BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     SB 552  


                                                                    Page  1





          Date of Hearing:  August 3, 2016


                        ASSEMBLY COMMITTEE ON APPROPRIATIONS


                               Lorena Gonzalez, Chair


          SB 552  
          (Wolk) - As Amended August 1, 2016


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          |Policy       |Environmental Safety and Toxic |Vote:|4-2          |
          |Committee:   |Materials                      |     |             |
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          |             |Water, Parks and Wildlife      |     |10- 5        |
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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          SUMMARY:


          This bill revises the authority of the State Water Resources  
          Control Board (SWRCB) with regard to public water system (PWS)  
          consolidation and authorizes SWRCB to provide administrative and  
          managerial services to the PWS, as specified.  Specifically,  
          this bill: 


          1)   Updates and clarifies several provisions of law on water  








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          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:



             a)   Contract with an administrator 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.



             b)   Order the designated PWS to accept administrative and  
               managerial services, including full management and control,  
               from an administrator selected by SWRCB.
          


          FISCAL EFFECT:


          1)Unknown, potentially significant costs, depending upon the  
            number of PWSs placed under the control of, or provided  
            assistance by, an administrator, as well as the extent and  
            duration of the assistance.  This bill does not identify a  
            funding source.


          2)According to the California Public Utilities Commission (PUC),  
            there will be increased annual costs of approximately $130,000  
            to assist SWRCB in determining the fair market value of a  
            privately-owned PWS for consolidation purposes.  However, it  
            is unclear if this bill actually increases costs or if the  
            costs are associated with the recently enacted consolidation  








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            legislation.


          COMMENTS:


          1)Purpose.  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 contracting with an  
            administrator would provide technical and managerial capacity,  
            economies of scale, and other efficiencies.  


            According to the author, California is the 6th largest economy  
            of the world, and it is unconscionable that so many  
            Californians are living in Third World conditions without  
            water. The author further contends that 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.  Last year, SB 88 (Committee on Budget), Chapter  
            27, Statues of 2015,  authorized 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 consolidation provisions were largely based on  
            recommendations in the Governor's "Resilient, Affordable, Safe  
            Drinking Water for Disadvantaged Communities Framework", which  
            was released May 2015.  The framework identified three steps  
            to ensure every Californian has access to an adequate supply  
            of safe water to meet daily needs.  










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            The first two steps to improve technical, managerial, and  
            financial capacity and to implement consolidation if  
            improvements are not effective were contained in 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 is included in this bill.





          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)  
          319-2081