BILL ANALYSIS �
AB 2011
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Date of Hearing: May 9, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2011 (Gatto) - As Amended: April 18, 2012
Policy Committee: Water, Parks and
Wildlife Vote: 9-4
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill allocates $50 million from the prospective Safe,
Clean, and Reliable Drinking Water Supply Act of 2012 to
establish CalConserve, a program by which the Department of
Water Resources (DWR) would provide grants to local agencies for
the implementation of local and regional water conservation
revolving loan programs that help customers carry out water use
efficiency retrofit projects.
FISCAL EFFECT
1)Allocates $50 million from the proposed $11.1 billion water
bond. While the bill does not identify the section of the
water bond from which the $50 million will be funded, there
are several sections consistent with the CalConserve program.
(While the water bond is scheduled to appear on the ballot in
November of 2012; it is possible the ballot measure may be
postponed. While this bill seems consistent with the purposes
of the bond act and, therefore, a permissible legislative
action to implement the act, it is questionable whether the
Legislature should enact laws implementing bond acts before
passage.)
2)DWR anticipates annual costs, if the water bond becomes law,
of approximately $550,000 (equivalent to four staff members)
to implement and administer the grant program. DWR affirms its
ability to administer the grant program. However, DWR
contends the program created by this bill will require
substantial changes to the existing DWR grant program
guidelines.
AB 2011
Page 2
(The water bond limits administrative costs to five percent of
the amount of funds allocated to a grant program pursuant to
the bond act, which, as applied to this bill, would total
$250,000. To the extent the program created by this bill
creates administrative costs beyond $250,000, it will create
cost pressure to fund DWR's administrative activities.
COMMENTS
1)Rationale . The author notes that while programs exist to help
public agencies finance water efficiency retrofits, no such
program exists to assist private entities, such as homeowners.
The author intends this bill, contingent on passage of the
water bond, to create a sustainable source of funding for
private water-efficiency upgrades.
2)Background . In 2009, the Legislature passed a package of five
bills to resolve many long-standing water issues. Among the
package was SBX7 2 (Cogdill), which authorized the Safe,
Clean, and Reliable Drinking Water Supply Act of 2010, which,
if approved by the voters, authorized the issuance of $11
billion in general obligation bonds to finance a safe drinking
water and water supply reliability program. SBX7 2 scheduled
the bond act for the November 2010 ballot. However, concerns
about voter appetite for a bond act amidst economic distress
and ongoing state budget shortfalls led the Legislature to
reschedule the water bond to the November 2012 ballot.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081