BILL ANALYSIS                                                                                                                                                                                                    Ó



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          Date of Hearing:  April 28, 2015


                  ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE


                                 Marc Levine, Chair


          AB 1095  
          (Eduardo Garcia) - As Introduced February 27, 2015


          SUBJECT:  Water Quality, Supply, and Infrastructure Improvement  
          Act of 2014:  restoration funding:  Salton Sea


          SUMMARY:  Appropriates an unspecified amount of funding to the  
          California Natural Resources Agency (CNRA) for Salton Sea  
          restoration projects from the $475 million that is available in  
          the Water Quality, Supply, and Infrastructure Improvement Act of  
          2014 (Proposition 1) for the state of California to comply with  
          obligations in specified settlements, compacts, and Acts.   


          EXISTING LAW:  


          1)Authorizes $7.545 billion in general obligation funding for  
            water-related projects and programs in Proposition 1, the Safe  
            Drinking Water, Quality, and Infrastructure Act of 2014 (Prop.  
            1). 


          2)Under Prop. 1, authorizes $475 million in order to fulfill  
            State obligations related to: the Klamath Agreements; Tahoe  
            Compact; San Joaquin River Restoration Agreement; Salton Sea  
            Restoration; and, Central Valley Project Improvement Act  
            refuge water supplies.








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          3)Establishes the Salton Sea Restoration Act (SSRA) with the  
            legislative intent of providing that the State undertakes  
            restoration of the Salton Sea ecosystem and the permanent  
            protection of the wildlife dependent on that ecosystem based  
            on a "preferred alternative" that is developed as a result of  
            a restoration study and alternative selection process. 

          4)Requires the SSRA preferred alternative to provide the maximum  
            feasible attainment of specified environmental objectives,  
            including restoration of long-term stable aquatic and  
            shoreline habitat to historic levels and diversity of fish and  
            wildlife dependent on the Salton Sea, elimination of air  
            quality impacts from restoration projects, and protection of  
            water quality.
            
          5)Provides that for purposes of the SSRA restoration plan the  
            Salton Sea ecosystem includes the Salton Sea, agricultural  
            lands surrounding the Sea, and the tributaries and drains  
            within Imperial and Coachella Valleys that deliver water to  
            the Sea.

          6)Requires the CNRA Secretary, in consultation with the  
            Department of Fish and Wildlife (DFW), the Department of Water  
            Resources (DWR), the Salton Sea Authority (SSA), air quality  
            districts, and the Salton Sea Advisory Committee, undertake a  
            restoration study to determine a preferred alternative for  
            restoration of the Salton Sea, prepare a Programmatic  
            Environmental Impact Report (PEIR) analyzing the alternatives,  
            and submit a preferred alternative to the Legislature on or  
            before December 31, 2006.

          7)Establishes the Salton Sea Restoration Fund (SSRF), which is  
            administered by the DFW Director.  Authorizes moneys deposited  
            in the SSRF to be expended, upon appropriation by the  
            Legislature, for the following purposes:  

             a)   Environmental and engineering studies related to  
               restoration of the Salton Sea and the protection of fish  








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               and wildlife dependent on the Sea; 

             b)   Implementation of conservation measures necessary to  
               protect fish and wildlife dependent on the Sea; 

             c)   Implementation of the preferred Salton Sea restoration  
               alternative; and,

             d)   Administrative, technical, and public outreach costs  
               related to development and selection of the preferred  
               Salton Sea restoration alternative.   



          FISCAL EFFECT:  Unknown


          COMMENTS:  This bill appropriates an unspecified amount of  
          funding from Prop. 1 for Salton Sea restoration.


          1)Author's statement:  The author states that this bill is  
            needed because the Salton Sea is California's largest inland  
            lake and very important to both the residents of Imperial and  
            Riverside counties and to the wildlife that relies upon the  
            Sea for habitat.  The author adds that the Salton Sea is  
            nicknamed "California's Everglades" by some as it currently  
            supports 400 species of birds, many of them year-round, and is  
            a critical stopping point along the 5,000-mile Pacific Flyway.  
            The author adds that without restoration communities windblown  
            particle from the dry lakebed will worsen the already poor air  
            quality in the Imperial and Coachella Valleys to the detriment  
            of many who live there and already suffer air quality-related  
            health problems.


          2)Background:  The Salton Sea, California's largest lake, is  
            located in a low-lying trough or desert sink in Southern  
            California, much of which is below sea level.  The current sea  








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            was formed in 1905 when the Colorado River flooded its banks  
            at a faulty construction site during the building of the  
            All-American Canal.  However, the sea bed has periodically  
            filled and receded numerous times, from prehistoric times  
            through the 1800s.  The present sea is fed primarily by  
            agricultural runoff.  Since it has no natural outlet, it is  
            becoming increasingly saline and today is considerably saltier  
            than the ocean.  


            The State's obligation to fund Salton Sea restoration is  
            related to the Quantification Settlement Agreement (QSA),  
            which is in turn related to California's dependence on  
            Colorado River water.  The Colorado River Compact is a 1922  
            agreement among the seven Colorado River basin states as to  
            how they will apportion Colorado River flows.  Based on the  
            flows of the River prior to 1922, 7.5 million acre-feet (MAF)  
            were assigned to the Upper Division, consisting of Colorado,  
            New Mexico, Utah, and Wyoming and 7.5 MAF were assigned to the  
            Lower Division as follows:  California 4.4 MAF , Arizona 2.8  
            MAF, and Nevada .3 MAF.  But even though California received  
            the lion's share, it continuously relied upon another .8 MAF  
            of "surplus" from the other States to average about 5.2 MAF.  


            As the rest of the southwest grew, the other States began to  
            pressure the Secretary of the Interior to give California a  
            deadline to come up with a plan to ratchet back to 4.4 MAF.   
            As a result, Secretary of the Interior Gale Norton gave  
            California a deadline of December 31, 2002 to come up with a  
            "4.4 Plan" or she threatened to discontinue declaring  
            surpluses and cut off the extra water supply.


            Under California appropriative water law, the most senior  
            water rights holder takes all that he or she has used  
            reasonably, beneficially, and continuously, and then the next  
            most senior, and so on with any shortage falling wholly upon  
            the most junior water rights holders first.  But in order to  








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            reach a 4.4 Plan, the major Colorado River water rights  
            holders, Imperial Irrigation District (Imperial), the  
            Metropolitan Water District of Southern California, the San  
            Diego County Water Authority (San Diego), and the Coachella  
            Valley Water District (Coachella), agreed to quantify their  
            water rights, engage in a series of transfers, and restore the  
            Salton Sea.  The reason for inclusion of the Salton Sea is  
            that, beginning in 2017, the QSA included ag-to-urban water  
            transfers that would reduce the runoff from IID that was  
            providing significant inflow to the Sea.  As a result, the Sea  
            will shrink considerably in size, increasing salinity and  
            exposing large areas of dry sea bed playa.


          3)Reasons for Salton Sea Restoration:  The Salton Sea is one of  
            the most important wetland areas in California for migratory  
            waterfowl and shorebirds, since over 95% of California's  
            historical wetlands have been converted to other land uses.   
            The Salton Sea supports over 400 species of birds, and is an  
            internationally significant stopover site for hundreds of  
            thousands of birds migrating along the Pacific Flyway.   
            Recently, fishery resources in the sea have declined  
            significantly due to increasing salinity, evaporation and  
            declining water quality.  Once the QSA water transfers are  
            fully implemented, it is generally recognized that without  
            restoration efforts the ecosystem of the Salton Sea will  
            collapse over the next decade or two.  


            The drying up of the sea also will have human health impacts.   
            As the Pacific Institute, an independent research and policy  
            analysis think tank writes in Hazard, the Future of the Salton  
            Sea with No Restoration Project (May 2006), more than 100  
            miles of dusty lakebed could be exposed to the desert winds.   
            That would cause fine particles to blow over the Coachella and  
            Imperial Valleys with the latter already suffering from the  
            highest childhood asthma hospitalization rate in the State and  
            both areas containing high numbers of seniors who are  
            especially susceptible to poor air quality.








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          4)State Obligation to the Sea:  To facilitate the implementation  
            of the QSA, the Legislature passed and the Governor signed a  
            package of three bills in September 2003.  This Legislation  
            details the financial responsibility the State assumes with  
            respect to mitigation, and requires the formation of a joint  
            powers authority (JPA) to implement and allocate mitigation  
            responsibilities between local agencies and the State.  The  
            JPA consists of DFW, Coachella, Imperial, and San Diego.   
            Under the QSA, Coachella, Imperial, and San Diego agree to  
            fund the first $133 million (in 2003 dollars) for mitigation  
            costs related to habitat restoration and air quality and the  
            State of California assumed responsibility for all mitigation  
            and monitoring beyond that first $133 million.  This  
            open-ended State obligation was subject to litigation with the  
            Third District Court of Appeal ruling that while the State is  
            contractually liable for the excess mitigation costs, neither  
            the QSA parties nor anyone else can compel the Legislature to  
            appropriate funds to pay for the mitigation.  In other words,  
            the court found that the State's contractual obligation under  
            the QSA to pay for excess mitigation costs may be  
            unenforceable but it is not illusory as the Legislature could  
            choose to fund it.


          1)Restoration proposals and funding:  In 2007, the CNRA  
            completed a restoration study and released the Salton Sea  
            Ecosystem Restoration Program Plan and Final PEIR.  The Agency  
            estimated that the preferred alternative identified in the  
            PEIR would cost over $8 billion, expended over a period of 75  
            years, to implement.  The preferred alternative included a  
            saline habitat complex at the north and south end of the Sea,  
            a Marine Sea extending around the northern shoreline in a  
            horseshoe shape, air quality management facilities to reduce  
            particulate emissions from exposed playa, a brine sink for  
            discharge of salts, sedimentation distribution facilities, and  
            early start habitat projects to provide habitat pending  
            completion of other habitat components.  A detailed financing  








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            plan was never developed for the preferred alternative, which  
            has not been endorsed by the Legislature.  The PEIR also noted  
            that even the "no project" alternative would cost the State  
            over $1 billion due to state and federal requirements to  
            address air quality, water quality and habitat issues even if  
            no restoration plan is pursued.


            In 2008, the nonpartisan Legislative Analyst's Office released  
            a report, Restoring the Salton Sea. The report recommended  
            that the Legislature set explicit statutory priorities for  
            addressing environmental problems at the Sea and, in  
            particular, establish the protection of air quality and the  
            preservation of wildlife habitat as the highest priorities for  
            expenditure.


            In 2012, the CNRA, jointly with the U.S. Army Corps of  
            Engineers, prepared and released a draft Salton Sea  
            Conservation Habitat (SCH) Project Environmental Impact  
            Statement/Environmental Impact Report (EIS/EIR).  The SCH  
            Project EIS/EIR proposes a range of aquatic habitats to  
            support fish and wildlife species dependent on the Salton Sea.  
             The CNRA's preferred alternative identified in the EIS/EIR  
            would include construction of 3,770 acres of habitat ponds.   
            Proposition 84, The Safe Drinking Water, Water Quality and  
            Supply, Flood Control, River and Coastal Protection Bond Act  
            of 2006 made $47 million available for deposit into the SSRF.   



            November 2012 the California State Auditor put out a report  
            whose title says it all: Salton Sea Restoration Fund: The  
            State Has Not Fully Funded a Restoration Plan and the State's  
            Future Mitigation Costs are Uncertain.  The report establishes  
            that between fiscal years 2003-2004 and 2012-2013 the State  
            had spent approximately $32 million and anticipated another  
            approximately over $81 million in funding from Prop. 84 and  
            the SSRF water agencies.  Prior to 2013, the majority of the  








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            SSRF was spent on habitat project planning and environmental  
            work, with some limited on-the-ground restoration.  The  
            Governor's 2013-14 budget included $2 million to study funding  
            and restoration alternatives by the SSA and $28.4 million from  
            the SSRF for the first phase of implementation of the SCH  
            Project.  The first phase includes on-the-ground construction  
            of 800 to 1,200 acres of habitat ponds.  Additional funding  
            for implementation of the SCH Project is also being sought at  
            the federal level.


          2)Prior and related legislation:  


            In 2003 and 2004, the Legislature approved a package of bills  
            facilitating the implementation of the QSA and calling for  
            restoration of the Salton Sea:  SB 277 (Ducheny), Chapter 611,  
            Statutes of 2003; SB 317 (Kuehl), Chapter 612, Statutes of  
            2003; SB 654 (Machado), Chapter 613, Statutes of 2003; and, SB  
            1214, Chapter 614, Statutes of 2004 (Kuehl)). Among other  
            things, the legislative package directed DWR in consultation  
            with the newly-created Salton Sea Advisory Committee and SSA,  
            to prepare an ecosystem restoration study and associated  
            programmatic environmental documentation, and created the  
            SSRF.  The agencies released a Salton Sea Ecosystem  
            Restoration Program plan and programmatic environmental impact  
            report in 2009 with an estimated cost of over $8 billion. 


            SB 51 (Ducheny), Chapter 303, Statutes of 2010, established,  
            among other things, the Salton Sea Restoration Council  
            (Council) to serve as the state agency responsible for  
            overseeing restoration of the Salton Sea. SB 51 required the  
            Council to evaluate Salton Sea restoration plans and to report  
            to the Governor and the Legislature by June 30, 2013, with a  
            recommended restoration plan. 


            The Governor's 2012 Reorganization Plan, as modified by budget  








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            trailer bill SB 1018 (Leno), Chapter 39, Statutes of 2012,  
            eliminated the Council, effective December 31, 2012, before  
            the Council ever actually met.  


            AB 71 (V. Manuel Pérez), Chapter 402, Statutes of 2013,  
            required the CNRA Secretary, in consultation with the SSA, to  
            lead Salton Sea restoration efforts.  


            AB 148 (V. Manuel Pérez), Chapter 124, Statutes of 2014 made  
            technical and clarifying changes to AB 71. 


          3)Supporting arguments:  Supporters state that only after the  
            State and QSA parties committed to mitigation and restoration  
            measures was the QSA signed.  Supporters add that the  
            conservation-based component of the water transfer agreement  
            with San Diego commences in 2017 after fifteen years of State  
            Water Resources Control Board-ordered return flows of  
            mitigation water to the Salton Sea and that, as a result, the  
            "need for funding to meet the State's obligation looms very,  
            very large indeed."


          4)Proposed Committee amendment:  The author advises that the  
            bill inadvertently omits from its language a reference to  
            Chapter 614 from the 2003-2004 Legislative package when  
            referring to the mitigation measures that should be funded.   
            Committee staff proposes amending Section 1 of the bill as  
            follows to correct the omission:


            SECTION 1. Of the funds authorized pursuant to Section 79736  
            of the Water Code, the sum of ____ dollars ($____) is hereby  
            appropriated from the Water Quality, Supply, and  
            Infrastructure Improvement Fund of 2014 to the Natural  
            Resources Agency to support restoration projects that fulfill  
            the obligations of the state in complying with intrastate or  








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            multiparty water quantification settlement agreement  
            provisions, as set forth in Chapters 611, 612,  and  613  , and  
            614  of the Statutes of 2003.


          REGISTERED SUPPORT / OPPOSITION:




          Support


          Imperial Irrigation District


          Salton Sea Authority (if amended)




          Opposition


          None on file




          Analysis Prepared by:Tina Cannon Leahy / W., P., & W. / (916)  
          319-2096
















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