BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair SB 322 (Hueso) - Water recycling. Amended: May 8, 2013 Policy Vote: EQ 9-0 Urgency: No Mandate: No Hearing Date: May 20, 2013 Consultant: Marie Liu This bill does not meet the criteria for referral to the Suspense File. Bill Summary: SB 322 would add additional requirements regarding the development uniform water recycling criteria by the Department of Public Health (DPH) with consultation with the State Water Resources Control Board (SWRCB). Fiscal Impact: Unknown, but likely in the thousands to low tens of thousands of dollars from the Waste Discharge Permit Fund (special) or nonstate donations for additional requirements for the development of uniform water recycling criteria. Background: Existing law requires DPH take several actions regarding water recycling. Specifically, DPH is required to: Report to the Legislature regarding the feasibility of developing uniform water recycling criteria for direct potable reuse by December 31, 2016. DPH is authorized to convene and advisory group, task force, or other group to advise DPH regarding the development of this criteria. Develop and adopt uniform water recycling criteria for surface water augmentation. In developing these criteria, DPH is required to consider specified reports and research. DPH is required to convene and administer an expert panel for the purposes of advising DPH regarding developing these criteria. Adopt uniform water recycling criteria for indirect potable reuse for groundwater recharge. Existing law requires that civil penalties deposited in the Waste Discharge Permit Fund be available to DPH, upon appropriation by the Legislature, in an amount of up to $500,000 per FY for a total of $3 million, for the purposes of completing uniform water recycling criteria requirements for direct and indirect potable use (WC §13350(k)). SB 322 (Hueso) Page 1 Proposed Law: This bill would require that DPH consult with the SWRCB in its investigation on the feasibility of developing uniform water recycling criteria for direct potable reuse. This bill would expand the information that DPH must consider in developing uniform water recycling criteria for surface water augmentation to include a report by the National Research Council of the National Academies. This bill would require that DPH convene the expert panel on the development of criteria for surface water augmentation by January 30, 2014 and would additionally require the panel to assess what, if any, additional areas of research are needed to establish uniform regulatory criteria for indirect potable reuse and recommend an approach for accomplishing that research. This bill would expand the membership to include a limnologist and would require DPH to consult with the National Water Research Institute and the SWRCB to select panel members. DPH would be required to prepare a draft report by June 30, 2016 that summarizes the recommendations of the expert panel. This bill would allow the expert panel, advisory group, and resulting report to be directly funded through nonstate donations. DPH would be required to use state funds for staff time, the expert panel, and the report to the extent that state funds are available. DPH would be allowed to accept funds from any source and to expend these funds for the purpose of completing its responsibilities in this chapter. Related Legislation: SB 918 (Pavley) Chapter 700/2010 required DPH to establish standards and regulations for various types of water recycling. Staff Comments: In the FY 2012-13 budget, DPH was appropriated $700,000 for the development of the groundwater recharge criteria. In the Governor's proposed budget for FY 2013-14, an additional $700,000 is being requested for the development of the surface water criteria. No funding source has been identified for the development of criteria direct potable reuse. DPH has indicated that the expert panel members have not yet been selected yet and will likely not be selected unless this year BCP for an additional $700,000 is approved. SB 322 (Hueso) Page 2 Staff believes that because development of the criteria on using recycled water for surface water augmentation and direct potable reuse has not yet begun, the additional workload required by this bill will likely be minimal. At most, staff anticipates the costs being in the low tens of thousands. These costs can be covered either by future appropriations from the Waste Discharge Permit Fund or by nonstate funds received by DPH for this purpose. Existing law allows DPH to receive nonstate funds to develop uniform water recycling criteria, subject to appropriation by the Legislature (WC §13569). This bill would create a new section that would also DPH, the expert panel, advisory group, and report preparation to be funded directly by nonstate donations, that is without an appropriation from the Legislature. Staff believes that combining these two sections would provide more clarity on the use of nonstate funds. Recommended Amendments: Staff recommends that section 4 of the bill regarding use of nonstate funds be combined with WC §13569.