BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Kevin de León, Chair
SB 449 (Galgiani) - Local water supply programs or projects:
funding.
Amended: April 18, 2013 Policy Vote: NR&W 7-2
Urgency: No Mandate: No
Hearing Date: May 23, 2013 Consultant: Marie Liu
SUSPENSE FILE.
Bill Summary: SB 449 would prohibit the Department of Water
Resources (DWR) from providing loans, grants, or direct
expenditure, for programs or projects within the service area of
an urban or agricultural water supplier that receives water
from, transferred through, or used in the Delta watershed,
unless DWR determines that the water supplier is reducing its
dependence on the Delta.
Fiscal Impact: Uncertain, but likely in the mid to high hundreds
of thousands of dollars from various special funds and the
General Fund to DWR for increased workload to review funding
eligibility.
Background: As expressed in the Sacramento-San Joaquin Delta
Reform Act of 2009, it is the policy of the state to reduce
reliance on the Delta in meeting California's future water
supply needs through a statewide strategy of investing in
improved regional supplies, conservation, and water use
efficiency. Each region that depends on water from the Delta
watershed shall improve its regional self-reliance for water
through investment in water use efficiency, water recycling,
advanced water technologies, local and regional water supply
projects, and improved regional coordination of local and
regional water supply efforts.
Proposed Law: SB 449 would require urban and agricultural water
suppliers to meet the following criteria to illustrate that they
are reducing its dependence on the Delta:
DWR determines that the water supplier is working to
achieve a 20% reduction in urban per capital use by December
31, 2020 if it is a urban water supplier or that the water
supplier has adopted a volumetric water pricing system if it
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is an agricultural water supplier.
The water agency demonstrates, to DWR's satisfaction, that
the water supplier is complying with the implementation
schedule set forth in the relevant water management plan.
Beginning in 2015, the water agency includes in its relevant
water management plan, the expected outcome for measurable
reduction in Delta reliance and improvement in regional
self-reliance.
Failure to meet these criteria would prohibit DWR from providing
loans, grants, or direct expenditure in that water supplier's
service area.
Staff Comments: This bill raises several implementation
questions that have cost implications. This bill's requirement
that a water supplier comply with existing law regarding
reducing dependence on the Delta in order to be eligible to
receive grants or loans for DWR is a relatively straightforward
requirement to implement. DWR could, for example, require the
applicant to self-certify compliance as part of a grant or loan
application. However, there would be costs to revise guidelines
and for additional review costs, likely in the low hundreds of
thousands of dollars. To the extent that these grant and loan
programs are funded by bonds that cap administrative costs, at
least some of these costs are likely to be borne by the General
Fund.
Implementing this bill's prohibition to direct expenditures
however is much more difficult and unclear. For example, if DWR
is working on a flood control project (that ultimately protects
the state's liability), would this bill's provision prohibit
that project from going forward? Also, as there is no
application from the appropriate water supplier in this
situation, it would likely be a much more time-intensive
activity to verify compliance with the bill's requirements.
Staff believes at a minimum, verifying eligibility for non-bonds
and grants could result in DWR costs in the low to mid hundreds
of thousands of dollars.
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