BILL ANALYSIS �
AB 2238
SENATE COMMITTEE ON ENVIRONMENTAL QUALITY
Senator S. Joseph Simitian, Chairman
2011-2012 Regular Session
BILL NO: AB 2238
AUTHOR: Perea
AMENDED: August 24, 2012
FISCAL: Yes HEARING DATE: August 31,
2012
URGENCY: Yes CONSULTANT: Joanne Roy
SUBJECT : DRINKING WATER
SUMMARY :
Existing law :
1)Pursuant to the California Constitution, Article 2 �10(c),
the Legislature "may amend or repeal an initiative statute
by another statute that becomes effective only when approved
by the electors unless the initiative statute permits
amendment or repeal without their approval."
2)Establishes the Emergency Clean Water Grant Fund (ECWGF) in
the General Fund. (Health and Safety Code (HSC) �116475).
Provisions relating to this Fund:
a) Provide for the continuous appropriation of funds to
the Department of Public Health (DPH) to provide
financial assistance to public water systems and to fund
emergency actions to ensure safe drinking water supplies.
b) Authorize DPH to expend funds for specified purposes
such as:
i) The provision of water supplies and bottled water.
ii) Improvements of an existing water supply system.
iii) Hookups with adjacent water systems.
iv) Design, purchase, and installation of water
treatment technologies.
v) Operation and maintenance of water treatment
technologies.
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c) Require DPH to develop and revise guidelines for the
allocation and administration of ECWGF.
3)Pursuant to Proposition 84 (Prop. 84) (Public Resources Code
(PRC) �75021):
a) Provides a total of $10 million to DPH for grants and
directs expenditures to fund emergency and urgent actions
to ensure the availability of safe drinking water
supplies.
b) Provides that eligible projects include, but are not
limited to:
i) Providing alternative water supplies including
bottled water where necessary to protect public health.
ii) Improvements in existing water systems necessary
to prevent contamination or provide other sources of
safe drinking water including replacement wells.
iii) Establishing connections to an adjacent water
system.
iv) Design, purchase, installation and initial
operation costs for water treatment equipment and
systems.
c) Prohibits grants and expenditures from exceeding
$250,000 per project.
d) Exempts direct expenditures from contracting and
procurement requirements to the extent necessary to take
immediate action to protect public health and safety.
4)Provides funding for public water systems from Safe Drinking
Water State Revolving Fund (SDWSRF) to correct deficiencies
and problems that pose public health risks, and requires DPH
to report to the Legislature about expenditures from the
revolving fund.
5)Under the federal Safe Drinking Water Act, requires the
federal Environmental Protection Agency (US EPA) to set
standards for drinking water quality and oversee the states,
localities, and water suppliers who implement those
standards. California has authority over drinking water,
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delegated by US EPA.
6)Under California Safe Drinking Water Act, establishes the
drinking water program within DPH to regulate public
drinking water systems. (HSC �116275 et seq.).
7)Authorizes point-of-use (POU) and point-of-entry (POE)
devices for water treatment to meet drinking water standards
as specified by state and federal law. Regulations adopted
by DPH must include requirements governing the use of POU
and POE treatment by public water systems in lieu of
centralized treatment where it can be demonstrated that
centralized treatment is not immediately economically
feasible and is limited to: a) less than 200 service
connections, b) uses allowed under the SDWA and its
implementing regulations, and c) water systems that have
submitted pre-applications with DPH for funding to correct
the violations for which the POE and POU treatment is
provided. (�116380).
8)Prohibits DPH from issuing a permit allowing POU treatment
unless DPH determines after conducting a public hearing in
the community served by the public water system that there
is not substantial community opposition to the devices. The
issuance of a permit must be limited to no more than 3 years
or until funding for centralized treatment is available,
whichever is first. (�116552).
This bill as approved by the Senate Environmental Quality
Committee (July 25, 2012 version of the bill) requires DPH to
consider specified information from the appropriate local
agency formation commission when processing an application for
SDWSRF funding.
Amendments taken on the Senate Floor (August 24, 2012 version
of the bill) and subsequently referred back to the Committee
on Environmental Quality pursuant to Senate Rule 29.10 :
1)Strike all of the provisions in the July 25, 2012, version
of the bill and expand actions available for emergency
funding from ECWGF.
2)Authorize DPH to use ECWGF funding for "interim water
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treatment."
3)For purposes of ECWGF, define "public health emergency" to
include:
a) A public water system that:
i) Serves a severely disadvantaged community and
lacks the technical or financial capacity to deliver
potable water or has applied for specified funding.
ii) Has applied for funding for a project to address
the public health emergency and the project is ranked
on the project priority list pursuant to the Safe
Drinking Water State Revolving Loan Fund of 1997.
b) Disruption or contamination of drinking water supplies
caused by natural disasters such as fire, flood,
earthquakes.
4)Cap funding for emergency actions for an alternative water
supply at $50,000 per public water system per public health
emergency.
5)Exempt direct expenditures from contracting and procurement
requirements to the extent necessary to take immediate
action to protect public health and safety.
6)Require DPH to post on its website SDWSRF funding
information regarding small community water systems serving
disadvantaged and severely disadvantaged communities.
7)Add an urgency clause.
COMMENTS :
1) Back on a 29.10 . AB 2238 was amended on the floor and
subsequently referred back to committee in accordance with
Senate Rule 29.10. The amendments to AB 2238 differ from
the version of the bill approved by the Senate
Environmental Quality Committee by stripping out the
contents of the bill and replacing them with provisions
related to ECWGF and DPH reporting requirements.
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2) Purpose of Bill . According to the co-sponsor of the bill,
the Governor's Drinking Water Stakeholder Group, the
purpose of this bill is to "help severely disadvantaged
communities without safe drinking water access alternative
sources of safe drinking water in the immediate term." The
author states, "DPH has limited its allocation of funds for
alternative water supplies to systems that suffer sudden
and temporary interruption of safe drinking water supplies.
This definition means that communities that endure
long-term drinking water contamination are ineligible for
funding, even though the water systems issues "Do not
drink" notices on a continuing basis." The author intends
for this bill to allow these communities to "qualify for
emergency funding for alternative supplies, under specific
circumstances."
3) Background . "Addressing Nitrate in California's Drinking
Water, With a Focus on Tulare Lake Basin and Salinas Valley
Groundwater," a January 1, 2012, report to the Legislature
by the SWRCB in response to SB 1XX, contains several
actions relating to: a) safe drinking water (e.g., small
water system task force, creating new regional safe
drinking water solutions for groups of small water systems
where cost-effective, domestic well testing, stable small
system funds), b) reduction actions (e.g., education and
outreach to help farmers improve efficiency in nitrogen
use, fertilizer excise fee, higher fertilizer fee in risk
areas), c) monitoring and assessment (e.g., RWQCB
designating drinking water areas at risk, monitoring
at-risk populations, groundwater data task force), and d)
funding (e.g., mill fee, local compensation agreements,
fertilizer excise fee, water use fee).
The author states that this report informed a Governor's
office working group and its recommendations. AB 2238 is
one of the group's recommendations but the report made no
reference to the funding proposal in this bill.
4) Why so late ? Some staffers in the governor's office
created a "Governor's Drinking Water Stakeholder Group,"
which submitted an eight-page "Report of the Drinking Water
Stakeholder Group," dated August 20, 2012, and assert that
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AB 2238 is based on a recommendation by the Group.
According to the report, the Group "was challenged with an
aggressive timeline to coincide with the Water Board's
development of their report and the remaining 2011-12
Legislative calendar. The Group was convened in mid-June
and met regularly together and through workshops on key
issues."
Apparently those who created the Group believe the Legislative
session in 2012 reconvenes in late August rather than
January 1, 2012. This leaves little time for legislative
staff to analyze, and for the Legislature and the public to
adequately review, the legislation and more effective
alternatives in a thoughtful and transparent way.
5) No Money in ECWGF . According to DPH, there is no money in
ECWGF and there has not been for several years. Current
law states that ECWGF is continuously appropriated. ECWGF
does not have an automatic source of revenue, so money
would have to be appropriated into the fund. A two-thirds
vote of the Legislature is required for a general
appropriation.
Given these facts, why does this bill exist?
6) Using One Fund To Get To the Money of Another Fund .
Why is HSC �116475 proposed to be amended at this late date in
the legislative process when there is no money in the fund?
According to DPH, the department developed guidance to
administer ECWGF and uses ECWGF guidance as part of the
criteria for awarding Prop. 84 emergency funding.
However, there is a very important difference in criteria
between the two funds. As noted by the Governor's office,
ECWGF moneys are authorized for expenditure on operation
and maintenance. On the other hand, Prop. 84 emergency
funds are restricted to initial operation costs only.
Prop. 84 is a general obligation (GO) bond. GO bonds are
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generally understood to not apply to operation and
maintenance costs.
As noted above, Prop. 84 provides DPH the authority to
expend Prop. 84 emergency funds. However, there is nothing
in HSC �116475 that links ECWGF to Prop. 84 emergency
funding in PRC �75021. There is nothing in statute that
states ECWGF criteria shall govern the award of money in
PRC �75021. However, for administrative convenience, DPH
says that it uses the same criteria from HSC �116475 to
administer PRC �75021. DPH is authorized to administer PRC
�75021 on its own within the scope of authorized
expenditures and criteria approved by the voters. A
question arises as to whether it is appropriate for a
department to use the guidelines and criteria of one fund
to administer another.
7) Prop. 84 Emergency Fund .
The language in AB 2238 addresses one fund only, ECWGF, and is
silent on the proponents' intention to use moneys from
Prop. 84 PRC �75021. There is no mention of Prop. 84 or
PRC �75021 in AB 2238 whatsoever, not even legislative
intent language.
Prop. 84 is an initiative statute that was approved by
California voters in 2006. Prop. 84 PRC �75021, sets aside
$10 million to fund emergency and urgent actions to address
drinking water issues. There is currently over $9 million
in this fund.
In PRC �75021, the voters gave a list of actions eligible for
funding that illustrates the types of projects DPH is
expected to provide grants and direct expenditures from the
Prop. 84 emergency fund. DPH does not have the authority
to spend outside of the scope of authorized expenditures.
PRC �75021 seems to grant DPH sole discretion to direct the
expenditure of Prop. 84 funds. According to DPH, "the
Department may review and revise criteria used for Prop. 84
to determine if changes can be made to allow communities
access to those funds."
In addition, PRC �75021 cannot be changed by the Legislature
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because the initiative did not give the Legislature the
statutory authority to do so. Prop. 84 is silent on
granting such authority in PRC �75021 compared to
specifically authorizing it in other sections, such as PRC
�75025 which provides $60 million to address groundwater
contamination issues. In conformance with California
Constitution Article 2 �10(c), the omission of granted
authority means that the Legislature may not amend or
repeal PRC �75021.
Speaking with proponents of AB 2238, they seem to be under the
impression that the Prop. 84 emergency fund is only used
for natural disasters in wealthy communities. This is not
the case. The following are a few recipients of PRC �75021
funding and projects funded: Lanare Community Service
District to weld new pipe and valves to a new well in order
to eliminate arsenic from the water supply; Ducor Community
Service District to replace the system's main well pump and
motor; and Tooleville to replace the system's main well
pump and motor.
8) Not A "Public Health Emergency" . There is no question that
providing potable water to severely disadvantaged
communities with contaminated drinking water supplies is a
serious issue. However, is deeming this chronic condition
a "public health emergency" appropriate?
a) "Public Health Emergency" . As related to drinking
water, in administering Prop. 84 funds, DPH defines
"public health emergency" as "an emergent health hazard
of such magnitude that immediate remedial action is
necessary to prevent the contamination or potential
contamination of the water supplied by a public water
system." "An emergent health hazard of such magnitude
that immediate remedial action is necessary" does not
apply strictly to natural disasters or catastrophic
events. For example, a well pump that unexpectedly
breaks down and needs to be immediately replaced may
likely be considered an emergency because without the
pump, there may be no water supply at all for a
community.
In AB 2238, "public health emergency" includes a public
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water system that lacks the technical or financial
capacity to deliver water that meets primary drinking
water standards or has applied "for funding for a
project to address the public health emergency" and the
project is ranked on the Safe Drinking Water State
Revolving Fund list. AB 2238's definition of "public
health emergency" essentially equates a public water
system's lack of technical or financial capacity with an
acute condition. The proponents seek to address chronic
problems and not acute ones which are traditionally
considered emergencies. In addition, the bill provides
that being in queue for project funding is considered an
emergency as well.
b) "Public Health Threat" . As related to drinking
water, in administering Prop. 84 funds, DPH defines
"public health threat" as "a situation involving an
imminent health hazard due to serious defects where
corrective action is necessary to prevent or alleviate
the contamination or potential contamination of the
water supplied by a public water system."
A severely disadvantaged community that does not have the
technical or financial capacity to ensure potable
drinking water can arguably pose "an imminent health
hazard." The contaminated water can potentially cause
sickness if the water is not adequately treated and an
unsafe amount of contaminated water is ingested. In
addition, these cases may be considered "due to serious
defects where corrective action is necessary to prevent
or alleviate?contamination?of water supplied by a public
water system." "Technical capacity" refers to the
physical infrastructure of the water system such as
source water adequacy, infrastructure adequacy, and
technical knowledge. "Financial capacity" refers to the
financial resources of the water system such as fiscal
controls, revenue sufficiency, and ability to access
funds when needed. These public water systems may not
be equipped to clean the water to requisite level and
need to be fixed or addressed in a manner that delivers
clean, potable water to these communities. The issue
trying to be addressed by AB 2238 fits within the term,
"public health threat."
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As noted above, providing potable drinking water to
severely disadvantaged communities with contaminated water
supplies is indisputably a serious issue that needs to be
addressed and is more accurately and suitably described as
a "public health threat" not a "public health emergency."
Although one may argue that this is just semantics, it is
not. It is proposed to be enacted as law and people are
expected to interpret, rely on, and obey these words.
DPH provides funding for both public health threats and
public health emergencies from the same Prop. 84 fund.
Activities eligible for funding to address public health
threats and public health emergencies are the same as well.
9) "Interim Water Treatment" is Vague . AB 2238 authorizes
ECWGF money to be used for the payment of "the provision of
interim water treatment" (HSC �116475(b)(5)). Interim
water treatment can apply to a variety of actions,
including point-of-use (POU) and point-of-entry (POE) water
treatment devices.
The Senate Environmental Quality Committee and the
Legislature have acknowledged a need to allow for the use
of this lesser technology in cases where small,
disadvantaged communities need temporary relief while they
develop a permanent centralized treatment facility.
However, concern may be raised that this bill encourages
development of small communities without adequate
infrastructure in an effort to save money at the cost of
public health protection - while also encouraging
development in more isolated and rural areas.
In addition, current law has several requirements and
restrictions on the use of POU and POE treatment by a
public water system. For example, HSC �116552 prohibits
DPH from issuing a permit allowing POU treatment unless DPH
determines after conducting a public hearing in the
community served by the public water system that there is
not substantial community opposition to the devices.
Although "emergency" infers immediate action, DPH would
still have to abide by the permit and public hearing
requirements for POU treatment if that is the purpose of an
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emergency grant.
Also, current law requires that the issuance of a POU
permit must be limited to no more than three years or until
funding for centralized treatment is available, whichever
is first. Long-term fixes can take several years beyond
the maximum of three years that a POU treatment device may
be permitted for use. How long should an "interim water
treatment" last?
10)A Legislative Fix Is NOT Appropriate . Prop. 84 emergency
fund use and criteria cannot be amended by the Legislature
but is within the discretion of DPH. The department must
adhere to the scope of authority granted by the voters. The
Governor is the sponsor of this bill. The Governor is
seeking a legislative remedy to gain broader access to the
Prop. 84 emergency fund by amending a different fund,
ECWGF. Considering Prop. 84 specifically grants DPH the
authority to handle the Prop. 84 emergency fund, why does
the Governor not address this issue directly with DPH, a
department that is within his Administration?
SOURCE : Governor Edmund G. Brown, Jr., Governor's
Drinking Water Stakeholder Group, and Clean
Water Action
SUPPORT : California Association of Environmental Health
Administrators, California Bean Shippers
Association, California Cotton Ginners
Association, California Cotton Growers
Association, California Farm Bureau Federation,
California Grain and Feed Association,
California Rural Legal Assistance, California
Seed Association, California Pear Growers
Association, California Rice commission,
Community Water Center, Environmental Justice
Coalition for Water, Monterey County Board of
Supervisors, Pacific Egg and Poultry
Association, Safe Water Alliance, San Jerardo
Cooperative, Inc., Western Agricultural
Processors Association, Western United Dairymen
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OPPOSITION : None on file