BILL ANALYSIS Ó
SB 246
Page 1
SENATE THIRD READING
SB 246 (Fuller)
As Amended August 7, 2013
Majority vote
SENATE VOTE :37-0
LOCAL GOVERNMENT 9-0
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|Ayes:|Achadjian, Levine, Alejo, | | |
| |Bradford, Gordon, | | |
| |Melendez, Mullin, Rendon, | | |
| |Waldron | | |
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SUMMARY : Revises the special act governing the Bighorn-Desert View
Water Agency, and makes other changes to existing law that governs
the Bighorn-Desert View Water Agency. Specifically, this bill :
1)Repeals the Desert View Water District-Bighorn Mountains Water
Agency Consolidation Law that required the Desert View Water
District and the Bighorn Mountains Water Agency to separately
account and use funds, and deletes cross-references to the
consolidation law from the Bighorn-Desert View Water Agency's
special act.
2)Requires the Bighorn-Desert View Water Agency (Agency) to
separately account for and use funds derived from the operation of
the Desert View Water District and the Bighorn Mountains Water
Agency for the purpose of bond debt service for each of the former
systems, and declares that its provisions must not be construed to
impair any contract entered into prior to January 1, 2014.
3)Decreases, from three months to 60 days, the period that any legal
action may contest, question, or deny the validity of the Agency's
bonds, improvement districts, annexations, or other proceedings.
4)Decreases, from six to three, the number of public places that the
Agency must post specified hearing notices.
5)Makes changes to existing law that governs the Agency's power to
enter into contracts, and deletes a requirement that the Agency
must get two-thirds voter approval for specified contracts that
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incur long-term debt.
6)Allows the Agency to file legal actions, pursuant to specified
statutes in the Code of Civil Procedure, to determine the validity
of the Agency's bonds, warrants, promissory notes, contracts, or
other evidences of indebtedness.
7)Specifies in addition to defined powers in existing law, the
Agency may do the following:
a) To take by condemnation or to lease, with or without the
privilege of purchase, or sell real and personal property
useful or necessary to produce water;
b) To construct, maintain, and operate water wells; and,
c) To enlarge any waterworks or waterworks system acquired by
the Agency.
8)Deletes the requirement in existing law that the Agency's board
shall regulate the use of recreational facilities by ordinance and
repeals the violation of those regulations as a misdemeanor, and
makes a violation of the specified regulations an infraction,
punishable by a fine not to exceed $300.
9)Increases annual interest rate not to exceed 12%, establishes a
total aggregate amount of notes outstanding not to exceed $5
million, and requires the maturity of the notes shall not be later
than five years for the Agency to issue negotiable promissory
notes.
10)Increases the annual interest rate to not exceed 12%, pursuant to
existing law, for the Agency to incur debt and issue bonds.
11)Clarifies that the Agency's power to levy taxes, fees, charges,
assessments, and incur debt are subject to constitutional and
statutory requirements.
12)Specifies that the Agency's board, to restrict the use of water
during a drought or water shortage, must comply with specified
statutes in the Water Code governing water shortage emergencies.
13)Authorizes the Agency to issue bonds in accordance with the
Municipal Improvement Act of 1913, the Refunding Assessment Bond
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Act of 1935, the Improvement Act of 1911, the Improvement Bond Act
of 1915, and the Revenue Bond Law of 1941.
14)Allows the Agency to sell bonds through negotiated sale or
private sale subject to specified conditions, and prohibits bonds
from being sold for less than 94% of par value.
15)Specifies the manner in which the Agency can record liens for
unpaid water service charges.
16)Clarifies that bond proceeds and surplus revenues from water
rates can be used to pay for replacement of the Agency's works.
17)Repeals the Agency's right of eminent domain to take any property
necessary to supply the agency with water, which is currently
authorized.
18)Deletes provisions in existing law relating to vacancies on the
Agency's board of directors and specifies that the Agency must
fill vacancies on its board pursuant to specified statutes in the
Government Code.
19)Requires the Agency's board to adopt a resolution specifying the
date, time, and place of its meetings and deletes redundant
provisions in existing law that relate to board meetings.
20)Specifies that the Agency's board can act by minute order and
details specific notice, posting, and publication procedures that
the board must follow to adopt an ordinance.
21)Removes the requirement that the board of directors must include
in a resolution to incur bonded indebtedness the designation of
precincts, the location of polling places, and the names of the
officers selected to conduct the election, as specified. Deletes
the seven-day timeframe following the election to incur bonded
indebtedness that the returns of the election must be made, and
the votes canvassed by the board of directors.
22)Deletes the provision in existing law that requires the board to
adopt an ordinance to exercise specified powers related to
pensions.
23)Deletes compensation provisions in existing law for directors,
and instead, provides that directors may receive an amount not to
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exceed $100 per day for each day's attendance at meetings of the
board, if established by an adopted ordinance by the governing
board.
24)Requires the board to appoint, define duties, and establish
compensation, by a majority vote, for an attorney, chief engineer,
general manager, and auditor. Provides each of these positions
serve at the pleasure of the board. Prohibits a member of the
board of directors from serving as any of the positions above.
Deletes existing law that authorizes the board to appoint a
treasurer and to consolidate specified offices.
25)Requires the board of directors at the first meeting in January
in each even numbered year to choose a vice president and
secretary from among its members.
26)Requires the board to adopt an annual appropriations limit and
budget.
27)Authorizes the voters in the Agency to pass an initiative or
disapprove of an ordinance by referendum subject to specified
statutes in the Elections Code, and deletes current statutory
language governing the Agency's elections.
28)Clarifies that the Agency shall not dissolve until all
indebtedness is fully satisfied.
29)Specifies that the Agency is subject to the California Public
Records Act.
30)Updates the statutory metes-and-bounds description of the
Agency's boundaries.
31)Makes findings and declarations relative to provisions that
impose a limitation on the public's right of access to the meeting
of public bodies or the writing of public officials and agencies
in order for the Agency to reduces costs and staff burdens
associated with posting notices of specified hearings, while still
providing adequate notice of public hearings, it is necessary to
reduce the number of public locations in which the agency must
post specified hearing notices.
32)Makes numerous technical and non-substantive changes.
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EXISTING LAW establishes the Bighorn Mountains Water Agency
Consolidation Law to authorize a consolidation between the Desert
View Water District and the Bighorn Mountains Water agency.
FISCAL EFFECT : None
COMMENTS : In 1969, SB 1175 (Coombs) established the Bighorn
Mountains Water Agency Law, a special act in the Water Code
Appendix. In 1989, the Desert View Water District-Bighorn Mountains
Water Agency Consolidation Law (AB 1819 (Woodruff), Chapter 570,
Statutes of 1989) merged the Bighorn Mountains Water Agency with the
Desert View Water District that was governed by the County Water
District Law.
This bill repeals the Desert View Water District-Bighorn Mountains
Water Agency Consolidation law and rewrites the existing Bighorn
Mountains Water Agency Law in the Water Code Appendix to rename the
law the Bighorn-Desert View Water Agency Law to govern the
Bighorn-Desert View Water Agency (Agency). This bill repeals
references from the consolidation law and updates the governing
statute.
The 1989 consolidation bill required the Agency to separately
account for the funds of the two precursor agencies. This bill
maintains the separate accounting of debt acquired by the precursor
agencies prior to consolidation, but no longer requires the Agency
to financially operate as separate entities. This bill decreases,
from three months to 60 days, the amount of time public officials
may initiate a validating lawsuit in order to get the court to
validate their actions, contract, agreements, and bonds. This bill
makes several changes to the requirements of the board in existing
law including noticing requirements, compensation, and appointing
authority. This bill is sponsored by the Agency.
According to the author, "The current Water Agency Law is outdated
because if does not reflect important additions to the California
Constitution, such as Articles XIII A, B, C, and D, which affect the
Board of Director's authority to enact taxes and adopt water rates.
Moreover, the original Act is not well organized, thereby reducing
its usefulness as a reference for Agency staff, public officials and
the general public. Additionally, the requirement to keep the two
water systems financially separate works against the economic
savings that consolidation was expected to bring to the ratepayers."
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The Agency provides retail water service to residents within a
45-square mile area encompassing the San Bernardino County
communities of Flamingo Heights, Landers, and Johnson Valley. The
Agency is also authorized to develop hydroelectric energy, use
falling water for electric energy, and to exercise all powers
granted in the County Water District Law. The Agency has several
improvement districts, which are geographical subdivisions through
which water districts can fund capital improvements that benefit
those specific geographic areas.
Current law allows the Agency to raise revenue by charging service
fees, standby charges, and benefit assessments. To raise capital,
the Agency can use general obligation bonds, revenue bonds, and
benefit assessment bonds. Existing law also allows the Agency to
borrow money with promissory notes. This bill clarifies that the
Agency's ability to raise revenue and capital are subject to the
California Constitution and state law.
Support arguments: Supporters argue that this bill removes the
requirement that the consolidated agency operate financially as two
separate enterprises which negated financial efficiencies expected
from the consolidation and modernizes the enabling act so that it is
a more transparent and functional statute.
Opposition arguments: None.
Analysis Prepared by : Misa Yokoi-Shelton / L. GOV. / (916)
319-3958
FN:
0001699