BILL ANALYSIS �
AB 2238
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ASSEMBLY THIRD READING
AB 2238 (Perea)
As Amended May 25, 2012
Majority vote
LOCAL GOVERNMENT 6-3 ENVIRONMENTAL SAFETY 6-3
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|Ayes:|Alejo, Bradford, Campos, |Ayes:|Wieckowski, Campos, |
| |Davis, Gordon, Hueso | |Chesbro, Davis, Feuer, |
| | | |Bonnie Lowenthal |
|-----+--------------------------+-----+--------------------------|
|Nays:|Smyth, Knight, Norby |Nays:|Miller, Donnelly, Morrell |
| | | | |
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APPROPRIATIONS 12-5
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|Ayes:|Fuentes, Blumenfield, | | |
| |Bradford, Charles | | |
| |Calderon, Campos, Davis, | | |
| |Gatto, Ammiano, Hill, | | |
| |Lara, Mitchell, Solorio | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Harkey, Donnelly, | | |
| |Nielsen, Norby, Wagner | | |
| | | | |
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SUMMARY : Allows local agency formation commissions (LAFCOs), in
their municipal service reviews, to assess alternatives for
improving efficiency and affordability of infrastructure and
service delivery for drinking water and wastewater services, and
adds new requirements to the Department of Public Health (DPH)
for programs related to small community water systems.
Specifically, this bill :
1)Allows a LAFCO, in conducting a municipal service review
(MSR), to comprehensively assess various alternatives for
improving efficiency and affordability of infrastructure and
service delivery for drinking water and wastewater services.
2)Requires DPH, in administering existing programs to fund
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improvements and expansions of small community water systems,
to promote the consolidation or merger of small community
water systems that serve disadvantaged communities where
consolidation or merger will help at least one of the affected
agencies.
3)Specifies that DPH, in promoting the consolidation or merger
of small community water systems, shall require that funding
for feasibility studies performed prior to a construction
project include studies of the feasibility of consolidating
public water systems if at least one of the water systems
serves a disadvantaged community, unless DPH makes a written
determination that consolidation or merger is not feasible
under the circumstances.
4)Requires DPH, if a LAFCO conducted a study, including an MSR,
within the previous five calendar years, which found the
consolidation of the public water systems feasible, to
consider those findings during its assessment of feasibility.
5)Requires DPH to give priority to funding construction projects
that involve the consolidation of two or more community water
systems, at least one of which is a small community water
system that serves a disadvantaged community into a single,
consolidated system, if it is shown that small community water
system consolidation will further specified goals.
6)Requires the Strategic Growth Council (SGC) to manage and
award financial assistance to a city, county, LAFCO, special
district, nonprofit organization, or other specified entity,
for the preparation, planning, and implementation of a public
water system consolidation, merger, or extension of services
project for the purposes of promoting water conservation, and
specifies that the SGC must give priority to funding projects
proposed by a disadvantaged community.
7)Declares the intent of the Legislature to encourage LAFCOs to
focus on the consolidation, merger, or extension of public
water systems, especially those located in disadvantaged
communities.
EXISTING LAW :
1)Requires LAFCOs to initiate and make studies of existing
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governmental agencies including, but not limited to,
inventorying those agencies and determining their maximum
service area and service capacities.
2)Allows LAFCOs, or the board of supervisors on behalf of a
LAFCO, to apply for and accept, or both, any financial
assistance and grants-in-aid from public or private agencies
or from the state or federal government or from a local
government.
3)Requires LAFCOs, in order to prepare and to update spheres of
influence, to conduct a service review of the municipal
services provided in the county or other appropriate area
designated by the LAFCO, and shall prepare a written statement
of its determinations with respect to each of the following:
a) Growth and population projections for the affected area;
b) The location and characteristics of any disadvantaged
unincorporated communities within or contiguous to the
sphere of influence;
c) Present and planned capacity of public facilities,
adequacy of public services, and infrastructure needs or
deficiencies including needs or deficiencies related to
sewers, municipal and industrial water, and structural fire
protection in any disadvantaged, unincorporated communities
within or contiguous to the sphere of influence;
d) Financial ability of agencies to provide services;
e) Status of, and opportunities for, shared facilities;
f) Accountability for community service needs, including
governmental structure and operational efficiencies; and,
g) Any other matter related to effective or efficient
service delivery.
4)Requires LAFCOs to comprehensively review all of the agencies
that provide the identified service or services within the
designated geographic area and allows LAFCOs to assess various
alternatives for improving efficiency and affordability of
infrastructure and service delivery within and contiguous to
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the sphere of influence, including, but not limited to, the
consolidation of governmental agencies.
5)Defines, for purposes of LAFCO law, the term "disadvantaged
unincorporated community" to mean inhabited territory, as
defined, or as determined by LAFCO policy, that constitutes
all or a portion of a "disadvantaged community" as it is
defined in the Water Code, which defines "disadvantaged
community" as a community with an annual median household
income that is less than 80% of the statewide annual median
household income.
6)Requires DPH, in administering programs to fund improvements
and expansions of small community water systems, to do all of
the following:
a) Give priority to funding projects in disadvantaged
communities;
b) Encourage the consolidation of small community water
systems that serve disadvantaged communities in instances
where consolidation will help the affected agencies and the
state to meet all of the following goals:
i) Improvement in the quality of water delivered;
ii) Improvement in the reliability of water delivery;
and,
iii) Reduction in the cost of drinking water for
ratepayers.
c) Allow funding for feasibility studies performed prior to
a construction project to include studies of the
feasibility of consolidating two or more community water
systems, at least one of which is a small community water
system that serves a disadvantaged community; and,
d) In instances where it is shown that small community
water system consolidation will further specified goals,
give priority to funding construction projects that involve
the physical restructuring of two or more community water
systems, at least one of which is a small community water
system that serves a disadvantaged community, into a
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single, consolidated system.
7)Establishes SGC in state government to consist of the Director
of State Planning and Research, the Secretary of the Resources
Agency, the Secretary for Environmental Protection, the
Secretary of Business, Transportation and Housing, the
Secretary of California Health and Human Services, and one
member of the public to be appointed by the Governor.
8)Requires SGC to identify and review activities and funding
programs of member state agencies that may be coordinated to
improve air and water quality, improve natural resource
protection, increase the availability of affordable housing,
improve transportation, meet the goals of the California
Global Warming Solutions Act of 2006, encourage sustainable
land use planning, and revitalize urban and community centers
in a sustainable manner.
9)Requires SGC to manage and award grants and loans to support
the planning and development of sustainable communities, and
allows SGC to do all of the following:
a) Develop guidelines for awarding financial assistance,
including criteria for eligibility and additional
consideration;
b) Develop criteria for determining the amount of financial
assistance to be awarded, as specified;
c) Provide for payments of interest on loans, as specified;
d) Provide for the time period for repaying a loan;
e) Provide for the recovery of funds from an applicant that
fails to complete the project for which financial
assistance was awarded;
f) Provide technical assistance for application
preparation; and,
g) Designate a state agency or department to administer
technical and financial assistance programs for the
disbursing of grants and loans to support the planning and
development of sustainable communities.
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FISCAL EFFECT : According to the Assembly Appropriations
Committee, there are minor absorbable costs for DPH.
COMMENTS : According to the author, this bill sets up a
comprehensive approach to increase efficiency of service
delivery and access to clean and affordable water and wastewater
services in disadvantaged communities. First, the bill requires
DPH to promote the consolidation of small water systems that
serve disadvantaged communities and prioritizes funding for
projects involving consolidation to promote safe and affordable
drinking water. Second, the bill allows LAFCOs to assess
various alternatives for improving efficiency and affordability
of service delivery and compliance in specified studies
performed by LAFCOs. And third, the bill allows LAFCOs to
access existing grant funds that support the planning and
development of sustainable communities.
According to the sponsor, the California Rural Legal Assistance
Foundation, there are hundreds of thousands of Californians who
live in disadvantaged communities without the most basic
features of a safe and healthy environment such as clean and
affordable drinking water, adequate wastewater treatment, or
storm water drainage. The author notes that these problems
disproportionately affect families that live in disadvantaged
unincorporated communities, which can range from remote but
concentrated settlements of industrial or agricultural laborers,
to neighborhoods at the fringes of cities and towns that have
been left out of city islands, to islands within cities,
surrounded on all sides by an incorporated city but excluded
from the city's services.
Current LAFCO law specifies various ways that special districts
and other agencies can be reorganized and modified, including
consolidation, dissolution, including dissolution with
annexation, a merger, or establishment of a subsidiary district.
Service reviews (MSRs) were added to LAFCO's mandate with the
passage of the Cortese-Knox-Hertzberg Act in 2000.
A service review is a comprehensive study designed to better
inform LAFCO, local agencies, and the community about the
provision of municipal services. Service reviews attempt to
capture and analyze information about the governance structures
and efficiencies of service providers, and to identify
opportunities for greater coordination and cooperation between
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providers. The service review is a prerequisite to a sphere of
influence determination and may also lead a LAFCO to take other
actions under its authority.
This bill allows LAFCOs to "assess various alternatives for
improving efficiency and affordability of infrastructure and
service delivery for drinking water and wastewater services."
According to the California Association of Local Agency
Formation Commissions (CALAFCO), "nearly half of the thousands
of MSRs conducted by LAFCO include the review of water or
wastewater agencies." CALAFCO believes that current law is
sufficient to meet the desired goals of the bill. Language in
the bill is permissive, thus allowing LAFCOs to do this
additional assessment if they so choose.
AB 783 (Arambula), Chapter 614, Statutes of 2007, required DPH
to prioritize funding of water projects in disadvantaged
communities and directed DPH to promote, provide funds for
studies on, and prioritize funding for projects which
consolidate small public water systems in certain situations.
This bill builds upon those existing provisions to require DPH
to promote the consolidation of small community water systems
and requires DPH to consider findings made through a recent
study or an MSR undertaken by a LAFCO, in their determination of
the feasibility of consolidation.
This bill provides that LAFCOs intending to fund consolidation,
merger or extension of services for projects for the purposes of
promoting water conservation and to support the planning and
development of sustainable communities are eligible for funding
under the Safe Drinking Water, Water Quality and Supply, Flood
Control, River and Coastal Protection Bond Act of 2006
(Proposition 84). SGC is currently tasked with identifying and
reviewing activities and funding programs of member state
agencies that may be coordinated to improve air and water
quality, improve natural resource protection, increase the
availability of affordable housing, improve transportation, meet
the goals of the California Global Warming Solutions Act of
2006, encourage sustainable land use planning, and revitalize
urban and community centers in a sustainable manner. Currently
LAFCOs can only apply through an metropolitan planning
organization or other eligible local agency for grants that
support the preparation of sustainable community strategies from
Proposition 84.
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This bill is the latest in a series of bills to insert the
concerns of disadvantaged communities into local government
planning. SB 1174 (Wolk) of 2010 concentrated on local general
plans; the bill died on the Assembly Appropriations Committee's
suspense file. AB 853 (Arambula) of 2010 focused on the LAFCOs'
municipal service reviews, spheres of influence, and city
annexation procedures; Governor Schwarzenegger vetoed the bill
as "unnecessary." SB 194 (Florez) of 2010 looked at
disadvantaged communities' needs for public works funding;
Governor Schwarzenegger vetoed the bill as "unnecessary."
Another bill, SB 244 (Wolk), Chapter 513, Statutes of 2011,
mandates new duties for LAFCOs, cities, and counties.
Provisions in SB 244, which took effect January 1, 2012, added
the following duties for LAFCOs:
1)Requires the LAFCO, in determining the sphere of influence of
each local agency, to additionally consider, for a city or
special district that provides public facilities or services
related to sewers, municipal and industrial water, or
structural fire protection, the present and probable need for
those public facilities and services of any disadvantaged
unincorporated communities within the existing sphere of
influence, beginning with the next sphere of influence update
on or after July 1, 2012.
2)Allows the LAFCO, in determining a sphere of influence, to
assess the feasibility of governmental reorganization of
particular agencies and recommend reorganization of those
agencies when reorganization is found to be feasible and if
reorganization will further the goals of orderly development
and efficient and affordable service delivery.
3)Requires the LAFCO, in the written statement of its
determinations for a municipal service review to additionally
consider the following:
a) The location and characteristics of any disadvantaged
unincorporated communities within or contiguous to the
sphere of influence;
b) Present and planned capacity of public facilities and
adequacy of public services, and deficiencies including
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needs or deficiencies related to sewers, municipal and
industrial water, and structural fire protection in any
disadvantaged, unincorporated communities within or
contiguous to the agency's proposed sphere of influence;
and,
c) Allows the LAFCO, in conducting a municipal service
review, to assess various alternatives for improving
efficiency and affordability of infrastructure and service
delivery within and contiguous to the sphere of influence,
including, but not limited to, the consolidation of
governmental agencies.
Given that SB 244 only took effect on January 1, 2012, the
Legislature may wish to consider how the implementation of SB
244 is going before amending LAFCO statutes. The Legislature
may wish to consider whether the requirements contained in SB
244 address the goals behind this bill in terms of assessing
feasibility of consolidation and further examination of water
providers in disadvantaged unincorporated communities.
The California Special Districts Association (CSDA) also points
out that "some of the disadvantaged communities with
applications in the pipeline at DPH have been engaged in a
multi-year struggle for resolution to critical health threats."
In order to prevent delays in the delivery of this urgently
needed core infrastructure funding for suffering disadvantaged
communities, CSDA requests the addition of language to clarify
that the bill's provisions will not apply to any applications
submitted to DPH prior to January 1, 2013.
Support arguments: Supporters believe that consolidation of
small water systems could increase the economies of scale and
potentially reduce the costs of service delivery for the
communities being consolidated.
Opposition arguments: In light of new requirements contained in
SB 244 (Wolk), this bill is potentially duplicative and
unnecessary.
Analysis Prepared by : Debbie Michel / L. GOV. / (916)
319-3958 FN: 0003878
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