BILL ANALYSIS
AB 1438
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Date of Hearing: April 28, 2009
ASSEMBLY COMMITTEE ON WATER, PARKS AND WILDLIFE
Jared William Huffman, Chair
AB 1438 (Conway) - As Amended: April 13, 2009
SUBJECT : Safe Drinking Water Revolving Fund
SUMMARY : Expands eligibility for grants under the State's Safe
Drinking Water Revolving Fund (Revolving Fund). Specifically,
this bill :
1)Adds fire flow demand as a criterion to consider when
determining "reasonable amount of growth" for project funding
under the State Revolving Fund.
2)Requires the California Department of Public Health (DPH), in
order to implement the State Revolving Fund, to establish a
wellhead protection account pursuant to Section 1452(a) (2) of
the federal Safe Drinking Water Act (SDWA).
3)Adds environmental documentation as an activity eligible for
funding under the Revolving Fund.
4)Repeals current $1 million limit on Revolving Fund grants and
provides for DPH to establish and publish a new limit.
EXISTING LAW caps state funding, through Safe Drinking Water
State Revolving Fund, for engineering study, design and
construction of projects at $1 million.
FISCAL EFFECT : Unknown
COMMENTS : Author frames this bill as updating DPH authority to
administer the Revolving Fund, "most notably to provide
continuous authority to raise the grant cap for planning and
construction projects through their administrative regulatory
process." In explaining the need for raising the grant cap,
bill sponsors note that DPH recently has presented information
on the higher costs of wellhead treatment and other projects.
The current project priority list for the Proposition 84 small
community drinking water program includes 60 projects that
exceed the current $1 million cap.
Small Community Wastewater Challenges :The sponsors focus on the
AB 1438
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needs of smaller communities. The SWRCB, in its June 16, 2008,
Water Boards' Draft Small Community Wastewater Strategy, asserts
that, "?Small communities face specific challenges related to
their drinking water and wastewater systems. Many are currently
on failing septic systems or have old and undersized wastewater
treatment plants that cannot meet current water quality
standards. Such systems can cause significant health and safety
problems, endanger surface water uses, and pose a threat to
groundwater supplies? Therefore, more financial, technical, and
regulatory assistance is needed to bring small communities into
compliance." This bill attempts to provide additional
assistance to communities in need by enabling the DPH to award
grants sufficient to fund necessary drinking water and
wastewater system projects.
Federal Stimulus Funds : On February 17, 2009, President Obama
signed the American Recovery and Reinvestment Act of 2009 (ARRA)
into law. Among its provisions, ARRA provides approximately
$160 million to the Revolving Fund for infrastructure
development for California's drinking water systems. On March
27, 2009, the Governor signed SB 27XXX (Negrete McLeod) Chapter
25, Statutes of 2009-10 Third Extraordinary Session, which
expanded authorized uses for clean drinking water and wastewater
funding from the federal government pursuant to the ARRA. This
bill moves in the same direction as SB 27XXX.
Statutory Cap vs. Discretionary Caps : AB 1438 removes the
statutory cap of $1 million for Revolving Fund grant awards for
single projects, and instead authorizes DPH to set a maximum
level of grant awards through a public process. Supporters
argue that this flexibility enables DPH to more effectively fund
drinking water projects in communities with diverse needs and
therefore best assist disadvantaged communities. Authorizing
DPH to continue adjusting the cap will allow for future changes
in costs and financial conditions. Setting the cap involves a
balance between providing enough funding to allow communities to
get safe drinking waters and spreading the limited funding
broadly throughout California. With the recent infusion from
the federal stimulus package, this may be the time to allow for
flexibility to respond to the current conditions.
REGISTERED SUPPORT / OPPOSITION :
Support
AB 1438
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CA Rural Legal Assistance Foundation
Clean Water Action
Environmental Justice Coalition for Water
Opposition :None submitted
Analysis Prepared by : Alf W. Brandt / W., P. & W. / (916)
319-2096