BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 640
                                                                  Page  1

          Date of Hearing:   January 19, 2012

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                    AB 640 (Logue) - As Amended:  January 4, 2012 

          Policy Committee:                              Environmental 
          Safety and Toxic Materials                    Vote: 8-0

          Urgency:     No                   State Mandated Local Program: 
          No     Reimbursable:              No

           SUMMARY  

          This bill revises the definition of "small community," from 
          10,000 to 20,000 persons, that is used in determining whether a 
          publicly owned water facility (POWTF) may redirect an equivalent 
          amount of any mandatory minimum fines for water code violations 
          toward completion of a compliance project.

           FISCAL EFFECT  

          1)Minor, absorbable costs to the State Water Resources Control 
            Board and the regional boards resulting from increased 
            oversight of water systems committed to remedying water code 
            violations rather than simply paying minimum mandatory 
            penalties (MMPs).  

          2)Unknown, potentially significant annual water code violation 
            penalty revenue loss, ranging from $100,000 to $1 million 
            annually. Absent this bill, penalty revenues would be used to 
            clean up and abate water pollution sources.  Under this bill, 
            these penalty revenues will be used by eligible water 
            facilities to make system improvements to abate or prevent 
            water pollution. 

           COMMENTS  

           1)Rationale  .  The author notes that many small, publicly owned 
            water systems face financial hardship and have difficulty 
            paying MMPs for water code violations while making water 
            system upgrades to remedy the violations.  The author contends 
            communities of 20,000 people or fewer are appropriately 
            considered small communities.  The author concludes, 








                                                                  AB 640
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            therefore, that publicly owned water systems serving 
            communities of 20,000 people or fewer should benefit from 
            existing statute that allows a water system serving a "small 
            community" to apply MMP payments towards remediating water 
            code violations. 

           2)Background .  The Porter-Cologne Water Quality Act authorizes 
            SWRCB and RWQCB to set waste discharge requirements and 
            establishes MMP of $3,000 for each serious waste discharge 
            violation.  This may be in addition to other penalties and 
            fees.

            The act additionally provides that publicly owned treatment 
            works that serve a small (no more than 10,000 residents) or 
            low-income rural community may apply the amount of penalty to 
            completion of a compliance project to remedy the waste 
            discharge violation.

            The Water Code provides various definitions of small 
            community, ranging from populations of 5,000 to 20,000.

           3)Support  .  This bill is supported by the Association of 
            California Water Agencies (ACWA) and the Regional Council of 
            Rural Counties.  
           
           4)There is no formal opposition to this bill.  

           Analysis Prepared by  :    Jay Dickenson / APPR. / (916) 319-2081