BILL ANALYSIS                                                                                                                                                                                                    �





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          |                                                                 |
          |         SENATE COMMITTEE ON NATURAL RESOURCES AND WATER         |
          |                   Senator Fran Pavley, Chair                    |
          |                    2011-2012 Regular Session                    |
          |                                                                 |
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          BILL NO: SB 1247                   HEARING DATE: April 10, 2012
          AUTHOR: Gaines                     URGENCY: No
          VERSION: March 26, 2012            CONSULTANT: Dennis O'Connor
          DUAL REFERRAL: No                  FISCAL: Yes
          SUBJECT: Watermaster Service Areas, Cost of Administration.
          
          BACKGROUND AND EXISTING LAW
          The State established the Watermaster Program in 1924.   The 
          main purpose of the program is to ensure that an unbiased and 
          qualified person allocates water according to established water 
          rights.  Watermaster service areas are created by the Department 
          of Water Resources (DWR) either at the request of water users or 
          by order of the Superior Court. 

          The first watermaster service area (WSA) was formed in September 
          1929.  Each WSA corresponds to a distinct set of rivers and 
          streams.  DWR currently provides watermaster services in 12 WSAs 
          in Northern California.

          Prior to 2004, the costs of the watermaster program were to be 
          shared 50-50 between the water rights holders and the state's 
          general fund.  However, DWR also used funds from other programs 
          to help offset costs of the watermaster related activities, such 
          that by 2004 many of the water right holders were only paying 25 
          percent or less of the actual costs of the program. 

          As a part of the 2004-05 budget, the statutes were changed to 
          make the watermaster program funded 100 percent by water rights 
          holders.  

          Notwithstanding the statutory change, DWR continued to 
          supplement the program with funds from other programs.  So, 
          while the costs billed to water rights holders did increase, a 
          significant part of the program's costs were not passed on to 
          the water rights holders.  Senate Budget Subcommittee #2 
          discovered this situation last year, and made the appropriate 
          budget changes to ensure the program is indeed 100 percent 
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          funded by the water rights holders.

          PROPOSED LAW
          This bill would change the funding of the watermaster program 
          back to a 50-50 cost share between the water rights holders and 
          the state's general fund.

          ARGUMENTS IN SUPPORT
          According to the sponsors, failing to fund the watermaster 
          program would result in dramatic fee increases to water right 
          holders; including some up to 800 percent. They assert that both 
          the DWR and the State have seen the value in partially funding 
          the watermaster program as it provides not only a benefit to the 
          water right holders, but it also helps to prevent the waste or 
          unreasonable use of water.  SB 1247 would help reduce the amount 
          paid by the water right holders and would instead allow DWR to 
          pay up to 50 percent of watermaster costs.

          ARGUMENTS IN OPPOSITION: None received

          COMMENTS 
           How Much Money Are We Talking About?   DWR's spreadsheet for the 
          2011-12 watermaster service program compares 2011-12 costs with 
          2005-06 costs.  

          Total costs for the 2011-12 year to be billed to water rights 
          holders are $1,378,000, up 367 percent from 2006-05's $375,000.  


          On a per acre-foot basis, the charges to individual water right 
          holders in 2011-12 will range from $0.56/af to $4.14/af, 
          depending on WSA, or a weighted average of $3.14/af.  This 
          compares to the 2005-06 rates of $0.23/af to $1.61/af, depending 
          on WSA, or a weighted average of $0.86/af.

          The 800 percent increase referred to above in the "Arguments In 
          Support" is for the Shasta WSA.  Charges there will increase 
          from $0.28/af to $2.29/af.

          SUGGESTED AMENDMENTS: None

          SUPPORT
          California Cattleman's Association (Sponsor)

          OPPOSITION
          None Received

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