BILL ANALYSIS SENATE COMMITTEE ON AGRICULTURE AND WATER RESOURCES Jim Costa, Chairman SB60 (Hayden) As Introduced Hearing Date: March 2, 1999 Fiscal: Yes Consultant: Dan Webb PURPOSE OF BILL: To enact fiscal, ethical, and environmental reforms relative to the Metropolitan Water District of Southern California. BACKGROUND: The Metropolitan Water District Act authorizes the creation of metropolitan water districts for the purpose of developing, storing, and distributing water for municipal and domestic purposes. The only district organized under this act is the Metropolitan Water District of Southern California (MWD). The MWD wholesales water to 27 member agencies and serves nearly 16 million people in Southern California. The district's water sources include the Colorado River via the Colorado River Aqueduct, the north state via the California Aqueduct, the east side of the Sierra via the Los Angeles Aqueduct, supplies gained through water transfers, and local supplies resulting from conservation, recycling, and groundwater recovery. In recent years, tensions within the MWD family and relations with its neighbors and the Legislature resulted in the appointment of a Senate Select Committee on Southern California Water Districts Expenditures and Governance. The committee is in its second year of operation, and is charged with examining allegations of ethical and fiscal abuse. PROPOSED LAW: This bill would enact the following water policies affecting the MWD: 1. Prohibits the Metropolitan Water District of Southern California from using public funds to conduct political research. 2. Requires the establishment and operation of an Office of Ethics charged to: A. Regulate the behavior of its board members, officers and employees. B. Protect the confidentiality of sources, the job security of "whistle blowers," and the due process rights of the accused. C. Make publicly available the results of any investigations. D. Adopt rules related to business relationships between board members, contractors, vendors, and public agency members. E. Regulate the solicitation of campaign contributions by board members, officers, employees, bidders, and contractors. F. Prevent the use of coalitions as a means to advance public opinion where use of aliases is likely to be mislead the public as to the group's true identity or funding source. 3. Mandates public notice and procedures for contracts of $50,000 or more. 4. Requires the district to place increased emphasis on various sustainable, environmentally sound, cost-effective water conservation programs, and requires an annual report on water conservation to incept February 1, 2001. COMMENTS: With the exception of the incepting date for an annual water conservation report, this bill is identical to the enrolled version of SB 1875 (Hayden and Ayala) of 1998, which passed the Legislature but was vetoed by Governor Wilson. It is the request of the Committee on Rules that any do-pass motion include a re-referral of this bill to the Senate Committee on Local Government. SUPPORT: Metropolitan Water District of Southern California OPPOSED: None Received