the State General Obligation Bond
Law. Approval by the electors of the state for the issuance of the
bonds under this division shall include approval of the issuance of
any bonds issued to refund any bonds originally issued under this
division or any previously issued refunding bonds.
79823. The proceeds from the sale of bonds authorized by this
division are not "proceeds of taxes" as that term is used in Article
XIII B of the California Constitution, and the disbursement of these
proceeds is not subject to the limitations imposed by that article.
79824. Of the five billion eight hundred million dollars
($5,800,000,000) in bonds authorized in this division, no more than
two billion nine hundred million dollars ($2,900,000,000) shall be
sold by the Treasurer before July 1, 2019.
SEC. 3. Section 2 of Chapter 3 of the Seventh Extraordinary
Session, of the Statutes of 2009, as amended by Section 1 of Chapter
74 of the Statutes of 2012, is repealed.
SEC. 4. Section 2 of this act shall be submitted to the voters at
the November 4, 2014, statewide general election in accordance with
provisions of the Government Code and the Elections Code governing
the submission of a statewide measure to the voters.
SEC. 5. Section 2 of this act shall take effect upon the approval
by the voters of the California Water Infrastructure Act of 2014 as
set forth in that section at the November 4, 2014, statewide general
election.
SEC. 6. This act is an urgency statute
necessary for the immediate preservation of the public peace, health,
or safety within the meaning of Article IV of the Constitution and
shall go into immediate effect. The facts constituting the necessity
are:
In order to ensure that the Safe, Clean, and Reliable Drinking
Water Supply Act of 2012 is removed from the November 4, 2014,
statewide general election, and to ensure that the California Water
Infrastructure Act of 2014 is placed on the November 4, 2014,
statewide general election, it is necessary that this act take effect
immediately.