BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1704


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          (Without Reference to File)





          ASSEMBLY THIRD READING


          AB  
          1704 (Dodd)


          As Amended  May 31, 2016


          Majority vote


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          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Water           |11-1 |Levine, Dababneh,     |Harper              |
          |                |     |Dodd, Gordon,         |                    |
          |                |     |Cristina Garcia,      |                    |
          |                |     |Gomez, Lopez, Medina, |                    |
          |                |     |Olsen, Salas,         |                    |
          |                |     |Williams              |                    |
          |                |     |                      |                    |
          |----------------+-----+----------------------+--------------------|
          |Appropriations  |15-0 |Gonzalez, Bigelow,    |                    |
          |                |     |Bloom, Bonilla,       |                    |
          |                |     |Bonta, Calderon,      |                    |
          |                |     |Daly, Eggman, Eduardo |                    |
          |                |     |Garcia, Roger         |                    |
          |                |     |Hernández, Holden,    |                    |








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          |                |     |Quirk, Santiago,      |                    |
          |                |     |Weber, Wood           |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
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          SUMMARY:  Requires the State Water Resources Control Board  
          (SWRCB) to adopt general conditions for small irrigation uses  
          according to certain timelines, and specifies some of the  
          conditions.  Specifically, this bill:


          1)Modifies the information to be included in a registration of  
            water use for appropriation of water to include a  
            certification that the registrant has provided a copy of the  
            registration form to the Department of Fish and Wildlife (DFW)  
            and agrees to comply with the general conditions applicable.   
            Requires that the registration form include instructions for  
            complying with those conditions. 


          2)Requires the SWRCB, in consultation with DFW, to establish  
            general conditions for small irrigation use.  Allows the SWRCB  
            to include in the general conditions requirements that are  
            applicable only to specific methods of diversion or categories  
            of registration commensurate with the project's environmental  
            impact.  Requires that the general conditions adopted by the  
            SWRCB include the following:


               a)     That the appropriation is subject to prior rights, 

               b)     That diversion works shall be constructed and water  
                 applied to beneficial use with due diligence, 

               c)     That the registration shall be renewed and water use  
                 reported as required by law and SWRCB rules, and









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               d)     Any general conditions required by DFW to comply  
                 with laws regarding streambed alteration agreements.


          3)Requires DFW to adopt general conditions for small irrigation  
            uses to address requirements for streambed alteration  
            agreements, but only after DFW determines that funds are  
            available for that purpose.  Authorizes the conditions adopted  
            by DFW for small irrigation uses to include all of the  
            following:


               a)     An assessment to avoid potential site-specific  
                 impacts on fish and wildlife.

               b)     Submission of site-specific information.


               c)     Consultation with DFW regarding the findings of site  
                 specific assessments and information.

               d)     Implementation of additional measures DFW lawfully  
                 deems necessary to avoid site-specific impacts on fish  
                 and wildlife. 


          4)States legislative intent that the SWRCB and DFW adopt general  
            conditions to simplify the issuance of registrations in a  
            cost-effective and environmentally protective manner, and that  
            the regulatory burden of complying with the general conditions  
            be commensurate with the complexity and type of resources  
            potentially affected.


          5)Authorizes the SWRCB to continue to approve small irrigation  
            use appropriations pursuant to any general conditions in  
            effect on December 31, 2016, including any conditions lawfully  
            required by DFW, before the adoption of general conditions by  
            DFW under this bill.








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          6)Repeals a provision of existing law providing that the SWRCB  
            does not need to adopt general conditions for small irrigation  
            use until the SWRCB determines that funds are available for  
            that purpose.


          7)Requires the SWRCB, no later than June 30, 2017, to adopt  
            general conditions that would permit a registrant to construct  
            facilities to store water for small irrigation use during  
            times of high stream flow in exchange for the registrant  
            reducing existing diversions during periods of low stream  
            flow, for all of the following:


               a)     Diversions from coastal streams entering the Pacific  
                 Ocean and streams entering the San Francisco Bay to  
                 off-stream storage reservoirs or on-stream storage  
                 reservoirs located on stream reaches where fish are not  
                 present, as specified. 


               b)     Diversions from watersheds that support salmonid  
                 fisheries and from drainage areas of one square mile or  
                 less, subject to additional specified conditions.


               c)     Diversions from other streams for which, in the  
                 judgment of the SWRCB, the reduction in existing  
                 diversions during low flow periods will result in a  
                 benefit to fish and wildlife.


          8)Requires that facilities to store water for small irrigation  
            uses shall be subject to all of the following general  
            conditions:










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               a)     No water shall be diverted or used and no  
                 construction shall commence until the applicant has  
                 obtained and is in compliance with all necessary permits  
                 and approvals required by other agencies;


               b)     All appropriations, including the method of  
                 diversion, purpose of use, and quantity of water  
                 diverted, are subject to the continuing authority of the  
                 SWRCB to protect the public trust and prevent waste and  
                 unreasonable use.


               c)     Diversion of water under appropriation is subject to  
                 prior rights, and applicants may be required to  
                 compensate downstream holders of prior rights for any  
                 injury caused by releases.


               d)     The appropriations are subject to available flows.


               e)     The appropriations do not authorize take of species  
                 protected under state or federal endangered species acts.


               f)     The appropriations are subject to applicable SWRCB  
                 water measurement and reporting regulations.


          9)Requires the SWRCB to adopt general conditions for  
            registration of small irrigation uses for purposes other than  
            those described in paragraph 7) above, by no later than June  
            30, 2018.


          10)Requires that a registration fee of $500, and a renewal  
            registration fee of $250, be paid to the DFW for small  
            irrigation use registrations.








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          11)Authorizes the SWRCB, beginning January 1, 2020, to  
            periodically adopt regulations to update the general  
            conditions specified in this bill.


          EXISTING LAW:  


          1)Requires the SWRCB to establish general conditions to which  
            all registrations of appropriations for small domestic, small  
            irrigation, and livestock stock pond uses shall be subject.   
            Requires that the conditions include that the appropriation is  
            subject to prior rights, that all conditions lawfully required  
            by DFW are conditions of the appropriation, that diversions be  
            constructed and water applied to beneficial use with due  
            diligence, and that the registration be renewed and water use  
            reported pursuant to law and rules of the SWRCB.


          2)Provides that the SWRCB is not required to adopt general  
            conditions for small irrigation use until the SWRCB determines  
            that funds are available for that purpose.  


          FISCAL EFFECT:  According to the Assembly Appropriations  
          Committee:


          1)Significant annual administrative costs of approximately $4  
            million [General Fund (GF)] plus $11 million in contract funds  
            (GF) for SWRCB to set general conditions statewide for small  
            irrigation use.
          2)Ongoing costs of approximately $2 million (Water Rights Fund)  
            for SWRCB to issue and renew registrations following the  
            development of general conditions.










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          3)DFW estimates it will require 31.0 Personnel Years and  
            $4,727,000 (GF) to implement this bill.  However, DFW is only  
            required to adopt general conditions if funding is available.   



          4)Although this bill authorizes fees for DFW, it is unlikely the  
            fee revenues would be sufficient to cover costs.  This bill  
            does not provide additional fee authority for SWRCB beyond  
            their existing authority.


          COMMENTS:  This bill requires the SWRCB, in consultation with  
          DFW, to adopt general conditions for registrations to divert and  
          store water for small irrigation uses, and specifies in statute  
          what some of the conditions shall be.  The SWRCB would be  
          required, by June 30, 2017, to adopt general conditions for some  
          small irrigation uses, and by June 30, 2018, for others.   
          According to the author, this bill facilitates small irrigation  
          use registrations statewide during periods of high stream flow  
          that result in reduction of diversions during periods of low  
          stream flow.  The author maintains this bill will assist growers  
          and benefit habitat for fish in our streams and rivers.


          The small irrigation registration process was created by AB 964  
          (Huffman), Chapter 579, Statutes of 2011, in response to  
          resource conflicts that were occurring when sprinklers used to  
          protect vineyards against frost were creating simultaneous water  
          demands that, when combined with other water uses, caused drops  
          in river flows that could be harmful to salmon and other fish.   
          The small irrigation use registration process was created to  
          provide an expedited water right for a pond that stores less  
          than 20 acre-feet annually so that a vineyard could draw from  
          its pond for frost protection instead of directly from the  
          stream.  However, the bill was not limited to frost protection  
          uses.  The SWRCB at that time identified that one quarter of its  
          pending water rights applications were for uses of 20 acre-feet  
          per year or less.  Creation of a small irrigation registration  








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          process was expected to streamline permitting for some of those  
          small irrigation uses and help the SWRCB eliminate some of its  
          water right permitting backlog.


          In addition to DFW's ability under existing law to impose  
          project-specific terms and conditions on water registrations, AB  
          964 required the SWRCB to develop general conditions that  
          protect in-stream beneficial uses before the small irrigation  
          registration process may be used.  AB 964 allowed the SWRCB to  
          develop general conditions for some areas or uses before others  
          but mandated that the SWRCB develop general conditions for frost  
          protection uses in northern California coastal streams by June  
          30, 2012, unless the SWRCB determined it had insufficient funds  
          for that purpose.  On July 25, 2012, the SWRCB approved an  
          initial set of general conditions for Small Irrigation Use  
          registrations.  


          The author of this bill indicates that although the SWRCB did  
          adopt general conditions for small irrigation use registrations  
          for purposes of frost protection in the north coast region,  
          registrants still needed to comply with additional conditions  
          and processes imposed by DFW.  The information that was required  
          by DFW to be included for a successful application was not  
          always clear to the applicant, and registrations still were  
          being reviewed and acted upon by the DFW on a case by case  
          basis.  As a result, many of the proposed registrations were not  
          acted upon in a timely manner, due in part to limited staff  
          resources at DFW, and to a lack of information as to what should  
          be included in the application.  


          Supporters emphasize that rural water users have opportunities  
          to change water use practice in ways that can benefit threatened  
          and endangered fish species in critically dry years.  However,  
          in some cases, landowners who are willing to make such changes  
          are unable to do so due to delays in the approval process for  
          small irrigation uses.  This bill would establish general  








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          conditions for such uses that should accelerate permit  
          processing, especially during times of drought.  According to  
          supporters, many wine grape growers would like to reduce  
          diversions during the warm weather irrigation season by  
          obtaining rights to store water during peak flow winter months  
          in small on-farm storage ponds, but obtaining permits for such  
          small irrigation storage ponds has been difficult.  Supporters  
          also express support for the provisions in this bill that would  
          require the DFW to propose general conditions, and to make such  
          permits available statewide.  There is currently no registered  
          opposition to this bill as amended.


          Analysis Prepared by:                          Diane Colborn /  
          W., P., & W. / (916) 319-2096                    FN: 0003303