BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 935


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          Date of Hearing:  May 6, 2015


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                                 Jimmy Gomez, Chair


          AB  
          935 (Salas) - As Amended March 26, 2015


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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          


          SUMMARY:


          This bill requires the Department of Water Resources (DWR) to  








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          provide grants and expenditures for the planning, design, and  
          construction of local and regional conveyance projects as  
          specified.   Specifically, this bill:  


          1)Requires grants and expenditures to be consistent with an  
            adopted integrated regional water management plan (IRWM) and  
            achieve one or more of the following benefits:


             a)   Improved regional or interregional water supply  
               reliability.


             b)   Mitigation of conditions of groundwater overdraft and  
               subsidence, and improved groundwater quality.


             c)   Adaptation to the impacts of hydrologic changes.


             d)   Improved water security from drought, natural disasters,  
               and other events that interrupt water supplies. 


             e)   Providing safe drinking water for disadvantaged  
               communities and economically distressed areas.


          2)Requires a local cost-share of not less than 50% unless the  
            area is a disadvantaged community or an economically  
            distressed area.                   


          3)Authorizes DWR to adopt regulations to the implement the  
            regional conveyance grant and expenditure program.


          FISCAL EFFECT:








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          1)Unknown, potentially significant, funding shifts from other  
            water management activities to local and regional conveyance  
            projects (IRWMP bond funding).


          2)Increased costs of $250,000 to $350,000 for DWR to develop  
            regulations (IRWMP bond funding).





          


          COMMENTS:


          1)Purpose.  According to the author, conveyance is necessary to  
            fully realize the benefits of virtually every type of local  
            water management project, such as desalination, recycling,  
            water use efficiency, and storage projects.  
            


            The author further contends that the recently passed water  
            bond, Proposition 1 (AB 1471, Chapter 188, Statutes of 2014),  
            provides funding for surface water storage and groundwater  
            storage projects , however, in order to create the greatest  
            possible statewide benefit, it will be necessary to have  
            adequate connections between both. 





          2)Proposition 1 IRWMP funding.  Proposition 1, the Safe Drinking  








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            Water, Quality, and Infrastructure Act of 2014, authorizes  
            $7.545 billion in general obligation funding for water-related  
            projects and programs.   Proposition 1 includes $510 million  
            for the IRWM program and specifically carves out at least $51  
            million for direct expenditure or non-competitive grants to  
            ensure the involvement of disadvantaged communities in the  
            IRWM process.  Proposition 1 also requires at least another  
            $51 million be expended within the IRWM regions on projects  
            that benefit disadvantaged communities.


            Bond issuance and audit costs are approximately 7%, so this  
            bill would be funded from the remaining approximately $375  
            million for planning and implementation grants within the IRWM  
            funding category.


          3)   Disadvantaged Communities and Economically Distressed  
            Areas.  Proposition 1 defines a disadvantaged community as a  
            community with an annual median household income that is less  
            than 80 % of the statewide annual median household income.   
            Proposition 1 defines an economically distressed area as the  
            following:


             a)   A municipality with a population of 20,000 persons or  
               less or a rural county, or a reasonably isolated and  
               divisible segment of a larger municipality where the  
               segment of the population is 20,000 persons or less.


             b)   The area has an annual median household income that is  
               less than 85% of the statewide median household income.


             c)   An area DWR finds to be in financial hardship, an area  
               with unemployed at a rate that is 2% higher than the  
               statewide average; or, an area with a low population  
               density.








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          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)  
          319-2081