BILL ANALYSIS Ķ AB 786 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 786 (Levine) As Amended September 2, 2015 2/3 vote. Urgency -------------------------------------------------------------------- |ASSEMBLY: | |(June 2, 2015) |SENATE: |39-0 |(September 8, | | | | | | |2015) | | | | | | | | | | | | | | | -------------------------------------------------------------------- (vote not relevant) ---------------------------------------------------------------------- | | | | | | | | | | | | |COMMITTEE VOTE: |7-0 |(September 10, |RECOMMENDATION: |concur | | | |2015) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ---------------------------------------------------------------------- (H. & C.D.) Original Committee Reference: H. & C.D. SUMMARY: Clarifies that a homeowners association (HOA) may only impose a fine or assessment against a homeowner for reducing or AB 786 Page 2 eliminating the watering of vegetation or lawns during a drought where, prior to the imposition of a fine or assessment, the homeowner receives recycled water from a retail water supplier and fails to use that recycled water for landscaping irrigation. This bill is an urgency measure. The Senate amendments delete the Assembly version of this bill, and instead: 1)Clarify that an HOA may only impose a fine or assessment against a homeowner for reducing or eliminating the watering of vegetation or lawns during a drought where, prior to the imposition of a fine or assessment, the homeowner receives recycled water from a retail water supplier and fails to use that recycled water for landscaping irrigation. 2)Define "recycled water" as water which, as a result of treatment of waste, is suitable for a direct beneficial use or a controlled use that would not otherwise occur and is therefor considered a valuable resource. 3)Define "retail water supplier" as any local entity, including a public agency, city, county, or private water company, that provides retail water service. 4)Provide that it is an urgency measure. 5)Include chaptering out amendments with AB 349 (Gonzalez), Chapter 266, Statutes of 2015. FISCAL EFFECT: None COMMENTS: AB 786 Page 3 Purpose of this bill: According to the author, "the Department of Water Resources states that irrigation for outdoor landscaping can account for anywhere from an average of 25% to an average of 80% of overall urban water use, depending on the area. On January 17, 2014, Governor Brown proclaimed a drought state of emergency in California citing three consecutive years of severe drought conditions and the impossibility of predicting how long the drought could last. The emergency drought proclamation was followed on April 24, 2014, by an Executive Order (2014 EO) seeking to limit outdoor watering. "The 2014 EO also identified an ongoing problem with HOAs that were fining or threatening to fine homeowners for complying with water conservation measures. The 2014 EO declared HOA measures void and unenforceable if they had the effect of prohibiting compliance with the water-saving measures adopted by a public agency or private water company. But the 2014 EO did not protect homeowners who voluntarily let their lawn go brown." The author notes that the chronic drought has continued and California is now in its fourth year. On April 1, 2015, the Governor followed up on the proclamation of a drought state of emergency with Executive Order B-29-15. Among the provisions of the Executive Order was directive No. 2, stating that the State Water Resources Control Board shall impose restrictions upon water suppliers to achieve a statewide 25% reduction in potable urban water usage through February 28, 2016. Restrictions in the amount of potable water used for outdoor landscaping are the primary tool. To further implement these restrictions, Governor Brown signed AB 1 (Brown), Chapter 62, on July 13, 2015. The author states that "AB 1 prohibits cities and counties from imposing fines on homeowners for failing to water a lawn or having a brown lawn during any period for which the Governor has declared a drought state of emergency. But AB 1 does not address HOAs. Civil Code Section 4735 prohibits HOAs from fining homeowners for letting their lawns go brown. But Section 4735 allows HOAs that are AB 786 Page 4 using recycled water to fine homeowners. Some HOAs have interpreted this to mean that if the HOA itself is using some recycled water on common areas then it can continue to fine homeowners that let their lawns go brown." The author believes that homeowners who voluntarily seek to aid the emergency drought situation should not be penalized by HOAs using the recycled water loophole in an attempt to maintain lush lawns during a drought. This bill will close a loophole by restricting the ability for HOAs to impose a fine on a homeowner only in circumstances in which, prior to the imposition of a fine or assessment, the owner of a separate interest receives recycled water from a retail water supplier and fails to use that recycled water for landscaping irrigation. Arguments in support: Supporters, including water districts and agencies, argue that California is experiencing unprecedented drought conditions and that homeowners need clarity regarding what measures they may take to reduce outdoor water use without risk of fines from their HOAs. Supporters contend that this bill is a sensible effort that closes a gap in law that some HOAs have been taking advantage of in order to fine residents that have allowed their lawns to go brown if recycled water is used on common areas. Arguments in opposition: This bill also contains the same provisions contained within AB 349 (Gonzalez), Chapter 266, Statutes of 2015, which was signed by the Governor on September 4, 2015. This language was included to avoid chaptering issues if both this bill and AB 349 are signed by the Governor. AB 349 prohibits an HOA from preventing a homeowner from installing artificial turf or synthetic grass. An HOA may establish reasonable restrictions about the type of artificial grass that a homeowner may use so long as those restrictions do not, in effect, prevent a homeowner from installing artificial grass. The Educational Community for Homeowners (ECHO) does not oppose the provisions in the bill relating to recycled water. ECHO opposes the AB 349 (Gonzalez) chaptering out provisions that are incorporated into this bill, however, because they are concerned AB 786 Page 5 about a number of health and environmental issues related to the installation and use of synthetic turf. This bill was substantially amended in the Senate and the Assembly-approved version of this bill was deleted. Related legislation: AB 349 (Gonzalez), Chapter 266, Statutes of 2015: Voids, or makes unenforceable, any provision of a CID governing document or architectural or landscaping guidelines or policies that prohibit the use of artificial turf or any other synthetic surface that resembles grass. Prohibits a requirement that an owner of a separate interest remove or reverse water-efficient landscaping measures, installed in response to a declaration of a state of emergency, upon the conclusion of the state of emergency. AB 349 was signed by the Governor on September 4, 2015. SB 759 (Lieu) of 2011: Would have voided, or made unenforceable, any provision of a CID governing document or architectural or landscaping guidelines or policies that prohibit the use of artificial turf or any other synthetic surface that resembles grass. SB 759 was vetoed by the Governor. AB 1793 (Saldaņa) of 2010: Would have voided, or made unenforceable, any provision of a CID governing document or architectural or landscaping guidelines or policies that prohibit the use of artificial turf or any other synthetic surface that resembles grass. AB 1793 was vetoed by the Governor. Analysis Prepared by: Rebecca Rabovsky / H. & C.D. / (916) 319-2085 FN: AB 786 Page 6 0002365