BILL ANALYSIS Ó AB 2738 Page 1 Date of Hearing: April 8, 2014 ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS Luis Alejo, Chair AB 2738 (Environmental Safety Committee) - As Amended: April 22, 2014 SUBJECT : Hazardous materials and Safe Drinking Water Act. SUMMARY : Contains technical or noncontroversial revisions to hazardous materials and safe drinking water provisions of the statutes. Specifically, this bill : 1)Modifies the Safe Drinking Water and Toxic Enforcement Act of 1986 (Proposition 65) as follows: a) Clarifies the provisions of Proposition 65 that require the noticing party to inform the alleged violator of his or her right to cure the violation. b) Specifies that the party alleging a Proposition 65 violation must send the notice of special compliance informing an alleged violator of the right to correct the violation, if any of the alleged violations in the 60-day notice are subject to the right to cure. 2)Modifies the use of funds generated from the fees paid by applications for loans from the Safe Drinking Water State Revolving Fund (SDWSRF) as follows: a) Authorizes the use of the administrative fee charged to recipients of SDWSRF loans to reimburse the Department of Public Health (DPH) for the costs of reviewing and approving applications, and the loan disbursement fee to reimburse the DPH for all other costs. b) Authorizes the DPH to annually adjust the fee schedule. 3)Removes duplicate references to the American National Standards Institute (ANSI) for the DPH Point-of-Use Water Treatment Device Certification. EXISTING LAW : 1)Pursuant to Proposition 65, provides for the regulation of AB 2738 Page 2 cancer causing chemical and reproductive toxicants, specifically: a) Provides that no person in the course of doing business shall knowingly and intentionally expose any individual to a chemical known to the state to cause cancer or reproductive toxicity without first giving clear and reasonable warning. It also provides that no person shall knowingly discharge or release those same chemicals into any source of drinking water. b) Prohibits any person who serves a notice of alleged violation from filing an action for exposure against the alleged violator or recovering from the alleged violator in a settlement any payment in lieu of penalties or any reimbursement for costs and attorney's fees, under limited conditions. c) Requires, within 14 days after service of the notice, the alleged violator to demonstrate that they have corrected the alleged violation and have paid a civil penalty in the amount of $500. 2)Pursuant to the state and federal Safe Drinking Water Act (SDWA): a) Authorizes, pursuant to the federal SDWA, the United States Environmental Protection Agency to make funds available to drinking water systems to finance infrastructure improvements. b) Establishes the Safe Drinking Water Small Community Emergency Grant Fund and authorizes DPH to assess an annual charge to applicants for SDWSRF loans to be deposited in this fund in lieu of interest that would otherwise be charged on SDWSRF loans. 3)Requires that home water treatment devices meet DPH standards for those devices offered for sale which claims to reduce contaminants or makes other health-related performance claims. Current law allows the manufacturer to provide third party certification to DPH of the efficacy of the device. FISCAL EFFECT : Not Known. AB 2738 Page 3 COMMENTS : Need for the bill . This bill provides for a series of technical, corrective, and non-substantive modifications to the hazardous materials and drinking water laws. The issues addressed in this bill were the result of legislation passed in 2013 that include AB 2227 (Gatto) related to Proposition 65, AB 21 (Alejo) related to emergency drinking water grants, and AB 119 (ESTM Committee) related to point-of-use water treatment devices. Proposition 65, AB 227 (Gatto), Chapter 581, Statutes of 2013 . AB 227 changed the enforcement provisions of Proposition 65 by limiting recovery by private citizen enforcement action for specified types of exposure to chemicals causing cancer or birth defects or other reproductive harm in those circumstances when failure to provide clear and reasonable warning has been remedied and a penalty has been paid. The technical amendments in this bill were suggested based on an initial implementation of AB 227 by the California Department of Justice. The proposed amendment clarifies that the noticing party must immediately inform the alleged violator of the right to cure the violation, and not wait until after sending the 60-day notice. The second amendment to Proposition 65 makes it clear that the noticing party must send the notice of special compliance informing an alleged violator of the right to cure if any of the alleged violations in the 60-day notice are the specific types of exposures subject to AB 227. Leaving the current statutory language in place creates a potential unintended loophole by letting the noticing party allege at least one violation that is not subject to AB 227 to avoid the entire process. Safe Drinking Water Small Community Emergency Grant Fund, AB 21 (Alejo), Chapter 628, Statues of 2013 . AB 21 established the Safe Drinking Water Small Community Emergency Grant Fund which is financed from a fee charged to loan recipients in lieu of a similar amount of interest. The fees collected are provided to disadvantaged communities in the form of grants to improve drinking water safety. AB 2738 provides that fees collected may be used for prescribed AB 2738 Page 4 administrative costs of providing assistance under these provisions, to the extent consistent with federal law. Certification of water treatment devices, AB 119 (ESTM), Chapter 403, Statues of 2013 . AB 119 provided that a device may be sold, provided it meets the ANSI standard or it had previously been approved by the DPH. The requirements of Health and Safety Code Section 116845 include the ANSI standards as well as alternative requirements for previously approved devices. The current inclusion of the ANSI requirement in addition to the posting on the DPH web page duplicates the requirements that must be met in order to be placed on the DPH website. The provisions of, AB 2738 make it clear that previously approved devices would be allowed to remain on the DPH website and therefore be authorized for sale in California. REGISTERED SUPPORT / OPPOSITION : Support None received. Opposition None received. Analysis Prepared by : Bob Fredenburg / E.S. & T.M. / (916) 319-3965