BILL ANALYSIS Ó SENATE COMMITTEE ON GOVERNANCE AND FINANCE Senator Robert M. Hertzberg, Chair 2015 - 2016 Regular ------------------------------------------------------------------ |Bill No: |SB 1378 |Hearing |5/4/16 | | | |Date: | | |----------+---------------------------------+-----------+---------| |Author: |Morrell |Tax Levy: |No | |----------+---------------------------------+-----------+---------| |Version: |4/25/16 Amended |Fiscal: |No | ------------------------------------------------------------------ ----------------------------------------------------------------- |Consultant|Weinberger | |: | | ----------------------------------------------------------------- San Gorgonio Pass Water Agency: board of directors Reduces, from seven to five members, the size of the San Gorgonio Pass Water Agency's Board of Directors by eliminating two at-large elected director seats on the board. Background The San Gorgonio Pass Water Agency (SGPWA) is a state water project contractor established by the enactment of the San Gorgonio Pass Water Agency Act (AB 2655, Cologne, 1961). The Agency delivers wholesale water and provides groundwater management services within an approximately 225 square mile service area that encompasses the cities of Banning, Beaumont, and Calimesa in Riverside County. SGPWA is governed by an elected seven member board of directors. Five directors are elected to represent divisions within the agency's boundaries, while two are elected at-large. Each director is elected for a four-year term. Currently, one of the at-large seats on the agency's board is held by a director who was appointed last year to fill a vacancy and the other at-large seat is held by a director whose four-year term end this year. As a result, both seats will be on this November's general election ballot. In recent years, the agency's board of directors has considered eliminating the two at-large directors' seats as a cost-saving measure. On July SB 1378 (Morrell) 4/25/16 Page 2 of ? 6, 2015, SGPWA's Board of Directors voted 6-0 to approve a resolution supporting a reduction in the board's size to five members and directing SGPWA's general manager to pursue legislation to reduce the board's size. Proposed Law Senate Bill 1378 amends the San Gorgonio Pass Water Agency Act to reduce, from seven to five members, the size of SGPWA's Board of Directors by deleting statutory language requiring the board to include two directors elected at-large and making other conforming statutory changes. State Revenue Impact No estimate. Comments 1. Purpose of the bill . Since at least 2011, the SGPWA's board has considered the possibility of saving costs by reducing the governing board's size. By eliminating the two-at large directors positions, SGPWA anticipates that significant cost saving will result from lower election costs for its board of directors. The Agency may realize additional savings from reduced payments to board members for meetings, travel, education, and medical reimbursements. Background information provided to SGPWA's board members last year estimated that "cost savings to the taxpayers with two fewer directors will be more than $425,000 over the next 10 years." SB 1378 brings the size of SGPWA's governing in line with many other special districts' five-member boards and, in doing so, generates much-needed cost savings for district residents. 2. Let the voters decide ? SGPWA's existing governing board structure allows each voter within the Agency's boundaries to be represented by three of the Agency's seven elected directors (one elected to represent the district in which a voter resides and two elected at-large to represent all voters). By eliminating the two-at-large directors' offices, SB 1378 could be seen by some voters as reducing their representation on the SB 1378 (Morrell) 4/25/16 Page 3 of ? board and, therefore, their ability to influence the board's decisions. While increasing efficiency and reducing public expenditures are worthwhile goals, it is unclear whether SGPWA's voters are willing to achieve this goal by potentially eroding their ability to hold board members accountable through the ballot. The Committee may wish to consider amending SB 1378 to require SGPWA to seek its voters' approval to eliminate the two at-large elected director position on its governing board. 3. Timing is everything . As a regular statute, SB 1378 would take effect on January 1, 2017 if it is enacted. As a result, the SGPWA will need to fill the two at-large elected director offices in 2016, regardless of whether or not SB 1378 is enacted. If SB 1378 is enacted, it is ambiguous whether the two at-large directors would vacate their offices immediately on January1, 2017, or whether they would hold those offices for the duration of their terms. The California Constitution allows bills with urgency clauses to take effect immediately if they're needed for the public peace, health, and safety. However, the California Constitution prohibits an urgency statutes from abolishing any office (Article IV, §8(d)), so SB 1378 cannot take effect before the at-large director's terms expire this year. 4. Let's get technical . The Committee may wish to consider amending SB 1378 to add quotation marks after the period on page 2, line 19 of the bill. Support and Opposition (4/28/16) Support : San Gorgonio Pass Water Agency. Opposition : Unknown. -- END -- SB 1378 (Morrell) 4/25/16 Page 4 of ?