BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 620|
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UNFINISHED BUSINESS
Bill No: SB 620
Author: Wright (D)
Amended: 9/11/13
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 4-0, 4/17/13
AYES: Wolk, Beall, DeSaulnier, Liu
NO VOTE RECORDED: Knight, Emmerson, Hernandez
SENATE FLOOR : 31-4, 5/29/13
AYES: Beall, Berryhill, Block, Cannella, Corbett, Correa, De
Le�n, DeSaulnier, Emmerson, Evans, Fuller, Gaines, Galgiani,
Hancock, Hill, Hueso, Huff, Jackson, Leno, Lieu, Liu, Monning,
Padilla, Pavley, Price, Roth, Torres, Wolk, Wright, Wyland,
Yee
NOES: Anderson, Knight, Lara, Nielsen
NO VOTE RECORDED: Calderon, Hernandez, Steinberg, Walters,
Vacancy
ASSEMBLY FLOOR : Not available
SUBJECT : Water replenishment districts
SOURCE : Water Replenishment District of Southern California
DIGEST : This bill amends state laws governing water
replenishment districts' (WRD's) annual budget reserves and the
penalties a WRD can impose on water-producing facility
operators.
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Assembly Amendments declare legislative intent of the
Legislature to provide the WRD of Southern California with the
ability to determine the appropriate use of monies held in its
annual reserve fund and add a sunset to the provision; require
the WRD to establish a budget advisory committee for purposes of
reviewing a replenishment assessment and WRD's annual operating
budget; require the court to direct that the WRD be awarded the
reasonable attorney's fees and costs of seeking injunctive
relief whenever the WRD prevails on a petition or complaint; and
make other clarifying and technical changes.
ANALYSIS : The WRD is the state's sole water replenishment
district. The primary function of a water replenishment
district is to recharge water into groundwater basins for later
withdrawal by water purveyors. The WRD earns revenue by
charging water replenishment assessments to the agencies,
utilities, and companies that pump groundwater. The WRD also
gets property tax revenues from its share of the 1% property tax
rate. The WRD uses these funds to buy surface water that then
percolates into the groundwater basin.
Existing law allows WRD to establish an annual reserve fund in
an amount not to exceed ten million dollars. The maximum
allowable reserve fund can be adjusted annually to reflect
percentage increases or decreases in the blended cost of water
from district supply sources. A minimum of 80% of the reserve
must be for water purchases.
Existing law allows WRD to file a petition or complaint in
Superior Court seeking a temporary restraining order and
injunctive relief against an operator of a water-producing
facility which has not been registered with the district or who
is delinquent in paying a replenishment assessment.
This bill:
1.Eliminates, until the 2019-20 fiscal year, the requirement in
existing law that a minimum of 80% of a WRD's annual reserve
fund shall be expended for water purchases.
2.States the intent of the Legislature to provide the WRD with
the ability to determine the appropriate use of monies held in
its annual reserve fund, and that public records that are kept
by the WRD of expenditures from the annual reserve fund shall
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help the Legislature determine whether the flexibility
provided should be permanently extended beyond the 2019-20
fiscal year.
3.Requires a water replenishment district to establish a budget
advisory committee for purposes of reviewing a replenishment
assessment, if any is proposed, and a WRD's annual operating
budget, including reserve funds maintained by the district.
4.Specifies, for the budget advisory committee, the following:
A. The committee shall consist of seven members who shall
serve a two-year term and who shall be elected from among
representatives of producers who are owners or operators of
groundwater producing facilities who are subject to the
replenishment assessment, as specified.
B. Two members shall be elected by vote of entities with an
annual pumping allocation of less than 5,000 acre-feet.
C. Two members shall be elected by vote of entities with an
annual pumping allocation of at least 5,000 acre-feet but
less than 10,000 acre-feet.
D. Three members shall be elected by vote of entities with
an annual pumping allocation of 10,000 acre-feet or
greater.
1.Requires, on or before the first Tuesday in January on a
biennial basis, the WRD to provide by first-class mail to each
producer notice that includes information regarding the
purpose of the committee, the categories that determine
membership on the committee, as specified, the schedule for
the election of members, and any additional information the
district determines necessary. Requires the deadline for each
producer to inform the WRD that it would like to serve on the
committee and the category for which it is eligible to serve,
and requires an eligible producer that would like to serve on
the committee and informs the WRD to be included on the
election ballot.
2.Requires the election of committee members to be conducted by
mail ballot not later than 90 days before the second Tuesday
in May, and specifies vote counting procedures.
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3.Requires the committee to hold its first meeting within 30
days of the date the results of the election are announced by
the WRD, and requires the committee to develop rules for its
operation. Requires the committee to take action by majority
vote of its members, and prohibits members from receiving
compensation for serving on the committee.
4.Requires, no later than the second Tuesday of April of each
year, the WRD to consult with the budget advisory committee,
and requires the committee to make recommendations to the
board, as specified.
5.Requires the WRD to maintain records regarding the
recommendations of the budget advisory committee and the final
decisions made by the board with regard to those
recommendations.
6.Sunsets all provisions related to the budget advisory
committee as of June 30, 2019, and as of January 1, 2020,
repeals those provisions, as specified.
7.Increases the penalty from $150 to $1,000 for any operator of
a water-producing facility who knowingly fails to register
his/her water-producing facility or knowingly fails to file
the groundwater production statement, or knowingly fails to
file and furnish any other reports or statements required by
resolution of the board, as specified, and in addition to
interest.
8.Provides that the increase in penalty shall not apply to any
operator of a water-producing facility that is a party to
litigation involving a water replenishment district filed
before July 1, 2013, until after the litigation is settled or
all legal remedies have been exhausted.
9.Requires, for existing law that allows the WRD to proceed for
injunctive relief, that the court direct that the WRD or
operator of a water-producing facility be awarded the
reasonable attorney's fees and costs relating to a motion
seeking injunctive relief whenever the WRD or operator of a
water-producing facility prevails on a petition or complaint.
10.Provides that the provisions specifying the awarding of
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attorney's fees in the bill shall not apply to any operator of
a water-producing facility that is a party to litigation
involving a WRD filed before July 1, 2013, until after the
litigation is settled or all legal remedies have been
exhausted.
11.Specifies that reimbursement to local agencies shall be made,
if the Commission on State Mandates determines that this bill
contains costs mandated by the state.
Background
A December 1999 State Auditor's report, found that WRD
maintained high fiscal reserves and didn't exercise strict
fiscal controls. In response to the audit, the Legislature
amended the WRD Act to, among other things, cap the size of
WRD's reserve fund and require 80% of the fund to be used for
water purchases. In recent years, WRD has been involved in
litigation with a group of cities within its jurisdiction over
whether the WRD, when imposing replenishment assessments,
complied with the Constitutional requirements established by
Proposition 218 (1996). After an initial favorable superior
court ruling, some cities stopped paying replenishment
assessments to WRD. Litigation over whether WRD may have to pay
refunds to the cities is pending.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
SUPPORT : (Verified 9/12/13)
Water Replenishment District of Southern California (source)
AFSME
Bell Gardens Chamber of Commerce
California Municipal Utilities Association
Cities of Gardena, Hawthorne, and Lawndale
Gardena Valley Chamber of Commerce
Hub Cities Consortium
Inglewood/Airport Area Chamber of Commerce
Latin Business Association
Lawndale Chamber of Commerce
Los Angeles/Orange County Building and Construction Trades
Council
Plumbers and Pipefitters Long Beach Local 494
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Rancho South East Association of REALTORS
Sheet Metal, Air, Rail, Transportation Workers' Local Union 105
South Bay Latino Chamber of Commerce
UA Local 250 Steamfitters and Refrigeration
West Basin Municipal Water District
OPPOSITION : (Verified 9/12/13)
Cities of Commerce, Montebello
Maywood Mutual Water Company #1
Southeast Water Coalition
AB:ej 9/12/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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