BILL ANALYSIS Ó
SB 208
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Date of Hearing: July 15, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 208
(Lara) - As Amended June 1, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill allows the Department of Water Resources (DWR) to
advance Integrated Regional Water Management Program (IRWMP)
grants payments of up to 50% of the grant award. Specifically,
this bill applies to:
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1)Projects undertaken by nonprofit organizations or
disadvantaged communities; and
2)Projects that benefit disadvantaged communities.
FISCAL EFFECT:
1)Unknown potential losses, potentially in the hundreds of
thousands of dollars (bond/GF) for misspent advanced funds
that are unrecoverable.
2)Absorbable costs for DWR to update guidelines and administer
the program.
COMMENTS:
1)Purpose. According to the author, IRWMP funding represents a
pay-as-you-go system where groups with approved plans provide
funding for water projects up front and are reimbursed later.
This mechanism is intended to safeguard state funds, but
instead disadvantages smaller communities and nonprofit
organizations who are impacted when pre-financing a water
project requires a lager budget than they are able to fund
upfront. This bill will improve equity by advancing grant
funds to nonprofit organizations and disadvantaged communities
under limited circumstances.
2)Background. Numerous water bonds, including most recently
Proposition 1, provide funding for projects and programs
through IRWMP grants. Typically, the Legislature appropriates
bond funds to DWR for a competitive grant solicitation. DWR
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then issues guidelines for a round of IRWMP funding, and
regional water management groups (RWMGs) submit their list of
local projects. DWR ranks the projects and makes the awards
within each IRWMP funding region.
In many cases, RWMGs contract with local entities to carry out
projects. In the typical reimbursement process, the local
entity submits invoices to its RWMG, who then submits invoices
to DWR. Upon review of the invoices, DWR reimburses the RWMG
who then reimburses the local entity. Depending on the
specific details of the funding agreement and the
administrative processes of the RWMG, a number of months may
pass between the time the local entity incurs the expense and
the time they receive reimbursement from the management group.
This creates a hardship for nonprofit organizations or
disadvantaged communities unable to bear the up-front cost of
the project.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081