BILL ANALYSIS                                                                                                                                                                                                    





           ----------------------------------------------------------------- 
          |                                                                 |
          |         SENATE COMMITTEE ON NATURAL RESOURCES AND WATER         |
          |                   Senator Fran Pavley, Chair                    |
          |                    2009-2010 Regular Session                    |
          |                                                                 |
           ----------------------------------------------------------------- 

          BILL NO: SB 1469                   HEARING DATE: April 13, 2010   

          AUTHOR: Simitian                   URGENCY: No  
          VERSION: March 23, 2010            CONSULTANT: Dennis O'Connor  
          DUAL REFERRAL: No                  FISCAL: Yes  
          SUBJECT: Sacramento-San Joaquin Delta: State Water Resources  
          Development System: water quality.  
          
          BACKGROUND AND EXISTING LAW

          The Department of Water Resources (DWR), among other things, is  
            responsible for:
           The construction and management of the State Water Resources  
            Development System, commonly known as the State Water Project  
            (SWP).
           Developing the California Water Plan.  Under current law, "it  
            is the policy of the state that The California Water Plan,  
            with any necessary amendments, supplements, and additions to  
            the plan, is accepted as the master plan which guides the  
            orderly and coordinated control, protection, conservation,  
            development, management and efficient utilization of the water  
            resources of the state."

          The State Water Resources Control Board (Board), among other  
            things, is responsible for:
           Administering and enforcing the state's water rights system.
           Protecting water quality and enforcing state water quality  
            laws.

          The Delta Stewardship Council (Council) is responsible for  
            developing a Delta Plan to achieve the two coequal goals of  
            providing a more reliable water supply for California and  
            protecting, restoring, and enhancing the Delta ecosystem.  The  
            coequal goals shall be achieved in a manner that protects and  
            enhances the unique cultural, recreational, natural resource,  
            and agricultural values of the Delta as an evolving place.

                                                                      1







          PROPOSED LAW
          
          This bill would require DWR, by January 1, 2012, to:

           Identify all parties that benefit from waters originating in  
            the Sacramento-San Joaquin Delta watershed and whose  
            activities impact the Delta watershed.
           Develop a process for determining the degree of responsibility  
            attributable to each of the identified parties for physical  
            and environmental impacts on the Delta.
           Estimate the infrastructure needs for the SWP over the next 30  
            years, including new facilities and expected repairs and  
            upgrades to existing facilities.
           Estimate the costs, over the next 30 years, of environmental  
            mitigation and restoration projects associated with the  
            infrastructure needs of the SWP.

          ARGUMENTS IN SUPPORT

          According to the author, "One of the acknowledged shortcomings  
          of the package of water bills that we passed last November was  
          the lack of a stable long term funding source to implement the  
          package.  Instead, we continued our current funding practice of  
          creative appropriations of existing bond funds, reappropriation  
          of previously budgeted but unspent appropriations from various  
          funds, and, frankly, simply hoping that somehow it will get  
          fixed in the future.  However, the reality is that it won't get  
          fixed in the future if we don't take steps now to prepare for  
          that future.  That means getting honest about what our real  
          infrastructure needs will be, how much we will need to invest in  
          environmental restoration efforts, and, under a beneficiaries  
          pay concept, precisely who will benefit from these investments."

          "SB 1469 is intended to be a vehicle to start this necessary  
          discussion."

          ARGUMENTS IN OPPOSITION: None

          COMMENTS 
          
           Should DWR Do All This?   The bill proposes that DWR identify all  
          parties that benefit from waters originating in the Delta  
          watershed, identify all parties whose activities impact the  
          Delta watershed, and develop a process to determine the degree  
          of responsibility attributable to each of those identified  
          parties for physical and environmental impacts on the Delta.   
          Two issues.  First, DWR, as the owner/operator of the SWP, would  
                                                                      2







          appear to have a conflict of interest in determining the degree  
          of benefits and impacts from the Delta watershed and developing  
          a process to assign responsibilities regarding the Delta  
          watershed.  Second, this determination of benefits/impacts and  
          development of a process to assign responsibilities would be a  
          quasi-judicial role more in line with the State Water Board's  
          roles and responsibilities for both water rights and water  
          quality.  (See amendment 1).

           Role of the Water Plan.   As noted above, the California Water  
          Plan is the master plan to guide the development of California's  
          water resources.  By law, DWR is to update it every five years,  
          and is to include a discussion of "a discussion of various  
          strategies, including, but not limited to, those relating to the  
          development of new water storage facilities, water conservation,  
          water recycling, desalination, conjunctive use, and water  
          transfers that may be pursued in order to meet the future water  
          needs of the state.  The department shall also include a  
          discussion of the potential for alternative water pricing  
          policies to change current and projected uses.  The department  
          shall include in the plan a discussion of the potential  
          advantages and disadvantages of each strategy and an  
          identification of all federal and state permits, approvals, or  
          entitlements that are anticipated to be required in order to  
          implement the various components of the strategy."

          Recent updates of the California Water Plan, including the  
          update that is currently being released, do discuss the  
          strategies in general terms, but do so without a quantitative  
          assessment of needed investments or specific recommendations for  
          nonstructural programs and policies.

          Conversations with the author's office suggest that the intent  
          is for there to be a comprehensive assessment of the investment  
          needs of the entire state, not just the investments associated  
          with the SWP.  This suggests that the estimate the  
          infrastructure needs called for by this bill would best be  
          addressed in the next update of the California Water Plan, which  
          is due December 31, 2013.  Also, as one of the author's  
          objectives is to determine, under a beneficiaries pay concept,  
          precisely who would benefit from these investments, the  
          provisions of the bill should be expanded to include that issue  
          as well. (See amendment 2).

          SUGGESTED AMENDMENTS 

               AMENDMENT 1  
                                                                      3







               Amend Section 1 of the bill to give the State Water Board  
               the responsibility for identifying benefits/impacts and  
               development of a process to assign responsibilities  
               regarding the watershed, and place the section in a more  
               appropriate part of the water code.

               AMENDMENT 2 
               Amend Section 2 of the bill to:
               o      Clarify that the assessment of investment needs is  
                 for all of California, not just the SWP.
               o      Explicitly include the assessment of the investment  
                 needs in the requirements for future California Water  
                 Plan updates.
               o      Add a requirement that the California Water Plan  
                 propose a policy for assigning funding responsibilities  
                 to beneficiaries of water resources investments and  
                 propose a financing strategy for funding responsibilities  
                 proposed to be assigned to the State
               o      Add a requirement that DWR clearly identify all  
                 relevant assumptions made in making the assessment.
               
          SUPPORT
          None Received

          OPPOSITION
          None Received





















                                                                      4