BILL ANALYSIS                                                                                                                                                                                                    Ó




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          |SENATE RULES COMMITTEE            |                        SB 554|
          |Office of Senate Floor Analyses   |                              |
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                                        VETO 


          Bill No:  SB 554
          Author:   Wolk (D) 
          Amended:  8/17/16  
          Vote:     21 

           SENATE NATURAL RES. & WATER COMMITTEE:  9-0, 1/12/16
           AYES:  Pavley, Stone, Allen, Hertzberg, Hueso, Jackson,  
            Monning, Vidak, Wolk

           SENATE APPROPRIATIONS COMMITTEE:  7-0, 1/21/16
           AYES:  Lara, Bates, Beall, Hill, Leyva, Mendoza, Nielsen

           SENATE FLOOR:  39-0, 1/27/16
           AYES:  Allen, Anderson, Bates, Beall, Block, Cannella, De León,  
            Fuller, Gaines, Galgiani, Glazer, Hall, Hancock, Hernandez,  
            Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno, Leyva, Liu,  
            McGuire, Mendoza, Mitchell, Monning, Moorlach, Morrell,  
            Nguyen, Nielsen, Pan, Pavley, Roth, Runner, Stone, Vidak,  
            Wieckowski, Wolk
           NO VOTE RECORDED:  Berryhill

           SENATE FLOOR:  36-3, 8/26/16
           AYES:  Allen, Anderson, Beall, Berryhill, Block, Cannella, De  
            León, Fuller, Gaines, Galgiani, Glazer, Hall, Hancock,  
            Hernandez, Hertzberg, Hill, Hueso, Huff, Jackson, Lara, Leno,  
            Leyva, Liu, McGuire, Mendoza, Mitchell, Monning, Moorlach,  
            Nielsen, Pan, Pavley, Roth, Stone, Vidak, Wieckowski, Wolk
           NOES:  Bates, Morrell, Nguyen

           ASSEMBLY FLOOR:  72-4, 8/24/16 - See last page for vote

           SUBJECT:   Delta levee maintenance


          SOURCE:    Central Valley Flood Control Association








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          DIGEST:  This bill extends the July 1, 2018, sunset date for the  
          Delta Levee Subventions program by two years.  Specifically,  
          this bill maintains the state's 75% maximum share for Delta  
          levee maintenance costs in excess of $1,000 per mile until July  
          1, 2020.


          ANALYSIS:


          Existing law:


          1)Creates the Delta levee maintenance subvention program.  This  
            program provides reimbursement funds to local agencies for  
            costs of maintaining or improving project or nonproject  
            levees.


          2)Provides that the reimbursement rate is up to 75 percent of  
            any costs incurred in excess of $1,000 per mile, based on an  
            assessment of the agency's ability to pay.  


          3)Provides that the 75 percent reimbursement rate ends July 1,  
            2018, at which time the reimbursement rate would become 50  
            percent of any costs incurred in excess of $1,000 per mile.  


          This bill extends the current 75 percent reimbursement rate for  
          Delta levee maintenance costs in excess of $1,000 per mile to  
          July 1, 2020.  


          Background


          Legislature has extended the 75 percent reimbursement rate three  
          times.  The Legislature created the Delta levee subvention  
          program in 1996.  The 75 percent reimbursement rate was to be in  








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                                                                    Page  3



          effect for 10 years, at which time the rate would drop to 50  
          percent.  The Legislature has subsequently delayed the reduction  
          in the reimbursement rate in 2006, 2010, and 2012.


          Comments


          One of the few Delta bright spots.  The 2010 Public Policy  
          Institute of California publication Comparing Futures for the  
          Sacramento - San Joaquin Delta noted, "The Delta Levee  
          Subventions Program, in particular, has significantly reduced  
          levee failures and is the most important state investments in  
          Delta levees today."  It is still true five years later.   
          Moreover, it is also one of the few Delta programs that have  
          shown tangible results.


          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   No


          According to the Assembly Appropriations Committee, "Potential  
          annual cost pressures, likely in the millions of dollars (GF),  
          to fund local projects to improve and maintain levees.  Without  
          this bill, the state cost share formula would decrease from 75%  
          to 50% on July 1, 2018."


          SUPPORT:   (Verified10/6/16)


          Central Valley Flood Control Association (source)
          Association of California Water Agencies
          Bethel Island Municipal Improvement District
          California State Association of Counties
          Collinsville Levee District
          Contra Costa County
          Delta Counties Coalition
          Delta Protection Commission
          East Bay Municipal Utilities Commission
          Reclamation District No. 3








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          Reclamation District No. 150
          Reclamation District No. 548
          Reclamation District No. 756
          Reclamation District No. 799
          Reclamation District No. 2025
          Reclamation District No. 2026
          Reclamation District No. 2028
          Reclamation District No. 2029
          Reclamation District No. 2041
          Reclamation District No. 2044
          Reclamation District No. 2060
          Reclamation District No. 2065
          Rural County Representatives of California
          San Joaquin County
          Solano County
          Solano County Farm Bureau
          Yolo County Farm Bureau


          OPPOSITION:   (Verified10/6/16)


          Calleguas Municipal Water District
          Cucamonga Valley Water District
          East Orange County Water District
          Eastern Municipal Water District
          Inland Empire Utilities Agency
          Las Virgenes Municipal Water District
          Long Beach Water Commission
          Mesa Water District
          Metropolitan Water District of Southern California
          Municipal Water District of Orange County
          Santa Margarita Water District
          South Coast Water District
          Three Valleys Municipal Water District
          Upper San Gabriel Valley Municipal Water District
          Walnut Valley Water District
          Yorba Linda Water District

          ARGUMENTS IN SUPPORT:  According to the author, "By continuing  
          the current cost share formula, SB 554 ensures that Delta  
          reclamation districts can afford to maintain and improve Delta  








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          levees. Maintenance of the Delta levees is important to reduce  
          flood risk and ensure the Delta can continue to serve its many  
          valuable uses - as fertile farmland, a water conveyance, and a  
          rich estuary ecosystem."


          ARGUMENTS IN OPPOSITION:     According to a coalition of  
          Southern California water agencies, "We recommend that a further  
          amendment be made to SB 554 to direct DWR to enlist an  
          independent entity, with financial expertise, to conduct an  
          affordability and benefits assessment for the Delta Levee  
          Subventions Program. It is simply unclear which Delta islands,  
          if any, lack the economic standing to underwrite their own levee  
          maintenance, and whether statewide interests merit a public  
          subsidy for those levee improvements.


          "We, the undersigned agree with the author, that levee  
          improvements in the Delta are important to protect public health  
          and safety, critical infrastructure and the fragile ecosystem.  
          But it is also important to ensure the best use of limited state  
          resources. An assessment of the program and accountability for  
          the level of funding expended to date and in the future is long  
          overdue.


          "Absent the further amendment as noted above, we urge your NO  
          vote on SB 554."


          GOVERNOR'S VETO MESSAGE:


               I am returning Senate Bill 554 without my signature.

               A number of efforts are underway to determine the levee  
               protection needs in the Delta.  The Delta Stewardship  
               Council is currently in the middle of identifying state  
               priorities for levee investments in the Delta, and the  
               Department of Water Resources has been working with the  
               Delta Protection Commission evaluating new financing  
               mechanisms. 








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               The existing 75 percent state cost share does not sunset  
               until July 2018, and as such, consideration of this bill is  
               premature.


          ASSEMBLY FLOOR:  72-4, 8/24/16
          AYES:  Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,  
            Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos,  
            Chang, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle,  
            Dodd, Eggman, Frazier, Beth Gaines, Gallagher, Cristina  
            Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez,  
            Gordon, Gray, Grove, Hadley, Roger Hernández, Holden, Jones,  
            Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low,  
            Maienschein, Mathis, Mayes, McCarty, Medina, Mullin, Nazarian,  
            Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas,  
            Salas, Santiago, Mark Stone, Thurmond, Ting, Wagner, Waldron,  
            Weber, Wilk, Williams, Wood, Rendon
          NOES:  Bigelow, Harper, Irwin, Melendez
          NO VOTE RECORDED:  Chau, Daly, Rodriguez, Steinorth


          Prepared by:Dennis O'Connor / N.R. & W. / (916) 651-4116
          10/14/16 12:54:08


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