BILL ANALYSIS Ó
SENATE COMMITTEE ON GOVERNANCE AND FINANCE
Senator Robert M. Hertzberg, Chair
2015 - 2016 Regular
------------------------------------------------------------------
|Bill No: |SB 1318 |Hearing |4/6/16 |
| | |Date: | |
|----------+---------------------------------+-----------+---------|
|Author: |Wolk |Tax Levy: |No |
|----------+---------------------------------+-----------+---------|
|Version: |3/28/16 |Fiscal: |Yes |
------------------------------------------------------------------
-----------------------------------------------------------------
|Consultant|Favorini-Csorba |
|: | |
-----------------------------------------------------------------
Local government: drinking water infrastructure or services:
wastewater infrastructure or services
Prohibits a LAFCO from updating the sphere of influence of, or
authorizing the extension of services by, a city or qualified
special district if nearby disadvantaged unincorporated
communities lack safe drinking water or adequate wastewater
services.
Background
The Cortese-Knox-Hertzberg Act creates a local agency formation
commission (LAFCO) in each county to control the boundaries of
cities, county service areas, and most special districts. The
courts repeatedly refer to LAFCOs as the Legislature's watchdog
over boundary changes. To plan for the future boundaries and
service areas of the cities and special districts, a LAFCO must
adopt a policy document for each city and district called a
sphere of influence. The LAFCOs' boundary decisions must be
consistent with the spheres of influence of the affected cities
or districts. Spheres must be updated at least every five
years.
In order to determine spheres of influence, LAFCOs must
periodically conduct a "municipal service review" (MSR) to
inform their decisions about spheres of influence. MSRs must
analyze and make determinations about seven topics:
SB 1318 (Wolk) 3/28/16 Page 2
of ?
Growth and population projections;
Present and planned capacity of public facilities and
adequacy of public services, including infrastructure needs
or deficiencies, including the water, sewer, and fire
protection needs of disadvantaged unincorporated
communities;
Agencies' financial abilities to provide services;
Opportunities for sharing facilities;
Accountability for community service needs;
The location and characteristics of any disadvantaged
unincorporated communities; and
Other matters relating to effective or efficient
services.
Local governments can only exercise their powers and provide
services where LAFCO allows them to: within their boundaries
(which are set by LAFCO), within their spheres of influence but
outside their boundaries (with authorization by LAFCO), and
outside their spheres to address a major threat to public health
if the extension is consistent with LAFCO's policies. In 2015,
the Legislature approved AB 402 (Dodd), which established a
pilot program in Napa County and San Bernardino County that
allowed the extension of services outside a local agency's
sphere of influence to support existing or planned uses, so long
as (1) a MSR has identified a service deficiency, (2) the
extension of service will not result in growth inducing impacts
or harm to agricultural lands, and (3) a sphere of influence
change is not feasible.
LAFCOs, along with the planning agencies of cities and counties,
are supposed to ensure that services are effectively and
efficiently delivered to all communities throughout the state.
Nevertheless, some communities continue to lack adequate public
services, including safe drinking water and functioning
wastewater systems. These communities are often poor and are
located in the unincorporated area of a county. In some cases
these "disadvantaged unincorporated communities" (DUCs) are
SB 1318 (Wolk) 3/28/16 Page 3
of ?
remote and far from other communities with better public
services; in others, a city may share a border with a DUC that
has been excluded from its boundaries.
In recent years, the Legislature has taken several steps to try
to address some of the service problems experienced by DUCs. SB
244 (Wolk, 2011) aimed to prevent cities from carving out DUCs
by prohibiting annexations to a city of territory greater than
10 acres if a DUC is contiguous with the territory proposed for
annexation, unless there is an application with the commission
to annex the unincorporated area or if the residents of the
affected territory oppose annexation. SB 244 also required
LAFCOs to include in the MSR a description of the location and
characteristics of any DUCs within or contiguous to the sphere
of influence and to consider the water, sewer, or fire
protection needs of DUCs within the sphere when considering
updates. When conducting an MSR, LAFCOs can also assess options
for governmental reorganizations or consolidations that improve
the efficiency and affordability of service delivery and can
review whether water systems in the area are in compliance with
the Safe Drinking Water Act. Finally, SB 244 required cities and
counties to review the water and fire service needs of DUCs in
their general plans.
SB 244 made it easier for LAFCOs to identify boundary changes
and governmental reorganizations necessary to fix water service
problems faced by DUCs. Subsequent legislation-SB 88 (Committee
on Budget and Fiscal Review, 2015)-took this effort a step
further by authorizing the State Water Resources Control Board
(SWRCB) to order a consolidation of neighboring water systems
where it is economically feasible in order to address public
health threats. To date, SWRCB has begun the consolidation
process with two water systems in communities that border the
city of Tulare.
Some advocates for disadvantaged unincorporated communities want
to provide additional incentives for local governments to serve
DUCs that lack safe drinking water or adequate wastewater
service.
Proposed Law
Senate Bill 1318 restricts the cases where a LAFCO can update a
SB 1318 (Wolk) 3/28/16 Page 4
of ?
sphere of influence or authorize an extension of service.
Specifically, the bill prohibits a LAFCO from updating the
sphere of influence for a city or a special district, if the
district has over 500 connections and provides either drinking
water or wastewater services, until the city or special district
has entered into an enforceable agreement to extend those
services to all disadvantaged unincorporated communities within
its sphere of influence or adjacent to its jurisdictional
boundaries, if they lack safe drinking water or adequate
wastewater services. The services must be extended to the
disadvantaged communities within five years of the approval of
the sphere of influence update, or sooner if feasible. However,
LAFCO may authorize the service extension if the LAFCO finds,
based on written evidence, that a majority of the residents of
the relevant disadvantaged communities are opposed to receiving
those services. If the LAFCO finds that the residents are
opposed, those findings cannot interfere with the SWRCB's
authority under SB 88 or other efforts to expand services.
SB 1318 also prohibits a LAFCO from authorizing a city or a
special district, regardless of size, to extend drinking water
or wastewater services as provided in the Cortese-Knox-Hertzberg
Act until the city or special district has entered into an
enforceable agreement to extend those services to all
disadvantaged communities-whether incorporated or
unincorporated-within its sphere of influence or adjacent to its
jurisdictional boundaries that lack safe drinking water or
adequate wastewater services. The services must be extended to
the disadvantaged communities within five years, or sooner if
feasible. However, LAFCO may authorize the service extension if
any of the following conditions apply:
The LAFCO finds, based on written evidence, that a
majority of the residents of the relevant disadvantaged
communities are opposed to receiving those services. If
the LAFCO finds that the residents are opposed, those
findings cannot interfere with the SWRCB's authority under
SB 88 or other efforts to expand services;
The extension of services is authorized to respond to an
existing or impending threat to the health or safety of the
public; or
The extension of services is to a disadvantaged
SB 1318 (Wolk) 3/28/16 Page 5
of ?
community.
A similar prohibition and exceptions apply to extensions of
services authorized under the pilot program in Napa County and
San Bernardino County.
SB 1318 further prohibits annexations of territory greater than
10 acres to city or a special district, if the district provides
water or wastewater services to more than 500 connections, where
there exists either (1) a DUC contiguous to the territory
proposed for annexation, or (2) a DUC within the city or
district's sphere of influence or adjacent to its boundaries
that lacks safe drinking water or adequate wastewater services,
with the same exceptions as provided elsewhere in the bill for
prohibitions on extensions of services. It also prohibits
LAFCOs from removing a disadvantaged community from the sphere
of a city or special district unless it finds that the removal
would improve service delivery to the community.
SB 1318 places additional responsibilities on LAFCOs as they
review and update spheres of influence. Specifically, the bill
requires the periodic review of the spheres of influence of any
city or special district that provides water, wastewater, or
structural fire protection services to consider the need for
those services of DUCs adjacent to its sphere. It also makes
mandatory several currently optional LAFCO processes and
studies, including to:
Review government reorganizations for potential
improvements to service delivery;
Recommend reorganization where feasible;
Review alternatives for improving the efficiency and
affordability of service delivery within or contiguous with
the sphere being reviewed if there is a DUC that lacks
adequate drinking water and waste water services; and
Review water systems in the area for compliance with the
Safe Drinking Water Act, if the information is available.
SB 1318 (Wolk) 3/28/16 Page 6
of ?
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill. Many communities in California continue
to suffer from third-world level drinking water and wastewater
services. In many cases, these communities' border cities or
special districts with more than enough capacity to serve them,
but their boundaries have been drawn to specifically exclude
them. Despite recent legislative efforts, some cities continue
to look to serve new development outside of their current
boundaries before helping neighboring communities. While SB 244
helped highlight the disparity in services for DUCs, stronger
measures are needed to ensure that LAFCOs and local governments
faithfully carry out their responsibilities. SB 1318 is simply
the next step. It incentivizes cities and special districts
that want to serve new development to help meet the needs of
existing communities with drinking water and wastewater
problems, and codifies best practices that conscientious LAFCOs
already follow. SB 1318 won't solve all of the problems of
DUCs, but it provides an important tool to get the state closer
to its goal of ensuring that all Californians have access to
safe, affordable drinking water.
2. An offer they can't refuse . A viable development needs
certain services, including drinking water and wastewater, but a
local government can only provide those services where LAFCO
lets them. By restricting the ability of LAFCO to approve
service extensions or sphere of influence updates, SB 1318
essentially conditions new development on the provision of
services to other unrelated communities, regardless of whether
there is any causal link or nexus between a proposed sphere
change or extension of services and the DUC that lacks drinking
water or wastewater. Courts have found that there may be an
unconstitutional taking when government requires development
fees or exactions that don't bear a reasonable relationship to
the conditions created by the new development. In addition,
anti-development forces may abuse the provisions of SB 1318 to
stop new housing or other facilities that they don't like.
Instead of providing third parties with leverage to try to force
cities and special districts to serve DUCs, it may be more
SB 1318 (Wolk) 3/28/16 Page 7
of ?
appropriate to directly require cities and counties, through the
general planning process, to ensure that these communities have
access to sustainable services.
3. Different strokes . California is a diverse state, with many
unique communities and considerations. Many of the communities
that lack safe drinking water are located in rural areas of
sparsely populated counties. But the bill would apply
statewide. There may be unintended consequences-such as a
freezing of spheres of influence and jurisdictional
boundaries-in densely populated urban counties such as Los
Angeles or the San Francisco Bay Area where DUCs are surrounded
by multiple cities and special districts. The very purpose of
LAFCOs is to take into account local conditions in determining
what services are provided where. The Committee may wish to
consider amending SB 1318 to apply only to parts of the state
where DUCs with water or wastewater inadequacies are known and
there are technically and economically feasible consolidations
that have been blocked for more parochial reasons.
4. Burden on LAFCOs . SB 1318 imposes a number of burdens on
LAFCOs that they may not have the resources to pursue, including
potential elections or polling to perform sphere updates,
mandatory studies of territory outside of an agency's sphere,
and mandatory assessments of alternatives for communities that
lack adequate drinking water or wastewater. Cities, counties,
and special districts fund LAFCO operations, but many of those
agencies are still recovering from the recession. Is now the
right time to impose additional financial responsibilities on
local agencies that are just getting to their feet?
5. Mandate . The California Constitution generally requires the
state to reimburse local agencies for their costs when the state
imposes new programs or additional duties on them. According to
the Legislative Counsel's Office, SB 1318 creates a new
state-mandated local program. SB 1318 provides that if the
Commission on State Mandates determines that the bill contains
state-mandated costs, reimbursement to local agencies must be
made according to an existing process in state law.
6. Double-referred . The Senate Rules Committee has ordered a
double-referral of SB 1318-first to the Senate Governance &
Finance Committee, which has jurisdiction over bills relating to
LAFCOs and local government services, and then to the Senate
SB 1318 (Wolk) 3/28/16 Page 8
of ?
Environmental Quality Committee, which has jurisdiction over
bills relating to drinking water and wastewater.
7. Let's be clear . The Committee may wish to consider two
clarifying amendments that correct errors to further the intent
of the bill:
Standardize references to "disadvantaged unincorporated
communities" throughout the bill. Some provisions of the
bill refer instead to disadvantaged communities, which
could include incorporated areas that are already within
the sphere of a city or special district.
Ensure that 56133(h) does not prevent cities which do
not provide water or wastewater services from updating
their spheres of influence. Some cities receive services
by contract, and thus could be prevented from changing
their spheres even though they are not able to remedy
nearby water problems. Similarly, one reference to
"district" in the same section is missing the modifier
"qualifying," which is necessary to restrict the bill's
applicability to districts that provide water or wastewater
services.
Support and
Opposition (3/31/2016)
Support : Leadership Counsel for Justice and Accountability
(co-sponsor); California Food Policy Advocates; California
League of Conservation Voters; California Rural Legal Assistance
Foundation; Central California Asthma Collaborative; Clean Water
Action; Community Water Center; Environmental Justice Coalition;
Environmental Working Group; Natural Resources Defense Council;
Policy Link; Pueblo Unido Community Development Coalition; Rural
Communities Assistance Foundation; San Joaquin Valley
Sustainable Agriculture Collaborative; Sequoia Riverlands Trust;
Sierra Club California.
Opposition : California Apartment Association; California
Association of Local Agency Formation Commissions; California
Association of Realtors; California Building Industries
Association; California Business Properties Association;
SB 1318 (Wolk) 3/28/16 Page 9
of ?
California Chamber of Commerce; California Manufacturers and
Technology Association; California Municipal Utilities
Association; California Special Districts Association; Contra
Costa LAFCO; El Dorado LAFCO; League of California Cities;
Nevada County LAFCO; Riverside LAFCO; San Bernardino County
LAFCO; San Diego LAFCO; San Luis Obispo LAFCO; San Mateo LAFCO;
Sonoma LAFCO.
-- END --