BILL ANALYSIS Ó
SB 7
Page 1
Date of Hearing: June 17, 2015
ASSEMBLY COMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT
Ed Chau, Chair
SB
7 (Wolk) - As Introduced December 1, 2014
SENATE VOTE: 28-7
SUBJECT: Housing: water meters: multiunit structures.
SUMMARY: Allows the Department of Housing and Community
Development (HCD), as part of the next triennial building
standards code cycle, beginning on or after January 1, 2016 or
during a subsequent code cycle, to propose building standards
for the installation of water submeters in multiunit residential
buildings. Specifically, this bill:
1)Includes intent language.
2)Defines "submeter" to mean a device that measures water
consumption of an individual rental unit within a multiunit
residential structure or mixed-use residential commercial
structure, and that is owned and operated by the owner of the
structure or the owner's agent.
3)Requires HCD to determine if there are circumstances in which
the installation of water submeters is infeasible and include
SB 7
Page 2
in the standards appropriate exemptions if necessary.
4)Allows HCD to determine if there are any issues specific to
high-rise multifamily buildings that require an exemption from
the requirement to install water submeters.
5)Makes money in the Building Standards Administration Special
Revolving Fund available upon appropriation by the Legislature
for the administrative cost of developing buildings standards
for the installation of water submeters in multiunit
residential buildings.
EXISTING LAW:
1)Provides that each water corporation with 500 or more service
connections that is not already subject to water metering
requirements under the existing Water Measurement Law must
install a water meter on each new service connection and must
retrofit each unmetered service connection by January 1, 2025.
2)Authorizes the California Building Standards Commission (CBSC)
to approve and adopt building standards. Every three years a
building standards rulemaking is undertaken to revise and
update the California Building Standards Code (Title 24 of the
California Code of Regulations).
FISCAL EFFECT: According to the Senate Appropriations
Committee, HCD administrative costs of $244,000 over two years
($127,000 in the first year, $114,000 in the second year) for 1
limited term PY of staff to develop the proposed building
standards (Building Standards Administration Special Revolving
Fund). Minor and absorbable costs for the CBSC to adopt the
proposed building standard in the next or subsequent triennial
code adoption cycle.
SB 7
Page 3
COMMENTS:
Background : The California Building Standards Law establishes
the CBSC and the process for adopting state building standards.
Statewide building standards are intended to provide uniformity
in building across the state. State law specifies which
departments are responsible for developing and proposing
building standards. When there is no designated department then
the CBSC is responsible. HCD is responsible for single family
and multi-family dwellings.
There are a few exemptions, which allow a local governing body,
city, or county to modify state building standards. A local
governing body, city, or county can adopt an ordinance or a
resolution in a public meeting that finds that a local building
standard must be modified from the state building standard
because of local climatic, geological, or topographical
conditions and file that ordinance with the CBSC. The CBSC
reviews the findings of the ordinance to determine if the local
governing body followed the correct procedure.
SB 7 would require HCD to propose building standards for the
installation of water submeters for multiunit residential
developments. As part of the process of developing the building
standards, HCD would be required to develop exemptions for
properties for which installation of a water submeter is
infeasible. Previous, unsuccessful bills that would have
mandated the installation of water meters have included an
exemption for low-income housing developments financed through
local, state, or federal funding. The exemption was based on
the fact that these projects are difficult to finance and
requiring submeters would add to the cost. In addition, the
billing requirements for low-income housing developments do not
allow for a separate billing for water use.
Although the bill does not specify who would install a water
submeter, in current practice as a plumbing fixture, fitting, or
device, a water submeter would be installed by a licensed C-36
SB 7
Page 4
plumbing contractor.
Purpose of this bill : According to the author, "California's
water supply is under intense pressure from climate change,
increasing population and development. The financial demands
from communities around the state for additional water and
wastewater infrastructure currently exceed the available state
and federal budgetary resources. Thus, it is essential that all
California communities use existing water supplies as
efficiently as possible. Water metering and volumetric pricing
are paramount to giving Californians an accurate price signal
about their water use. However for most multiple dwelling
housing units, such as apartments, water agencies do not provide
meters to individual units. Instead, there are master meters for
a group of dwelling units. The cost of water use is included
with the cost of rent, charged as a flat fee, or allocated in
some way among the residents connected to the master meter.
Residents in such dwelling units will not know how much water
they use unless their units are submetered. California's
population is 38 million people and growing. Currently 46% live
in multi-family housing. Of the state's 15.6 million apartment
residents, fewer than 20% (3.1 million) are billed for their
water use. In other words, for 80% of California's apartment
renters, or 12.5 million Californians, there is no correlation
between water usage and cost. Studies have shown that water
sub-meters are associated with decreased water usage.
Submetering encourages water users to be more aware of their
usage, giving them a financial incentive to conserve.
Furthermore, leaks may be reported and fixed more promptly if
occupants are paying for water based on actual usage. SB 7 would
encourage responsible water consumption and conservation by
providing residents with accurate information about the volume
and cost of their water usage by requiring the installation and
operation of submeters in new multifamily residential
buildings."
SB 7
Page 5
Arguments in support : Various organizations support the bill and
the installation of water submeters as a means of reducing water
consumption. According to the Santa Clara Valley Water
District, "the installation of water meters in apartments and
condominiums will encourage tenants to be more judicious in
their use of water, resulting in increased water use efficiency
and conservation."
Arguments in opposition : The California State Pipe Trades
Council and the Coalition of California Utility Employees are
opposed to this bill. They request that the bill be amended to
require submeters to be installed by the water purveyor or other
another entity responsible for installing the master water meter
for the service connection.
Related legislation:
AB 750 (Wolk) (2013): This bill would have mandated that water
purveyors adopt policies requiring that newly constructed
multiunit residential structures or mixed use residential and
commercial structures that apply for water connections after
January 1, 2015, have, as a condition of new water service,
submeters that measure the water supplied to each individual
dwelling unit. Included a cap on the administrative fee that
landlords can charge a tenant for billing for water. This bill
passed out of this committee 5-2. Failed passage in the
Committee on Water, Parks, and Wildlife.
AB 19 (Fong) (2011): This bill would have mandated that water
purveyors adopt policies requiring that multiunit residential
structures or mixed use residential and commercial structures
that apply for water connections after January 1, 2014, have, as
SB 7
Page 6
a condition of new water service, submeters that measure the
water supplied to each individual dwelling unit. Passed out of
the Committee on Water, Parks, and Wildlife 8-0. This bill
failed passage in this committee.
AB 1975 (Fong) (2010): This bill would have required the
Department of Housing and Community to adopt building standards
requiring installation of individual water meters and submeters
in newly constructed multiunit residential buildings. This bill
died on the suspense file in the Senate Committee on
Appropriations.
AB 1173 (Keene) (2007): This bill would have required submeters
in multiunit residential structures built after January 1, 2010.
This bill died on the suspense file in the Assembly Committee on
Appropriations.
Staff comments :
The committee may wish to consider creating a specific exemption
in this bill for low-income housing developments that are
financed using local, state, or federal funds and that are
offered to lower income households if 90% of the dwelling units
are offered to lower income households.
Committee amendments :
SB 7
Page 7
1)Add the following language:
At a minimum, the department shall develop exemptions for
structures in each of the following categories:
(1) Low-income housing. For purposes of this paragraph,
"low-income housing" means a residential building financed
with low-income housing tax credits, tax-exempt mortgage
revenue bonds, general obligation bonds, or local, state, or
federal loans or grants, for which the rents of the occupants
in lower income households, as defined in Section 50079.5 of
the Health and Safety Code, do not exceed rents prescribed by
deed restrictions or regulatory agreements pursuant to the
terms of the financing or financial assistance, and for which
not less than 90 percent of the dwelling units within the
building are designated for occupancy by lower income
households, as defined in Section 50079.5 of the Health and
Safety Code.
(2) Student dormitories.
(3) Long-term health care facilities, as defined in Section
1418 of the Health and Safety Code.
(4) Time-share property, as defined in subdivision (aa) of
Section 11212 of the Business and Professions Code.
SB 7
Page 8
(5) Residential care facilities, as defined in subdivision (k)
of Section 1569.2 of the Health and Safety Code.
2)Add the following definitions to the bill:
A "multiunit residential building" and "mixed-use residential
commercial structure" means real property containing two or
more dwelling units.
REGISTERED SUPPORT / OPPOSITION:
Support
Apartment Association of Orange County
Apartment Association, California Southern Cities
California Municipal Utilities Association
East Bay Rental Housing Association
SB 7
Page 9
Nor Cal Rental Property Association
North Valley Property Owners Association
Santa Clara Valley Water District
Sierra Club of California
U.S. Green Building Council, California (USGBC)
Opposition
Coalition of California Utility Employees
State Pipe Trades Council
Analysis Prepared by:Lisa Engel / H. & C.D. / (916)
319-2085
SB 7
Page 10