BILL NUMBER: AB 2636 ENROLLED
BILL TEXT
PASSED THE SENATE AUGUST 21, 2014
PASSED THE ASSEMBLY AUGUST 22, 2014
AMENDED IN SENATE AUGUST 19, 2014
AMENDED IN SENATE JUNE 30, 2014
AMENDED IN SENATE JUNE 19, 2014
AMENDED IN ASSEMBLY MAY 23, 2014
AMENDED IN ASSEMBLY MARCH 18, 2014
INTRODUCED BY Assembly Members Gatto and Skinner
(Coauthors: Assembly Members Bocanegra, Rendon, Rodriguez, Ting,
Wieckowski, and Williams)
FEBRUARY 21, 2014
An act to add Division 30 (commencing with Section 81000) to the
Water Code, relating to water.
LEGISLATIVE COUNSEL'S DIGEST
AB 2636, Gatto. CalConserve Water Use Efficiency Revolving Fund.
The California Constitution requires the reasonable and beneficial
use of water.
This bill would establish the CalConserve Water Use Efficiency
Revolving Fund and provide that the moneys in the fund are available
to the Department of Water Resources, upon appropriation by the
Legislature, for the purpose of water use efficiency projects. This
bill would require moneys in the fund to be used for purposes that
include, but are not limited to, at or below market interest rate
loans to local agencies, as defined, and would permit the department
to enter into agreements with local agencies that provide water or
recycled water service to provide loans.
Existing law, the Costa-Machado Water Act of 2000, a bond act
approved by the voters as Proposition 13 at the March 7, 2000,
statewide primary election, authorizes the issuance of general
obligation bonds in the amount of $1,970,000,000 for grants, loans,
and direct expenditures for the purposes of financing a safe drinking
water, clean water, watershed protection, and flood protection
program.
This bill would transfer to the CalConserve Water Use Efficiency
Revolving Fund from the bond act specified bond proceeds issued and
available for agricultural water projects. This bill would require
the department to use these moneys for loans and grants to local
agencies to acquire and construct agricultural water conservation
projects consistent with provisions of the bond act.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Water is a finite resource in California, and dry hydrologic
conditions caused by drought and climate change increase the
uncertainty of water supplies.
(b) Reliable water supplies are essential for public health and
safety, stability of local, regional, and statewide economies, and
food security.
(c) Water use efficiency, including conservation and recycling of
water, is an effective strategy to improve management of water
resources at the local and regional levels. Improved resource
management will help local communities withstand drought and other
conditions that limit water supplies.
(d) Water use efficiency projects will become more complex and
costly in order to increase the water savings potential.
(e) A sustainable source of funding is needed for urban and
agricultural water use efficiency projects to assist water and
recycled water providers in expanding local and regional programs.
(f) A revolving fund program is a mechanism to provide a
sustainable funding source that provides incentives for matching
local funds and accelerates local water supply development.
SEC. 2. Division 30 (commencing with Section 81000) is added to
the Water Code, to read:
DIVISION 30. CalConserve Water Use Efficiency Revolving Loan
Program
PART 1. General Provisions
81000. (a) It is the intent of the Legislature in establishing
the CalConserve Water Use Efficiency Revolving Fund to create a
sustainable funding source for water use efficiency projects.
(b) It is further the intent of the Legislature that the funds
from the CalConserve Water Use Efficiency Revolving Fund be used for
the following purposes:
(1) Measurable reductions in urban per capita water use.
(2) Improvements in agricultural water use efficiency and
measurable reductions in agricultural water use.
(3) Increased use of recycled water.
(4) Reductions in greenhouse gas emissions and water and energy
use.
(c) It is the intent of the Legislature that any public funds made
available by this division to private water companies regulated by
the Public Utilities Commission should be for the benefit of the
ratepayers or the public and not the investors pursuant to oversight
by the Public Utilities Commission.
81005. For purposes of this division, the following terms have
the following meanings:
(a) "Fund" means the CalConserve Water Use Efficiency Revolving
Fund established pursuant to Section 81020.
(b) "Local agency" means a city, county, city and county,
municipal utility district, community services district, sanitary
district, sanitation district, water district as defined in Section
20200, public water system as defined in Section 116275 of the Health
and Safety Code, or private water company under the jurisdiction of
the Public Utilities Commission.
(c) "On-bill financing" means a utility-based method for providing
low-interest or no-interest financing for water use efficiency
improvements through the monthly utility bill.
(d) "Technical assistance" means costs incurred for providing
advice, training, or other assistance to local agencies, such as the
following:
(1) Conducting specialized studies to identify water conservation
opportunities that meet the intent of Section 81000.
(2) Planning of specific remodeling, renovation, repair,
replacement, or other projects related to water conservation.
(3) Developing a project proposal for funding from the fund.
PART 2. CalConserve Water Use Efficiency Revolving Fund
81020. The CalConserve Water Use Efficiency Revolving Fund is
hereby created in the State Treasury. Moneys in the fund are
available, upon appropriation by the Legislature, to the department
for expenditure in accordance with this division. The department is
the state agency responsible for administering the fund.
81022. The proceeds of any bonds authorized to be issued and
available for the purposes of Section 79157 shall be transferred to
the fund and used by the department for loans and grants to local
agencies to acquire and construct agricultural water conservation
projects consistent with Article 3 (commencing with Section 79157) of
Chapter 8 of Division 26.
81024. The department may undertake any of the following:
(a) Provide for the deposit of any available and necessary moneys
into the fund.
(b) Enter into agreements with local agencies that provide water
or recycled water service to provide loans for the purposes described
in subdivision (b) of Section 81000.
(c) Provide for appropriate audit, accounting, and fiscal
management services, plans, and reports relative to the fund.
(d) Take additional incidental action as appropriate for the
adequate administration and operation of the fund.
(e) Make requests on behalf of the state for deposit into the fund
of available federal moneys.
(f) Enter into agreements with the federal government for federal
contributions to the fund.
(g) Accept federal contributions to the fund.
(h) Provide technical assistance to local agencies.
81026. (a) The department may enter into an agreement with the
federal government for federal contributions to the fund only if both
of the following conditions are met:
(1) The state identifies any required matching funds.
(2) The department is prepared to commit to the expenditure of any
minimum amount in the fund in the manner required by the federal
government.
(b) Any agreement between the department and the federal
government shall contain those provisions, terms, and conditions
required by the federal government and any implementing federal
rules, regulations, guidelines, and policies, including, but not
limited to, agreement to expend moneys in the fund in an expeditious
and timely manner.
81030. Moneys in the fund shall be used for the following
purposes:
(a) Loans to local agencies that meet all of the following
requirements:
(1) Are made at or below market interest rates.
(2) Require annual payments of principal and any interest, with
repayment commencing not later than one year after loan funding and
full amortization not later than 20 years after loan funding. Full
amortization for loans to disadvantaged communities shall be not
later than 25 years after loan funding.
(3) Require the loan recipient to establish an acceptable
dedicated source of revenue for repayment of a loan.
(b) To guarantee, or purchase insurance for, local obligations if
that action would improve credit market access or reduce interest
rates.
(c) As a source of revenue or security for the payment of
principal and interest on revenue or general obligation bonds issued
by the state, if the proceeds of the sale of those bonds will be
deposited in the fund.
(d) To earn interest.
(e) Technical assistance.
(f) For payment of the department's reasonable costs of
administering the fund, not to exceed 4 percent of the fund.
(g) Grants, principal forgiveness, negative interest rates, and
any other type of, or variation on, the types of assistance described
in this section that is authorized by a federal capitalization grant
deposited in the fund to the extent authorized and funded by that
federal capitalization grant.
81033. Funds made available pursuant to this division to a local
agency shall not be used for that local agency's administrative
costs.
81035. Any repayment of fund moneys, including interest payments,
and all interest earned on, or accruing to, any moneys in the fund,
shall be deposited in the fund and shall be available for expenditure
for the purposes and uses authorized by this division.
PART 3. Implementation
81040. Projects shall have one or more of the following benefits:
(a) Measurably reduce urban per capita potable water use.
(b) Measurably reduce agricultural water use.
(c) Increase the use or availability of recycled water supply.
(d) Reduce greenhouse gas emission and water and energy use.
81042. Subject to all applicable constitutional restrictions, a
local agency may borrow money and incur indebtedness pursuant to this
division.
81044. The department may adopt rules and guidelines necessary or
convenient to implement this division.
81046. A local agency may implement water use efficiency loan
programs pursuant to this section through on-bill financing.