BILL ANALYSIS Ó
SB 552
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Date of Hearing: June 28, 2016
ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE
Marc Levine, Chair
SB
552 (Wolk) - As Amended June 16, 2016
SENATE VOTE: 31-5
SUBJECT: Public water systems: disadvantaged communities:
consolidation or extension of service: administrative and
managerial services
SUMMARY: Authorizes the State Water Resources Control Board
(SWRCB) to contract with an administrator to provide
administrative and managerial services to a designated public
water system, as defined, to assist with the provision of an
adequate and affordable supply of safe drinking water.
Specifically, this bill:
1)Updates and clarifies several provisions of law on water
system consolidation.
2)Authorizes the SWRCB, in order to provide affordable, safe
drinking water to disadvantaged communities and to prevent
fraud, waste, and abuse, to do both of the following:
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a) Contract with an administrator, as specified, to provide
administrative and managerial services to a designated
public water system to assist the designated public water
system with the provision of an adequate and affordable
supply of safe drinking water, and
b) Order the designated public water system to accept
administrative and managerial services, including full
management and control, from an administrator selected by
the State Water Board.
3)Defines "administrator" as a person that the State Water Board
has determined is competent to perform the administrative and
managerial services of a public water system, as specified.
Authorizes the State Water Board, in determining competency,
to consider demonstrated experience in managing and operating
a public water system.
4)Authorizes an administrator to expend moneys for
infrastructure, operation and maintenance, and to set and
collect water user rates and fees.
5)Defines "designated public water system" as a public water
system that serves a disadvantaged community and that the
SWRCB finds consistently fails to provide an adequate and
affordable supply of safe drinking water.
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6)Requires the SWRCB to meet specified critera, before it
determines that a public water system is a designated public
water system.
7)Requires the State Water Board to make financial assistance
available to an administrator for a designated public water
system, as appropriate and to the extent that funding is
available.
EXISTING LAW:
1)Establishes a state policy that every human being has the
right to safe, clean, affordable, and accessible water
adequate for human consumption, cooking, and sanitary
purposes.
2)Establishes the federal Safe Drinking Water Act (SDWA) and
sets standards for drinking water quality.
3)Requires the SWRCB to regulate drinking water and to enforce
the federal SDWA.
4)Requires the SWRCB, in administering the SDWA programs to fund
improvements and expansions of small community water systems,
to encourage the consolidation of small community water
systems that serve disadvantaged communities, and prioritize
funding for construction projects that involve the physical
restructuring of two or more community water systems, at least
one of which is a small community water system that serves a
disadvantaged community, into a single, consolidated system.
5)Authorizes the SWRCB, where a public water system or a state
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small water system within a disadvantaged community,
consistently fails to provide an adequate supply of safe
drinking water, to order consolidation with a receiving water
system.
6)Limits the liability of a consolidated water system,
wholesaler, or any other agency in the chain of distribution
that delivers water to a consolidated water system, as
specified.
FISCAL EFFECT: Unknown.
COMMENTS: Authorizes the SWRCB to contract with an
administrator to provide administrative and managerial services
to a designated public water system, as defined, to assist with
the provision of an adequate and affordable supply of safe
drinking water.
1)Author's Statement: California is the 6th largest economy of
the world, it is unconscionable that so many Californians -
most especially people living in disadvantaged communities -
are living in Third World conditions without water.
California took a bold step last year by authorizing the State
Board to consolidate water systems that fail to deliver
drinkable water - and SB 552 is a tool that the State Water
Board may use to be more efficient. A third party
administrator will bring stability to the water system and the
community, and long-term sustainability to the water supply
for disadvantaged communities.
2)Background: California has a challenge providing safe
drinking water to all of its residents. The SWRCB is
responsible for the state's drinking water program and
estimates that 500 communities rely on public water systems
that do not meet drinking water standards. We do not know
exactly how many Californians lack access to safe drinking
water on a daily basis, but it is on the order of millions of
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people. Drinking water contamination disproportionally
affects disadvantaged communities that rely on groundwater as
their drinking water source. Many small communities do not
have the technical, managerial, or financial capability to
operate what can be complex drinking water systems.
For many years through various means, but primarily through
financial incentive or prioritization, the state has
encouraged voluntary consolidation of public water systems.
SB 88 (Committee on Budget), Chapter 27, Statues of 2015, for
the first time, authorized the SWRCB to require certain water
systems that consistently fail to provide safe drinking water,
to consolidate with, or receive an extension of service from,
another public water system.
The SB 88 provisions that authorized public water system
consolidation was largely built off of recommendations in the
Governor's "Resilient, Affordable, Safe Drinking Water for
Disadvantaged Communities Framework", which was released May
2015. The framework specifically laid out three steps to
ensure every Californian has access to an adequate supply of
safe water for daily needs. The first two steps to improve
technical, managerial, and financial capacity and to implement
consolidation if improvements are not effective were part of
SB 88. The third step of contracting with a third party to
manage the system to allow for it to be brought up to a
sustainable condition was not included and is embodied in this
bill.
Additional approach to correct drinking water system failures:
This bill creates an additional tool for addressing lack of
safe drinking water by authorizing the SWRCB to identify
public water systems that are consistently unable to provide
sufficient safe drinking water and to contract with a
competent administrator. The SWRCB notes that the use of a
contracted entity, would provide technical and managerial
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capacity, economies of scale, and other efficiencies.
3)Prior and Related Legislation:
a) SB 1263 (Wiekowski), would enhance the process for
evaluation of the creation of a new drinking water
system. To be heard in this committee on June 28, 2016.
b) SB 88 (Committee on Budget), Chapter 27, Statues of
2015, authorizes the SWRCB to order water system
consolidation or extension of services.
1)Supporting and Support If Amended Arguments: This bill will
grant the SWRCB the authority to order a water system which is
consistently failing to provide safe drinking water to accept
a contract administrator. This is an important tool for the
SWRCB to have. There are many systems which may not be
candidates for physical consolidation but could begin
providing safe drinking water to their customers with new
management. While this could be an important and effective
tool there should be more clarity provided to available
funding, a public process, an affordability analysis, and a
long-term sustainability plan when an administrator is used.
2)Opposing Arguments: This bill does not specify what entity
would be responsible for costs associated with the required
administrative and managerial services in the bill. There is
a lack of specificity in the bill relating to funding of the
required administrative services and whether the administrator
would be subject to Proposition 218. This bill does specify
that customers of a subsumed water system may not be charged
an additional fee beyond the costs of the consolidation
itself. As the current structure of the bill offers no
funding for the predictable increase in operation,
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maintenance, and administrative expenses, this bill would
place an undue burden on the receiving water system. Safe
drinking water is a right of every Californian, but it is a
cost that should not be paid in full by public water agencies.
REGISTERED SUPPORT / OPPOSITION:
Support
California Catholic Conference of Bishops
Clean Water Action (if amended)
Community Water Center (if amended)
RCAC (if amended)
Self-Help Enterprises (if amended)
Opposition
Association of California Water Agencies
California Municipal Utilities Association
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Regional Water Authority
Analysis Prepared by:Ryan Ojakian / W., P., & W. / (916)
319-2096