BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 7|
|Office of Senate Floor Analyses | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
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UNFINISHED BUSINESS
Bill No: SB 7
Author: Wolk (D), et al.
Amended: 8/19/16
Vote: 21
SENATE TRANS. & HOUSING COMMITTEE: 11-0, 4/14/15
AYES: Beall, Cannella, Allen, Bates, Gaines, Galgiani, Leyva,
McGuire, Mendoza, Roth, Wieckowski
SENATE APPROPRIATIONS COMMITTEE: 4-1, 4/27/15
AYES: Lara, Bates, Hill, Mendoza
NOES: Nielsen
NO VOTE RECORDED: Beall, Leyva
SENATE TRANS. & HOUSING COMMITTEE: 11-0, 8/30/16 (Pursuant to
Senate Rule 29.10)
AYES: Beall, Cannella, Allen, Bates, Gaines, Galgiani, Leyva,
McGuire, Mendoza, Roth, Wieckowski
SENATE FLOOR: 28-7, 5/4/15
AYES: Allen, Bates, Beall, Block, Cannella, De León, Gaines,
Galgiani, Hall, Hernandez, Hertzberg, Hill, Hueso, Huff,
Jackson, Leno, Leyva, Liu, McGuire, Mendoza, Mitchell,
Monning, Moorlach, Nguyen, Pan, Roth, Wieckowski, Wolk
NOES: Anderson, Fuller, Morrell, Nielsen, Runner, Stone, Vidak
NO VOTE RECORDED: Berryhill, Hancock, Lara, Pavley
ASSEMBLY FLOOR: 29-28, 9/8/15 (FAIL) - See last page for vote
ASSEMBLY FLOOR: 51-24, 8/25/16 - See last page for vote
SUBJECT: Housing: water meters: multiunit structures
SOURCE: Author
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DIGEST: This bill requires, as of January 1, 2018, that
individual water meters, also called submeters, be installed on
all new multifamily residential units or mixed commercial and
multifamily units, and requires that landlords bill residents
for the increment of water they use.
Assembly Amendments require that new multifamily residential
units or mixed commercial and multifamily units install
submeters and establish comprehensive tenant protections and
landlord rights regarding the submetering.
ANALYSIS: Existing law authorizes the Department of Housing and
Community Development (HCD) to develop building standards and to
submit those standards to the California Building Standards
Commission (BSC) for approval.
This bill:
1)Requires each water purveyor that provides water service to a
newly constructed multiunit residential structure or newly
constructed mixed-use residential and commercial structure for
which a water connection is submitted after January 1, 2018,
to ensure each individual unit be metered or submetered as a
pre-condition for new water service. The landlord of the
newly constructed structure shall be required to install and
read the submeters unless the water purveyor agrees to install
them.
2)Establishes numerous consumer protections for submetered water
service, including meter accuracy, notice and disclosure to
tenants, limitations on what can be included in the submetered
water bill, a mechanism to notice leaks and provide bill
protection to tenants, limitations on late fees, and
protections regarding eviction in the event of failure to pay
the water bill.
3)Requires that submeters be installed by licensed contractors
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who employ at least one apprentice from a state-approved
apprenticeship program, or a registered service agency that
has registered with the Department of Food and Agriculture.
This requirement becomes inoperative once the California
Building Standards Commission (BSC) adopts building standards
that require submetering.
4)Requires the Department of Housing and Community Development
(HCD), on or after their triennial code cycle commencing on or
after January 1, 2018, to propose to the BSC building
standards requiring the installation of water meters or
submeters in newly constructed multiunit residential
structures or mixed-use residential and commercial structures.
Comments
1)Purpose. The author states that "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." The author adds that "water metering
and volumetric pricing are paramount to giving Californians an
accurate price signal about their water use."
The author states that "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."
2)Submetering. Most apartment houses are master-metered for
water; the rates are closely regulated. To the water utility,
the water customer is the landlord of the apartment building,
not the tenants of the individual apartments, and there is
generally only one meter for the aggregate usage of the
property. This makes it much easier for the utility in that
it has to service only one customer, the landlord, who
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presumably recovers this cost in the rent. Because individual
tenants aren't billed for their water consumption, and don't
even know how much water they are using, there is little
incentive for tenants to conserve. Increasingly, new
apartment buildings have water meters installed for individual
apartments, a practice known as submetering.
Water submetering has many virtues. It benefits landlords,
who can charge tenants for the cost of water. It benefits
tenants, who can control their water cost based on usage. It
benefits water suppliers, as customers who are billed based on
usage use less. Studies show that submetering reduces water
use. A study jointly sponsored by the U.S. Environmental
Protection Agency, the National Apartment Association, and
others showed that individual submetering can reduce water
consumption by 15%. ["National Multiple Family Submetering
and Allocation Billing Program Study," sponsored by United
States Environmental Protection Agency, National Apartment
Association, National Multi Housing Council, City of Austin,
City of Phoenix, City of Portland, City of Tucson, Denver
Water Department, East Bay Municipal Utility District, San
Antonio Water System, San Diego County Water Authority,
Seattle Public Utilities, and Southern Nevada Water Authority;
2004.]
3)Consumer protections. Submetering raises significant
financial and consumer protection issues: who pays for the
submeters, where are they installed, who is responsible for
the accuracy of the meters and rendering the bill, what is the
cost for rendering the bill, what is an appropriate rate
design, how are disputes resolved, etc. This bill addresses
those issues by establishing comprehensive consumer
protections.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Assembly Appropriations Committee:
1)HCD administrative costs of $244,000 over two years ($127,000
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in the first year, $114,000 in the second year) for one
limited-term PY of staff to develop the proposed building
standards (Building Standards Administration Special Revolving
Fund).
2)Minor and absorbable costs for the BSC to adopt the proposed
building standard in the next or subsequent triennial code
adoption cycle.
3)Minimal fiscal impact to the Department of Food and
Agriculture. This bill increaseS the amount of water submeters
installed in multiunit structures. Each water submeter is
charged an annual device administrative fee in the amount of
$0.10 per device. These funds are deposited into the
Department of Food and Agriculture Fund. The Department
estimates the increase in revenue generated by the additional
water submeters will be less than $5,000 annually.
SUPPORT: (Verified8/25/16)
American Utility Management
California Apartment Association
California Association of Realtors
California Building Industry Association
California Business Properties Association
California League of Conservation Voters
California Rural Legal Assistance Foundation
Conservice
East Bay Municipal Utility District
Friends of the River
NWP Services Corporation
Sierra Club California
Western Center on Law and Poverty
OPPOSITION: (Verified8/25/16)
None received
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ASSEMBLY FLOOR: 29-28, 9/8/15 (FAIL)
AYES: Baker, Burke, Chau, Chiu, Chu, Eggman, Gomez, Gonzalez,
Gordon, Gray, Holden, Jones-Sawyer, Levine, Lopez, McCarty,
Medina, Mullin, Nazarian, O'Donnell, Quirk, Rendon,
Ridley-Thomas, Santiago, Mark Stone, Thurmond, Ting, Weber,
Williams, Atkins
NOES: Achadjian, Travis Allen, Bigelow, Brough, Chang, Dahle,
Beth Gaines, Gallagher, Gatto, Grove, Harper, Jones, Kim,
Lackey, Linder, Maienschein, Mathis, Mayes, Melendez,
Obernolte, Olsen, Patterson, Perea, Steinorth, Wagner,
Waldron, Wilk, Wood
NO VOTE RECORDED: Alejo, Bloom, Bonilla, Bonta, Brown,
Calderon, Campos, Chávez, Cooley, Cooper, Dababneh, Daly,
Dodd, Frazier, Cristina Garcia, Eduardo Garcia, Gipson,
Hadley, Roger Hernández, Irwin, Low, Rodriguez, Salas
ASSEMBLY FLOOR: 51-24, 8/25/16
AYES: Alejo, Arambula, Atkins, Baker, Bloom, Bonilla, Bonta,
Brown, Calderon, Campos, Chau, Chiu, Chu, Cooley, Cooper,
Dababneh, Daly, Dodd, Eggman, Frazier, Cristina Garcia,
Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray,
Roger Hernández, Holden, Irwin, Jones-Sawyer, Levine, Lopez,
Low, McCarty, Medina, Mullin, Nazarian, O'Donnell, Olsen,
Quirk, Ridley-Thomas, Santiago, Mark Stone, Thurmond, Ting,
Weber, Williams, Wood, Rendon
NOES: Achadjian, Travis Allen, Bigelow, Brough, Chang, Chávez,
Beth Gaines, Gallagher, Grove, Hadley, Harper, Jones, Lackey,
Maienschein, Mathis, Mayes, Melendez, Obernolte, Patterson,
Salas, Steinorth, Wagner, Waldron, Wilk
NO VOTE RECORDED: Burke, Dahle, Kim, Linder, Rodriguez
Prepared by:Randy Chinn / T. & H. / (916) 651-4121
8/30/16 20:28:22
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