BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1588


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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          1588 (Mathis and Alejo)


          As Amended  August 16, 2016


          2/3 vote


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          |ASSEMBLY:  |76-0  |(June 2, 2016) |SENATE: |39-0  |(August 17,      |
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          Original Committee Reference:  W., P., & W.




          SUMMARY:  To the extent funds are available, authorizes the  
          State Water Resources Control Board (SWRCB) to implement  
          low-interest loan and grant programs for counties and qualified  
          nonprofit organizations, as defined, to fund water and  
          wastewater facilities improvements.  Specifically, this bill:


          1)Permits the SWRCB to use funds out of $15 million appropriated  
            in the Budget Act of 2016 (SB 826 (Leno), Chapter 23, Statues  
            of 2016) to fund the low-interest loan and grant programs or  
            any other funding source consistent with the purposes of this  
            chapter.  Requires the SWRCB to use reasonable and feasible  
            efforts to secure local matching funds for the purposes of  
            funding projects pursuant to this chapter.










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          2)Authorizes the SWRCB to establish a program of low-interest  
            loans and grants for counties and qualified nonprofit  
            organizations to provide funds to eligible applicants for  
            specified water or wastewater improvements.


          3)Allows the SWRCB to adopt any guidelines it determines are  
            necessary to administer the program and exempts a guideline  
            adopted for this chapter from the Administrative Procedures  
            Act. 


          4)Allows a county or qualified nonprofit organization to apply  
            to the SWRCB for funds to award grants and/or loans to  
            residents of the county.


          5)Requires counties or qualified nonprofit organizations  
            receiving a grant or a loan under this chapter to annually  
            provide specified information to the board regarding projects  
            and funding recipients.


          6)Requires eligible loan applicants to meet the following  
            specified criteria:


             a)   Requires loans to be secured by a mortgage on the  
               residence and repaid within 20 years in accordance with  
               terms established by the SWRCB.  Limits the loan interest  
               rate to 1%.  Requires loan recipients to maintain  
               homeowners insurance during the life of the loan.  
             b)   Allows counties or qualified nonprofit organizations to  
               enter into contracts with private financial institutions to  
               provide loans consistent with the purposes of this chapter.


          7)Requires eligible grant recipients to meet the following  
            specified criteria:


             a)   Requires grant recipients to repay the county or  








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               qualified nonprofit organization in full if the recipient  
               sells the residence less than five years from signing the  
               grant agreement.  Requires the grant recipient to repay the  
               county or qualified nonprofit organization any unused grant  
               funds.


          The Senate amendments:  Permits instead of requires, the SWRCB  
          to create the low-interest loan and grant programs.  Eliminates  
          a $10 million General Fund Transfer and replaces with the  
          ability to access funds from a $15 million appropriation in the  
          2016 Budget Act, to create the low-interest loan and grant  
          programs.  Defines and allows qualified nonprofit organizations  
          in addition to counties, to apply to the SWRCB to administer  
          low-interest loan and grant programs.  Permits the SWRCB to  
          enter into agreements to advance funds to counties or qualified  
          nonprofit organizations.  Removes an urgency clause from the  
          bill. 


          EXISTING LAW: 


          1)Under the federal Clean Water Act: 


             a)   Establishes federal guidelines for surface water quality  
               protection. 


             b)   Authorizes water quality programs; requires federal  
               effluent limitations and state water quality standards;  
               requires permits for the discharge of pollutants into  
               navigable waters; provides enforcement mechanisms; and  
               authorizes funding for wastewater treatment works,  
               construction grants, and state revolving loan programs, as  
               well as funding to states and tribes for their water  
               quality programs. 


          1)Establishes the Clean Water State Revolving Fund (CWSRF) to  
            offer financial assistance for water quality projects. 








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          2)Under the federal Safe Drinking Water Act (SDWA):


             a)   Establishes federal standards for contaminants in  
               drinking water.


             b)   Authorizes states to enter into primacy agreements with  
               the federal United States Environmental Protection Agency  
               (US EPA) to enforce the SDWA if the state establishes  
               drinking water standards that are at least as stringent as  
               those developed by the US EPA, as required by the SDWA.


             c)   Establishes the Safe Drinking Water State Revolving Fund  
               (SDWSRF) to offer financial assistance for safe drinking  
               water projects.


          3)Under the Porter-Cologne Water Quality Control Act: 


              a)    Establishes the State Water Resources Control Board  
                (State Water Board) and Regional Water Quality Control  
                Boards to regulate and protect water quality in  
                California.


              b)    Establishes the State Water Pollution Control  
                Revolving Fund to, among other things, implement the  
                federal CWSRF program.


          4)Transferred the Drinking Water Program and the SDWSRF from the  
            Department of Public Health to the State Water Board effective  
            July 1, 2014.


          5)Under the California Safe Drinking Water Act:









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             a)   Requires the State Water Board to protect the public  
               from contaminants in drinking water. 


             b)   Establishes the SDWSRF which is partially capitalized by  
               federal contributions from the federal Safe Drinking Water  
               Act.  Specifies that the SDWSRF provide funding for public  
               water systems to correct deficiencies and problems that  
               pose public health risks and to meet safe drinking water  
               standards.


          FISCAL EFFECT:  Unknown.




          COMMENTS:  According to the author, Californians who are reliant  
          on groundwater wells need access to low-interest financing and  
          grants to undertake necessary repairs to provide safe, reliable  
          drinking water.  There are many state and federal programs that  
          provide financial assistance, such as low-interest loans and  
          grants, to communities to undertake water and wastewater  
          infrastructure improvement projects.  Unfortunately, there are  
          very few resources available to individual homeowners who are  
          reliant on their own groundwater wells.


          It is the policy of the state that every human being has the  
          right to safe, clean, affordable, and accessible water adequate  
          for human consumption, cooking, and sanitary purposes.  The  
          CWSRF program provides low-interest loans and other financing  
          mechanisms for publicly-owned wastewater treatment facilities,  
          local sewers, sewer interceptors, water recycling facilities,  
          and storm water treatment facilities.  The SDWSRF provides  
          funding for public water systems.  But improvements to those  
          parts of the water and wastewater infrastructure that are on  
          private property such as wells, sewer laterals, or septic  
          systems have not been funded by the CWSRF or SDWSRF programs.   
          This bill allows for assistance on private property similar to  
          what exists for public systems.








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          Analysis Prepared by:                                             
                          Ryan Ojakian / W., P., & W. / (916) 319-2096   
          FN: 0004342