BILL ANALYSIS Ó SENATE GOVERNANCE & FINANCE COMMITTEE Senator Lois Wolk, Chair BILL NO: SB 26 HEARING: 8/20/14 AUTHOR: Correa FISCAL: Yes VERSION: 6/17/14 TAX LEVY: No CONSULTANT: Ewing PURSUANT TO SENATE RULE 29.10 ORANGE COUNTY WATER DISTRICT ACT Requires the Orange County Water District to provide notice to an affected city, and hold a public meeting in that city, prior to developing property within city boundaries. Background and Existing Law The Legislature created the Orange County Water District in 1933 to meet the water and related needs of the residents of Orange County (SB 1201, Edwards, 1933). State law authorizes the district to acquire, hold, use and dispose of real property for purposes of the district, as determined by the district's board of directors. The Orange County Water District recently elected to enter into an exploratory agreement with a private entity on the potential to develop a thermal electricity generation plant on a site owned by the District that is located within the City of Anaheim. Generally, special districts must comply with the building and zoning ordinances of the cities or counties in which the facilities they construct are located (AB 56, Biddick, 1959). However, the state has established exceptions for the development of water and electrical facilities. In general, cities and counties cannot impede the development of those facilities through their zoning and building ordinances to ensure reliable water and energy systems. For large thermal power plants, those that can produce 50 megawatts or more of electricity, the California Energy Commission has the exclusive power to certify all sites and related facilities in the state (SB 1277, Smith, 1976). The Commission must consider local zoning and building SB 26 -- 6/17/14 -- Page 2 ordinances during its decision-making process, but can override those ordinances if the Commission determines that the facility is required for public convenience and necessity, and that there are not more prudent and feasible means of achieving public convenience and necessity (SB 110, Peace, 1999). Similarly, AB 56 (Biddick, Chapter 2110, 1959) provided an exemption from compliance with local building and zoning ordinances for special districts that develop water or electricity facilities. Subsequent legislation sustained the exemption from local building ordinances for the construction of facilities for the production, generation, storage, treatment or transmission of water, wastewater, or electricity by a special district, and provided limited exemptions from zoning ordinances, as follows (SB 1711, Costa, 2002): Local zoning ordinances do not apply to the location or construction of facilities for the production, generation, storage, treatment, or transmission of water, or for the production of electricity that are subject to the Municipal Utility District Act, or electrical substations in an electrical transmission system that receives electricity at less than 100,000 volts. Local zoning ordinances of a county or city shall apply to the location or construction of facilities for the storage or transmission of electrical energy by a special district if the zoning ordinance makes provisions for those facilities. A special district may, upon a 4/5 vote of its board, at a noticed public hearing, render a city or county zoning ordinance inapplicable to a proposed use of a property if that special district determines that there is no feasible alternative and the use of the property is for facilities related to storage or transmission of water or electrical energy, including structures such as warehouses, administrative buildings, and automotive storage and repair buildings. The special district must notify the city or county whose zoning ordinance has been rendered inapplicable, as well as affected property owners. The affected city or county may SB 26 -- 6/17/14 -- Page 3 seek judicial review of the decision to render the zoning ordinance inapplicable. Anaheim officials are concerned that current law does not provide residents with sufficient opportunities to participate in the decision-making process for the siting of electric generation facilities on properties owned by the Orange County Water District. Proposed Law Senate Bill 26 clarifies that provisions of existing law related to the application and exemptions from local zoning and building ordinances, and notice requirements, apply to the Orange County Water District. SB 26 requires the Orange County Water District to provide notice of intent to develop real property owned by the district, which is within the boundaries of a city, to the city planning agency, at least 30 days prior any action to approve the development. SB 26 requires the Orange County Water District to hold a public meeting within the boundaries of a city if the district proposes to locate, within that city, a facility for the production, generation, storage, treatment or transmission of water, wastewater, or electricity, or related structures. SB 26 expresses the Legislature's intent to: Clarify that existing law with regard to the application of zoning and building ordinances adopted by counties and cities applies to any property owned by the Orange County Water District. Foster collaboration between the district and the cities in which the district owns property. Provide increased transparency to the public in land use decisions made by the district. State Revenue Impact No estimate. SB 26 -- 6/17/14 -- Page 4 Comments 1. Purpose of the bill . In 2013, the Orange County Water District sought to develop an electricity generation plant within the City of Anaheim, in an area of the city that would be inconsistent with the city's land use plans. Existing law includes provisions that address land use conflicts when a special district intends to develop property within the boundaries of a city or county. Senate Bill 26 includes language in the Orange County Water District Act to clarify that existing statutory provisions apply to the land use decisions of the water district and strengthens the public disclosure and transparency requirements in these instances. 2. Special legislation . The California Constitution prohibits special legislation when a general law can apply (Article IV, Sec. 16). SB 26 contains findings and declarations explaining the need for a special statue for the Orange County Water District. 3. Gut and amend . As introduced and passed by the Senate, SB 26 contained provisions relating to the Political Reform Act. Amendments taken in the Assembly deleted the initial contents of SB 26 and inserted the current language relating to the Orange County Water District. Because this topic was never heard in the Senate, the Senate Rules Committee referred the amended bill under Senate Rule 29.10 to the Senate Governance and Finance Committee for a hearing on the Assembly's amendments. At its August 20 hearing, the Committee has two choices: Hold the bill Return the bill to the Senate Floor. Assembly Actions Assembly Local Government Committee:9-0 Assembly Appropriations Committee: 17-0 Assembly Floor: 78-0 Support and Opposition (8/18/14) Support : City of Anaheim. SB 26 -- 6/17/14 -- Page 5 Opposition : Unknown.