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: 8/22/14 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 provides specific authority to a groundwater sustainability agency (GSA), as defined in SB 1168 (Pavley, 2014), to impose certain fees. This bill authorizes the Department of Water Resources (DWR) or a GSA to provide technical assistance to entities that extract or use groundwater to promote water conservation and protect groundwater resources. Senate Floor Amendments of 8/22/14 clarify the relation between cities/counties and groundwater agencies with respect to land CONTINUED AB 1739 Page 2 use planning, consideration of groundwater plans in local planning, and consideration of local general plans in groundwater planning. Senate Floor Amendments of 8/18/14 (1) refine provisions of the bill regarding state evaluation and intervention regarding groundwater sustainability plans, (2) delete those parts of the bill that will be solely in SB 1168 (which has similar amendments), and (3) make chaptering of the bill contingent on enactment of SB 1168. ANALYSIS : Existing law: 1.Authorizes local agencies to adopt and implement a groundwater management plan. Requires a groundwater management plan to contain specified components and requires a local agency seeking state funds administered by DWR for groundwater projects or groundwater quality projects to do certain things, including, but not limited to, preparing and implementing a groundwater management plan that includes basin management objectives for the groundwater basin. 2.Establishes the Water Rights Fund (Fund), which consists of various fees and penalties. The monies in the Fund are available, upon appropriation by the Legislature, for, among other things, the administration of the State Water Resource Control Board's (Board) water rights program. 3.Requires, with certain exceptions, each person who diverts water after December 31, 1965, to file with the Board a prescribed statement of diversion and use. 4.Subjects a person to civil liability if that person fails to file, as required, a diversion and use statement for a diversion or use that occurs after January 1, 2009, tampers with any measuring device, or makes a material misstatement in connection with the filing of a diversion or use statement. 5.Provides that a person who violates a cease and desist order of the Board may be liable in an amount not to exceed $1,000 for each day in which the violation occurs. Revenue generated from these penalties is deposited in the Fund. 6.Authorizes the Board or the DWR to adopt emergency regulations AB 1739 Page 3 providing for the filing of reports of water diversion or use that are required to be filed. 7.Requires the legislative body of each county and city to adopt a comprehensive, long-term general plan for the physical development of the county or city with specified elements, including, among others, land use and conservation elements. 8.Requires a city or county, upon the adoption or revision of its general plan, on or after January 1, 1996, to utilize as a source document any urban water management plan submitted to the city or county by a water agency. 9.Requires a public water system to provide a planning agency with certain information upon receiving notification of a city's or a county's proposed action to adopt or substantially amend a general plan. This bill: 1. Provides specific authority to a GSA, as defined in SB 1168 (Pavley, of 2014), to impose certain fees. 2. Authorizes the DWR or a GSA to provide technical assistance to entities that extract or use groundwater to promote water conservation and protect groundwater resources. 3. Requires the DWR to prepare and publish a report by December 31, 2016, on its Internet Web site that presents the department's best estimate, based on available information, of water available for replenishment of groundwater in the state. 4. Requires the DWR, by January 1, 2017, to publish on its Internet Web site best management practices for the sustainable management of groundwater, and requires the DWR to prepare and release a report by December 31, 2016, on the DWR's best estimate of water available for replenishment of groundwater in the state. 5. Requires a GSA to submit a groundwater sustainability plan to the DWR for review upon adoption. Requires the DWR to periodically review groundwater sustainability plans, and by June 1, 2016, and requires the DWR to adopt regulations for AB 1739 Page 4 evaluating groundwater sustainability plans adopt regulations for evaluating groundwater sustainability plans, the implementation of groundwater sustainability plans, and coordination agreements. These regulations adopted shall identify appropriate methodologies and assumptions for baseline conditions concerning hydrology, water demand, regulatory restrictions that affect the availability of surface water, and unreliability of, or reductions in, surface water deliveries to the agency or water users in the basin, and the impact of those conditions on achieving sustainability and shall include the historic average reliability and deliveries of surface water to the agency or water users in the basin.. 6. Requires the DWR to adopt the regulations, including any amendments thereto, as emergency regulations in accordance with the Administrative Procedure Act. The adoption of these regulations is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health and safety, or general welfare. 7. Authorizes a local agency to submit to the DWR for evaluation and assessment an alternative that the local agency believes satisfies the objectives of these provisions. 8. Requires the DWR to review any of the above-described submissions at least every five years after initial submission to the DWR. 9. Authorizes the DWR to conduct inspections to obtain an inspection warrant. 10.Authorizes the Board to designate a basin as a probationary basin, if the Board makes a certain determination. 11.Authorizes the Board to develop an interim plan for a probationary basin if the Board, in consultation with the DWR, determines that a local agency has not remedied a deficiency that resulted in designating the basin as a probationary basin within a certain timeframe. 12.Authorizes the Board to adopt an interim plan for a AB 1739 Page 5 probationary basin after notice and a public hearing and requires state entities to comply with an interim plan. 13.Authorizes the Board to rescind all or a portion of an interim plan if the Board determines at the request of specified petitioners that a groundwater sustainability plan or adjudication action is adequate to eliminate the condition of long-term overdraft or condition where groundwater extractions result in significant depletions of interconnected surface waters. 14.Provides that the Board has authority to stay its proceedings relating to an interim plan or to rescind or amend an interim plan based on the progress made by a groundwater sustainability agency or in an adjudication action. 15.Provides that the money in the Fund is available for expenditure, upon appropriation by the Legislature, for the purpose of Board enforcement. Requires the Board to adopt a schedule of fees in an amount sufficient to recover all costs incurred and expended from the Fund by the Board. 16.Authorizes the Board to issue a cease and desist order in response to a violation or threatened violation of any decision or order of the Board or any extraction restriction, limitation, order, or regulation adopted or issued. 17.Establishes groundwater reporting requirements for a person extracting groundwater in an area within a basin that is not within the management area of a groundwater sustainability agency or a probationary basin. Requires the reports to be submitted to the Board or in certain areas, to an entity designated as a local agency by the Board, as specified. Requires each report to be accompanied by a specified fee. 18.Authorizes the Board or the DWR to adopt emergency regulations providing for the filing of reports of water extraction.19.Requires, prior to the adoption or any substantial amendment of a general plan, the planning agency to review and consider a groundwater sustainability plan, groundwater management plan, groundwater management court order, judgment, or AB 1739 Page 6 decree, adjudication of water rights, or a certain order or interim plan by the Board. 20.Requires the planning agency to refer a proposed action to adopt or substantially amend a general plan to any groundwater sustainability agency that has adopted a groundwater sustainability plan or local agency that otherwise manages groundwater and to the Board if it has adopted an interim plan that includes territory within the planning area. 21.Requires a groundwater sustainability agency or an entity that submits an alternative to provide the planning agency with certain information as is appropriate and relevant, including a report on the anticipated effect of the proposed action on implementation of a groundwater sustainability plan. 22.Provides that the provisions against superseding the land use authority of cities and counties applies to that authority within the overlying basin, including the city or county general plan, and requires a groundwater sustainability plan to take into account the most recent planning assumptions stated in local general plans overlying the basin. 23.Requires, after January 31, 2020, the DWR, in consultation with the Board, to determine that a groundwater sustainability plan is inadequate or that the groundwater sustainability program is not being implemented in a manner that will likely achieve the sustainability goal. 24.Provides that the basin, after January 31, 2022, be managed under a groundwater sustainability plan or coordinated groundwater sustainability plans if none of the following have occurred: A. A groundwater sustainability agency has adopted a groundwater sustainability plan for the entire basin. B. A collection of local agencies has adopted groundwater sustainability plans that collectively serve as a groundwater sustainability plan for the entire basin. AB 1739 Page 7 C. The DWR has approved an alternative, as specified. 25.Provides that the basin be managed, as specified, after January 31, 2022, if both of the following have occurred: A. The DWR, in consultation with the Board, determines that a groundwater sustainability plan is inadequate or that the groundwater sustainability plan is not being implemented in a manner that will likely achieve the sustainability goal. B. The Board determines that the basin is in a condition of long-term overdraft or in a condition where groundwater extractions result in significant depletions of interconnected surface waters. 26.Revises the definition of "undesirable result," and specifies that certain authority granted to a groundwater sustainability agency to control groundwater extractions shall be consistent with applicable elements of a city or county general plan, except as specified. 27.Provides that this bill is contingent on the enactment of SB 1168 (Pavley). 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 AB 1739 Page 8 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 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 AB 1739 Page 9 basins where groundwater is managed under other sections of the Water Code without the permission of the court or the other agency. 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 AB 1739 Page 10 According to the Senate Appropriations Committee: 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 8/25/14) Agua Caliente Band of Cahuilla Indians Association of California Water Agencies Barona Bank of Mission Indians Bay Area Council California Council of Geoscience Organizations California Groundwater Coalition California Groundwater Council California Tribal Business Alliance California Trout California Water Foundation California Waterfowl Association City of Los Angeles, Mayor's Office Community Alliance with Family Farmers East Bay Municipal Utility District EMAX Laboratories, Inc. Groundwater Resources Association of California AB 1739 Page 11 Horizon Environmental, Inc. Inland Empire Utilities Agency Inyo County Irvine Ranch Water District Los Angeles Area Chamber of Commerce Los Angeles City Council Luhdorff & Scalmanini Consulting Engineers Mayor of Los Angeles Montclair Environmental Management, Inc. Orange County Water District Pala Band of Mission Indians Parker Groundwater Paskenta Band of Nomlaki Indians PRO Water Equity Quinn Environmental Strategies, Inc. Raymond Basin Management Board San Francisco Bay Regional Water Quality Control Board San Francisco Public Utilities Commission San Gabriel Valley Water Association Santa Clara Valley Water District Sierra Club California Sullivan International Group, Inc. The Source Group, Inc. Todd Groundwater Trout Unlimited United States Department of Defense, Regional Environmental Upper San Gabriel Valley Municipal Water District Viejas Band of Kumeyaay Indians WILDCOAST OPPOSITION : (Verified 8/25/14) 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 AB 1739 Page 12 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 Floral Association California Tomato Growers Association California Warehouse Association California Women for Agriculture Campos Brothers Farms Dairy Farmers of America-Western Area Del Monte Foods 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 Northern California Water Association Pacific Coast Producers Raisin Bargaining Association Sacramento Regional Water Authority San Joaquin County Stockton East Water District Sun-Maid Growers of California Sunsweet Growers Inc. Valley Ag Water Coalition Western Agricultural Processors Association Western Growers Association Western Plant Health Association ARGUMENTS IN SUPPORT : According to the California Water Foundation (CWF), "AB 1739 addresses one of California's most AB 1739 Page 13 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." 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 AB 1739 Page 14 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 NO VOTE RECORDED: Achadjian, Dababneh, Eggman, Frazier, Gray, Hall, Holden, Vacancy RM:d 9/09/14 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END ****