BILL ANALYSIS Ó
SB 555
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Date of Hearing: July 14, 2015
ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE
Marc Levine, Chair
SB
555 (Wolk) - As Amended July 7, 2015
SENATE VOTE: 36-2
SUBJECT: Urban retail water suppliers: water loss management.
SUMMARY: Requires each urban retail water supplier, on or
before July 1, 2017, and annually thereafter, to submit annual
water loss audit (WLA) reports to the Department of Water
Resources (DWR) as specified and requires DWR to post such WLAs
and provide technical assistance. Specifically, this bill:
1)Requires DWR, by January 1, 2017, to adopt rules for
standardizing and validating WLAs, including the method for
submitting WLAs, and to update those rules within six months
of a release of subsequent editions of the American Water
Works Association's (AWWA's) Water Audits and Loss Control
Programs Manual.
2)Requires DWR, as part of its rules, to specify the technical
qualifications required of a person performing validations and
the certification requirements for a person selected by an
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urban retail water supplier to provide validations of its own
water loss audit report.
3)Defines validating, for the purpose of this bill, to mean a
process whereby a technical expert, who is identified by name
and qualifications, engages with the urban retail water
supplier to confirm the quality and accuracy of the WLA report
data by following the principles and terminology set out in
the AWWA manual and free software.
4)Requires that on or before July 1, 2017, and annually
thereafter, that each urban retail water supplier shall submit
completed and validated WLA report for the previous calendar
year.
5)Requires the State Water Resources Control Board (State Water
Board), using available funds, to contribute up to $400,000
towards DWR's costs incurred in performing validations of
water loss audit reports for the 2016-17 fiscal year.
Thereafter requires the State Water Board to determine if
validations should be paid for using state funds or if urban
retail water suppliers should be solely responsible for their
own validation costs.
6)Requires each WLA report to be accompanied by information
identifying the steps taken to:
a) Increase the validity of data entered into the final
audit.
b) Reduce the volume of apparent losses.
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c) Reduce the volume of real losses.
7)Specifies that a chief financial officer, chief engineer, or
general manager of the urban retail water supplier shall
attest to the WLA.
8)Requires DWR to return incomplete, invalid, or unattested WLAs
to the urban retail water supplier for resubmission within 90
days.
9)Requires DWR to post all validated WLAs on its Internet Web
site and to otherwise make the WLAs available for public
viewing.
10)Requires DWR, using available funds, to provide technical
assistance to urban retail water suppliers regarding water
loss detection programs.
11)Requires the State Water Board, no earlier than January 1,
2019 and no later than July 1, 2020, to adopt rules requiring
urban retail water suppliers to meet performance standards for
the volume of water losses.
12)Requires the State Water Board to employ full life cycle cost
accounting to evaluate the costs of meeting the performance
standards.
EXISTING LAW:
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1)Requires all urban water suppliers to prepare and adopt UWMPs,
update them every five years, and submit them to the
Department of Water Resources. Among other requirements,
UWMPs must:
a) Provide a description of the service area of the
supplier;
b) Identify and quantify water resources; and,
c) Make water use projections.
2)Specifies that compliance with the Urban Water Management
Planning Act is a prerequisite to receiving state funding for
water projects and programs.
3)Requires, beginning with the 2015 update, that UWMPs contain a
calculation of the distribution system water losses.
4)Requires distribution system water losses to be reported in
accordance with a worksheet approved or developed by DWR using
water loss calculations that are based on the water system
balance methodology developed by the AWWA.
FISCAL EFFECT: According to the Senate Appropriations Committee
analysis:
1)One-time costs of $400,000 from the General Fund to DWR to
develop the rules guiding the water audit reports.
2)Unknown ongoing costs, but likely in the range of $150,000 to
$200,000, from the General Fund to review audits annually,
provide technical assistance to urban water suppliers, and
update the water audit report regulations every five years.
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COMMENTS: This bill seeks to increase water use efficiency by
requiring water suppliers to document and control water losses
from their systems through annual audit reports to DWR. This
bill also directs DWR to set audit standards and provide
technical assistance. This bill also requires the State Water
Board to provide funding for validation assistance to urban
water suppliers for the first audits due under this bill and
then to later adopt rules requiring urban retail water suppliers
to meet performance standards.
1)Author's statement: The author advises that California's water
supply is under intense pressure from climate change,
increasing population, and aging infrastructure. The
financial demands from communities around the state for
additional water and wastewater currently exceed the available
state and federal budgetary resources.
The author advises that "despite the availability of free
audit software and the establishment of a Best Management
Practice for water loss by the California Urban Water
Conservation Council (CUWCC), urban water suppliers have been
slow to realize the full potential of water loss control. One
reason for the slow adoption of water loss control methods is
the unreliability of water loss audit data. One CUWCC study
found that 35% of water audit data submitted by California
water suppliers was invalid."
The author concludes that by "requiring urban water suppliers
to report system audit results and directing DWR to set audit
standards, while providing the necessary technical assistance,
water suppliers will achieve effective water loss control and
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contribute to California's water management, climate
mitigation and climate adaption goals."
2)Background: According to the California Water Plan, in its
discussion on urban water use efficiency, "the amount of water
lost due to leakage in the distribution system of the State's
water suppliers is not well known. This is largely due to the
fact that not all water suppliers perform regular water loss
audits. If water audits are not conducted, it is difficult for
a water agency to know the extent of its losses and unlikely
that the agency will implement practices to reduce these
losses."
3)Prior and related legislation: SB 1420 (Wolk), Chapter 490,
Statutes of 2014 requires, among other provisions, that
beginning with the 2015 update UWMPs are to contain a
calculation of the distribution system water losses.
4)Supporting arguments: Supporters state that water lost from
leaks and breaks in urban water suppliers' distribution
systems is a significant problem in California. Supporters
add that a 2010 study conducted for the California Public
Utilities Commission estimated that 10% of urban water
(870,000 acre-feet) is lost to leaks and that 40% of that
water (350,000 acre-feet) could be cost-effectively recovered
through pressure management, leak repair, and targeted pipe
replacement. Other supporters state that conducting annual
water loss audits will help California achieve its goal of
reducing urban water use 20% by 2020 and that water
conservation is a key strategy to make the best use of our
limited water supplies.
5)Opposing arguments: Opponents are concerned that this bill
does not take into consideration the cost-effectiveness of
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eliminating water loss or validating water loss surveys.
Opponents request a definition for the term "validation" and a
percentage "floor" of calculated water loss that once met
would allow an urban retail water supplier to "be exempt from
providing specified information supplemental to the validated
water loss survey." Opponents want a "cap on the
requirement to continually improve the validity of the water
audit" and a requirement that water audit "survey must focus
on reducing real as opposed to apparent water losses."
6)Suggested Committee amendments: Committee staff suggests
amendments that achieve the following five corrections and
improvements. These amendments, which are attached in mockup
form:
a) Remove language indicating a technical expert performing
a validation of a WLA report would "engage with" an urban
retail water supplier. The use of the term "engage with"
was misinterpreted by stakeholders to infer that a
technical expert performing an audit must be an external
third party to the urban retail water supplier. This bill
states that DWR will provide rules regarding certification
for a person selected by an urban retail water supplier.
That language is intended to provide the urban retail water
supplier the choice of using a qualified expert who is
either employed in-house by the urban retail water
supplier, if one is available, or a third-party.
b) Clarify that relying on the AWWA manual and software
cited in this bill as the basis for validation principles
and terminology also incorporates any updates or revisions
of those resources.
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c) Delete a redundant and confusing reference to DWR
adopting rules regarding the "timing" for submitting
validated WLA reports. The timing for submitting the
reports is already specified in this bill.
d) Extend the date for when the first validated WLA report
is due to October 1, 2017. This allows for additional time
after DWR adopts rules on January 1, 2017 for urban retail
water suppliers to complete and validate WLA reports.
e) Specify that by October 1, 2016 the State Water Board
will fund and provide WLA report validation assistance to
urban retail water suppliers. This change is meant to
achieve two goals: i) streamline the WLA report validation
assistance process by having the State Water Board, who is
the funding agency, directly obtain or provide the
assistance; and, ii) establish a deadline by which the
assistance will be made available so that urban retail
water suppliers are provided up to a year to avail
themselves of the assistance before their validated WLA
report is due.
REGISTERED SUPPORT / OPPOSITION:
Support
California League of Conservation Voters
Clean Water Action
Dignity Health
Gap Inc.
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MillerCoors
Natural Resources Defense Council
San Diego County Water Authority
Sierra Club California
Sierra Nevada Brewing Company
Sonoma County Water Agency
Symantec
The Coca Cola Company
Opposition
Association of California Water Agencies (unless amended)
California Municipal Utilities Association (unless amended)
Analysis Prepared by:Tina Leahy / W., P., & W. / (916)
319-2096