BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | AB 1739| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- THIRD READING Bill No: AB 1739 Author: Dickinson (D), et al. Amended: 8/7/14 in Senate Vote: 21 SENATE NATURAL RESOURCES AND WATER COMMITTEE : 7-1, 6/24/14 AYES: Pavley, Evans, Hueso, Jackson, Lara, Monning, Wolk NOES: Cannella NO VOTE RECORDED: Fuller SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14 AYES: De León, Hill, Lara, Padilla, Steinberg NO VOTE RECORDED: Walters, Gaines ASSEMBLY FLOOR : 48-24, 5/28/14 - See last page for vote SUBJECT : Groundwater management SOURCE : Author DIGEST : This bill enacts the Sustainable Groundwater Management Act, which establishes procedures and guidelines for the management of groundwater in California. ANALYSIS : Existing law allows certain existing local agencies to develop groundwater management plans (Water Code Section 10750 et seq.), which are commonly referred to as AB 3030 (Costa, Chapter 947, Statutes of 1997) plans. These plans must be developed with public hearings and only if less than half of the landowners in the proposed district do not protest the CONTINUED AB 1739 Page 2 development of the plan. This bill: 1. Creates the Sustainable Groundwater Management Act, which requires that all high- or medium-priority groundwater basins be managed under a groundwater sustainability plan (GSP) or coordinated GSP, except if the basin is a specified adjudicated area. The GSPs will be developed by Groundwater Sustainability Agencies (GSAs), which can be a local agency or combination of local agencies that jointly elect to be a GSA through a joint powers agreement or a memorandum of agreement. 2. Requires the Department of Water Resources (DWR) to review the GSP after adoption and then at least every five years thereafter for compliance and achievement of sustainability goals. If no adequate plan is developed or if the GSP is not being properly implemented, DWR and the State Water Resources Control Board (SWRCB) will be authorized to designate a basin as a probationary basin. Such a designation will trigger a process by which a GSA will first be given an opportunity to remedy the deficiency. If this does not occur, the SWRCB will be authorized to develop an interim plan for the probationary basin, which will remain in effect until any deficiencies are resolved. 3. Requires a planning agency to refer to either an adopted GSP or an interim plan adopted by the SWRCB before a general plan is substantially amended. A GSA will also be required to provide planning agencies with specific information. 4. Specifies the following responsibilities for the GSAs, DWR, and SWRCB: A. GSAs will be: Required to notify DWR of its creation and intent to undertake sustainable groundwater management by January 1, 2017. Required to consider the interests of all beneficial uses and users of groundwater. CONTINUED AB 1739 Page 3 Required to maintain a list of persons interested in receiving notices regarding plan preparation, meeting announcements, availability of draft plans, and other relevant documents. Authorized to conduct various investigations for the purpose of managing the groundwater basin. This bill establishes civil penalties that may be imposed by the GSA for extractions in excess of authorized amounts. Authorized to require metering of groundwater extractions and to control groundwater extractions. Required to develop a GSP, if the basin is a high or medium priority basin that includes specified information and aims to achieve a sustainability goal in the basin within 20 years of the implementation of the plan. Extensions may be granted in two five-year increments beyond the 20-year sustainability timeframe upon showing of good cause, as determined by DWR. The GSA must submit the GSP to DWR for review after adoption. The GSP must be adopted by January 1, 2020. Required to report annually to DWR specified information after the GSP is adopted, including, among other things, the groundwater basin elevation, aggregated extraction in the past year, and surface water used for groundwater recharge. Allowed to submit an alternative GSP if that alternative meets specified requirements. Required to periodically evaluate its GSP. CONTINUED AB 1739 Page 4 Required to hold a public hearing before adopting or amending a GSP. Allowed to impose a fee on groundwater extraction or other regulated activity to fund the costs associated with the GSP. This bill establishes a procedure to allow for fee collection by the GSA. B. The DWR will be: Required to consider modifying groundwater basin boundaries upon request of a local agency. DWR may require the local agency to provide the information necessary to justify changing the basin boundaries. The California Water Commission (Commission) will be required to hear and comment on any draft boundary revisions. Required to categorize each groundwater basin as a high, medium, low, or very low priority by January 1, 2017. DWR will be required to reassess the categorizations with every update of the California Water Plan (Bulletin 118). This bill establishes the criteria that will inform the categorization. Required to develop best management practices (BMPs) for the sustainable management of groundwater by January 1, 2017. The BMPs must be developed with at least three public meetings throughout the state and one at a public meeting of the Commission. Required to provide technical assistance to groundwater extractors to promote water conservation. Allowed to provide technical assistance to a GSA upon request. CONTINUED AB 1739 Page 5 Required to periodically review GSPs, at least every five years, for compliance with required elements and whether the GSP is likely to achieve the sustainability goal for the basin. The first review must occur within two years of its submission by a GSA. DWR may recommend correction actions to address any deficiencies it identifies. DWR will be required to develop, in consultation with the SWRCB, guidelines for evaluating GSPs and implementations of GSPs. The development of the guidelines will be exempt from the Administrative Procedures Act, but will need to be accomplished in a public process. Required to post on its Internet Web site adopted GSPs and provide 60 days for the public to submit comments to DWR regarding the plan. Authorized to determine, in consultation with the SWRCB, that a GSP is inadequate or is being insufficiently implemented. C. The SWRCB will be: Authorized to use the Water Rights Fund to fund its costs associated with the SWRCB's oversight and enforcement responsibilities in groundwater. Required to adopt a schedule of fees to recover costs associated with its oversight and enforcement responsibilities. The fees will be required to be set in an amount sufficient to cover all costs incurred and expended from the Water Rights Fund, though the costs will be able to be recovered over a period of years rather than immediately in the year in which the costs were incurred. CONTINUED AB 1739 Page 6 Allowed to designate a basin as a probationary basin if certain conditions are met, such as DWR has determined that no GSA is formed by January 1, 2017, or no adequate GSP or alternative has been developed by January 1, 2020, and the SWRCB finds that the basin is in a state of long-term overdraft. Allowed to develop an interim plan for a probationary basin if a GSA has failed to remedy the deficiency with their GSP or implementation of their GSP. The interim plan will be required to be developed with a public hearing and will be required to contain specified information. Allowed to rescind the interim plan if it, in consultation with DWR, determines that the GSP or alternative has been made adequate. Be allowed to issue a cease and desist order for violations of any interim plan it develops. Background California is the last state without an enforceable set of statewide groundwater management standards. While some of California's groundwater basins are sustainably managed, many are not. A number of different entities may manage some aspect of groundwater in California. These include: Special Districts . Many types of special districts have some groundwater related authorities under the water code and other statutes. Such districts include county water districts, municipal utility districts, community service districts, and water replenishment districts. Special Act Districts . The Legislature has created a number of special districts whose specific purpose is to manage one groundwater basin or another. These include agencies such as the Orange County Water District and Fox Canyon Groundwater CONTINUED AB 1739 Page 7 Management Agency. Court Appointed Watermasters . In an adjudication, the court determines who has rights to pump from the groundwater basin, how much they can pump, etc. The court also typically appoints someone to be the "Watermaster" whose job is to ensure that the basin is managed in accordance with the court's decree. Cities and Counties . The courts have held that cities and counties, under their general police powers, have the authority to enact ordinances regarding groundwater. More than 20 counties have done so, generally addressing issues such as banning transfers of groundwater out of the county. Counties also issue drilling permits for water wells. The powers to manage groundwater vary. In most special act districts, the authorizing act allows the agency to require groundwater users to report their extractions to the agency, who can then levy fees for groundwater management or water supply replenishment. Some acts also provide the special district the authority to limit exports and extractions. For most non-special act districts, the authority to manage groundwater derives from what is commonly referred to as AB 3030 (Water Code Section 10750 et seq.). AB 3030 allows, but does not require, certain defined existing local agencies to develop groundwater management plans in defined groundwater basins and subbasins. An AB 3030 plan can be developed only after a public hearing and adoption of a resolution of intention to adopt a groundwater management plan. If landowners representing more than 50% of the assessed value of lands within the proposed district do not protest the plan, the plan can be adopted within 35 days. If landowners representing a majority of the assessed value in the proposed district oppose the plan, cannot be adopted and no new plan may be attempted for one year. AB 3030 plans cannot be adopted in adjudicated basins or in basins where groundwater is managed under other sections of the Water Code without the permission of the court or the other agency. CONTINUED AB 1739 Page 8 Once the plan is adopted, rules and regulations must be adopted to implement the program called for in the plan. Many plans that have been adopted are relatively simple and in some cases are a means of defining boundaries. There are 149 adopted AB 3030 plans. If a local agency wishes to receive state funds administered by DWR for groundwater projects or for other projects that directly affect groundwater levels or quality, the local agency must have an AB 3030 plan or equivalent groundwater management plan meets specific requirements. These requirements are sometimes known as "SB 1938 [Machado, Chapter 603, Statutes of 2002] requirements." This January, the Governor released his final California Water Action Plan (CWAP). Among the many initiatives in the CWAP is a call to improve sustainable groundwater management: Groundwater is a critical buffer to the impacts of prolonged dry periods and climate change on our water system. The administration will work with the Legislature to ensure that local and regional agencies have the incentives, tools, authority and guidance to develop and enforce local and regional management plans that protect groundwater elevations, quality, and surface water-groundwater interactions. The administration will take steps, including sponsoring legislation, if necessary, to define local and regional responsibilities and to give local and regional agencies the authority to manage groundwater sustainably and ensure no groundwater basin is in danger of being permanently damaged by over drafting. When a basin is at risk of permanent damage, and local and regional entities have not made sufficient progress to correct the problem, the state should protect the basin and its users until an adequate local program is in place. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes According to the Senate Appropriations Committee: CONTINUED AB 1739 Page 9 No additional state costs for fiscal year (FY) 2014-15 through FY 2018-19 to the DWR for initial activities. Annual costs $3.5 to $4 million from the General Fund beginning in FY 2017-18 to DWR to review plans and to provide ongoing technical support. Annual costs of $260,000 to $390,000 from the Water Rights Funds (special) for FY 2014-15 through FY 2016-17 to the SWRCB for initial activities. Annual costs of $325,000 to $600,000 from the General Fund beginning in FY 2017-18 to the SWRCB for review of GSPs. Unknown annual costs, estimated to be approximately $1.5 M, from the Water Rights Fund (special) to the SWRCB for enforcement actions beginning in FY 2017-18. These costs would be at least partially offset by fees. SUPPORT : (Verified 8/16/14) Agua Caliente Band of Cahuilla Indians Association of California Water Agencies California Groundwater Council California Tribal Business Alliance California Trout California Water Foundation California Waterfowl Association Center for Biological Diversity Clean Water Action Community Alliance with Family Farmers Community Water Center Groundwater Resources Association of California Inland Empire Utilities Agency Irvine Ranch Water District Klamath Forest Alliance Klamath Riverkeeper Leadership Council for Justice and Accountability Orange County Water District Pala Band of Mission Indians CONTINUED AB 1739 Page 10 Paskenta Band of Nomlaki Indians Planning and Conservation League Sierra Club California The Nature Conservancy Trout Unlimited Union of Concerned Scientists United States Department of Defense, Regional Environmental Upper San Gabriel Valley Municipal Water District Viejas Band of Kumeyaay Indians OPPOSITION : (Verified 8/16/14) African American Farmers of California Agricultural Council of California Allied Grape Growers Almond Hullers & Processors Association Association of California Egg Farmers Blue Diamond Growers California Agricultural Aircraft Association California Ammonia Company California Association of Nurseries and Garden Centers California Bean Shippers Association California Blueberry Association California Canning Peach Association California Cattlemen's Association California Chamber of Commerce California Citrus Mutual California Cotton Ginners Association California Cotton Growers Association California Dairies, Inc. California Farm Bureau Federation California Fresh Fruit Association California Grain & Feed California Groundwater Association California League of Food Processors California Pear Growers Association California Seed Association California State Association of Counties California State Floral Association California Tomato Growers Association California Warehouse Association California Women for Agriculture Campos Brothers Farms Coachella Valley Water Agency CONTINUED AB 1739 Page 11 Dairy Farmers of America-Western Area Del Monte Foods Desert Water Agency Family Business Association Family Winemakers Fruit Growers Supply Company Grower-Shipper Association of Central California Grower-Shipper Association of Santa Barbara and San Luis Obispo Counties Kern County Land O' Lakes Nisei Farmers League Pacific Coast Producers Raisin Bargaining Association Rural County Representatives of California Stockton East Water District San Joaquin County Sun-Maid Growers of California Sunsweet Growers Inc. Western Agricultural Processors Association Western Growers Association Western Plant Health Association Zone 7 Water Agency ARGUMENTS IN SUPPORT : According to the California Water Foundation (CWF), "AB 1739 addresses one of California's most pressing water management issues - the need for improved and sustainable groundwater management. The current drought and its immediate impacts to the state's groundwater resources compel us to search for solutions now so we are better prepared for further droughts. Improved groundwater management will protect critical water supplies and provide ecosystem and economic benefits to the mid- and long-term. "A new statewide policy for sustainable groundwater management is urgently needed, and AB 1739 is an important piece of this discussion. Numerous stakeholders have been involved and are continuing to toward together on this legislation and ? SB 1168 [Pavley]. CWF is working with both authors to help ensure that these bills provide the right provisions to empower local groundwater management agencies with new tools and authorities, and to create an appropriate state 'backstop' that will allow the state to intervene, only when needed, to ensure groundwater management goals are met." CONTINUED AB 1739 Page 12 ARGUMENTS IN OPPOSITION : According to the California Farm Bureau Federation, "We are concerned the current process is rushed to meet arbitrary deadlines without adequate time to address such a complex issue. This measure will have huge long-term economic impacts on farms, the State and local economies and county tax roles, with a very real potential to devalue land and impact farms and businesses viability and in turn impact jobs. We believe groundwater must be managed locally/regionally and that overlying property rights are protected to avoid a taking. Without addressing these issues with stakeholder input, this measure will certainly create a significant fiscal impact to the state when many are forced to defend their overlying property rights through adjudication. "Overall, Farm Bureau believes we do not have a groundwater problem solely from a lack of regulation, but from a failure to update our water capture and delivery system to today's conditions. Any legislation that creates a new groundwater management regime must be coupled with real, substantive actions to increase surface water supplies and restore water supply reliability. The complexities of groundwater, groundwater management and interactions with surface water are too great to rush to judgment and to an isolated solution. We are not suggesting the status quo, nor are we suggesting do nothing, but we do recommend a carefully thought through process to develop appropriate protections of our groundwater resources for future generations. For these reasons we are actively engaged with others to develop a path forward, but we must oppose AB 1739." ASSEMBLY FLOOR : 48-24, 5/28/14 AYES: Alejo, Ammiano, Bloom, Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau, Chesbro, Cooley, Daly, Dickinson, Fong, Garcia, Gatto, Gomez, Gonzalez, Gordon, Roger Hernández, Jones-Sawyer, Levine, Lowenthal, Medina, Mullin, Muratsuchi, Nazarian, Pan, Perea, John A. Pérez, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Weber, Wieckowski, Williams, Yamada, Atkins NOES: Allen, Bigelow, Chávez, Conway, Dahle, Donnelly, Fox, Beth Gaines, Gorell, Grove, Hagman, Harkey, Jones, Linder, Logue, Maienschein, Mansoor, Melendez, Nestande, Olsen, Patterson, Wagner, Waldron, Wilk CONTINUED AB 1739 Page 13 NO VOTE RECORDED: Achadjian, Dababneh, Eggman, Frazier, Gray, Hall, Holden, Vacancy RM:d 8/17/14 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED