BILL ANALYSIS                                                                                                                                                                                                    



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           REPLACE  - 06/02/2010 Technical change (Member name)
          
          ASSEMBLY THIRD READING
          AB 2483 (Coto)
          As Amended  May 19, 2010
          Majority vote 

           LOCAL GOVERNMENT    6-3         WATER, PARKS & WILDLIFE    9-3  
           
           ----------------------------------------------------------------- 
          |Ayes:|Caballero, Arambula,      |Ayes:|Huffman, Arambula,        |
          |     |Bradford, Davis, Solorio, |     |Blumenfield, Caballero,   |
          |     |Torlakson                 |     |Ruskin, Bonnie Lowenthal, |
          |     |                          |     |Salas, Yamada, Fong       |
          |     |                          |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |Nays:|Smyth, Knight, Logue      |Nays:|Bill Berryhill, Tom       |
          |     |                          |     |Berryhill, Fletcher       |
           ----------------------------------------------------------------- 

           APPROPRIATIONS      12-5                                        
           
           -------------------------------- 
          |Ayes:|Fuentes, Ammiano,         |
          |     |Bradford,                 |
          |     |Charles Calderon, Coto,   |
          |     |Davis,                    |
          |     |Monning, Ruskin, Skinner, |
          |     |Solorio,                  |
          |     |Torlakson, Torrico        |
          |     |                          |
          |-----+--------------------------|
          |Nays:|Conway, Harkey, Miller,   |
          |     |Nielsen, Norby            |
          |     |                          |
           -------------------------------- 
           SUMMARY  :  Revises and recasts the Santa Clara Valley Water  
          District (District) Act. Specifically,  this bill  :

          1)Repeals the current uncodified District Act (Act).

          2)Revises and codifies the Act in an updated format.

          3)Adds legislative findings and declarations regarding the need  








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            for an integrated approach to flood protection and water  
            supply.

          4)Adds legislative findings that nothing in this Act shall be  
            construed to do any of the following:

             a)   Provide the District with regulatory authority that  
               conflicts with authority already exerted by the State  
               Department of Public Health, the State Water Resources  
               Control Board, the California regional water quality  
               control boards, or the Public Utilities Commission to  
               require water conservation measures; 

             b)   Provide the District with jurisdiction over water  
               conservation measures that conflict with measures that have  
               been imposed by cities in Santa Clara County, the County of  
               Santa Clara, or water retailers; or,

             c)   Provide the District with unilateral authority to impose  
               measures on other agencies to mitigate climate change or  
               increase the production of renewable or alternative energy.

          5)Provides that it is the intent of the Legislature that the  
            District lead, assist, and oversee water conservation efforts  
            and regulate only in the absence of other effective efforts,  
            or as necessary to ensure continued delivery of water under  
            the District's state and federal contracts.
          6)States that it is the intent of the Legislature that this Act  
            should not conflict with any provisions of the California  
            Constitution, or impact existing water rights.

          7)Adds succession language.

          8)Adds the following definitions:

             a)   "Abandoned well" means any well that has not been used  
               for one year or more, unless the owner demonstrates  
               intention for future use of the well as prescribed;

             b)   "Conjunctive management" means the coordination and  
               planned management of all available water resources to  
               optimize the availability, reliability, and quality of  
               water supplies;









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             c)   "Groundwater basin" means any basin identified in the  
               Department of Water Resources Bulletin No. 118;

             d)   "Groundwater overdraft" means the condition of a  
               groundwater basin when the amount withdrawn by pumping  
               exceeds total recharge including both natural and  
               intentional recharge;

             e)   "Inactive well" or "standby well" means a well not  
               routinely operating, but capable of being made operable  
               with a minimum effort;

             f)   "In-lieu recharge" means accomplishing increased storage  
               of groundwater by providing other water to users who rely  
               on groundwater as a primary supply, in order to accomplish  
               groundwater storage through the direct use of that other  
               water in lieu of pumping groundwater.

             g)   "Integrated water management" means a holistic approach  
               to flood, water resources, and environmental activities;

             h)   "Mutual water company" means any private corporation or  
               association organized for the purposes of delivering water  
               to its stockholders and members at cost;

             i)   "Nonagricultural water" means water used for any  
               beneficial use other than agricultural use, including  
               municipal, industrial, landscape irrigation, and domestic  
               use;

             j)   "Recycled water" means wastewater that is suitable for  
               beneficial use as a result of treatment;

             aa)  "Stewardship" means the careful and responsible  
               management of the environment and natural resources for the  
               current and future benefit of the greater community; and,

             bb)  "Watershed" means a regional or area bounded  
               peripherally by a divide and draining immediately to a  
               particular watercourse or body of water.

          9)Authorizes the District, in addition to its current  
            responsibilities, to do any of the following:









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             a)   Protect against land subsidence;

             b)   Plan for and adapt to climate change in a cost efficient  
               manner; and,

             c)   Encourage the integration of energy and water policies.

          10)Provides the District, in addition to its current powers, the  
            power to cooperate with, enter into, and to do any acts  
            necessary for the proper performance of any agreement with the  
            state, the United States, any state, city, county, district of  
            any kind, public or private corporation, association, firm, or  
            individual, for the ownership, joint acquisition, leasing,  
            disposition, use, management, construction, installation,  
            extension, maintenance, repair, or operation  of any rights,  
            works, or other property of a kind that might lawfully be  
            acquired or owned by the District, or for the lawful  
            performance of any power or purpose of the District.

          11)Provides the District with the power to construct, manage,  
            and maintain all District flood protection facilities,  
            including levees, modified channels, bypasses, culverts,  
            floodwalls, detention basins, diversion structures, all  
            appurtenances and other structures, as well as to utilize  
            nonstructural methods, for the purpose of containing or  
            conveying flood waters.

          12)Provides that District with the power to enact regulations to  
            protect against the diminution of the water supplies of the  
            District for the benefit of its inhabitants, including  
            reasonable regulation of existing and proposed wells against  
            acts destructive of the watershed and of exportation of water  
            from the District, or from a zone, or between District charge  
            zones. 

          13)Provides the District with the following additional powers  
            with regard to protection of water quality:

             a)   To conduct investigations of the quality of surface  
               water or groundwater within the District to determine if  
               water is being degraded, contaminated, or polluted;

             b)   To expend funds to provide replacement water supply for  
               contaminated water, to perform any cleanup, containment,  








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               abatement, prevention, remedial work, public notification,  
               or educational public outreach which, in the determination  
               of the District Board of Directors (Board), is required  
               under regulatory authority of any state or federal agency  
               or by the magnitude of the endeavor, or the urgent need for  
               prompt action to prevent, abate, or contain any threatened  
               or existing contamination of or pollution to the surface  
               water or groundwater of the district;

             c)   To hold the contaminator or polluter liable for costs  
               if, the District provides a replacement water supply or  
               causes contamination or pollution to be cleaned up or  
               contained, the effects abated, or other necessary remedial  
               action is taken to address actual or threatened  
               contamination or pollution; and,

             d)   To prevent land surface subsidence, where credible,  
               fact-based scientific evidence demonstrates that water  
               quality is in danger of being adversely affected.

          14)Specifies that the District may impose groundwater management  
            charges to cover the costs of groundwater management  
            activities, including conjunctive use, for the production of  
            water from the groundwater supplies within a zone of the  
            District that benefits from recharge of imported water, or  
            from the extraction of groundwater from all water extraction  
            facilities within the District.

          15) States that the District does not have the power to  
            supersede the land use planning authority of a city, county,  
            or any other entity to which land use planning authority has  
            been delegated.

          16)Requires the District to have a member of a public water  
            utility that operates within the District be a member of an  
            advisory board established by the District, so long as such  
            representation is allowed under applicable conflict of  
            interest laws.

          17)Requires the District to follow a prescribed process when  
            adopting, amending, or repealing an ordinance, which shall  
            include the following:

             a)   The ordinance shall be drafted in plain language;








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             b)   The agenda item proposing consideration of adoption or  
               modification of an ordinance shall include the following:

               i)     A statement of the necessity for action;

               ii)    Identification of each technical, theoretical, or  
                 empirical study on which the board relied;

               iii)   Facts, evidence, or other information relative to  
                 the anticipated economic impact of the action; and,

               iv)    Efforts made to avoid duplication of other entities'  
                 jurisdiction.

             c)   The ordinance modifications shall be based upon  
               credible, fact-based science or engineering information  
               concerning the need for, and consequences of, District  
               action; and,

             d)   The agenda item and all supporting information shall be  
               posted on the Districts website. 

          18)Establishes an administrative appeal process through which a  
            person aggrieved by a decision of the District may appeal that  
            decision to the chief executive officer, and if necessary,  
            ultimately the Board.

          19)Provides the Board with the discretion to uniformly authorize  
            partial or full payments of fees associated with candidate  
            ballot statements in order to encourage greater participation  
            in the political process.

          20)Removes the current caps on interest rates and indebtedness  
            that the District currently has.

          21)Specifies that groundwater management within the boundaries  
            of the District is the prerogative of the District and a  
            primary purpose for which the District was established and is  
            empowered.

          22)Requires the District to conjunctively manage its groundwater  
            and surface water resources to optimize water supply  
            reliability for the benefit of the county as a whole and to  








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            protect infrastructure from subsidence.

          23)Authorizes the District, in order to improve groundwater  
            supplies, to do all of the following:

             a)   Require conservation practices and measures;

             b)   Impose a rate structure to promote water conservation,  
               such as tiered rates; and,

             c)   Regulate ground water extractions to the extent  
               necessary to prevent groundwater overdraft and minimize the  
               risk of land subsidence.

          24)Specifies that a water retailer or other entity that has  
            adopted and is implementing an urban water management plan or  
            an equivalent conservation plan, is not subject to additional  
            water conservation requirements imposed by the District,  
            unless those additional requirements are a precondition for  
            the continued delivery of imported water to the District as  
            established by state or federal law.

          25)States that the District must comply with Article XIII D of  
            the California Constitution when proposing to impose or  
            increase property related groundwater management charges;  
            including providing a notice and protest process.

          26)Specifies that a previously approved charge remains in effect  
            until reduced or increased.

          27)Specifies that the District may impose a different  
            groundwater management rate for water to be used for  
            agricultural purposes.

          28)Expands the District's authority on what groundwater  
            management charges can be used for to include the following  
            activities:

             a)   Managing water supplies for the current and future  
               benefit of the District, including demand management  
               activities and watershed stewardship activities related to  
               the preservation and improvement of the quality of  
               groundwater supplies in the zone where the charge is  
               levied; and,








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             b)   Actions and programs to conserve, store, extract,  
               inject, recharge, recycle, protect, treat, transfer,  
               exchange, or distribute water for the current and future  
               benefit of the District.

          29)Requires that if the District has adopted an ordinance  
            authorizing rate structures to promote conservation, including  
            tiered rates, and determines, based on credible, fact-based,  
            scientific, or engineering evidence, that the evidence  
            supports imposing the water conservation rate structure, the  
            rate be established consistent with the rationale and method  
            established in the ordinance.

          30)States that it is the intent of the District to ensure that  
            the public is informed about proposed capital projects and  
            their funding sources, that broad environmental considerations  
            are included at the earliest possible phase of planning, and  
            that adequate opportunities are afforded the public to  
            participate in the decision making process.
          31)Establishes a public process for reviewing engineering  
            reports for capital projects.

          32)States that the provisions of this measure are severable.

          33)Declares that a special law for the District is necessary  
            because of the unique and special surface water, groundwater,  
            and floodwater problems in the area included in the District.

           EXISTING LAW  establishes the District and specifies its powers  
          and purposes relating to water supply and flood management.

           FISCAL EFFECT  :  According to the Assembly Appropriations  
          Committee:

          1)State costs are minor and absorbable.  Any local enforcement  
            costs related to provisions of the bill making a violation of  
            newly authorized district ordinances a misdemeanor are not  
            reimbursable.

          2)Costs to the district would be covered by fees charged to  
            members.  Mandated costs not reimbursable because the district  
            is requesting the measure.









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           COMMENTS  :  According to the sponsor, Santa Clara Valley Water  
          District, Santa Clara County is faced with water resource  
          challenges brought on by population growth, periodic drought,  
          regulatory restrictions, environmental considerations, aging  
          infrastructure, and changing laws.  A revised District Act which  
          emphasizes an integrated comprehensive water resources  
          management approach will enable the District to more efficiently  
          and adaptively manage through these challenges.

          Increasing pressures on the Bay-Delta system, the source of half  
          of Santa Clara County's water supplies, make it imperative that  
          the District have the clear authority to proactively promote  
          water conservation and protect the quality and quantity of local  
          groundwater supplies to ensure reliability of the local water  
          supply.

          According to the author's office, "while the revisions in  
          authority contained in this bill will position the District to  
          better implement new state policy direction regarding  
          conservation and management of increasingly scarce water  
          resources, it also presents an opportunity to update an  
          ambiguous document that has been pieced together in a sometimes  
          disjointed fashion over the course of the last six decades."  
          This bill includes a comprehensive rewrite of the Act that will  
          transform it into an organized, cohesive, comprehensive  
          articulation of the authority exercised by the District to  
          provide integrated management of water supply, watershed  
          stewardship, groundwater management, and flood protection.

          Groundwater management charges:  Article XIII D, section 6  
          subdivision (c), of the California Constitution, provides,  
          "Except for fees or charges for sewer, water, and refuse  
          collection services, no property related fee or charge shall be  
          imposed or increased unless and until that fee or charge is  
          submitted and approved by a majority vote of the property owners  
          of the property subject to the fee or charge or, at the option  
          of the agency, by a two-thirds vote of the electorate residing  
          in the affected area."  However, all property related fees and  
          charges, including those exempt from the election requirement,  
          are subject to the notice, hearing, and majority protest  
          procedures of article XIII D, Section 6(a), as well as the  
          substantive requirements of Section 6(b).  Before the Courts  
          right now are the questions of: What is the scope of the  
          exemption from the voter approval requirement in Article XIII D  








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          Section 6(c) as it pertains to water? And, do groundwater  
          pumping charges fall within the exemption from the voter  
          approval requirement in article XIII D, Section 6 subdivision  
          (c)?  The District itself has been a party to litigation on this  
          very issue.  The District is now in the process of appealing the  
          lower Court's decision on this matter.  The Legislature may wish  
          to consider if it is prudent for it to step in and specify the  
          groundwater management charge process for the District when the  
          Courts are still in the middle of deciding the constitutional  
          issue in a multitude of cases before them?

          The bill contains provisions requiring the District to follow a  
          prescribed set of requirements in order to adopt or amend an  
          ordinance.  These requirements are highly prescribed and any  
          change in them would require the District to come to the  
          Legislature for that change.  The Legislature may wish to have  
          the District instead adopt regulations at the local level  
          prescribing how ordinances can be adopted or amended, which  
          ensures that any changes that need to be made can happen at the  
          local level instead of requiring legislation.

          Support arguments:  Supporters, including the Association of  
          California Water Agencies (ACWA), state that this bill would add  
          accountability and transparency by providing clearer noticing to  
          the public and greater opportunity for public input, as well as  
          making the groundwater charge setting process more transparent.   
          ACWA also believes that the bill would strengthen the District's  
          ability to manage local water resources by providing stronger,  
          more proactive conservation tools.

          According to the District, "The new language is intended to be  
          clear and unambiguous to encourage transparency and  
          accountability to the public.  A better structured Act will  
          also, by context, clarify the scope and intent of the language  
          and will help to avoid misunderstandings as to District  
          authority."

          Opposition arguments:  Opposition, including the California  
          Water Association (CWA), states that the bill provides the  
          District with overly broad and unnecessary authority that would  
          have adverse impact on retail water purveyors in Santa Clara  
          County.  CWA believes that this bill would greatly expand the  
          District's authority over operators of water production  
          facilities.








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          Opposition, including the Howard Jarvis Taxpayers Association,  
          also argues that it is premature for the District to establish  
          one methodology for handling increases in groundwater management  
          charges when the Courts are currently debating which provisions  
          of Proposition 218 apply to groundwater management charges.


           Analysis Prepared by  :    Katie Kolitsos / L. GOV. / (916)  
          319-3958                                               FN:  
          0004474