BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 1669
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          Date of Hearing:   April 24, 2012

           ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS
                                Bob Wieckowski, Chair
                     AB 1669 (Perea) - As Amended:  April 9, 2012
           
          SUBJECT  :  Groundwater:  Nitrate at Risk Area Fund.

          SUMMARY  :  Requires the State Water Resources Control Board 
          (SWRCB), in conjunction with the California Department of Public 
          Health (CDPH), to designate areas that are reliant on 
          nitrate-contaminated groundwater for drinking water and that do 
          not have reliable access to safe, affordable drinking water.  
          Establishes the Nitrate at Risk Area Fund to fund the 
          development and implementation of sustainable and affordable 
          solutions for disadvantaged communities with 
          nitrate-contaminated drinking water.

           EXISTING LAW  :

          1)Pursuant to the federal Safe Drinking Water Act (SDWA):
             a)   Authorizes the United States Environmental Protection 
               Agency (US EPA) to set standards for drinking water quality 
               and to oversee the states, localities, and water suppliers 
               who implement those standards.
             b)   Establishes federal maximum contaminant levels (MCLs) 
               for nitrate in public water systems.
             c)   Establishes the Safe Drinking Water State Revolving Fund 
               (SDWSRF) program, which authorizes the US EPA to award 
               capitalization grants to states and authorizes the states 
               to, in turn, provide low-cost loans and other types of 
               assistance to public water systems to finance the costs of 
               infrastructure projects needed to achieve or maintain 
               compliance with federal SDWA requirements.

          2)Pursuant to the California SDWA (Health and Safety Code (HSC) 
            � 116275 et seq.):
             a)   Requires CDPH to regulate drinking water and to enforce 
               the federal SDWA and other regulations.
             b)   Establishes a state MCL for nitrate in public water 
               systems.

          3)Pursuant to the Porter-Cologne Water Quality Control Act 
            (Water Code (WC) � 13000, et seq.), provides that the SWRCB 
            and the California regional water quality control boards are 








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            the principal state agencies with authority over matters 
            relating to water quality.

          4)Requires the SWRCB to prepare and submit a report to the 
            Legislature that will improve understanding of the causes of 
            nitrate groundwater contamination, identify potential 
            remediation solutions and funding sources to recover costs 
            expended by the state to clean up or treat groundwater, and 
            ensure the provision of safe drinking water to all communities 
            (WC � 83002.5).

          5)Requires the SWRCB to submit a report to the Legislature that 
            identifies communities in California that rely on contaminated 
            groundwater as a primary source of drinking water; the 
            principal contaminants and constituents of concern; and 
            potential solutions and funding sources to clean up or treat 
            groundwater, or provide alternative water supplies (WC � 
            10782).

          6)Pursuant to the SDWSRF Law of 1997 (HSC � 116760 et seq.), 
            establishes California's SDWSRF and continuously appropriates 
            the SDWSRF to CDPH to provide grants or revolving fund loans 
            for the design and construction of projects for public water 
            systems that will enable suppliers to meet safe drinking water 
            standards.

          7)Pursuant to the Water Security, Clean Drinking Water, Coastal 
            and Beach Protection Act of 2002 (Proposition 50), provides 
            funding for, among other things, water security for drinking 
            water programs, community treatment facilities and monitoring 
            programs, and matching funds for federal grants for public 
            water system infrastructure improvements (WC �79500, et seq.).

          8)Pursuant to the Safe Drinking Water, Water Quality and Supply, 
            Flood Control, River and Coastal Protection Act of 2006 
            (Proposition 84), provides funding for, among other things, 
            protection and reduction of contamination of groundwater and 
            small community drinking water system improvements (Public 
            Resources Code � 75001, et seq.)

          9)Authorizes the California Department of Food and Agriculture 
            to impose an assessment in an amount not to exceed one mill 
            ($0.001) per dollar of all sales of fertilizing materials to 
            provide funding for research and education regarding the use 
            and handling of fertilizing materials, including, but not 








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            limited to, any environmental effects.  The current assessment 
            is at a  mill ($0.0005) (Food and Agricultural Code � 14611).

           FISCAL EFFECT  :   Unknown.

           COMMENTS  :

           Need for the bill  :  According to the author, "Small, very 
          low-income communities are disproportionately impacted by the 
          inaccessibility of safe drinking water in areas with pervasive 
          nitrate contamination.  In the agricultural regions of the 
          state, most communities rely on groundwater as their primary 
          source of drinking water, and that groundwater is increasingly 
          contaminated by nitrates.  As costs increase to address 
          groundwater contamination, families in many of our poorest 
          communities are forced to pay over $100 a month for water 
          service or are left without safe drinking water in their homes, 
          schools, and businesses because they can't afford the costs.  
          Some communities pay more than 10 percent of their income for 
          drinking water alone. In many rural areas, schools must use 
          funding intended for educational purposes to purchase bottled 
          water for children.

          Designation of those regions that are suffering from 
          nitrate-contaminated water or the effects of 
          nitrate-contaminated water (including those areas with 
          communities that have been forced to drill deeper wells to avoid 
          nitrate in the aquifer only to find their water supply 
          contaminated with arsenic at deeper groundwater levels), and the 
          creation of a fund that can channel much needed funding to these 
          regions more directly, will help streamline the process for 
          developing and funding drinking water solutions where there is a 
          critical need."

           Nitrates/ nitrites and public health  :  According to CDPH, the 
          presence of nitrates in groundwater is most often associated 
          with septic systems, confined animal feeding operations or 
          fertilizer use, which often occurs in rural settings.  Nitrates 
          are also present in treated wastewater, and thus are found in 
          surface water and groundwater recharge projects, which pose 
          risks to urban drinking water supplies.  Nitrates are also used 
          in the production of some products, such as fertilizers and 
          explosives.

          Nitrite is a chemical similar to nitrate, and it comes from the 








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          same sources as nitrate.  Once consumed, nitrate is converted 
          into nitrite in the body.  Nitrite can interfere with the 
          ability of red blood cells to carry oxygen to the tissues of the 
          body, producing a condition called methemoglobinemia.  This is 
          of greatest concern in infants, whose immature stomach 
          environment enables the conversion of nitrate into nitrite that 
          is absorbed into the blood stream.  The effects of nitrite are 
          often referred to as "blue baby syndrome."  High nitrate levels 
          may also affect the oxygen-carrying ability of the blood of 
          pregnant women.
           
          Nitrate contamination in California  :  Senate Bill SBX2 1 
          (Perata, Chapter 1, Statutes of 2008 Second Extraordinary 
          Session) required the SWRCB, in consultation with other 
          agencies, to prepare a report to the Legislature focusing on 
          nitrate groundwater contamination in the state and potential 
          remediation solutions.  In response, the SWRCB contracted with 
          the University of California to gather information to prepare 
          its report.

          The University of California at Davis (UCD) prepared and 
          released its resultant report, Addressing Nitrate in 
          California's Drinking Water, to the SWRCB in January 2012.  
          While the study only examined nitrate contamination in the 
          four-county Tulare Lake Basin and the Monterey County portion of 
          the Salinas Valley, its findings are helpful at informing the 
          discussion about nitrate contamination statewide.

          The UCD study showed that nitrate loading to groundwater in the 
          area is widespread and chronic, and is overwhelmingly the result 
          of crop and animal agricultural activities.  Urban wastewater, 
          septic systems, and other sources have significant localized 
          impact.  Due to long transit times, the impact of nitrates on 
          groundwater resources will likely worsen in scope and 
          concentration for several decades.

          The study indicated that about 2.6 million people in these 
          regions rely on groundwater for drinking water, including those 
          in some of the poorest communities in California.  Nitrate 
          contamination is increasing and currently poses public health 
          concerns for about 254,000 people in the study area.  
          Groundwater data show that 57% of the current population in the 
          study area uses a community public water system with recorded 
          raw (untreated) nitrate concentrations that have exceeded the 
          MCL at least once between 2006 and 2010.  Continued basin-wide 








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          trends in nitrate groundwater concentration may raise the 
          affected population to nearly 80% by 2050.

          In addition to the UCD report, AB 2222 (Caballero, Chapter 670, 
          Statutes of 2008) requires the SWRCB to submit a report to the 
          Legislature that identifies communities in California that rely 
          on contaminated groundwater as a primary source of drinking 
          water.  The SWRCB draft report was released in January 2012 and 
          identified 682 communities (excluding systems not regulated by 
          the state), serving more than 21 million people, which rely on 
          groundwater contaminated with one or more principal 
          contaminants.  The report also identified areas with nitrate 
          contamination. 

          This bill requires the SWRCB, in conjunction with CDPH, to 
          designate areas that are reliant on nitrate-contaminated 
          groundwater for drinking water and that do not have reliable 
          access to safe, affordable drinking water.  Some of this 
          research may have been partially completed in previously 
          required reports.
           
          Addressing nitrate contamination in drinking water  :  Technical 
          Report 8 of the UCD study ascertains that a range of safe 
          drinking water actions (alternative water supplies or drinking 
          water treatment), groundwater remediation, and source reduction 
          actions are needed to provide residents with safe drinking 
          water.  Since nitrate source reduction or groundwater 
          remediation will take years to decades to significantly improve 
          drinking water quality, residents currently receiving unsafe 
          drinking water require other immediate alternatives.

           Funding to address nitrate contamination in drinking water  :  The 
          slow response of groundwater quality to source reduction efforts 
          implies that the most immediate path toward attaining safe 
          drinking water in nitrate contaminated areas is in the form of 
          safe drinking water actions.  However, the costs to provide safe 
          drinking water to affected communities in this region are high, 
          due to the large number of groundwater-contaminating nitrate 
          sources, the dispersed population, and the high incidence of 
          elevated nitrate levels in drinking water.  Consequently, 
          communities in the study area have requested more SDWSRF funds 
          relative to other communities in the state ($29 per person 
          compared to $5 per person statewide).  Providing safe drinking 
          water or alternative water supplies to highly susceptible 
          populations in the study area is estimated to cost at least 








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          $20-$36 million per year ($80-$142 per susceptible person 
          annually or $5-$9 per acre of irrigated land annually).

          A variety of funding programs that currently exist to address 
          drinking water problems could be used to address nitrate 
          contamination, including funding through the SDWSRF, Proposition 
          50, and Proposition 84.  However, the UCD report finds that 
          these and other existing funding programs have not met systems' 
          stated need to ensure safe drinking water in the Salinas Valley 
          and Tulare Lake Basin.  Most current state funding to address 
          nitrate contamination is temporary (such as general obligation 
          bonds for loans through state propositions) and many programs 
          have already been fully allocated.  In addition, most safe 
          drinking water funding programs do not provide support for 
          operation and maintenance costs, which is necessary for many 
          disadvantaged communities, and the State of California 
          specifically does not fund operation and maintenance activities.

          That being said, current funding programs could be revised to 
          increase the funds available to small systems and increase the 
          effectiveness of these funds in providing safe drinking water.  
          For example, existing funds could be combined or restructured to 
          focus on encouraging and guiding disadvantaged communities to 
          make good long-term local decisions; on providing assistance to 
          small systems in the application and management process; and on 
          providing assistance for operations and maintenance of 
          facilities.  Encouraging regional consolidation of small water 
          systems could also help address nitrate contamination.  New 
          funding sources could also be examined, such as raising the 
          current fertilizer mill fee and other fees on fertilizers.

          This bill creates a new fund, the Nitrate at Risk Area Fund, to 
          specifically support disadvantaged communities facing nitrate 
          contamination in their drinking water.  However, the bill 
          currently does not identify a funding source.  The author of the 
          bill indicates that he plans to work closely with stakeholders 
          and the relevant state agencies to develop an appropriate source 
          of funding for the fund created in this bill.  Since 
          re-designating funds from existing sources could create a 
          shortfall in existing programs, the author may wish to consider 
          new sources of revenue.

           Upcoming SWRCB action on nitrates  :  A public workshop will be 
          held on Wednesday, May 23, 2012, to consider public input on the 
          options to address the nitrate contamination outlined in the UCD 








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          report.  Both the UCD report and public input at the workshop 
          will be used to inform the SWRCB in developing its final 
          recommendations for its report to the Legislature, as required 
          by SBX2 1, later in 2012.

           Committee amendments  :  As regulating drinking water is in the 
          purview of CDPH, the Committee may wish to designate CDPH, in 
          conjunction with the SWRCB, as the entity required to designate 
          areas that are reliant on nitrate-contaminated groundwater for 
          drinking water and that do not have reliable access to safe, 
          affordable drinking water.  Additionally, the Committee may wish 
          to clarify that CDPH, in designating areas that are reliant on 
          nitrate-contaminated groundwater for drinking water and that do 
          not have reliable access to safe, affordable drinking water, 
          should use existing data on public water systems.

           Related legislation  :

          1)AB 2208 (Perea), authorizes CDPH, when implementing the 
            SDWSRF, to consolidate multiple community projects to meet 
            safe drinking water standards.  AB 2208 is scheduled for 
            hearing in the Assembly Environmental Safety and Toxic 
            Materials (ESTM) Committee on April 24, 2012.

          2)AB 2238 (Perea), requires CDPH to promote the consolidation 
            and merger of small community water systems that serve 
            disadvantaged communities.  Requires the Local Agency 
            Formation Commission (LAFCO) to examine drinking water and 
            waste treatment service consolidation as part of a LAFCO local 
            agency service review.  AB 2238 is scheduled for hearing in 
            the Assembly ESTM Committee on April 24, 2012.

          3)AB 2334 (Fong), requires the Department of Water Resources to 
            analyze drinking water and wastewater services affordability 
            for low-income residents.  AB 2334 is scheduled for hearing in 
            the Assembly ESTM Committee on April 24, 2012.

          4)AB 2529 (Wieckowski), authorizes CDPH to adopt interim 
            regulations and take other actions to expedite the process of 
            providing funds for drinking water projects, especially to 
            severely disadvantaged communities.  AB 2529 is scheduled for 
            hearing in the Assembly ESTM Committee on April 24, 2012.

           REGISTERED SUPPORT / OPPOSITION  :









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           Support
           
          Community Water Center (sponsor) 
          California Rural Legal Assistance Foundation
          Clean Water Action

           Opposition
           
          None received.
           

          Analysis Prepared by  :    Shannon McKinney / E.S. & T.M. / (916) 
          319-3965