BILL ANALYSIS �
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| SENATE COMMITTEE ON NATURAL RESOURCES AND WATER |
| Senator Fran Pavley, Chair |
| 2013-2014 Regular Session |
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BILL NO: SB 1250 HEARING DATE: April 29, 2014
AUTHOR: Hueso URGENCY: Yes
VERSION: April 21, 2014 CONSULTANT: Dennis O'Connor
REFERRALS: Environmental Quality & FISCAL: Yes
Governance and Finance
SUBJECT: Safe, Clean, and Reliable Drinking Water Supply Act of
2014.
BACKGROUND AND EXISTING LAW
In November 2009, the legislature passed and the governor signed
SBX7 2 (Cogdill). Also known as the Safe, Clean, and Reliable
Drinking Water Supply Act of 2010, that law placed on the
November 2010 ballot an $11.14 B general obligation bond before
the voters to fund various water resources programs and
projects.
The legislature has amended the bond proposal three times,
including twice delaying the placement of the bond before the
voters. After initially being delayed to the November 2012
ballot, the bond was subsequently delayed to the November 2014
ballot, where it remains now.
Over the course of the last year or two, there has been much
discussion on whether the public would support the current
November 2014 bond proposal. Moreover, if the voters would not
support that bond proposal, what, if anything, should take its
place on the ballot?
To help answer those questions, this Committee held a joint
hearing in February with the Senate Governance and Finance
Committee titled "Overview of California's Debt Condition:
Priming the Pump for a Water Bond." That hearing explored
California's overall debt condition, the fund balances for
various bond funded programs, and the implications for the
November 2014 water bond.
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This was followed two weeks later by a second hearing which
asked the question "What's Changed Since the Legislature Passed
the Safe, Clean, and Reliable Drinking Water Supply Act of
2010?" That hearing highlighted some of the unanticipated
developments that occurred since the drafting of the bond, and
posed the policy question "What changes, if any, should be made
to the bond in light of recent developments?"
Later, on September 24, 2013, the Senate Environmental Quality
and the Natural Resources and Water held a joint hearing titled
"Setting the Stage for a 2014 Water Bond: Where Are We and Where
Do We Need To Go?" That hearing focused on where the various
legislative bond discussions stood, identified issues that may
need additional attention, and, where appropriate, suggested
alternative approaches for consideration of the members.
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PROPOSED LAW
This bill would replace the $11.14 B water bond that is
currently on the November 2014 ballot with a new $9.45 B general
obligation bond titled "The Safe, Clean, and Reliable Drinking
Water Supply Act of 2014."
The proposed bond measure is organized as follows:
Chapter 1.Short Title
Chapter 2 Findings and Declarations
Chapter 3.Definitions
Chapter 4.General Provisions
$900 M Chapter 5.Clean, Safe, and Reliable
Drinking Water
1,000 Chapter 6.Water Supply Reliability and
Drought Preparedness
2,250 Chapter 7.Delta Sustainability
3,000 Chapter 8.Statewide Water System
Operational Improvement for Drought
Preparedness
1,300 Chapter 9.Protecting Rivers, Lakes,
Streams, Coastal Waters, and Watersheds
500 Chapter 10.Groundwater Sustainability
500 Chapter 11.Water Recycling Program
_________ Chapter 12.Fiscal Provisions
$9,450 M
Chapter 5. Clean, Safe, and Reliable Drinking Water. This
chapter would authorize $900 M, upon appropriation by the
Legislature, for the following purposes:
Reduce contaminants in drinking water supplies regardless of
the source of the water or the contamination.
Address the critical and immediate needs of disadvantaged,
rural, or small communities that suffer from contaminated
drinking water supplies.
Leverage other private, federal, state, and local drinking
water quality and wastewater treatment funds.
Reduce contaminants in discharges to, and improve the quality
of, surface water streams.
Improve water quality of surface water streams, including
multibenefit stormwater quality projects.
Prevent further contamination of drinking water supplies.
Provide disadvantaged communities with public drinking water
infrastructure that provides clean and safe drinking water
supplies that the community can sustain over the long term.
Ensure access to clean, safe, and affordable drinking water
for California's communities.
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This chapter would further require:
Projects to be selected by a competitive grant or loan process
with added consideration for those projects that leverage
private, federal, or local funding. This would not apply to
projects that address a public health priority for which no
other source of funding can be identified.
Any agency administering grants or to assess the capacity of a
community to pay for the operation and maintenance of the
facility to be funded.
Projects receiving funding authorized by this chapter could be
implemented by any public water system or other public water
agency.
Funds provided by this chapter would be available as follows:
$400 Mfor deposit in the State Water Pollution Control
Revolving Fund Small Community Grant Fund for grants
for wastewater treatment projects. Priority would be
given to projects that serve disadvantaged communities
and severely disadvantaged communities, and to projects
that address public health hazards.
100 Mfor deposit in the Emergency Clean Water Grant Fund for
grants and direct expenditures to finance public health
emergencies and urgent actions to ensure that safe
drinking water supplies are available to all
Californians. Eligible projects include, but are not
limited to, the following:
Providing interim water supplies, including
bottled water.
Projects that improve or replace existing
water systems, provide other sources of safe drinking
water, including replacement wells, and prevent
contamination.
Establishing connections to an adjacent
water system.
The design, purchase, installation, and
initial operating costs for interim water treatment
equipment and systems.
The administering entity may expend up to $10 M for
grants and loans to address the water quality needs of
private well owners that have no other source of
funding and serve members of a disadvantaged community.
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400 Mfor grants and loans for public water system
infrastructure improvements and related actions to meet
safe drinking water standards, ensure affordable
drinking water, or both.
Priority would be given to projects for
small community water systems or state small water
systems in disadvantaged communities whose drinking
water source is impaired by chemical and nitrate
contaminants and other health hazards identified by
the implementing agency.
The implementing agency could make grants to
finance feasibility studies and to meet the
eligibility requirements for a construction grant.
Eligible expenses could include initial
operation and maintenance costs for systems serving
disadvantaged communities.
Special consideration would be given to
projects that provide shared solutions for multiple
communities served by a small community water system,
state small water system, or a private well.
Construction grants would be limited to $5 M
per project, except that the implementing agency may
set a limit of not more than $20 M for projects that
provide regional benefits or are shared among
multiple entities.
Not more than 25 percent of a grant could be
awarded in advance of actual expenditures.
The administering entity could expend up to
$25 M of the funds for technical assistance to
eligible communities.
Chapter 6. Water Supply Reliability and Drought Preparedness.
This chapter would authorize $1,000 M, upon appropriation by the
legislature, to DWR for grants to eligible projects that
implement an adopted integrated regional water management plan.
The funds would be distributed among 12 regions for
competitive grants within each region. The regional
distribution was a fixed amount per region with the balance
distributed by population.
Projects would be required to have not less than a 50% local
cost share. DWR could waive or reduce the cost-sharing
requirement for projects that directly benefit a disadvantaged
community or an economically distressed area.
Not less than 10 % of the funds would be allocated to
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disadvantaged communities.
Chapter 7. Delta Sustainability. This chapter would authorize
$2,250 M, upon appropriation by the legislature, for grants and
direct expenditures as follows:
$750 Mfor projects that support Delta sustainability
options. Of that amount, $50 M is for improvements to
wastewater treatment facilities upstream of the Delta
to improve Delta water quality, and $250 M is to
provide assistance to local governments and the local
agricultural economy due to loss of productive
agricultural lands for habitat and ecosystem
restoration within the Delta.
Projects that receive funding from this category would
be eligible for funding through other provisions of
this bond to the extent that the combined state funding
from this division did not exceed 50 percent of the
total project costs.
1,500 Mfor projects to protect and enhance the
sustainability of the Delta ecosystem, including
projects for the development and implementation of the
Bay Delta Conservation Plan and other projects to
protect and restore native fish and wildlife dependent
on the Delta ecosystem.
Funds would be available for appropriation to, among other
entities, the Sacramento-San Joaquin Delta Conservancy for
implementation consistent with the Delta Plan.
Chapter 8. Statewide Water System Operational Improvement for
Drought Preparedness. This chapter would continuously
appropriate $3,000 M to the California Water Commission (CWC)
for public benefits associated with water storage projects.
Eligible projects consist of only the following:
Surface storage projects identified in the CALFED Bay-Delta
Program Record of Decision, dated August 28, 2000, not
including projects prohibited under the California Wild and
Scenic Rivers Act. That is, Sites Reservoir, Temperance Flat
Reservoir, the Delta Wetlands Project, and Los Vaqueros
Reservoirs are eligible projects.
Groundwater storage projects and groundwater contamination
prevention or remediation projects that provide water storage
benefits.
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Conjunctive use and reservoir reoperation projects.
Local and regional surface storage projects that improve the
operation of water systems in the state and provide public
benefits.
Projects that improve dam stability in seismic events.
Projects must provide measurable improvements to the Delta
ecosystem or to the tributaries to the Delta.
Projects are to be selected by the CWC through a competitive
public process that ranks potential projects based on the
expected return for public investment as measured by the
magnitude of the public benefits provided.
Public benefits to be considered are limited to the following:
Ecosystem improvements.
Water quality improvements in the Delta, or in other river
systems, that provide significant public trust resources, or
that clean up and restore groundwater resources.
Flood control benefits.
Emergency response, including, but not limited to, securing
emergency water supplies and flows for dilution and salinity
repulsion following a natural disaster or act of terrorism.
Recreational purposes, including, but not limited to, those
recreational pursuits generally associated with the outdoors.
The CWC, in consultation with the Department of Fish and
Wildlife, the State Water Resources Control Board, and DWR,
would be required to develop and adopt, by regulation, methods
for quantification and management of public benefits by December
15, 2016.
No funds may be allocated for a project before all of the
following have occurred: December 15, 2016, and until the CWC
determines that all of the following have occurred:
The CWC has adopted the regulations regarding public benefits
and has quantified and made public the cost of the public
benefits associated with the project.
The project applicant has entered into a contract with each
party that will derive benefits, other than public benefits,
from the project that ensures the party will pay its share of
the total costs of the project. The benefits available to a
party shall be consistent with that party's share of total
project costs.
The project applicant has entered into a contract with each
public that administers the public benefits to ensure that the
public contribution achieves the public benefits identified
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for the project.
The CWC has held a public hearing to provide an opportunity
for the public to review and comment on the information
required to be prepared pursuant to this subdivision.
Feasibility studies have been completed.
The CWC has found and determined that the project is
feasible, is consistent with all applicable laws and
regulations, and will advance the long-term objectives of
restoring ecological health and improving water management
for beneficial uses of the Delta.
All environmental documentation associated with the project
has been completed, and all other federal, state, and local
approvals, certifications, and agreements required to be
completed have been obtained.
The public benefit cost share could not exceed 50 percent of the
total costs of a project. This limit would not apply to
conjunctive use and reservoir reoperation projects.
At least 50% of total public benefits of the project would be
required to be ecosystem improvements
A project would not be eligible for funding unless, by January
1, 2022, all of the following are met:
All feasibility studies are complete and the draft
environmental documents are available for public review.
The CWC finds that the project is feasible, and will advance
the long-term objectives of restoring ecological health and
improving water management for beneficial uses of the Delta.
The project applicant receives commitments for not less than
75 percent of the nonpublic benefit cost share of the project.
The January 1, 2022 date would be tolled in the event meeting
that deadline was delayed by litigation or failure to promulgate
regulations.
Funds for CALFED projects may be provided to local joint powers
authorities (JPA) formed by irrigation districts and other local
water districts and local governments within the applicable
hydrologic region to design, acquire, and construct those
projects.
The JPA may include governmental partners not located within
the hydrologic regions. The JPA could not include in their
membership any for-profit corporation, or any mutual water
company whose shareholders and members include a for-profit
corporation or any other private entity. DWR would be required
to be an ex officio member of each such JPA, but DWR could not
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control the governance, management, or operation of the
surface water storage projects.
The JPA would own, govern, manage, and operate a surface water
storage project, subject to the requirement that the
ownership, governance, management, and operation of the
surface water storage project shall advance the purposes set
forth in this chapter.
Any amendment of the provisions of this chapter by the
Legislature would require a two-thirds vote in each house of the
Legislature and voter approval.
Chapter 9. Protecting Rivers, Lakes, Streams, Coastal Waters,
and Watersheds. This chapter would provide, upon appropriation
by the Legislature, $1,300 M in funding for expenditures and
grants for multibenefit ecosystem and watershed protection and
restoration projects in accordance with statewide priorities.
The purposes of this chapter would be to:
Protect and increase the economic benefits arising from
healthy watersheds, fishery resources, and instream flow.
Implement watershed adaptation projects to reduce the impacts
of climate change on California's communities and ecosystems.
Restore river parkways throughout the state, including through
the California River Parkways Act of 2004, the Urban Streams
Restoration Program, and urban river greenways.
Protect and restore aquatic, wetland, and migratory bird
ecosystems, including fish and wildlife corridors and the
acquisition of water rights for instream flows.
Fulfill the obligations of the State of California in
complying with the terms of multiparty settlement agreements
related to water resources.
Remove barriers to fish passage.
Collaborate with federal agencies in the protection of fish
native to California and wetlands in the central valley of
California.
Implement fuel treatment projects to reduce wildfire risks,
protect watersheds tributary to water storage facilities, and
promote watershed health.
Protect and restore rural and urban watershed health to
improve watershed storage capacity, forest health, protection
of life and property, stormwater resource management, and
greenhouse gas reduction.
Promote access and recreational opportunities to watersheds
and waterways that are compatible with habitat values and
water quality objectives.
Promote educational opportunities to instruct and inform
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Californians about the value of watersheds.
Protect and restore coastal watersheds, including bays, marine
estuaries, and nearshore ecosystems.
Reduce pollution or contamination of rivers, lakes, streams,
or coastal waters, prevent and remediate mercury contamination
from legacy mines, and protect or restore natural system
functions that contribute to water supply, water quality, or
flood management.
Assist in the recovery of endangered, threatened, or migratory
species by improving watershed health, instream flows, fish
passage, coastal or inland wetland restoration, or other
means, such as through natural community conservation and
habitat conservation plans.
Promote urban forestry though the Urban Forest Act of 1978.
To guide the expenditure of funds described in this chapter:
The Natural Resources Agency (NRA) would be required to
develop a statewide natural resource protection plan to
identify priorities consistent with the purposes of this
section. All expenditures by state conservancies and state
agencies of funds described in this section would be required
to advance the priorities set forth in the statewide natural
resource protection plan. The plan would aggregate and
coordinate existing state planning efforts, and would be
completed within one year of voter approval of the bond.
State conservancies expending funds provided from this
subdivision would be required to provide biannual written
reports to NRA on expenditures made and how those expenditures
advance the statewide priorities set forth in the NRA
statewide natural resource protection plan.
The NRA would produce and make available to the public
biannual written reports on total expenditures made and
progress toward meeting statewide priorities.
Funds provided by this chapter would be available as follows:
$550 Mwould be distributed to undefined regions pursuant
to an undefined schedule.
500 Mto fulfill the obligations of the State of California in
complying with the terms of any of the following:
The February 18, 2010, Klamath Basin
Restoration Agreement or Klamath Hydroelectric
Settlement Agreement.
The Quantification Settlement Agreement.
The San Joaquin River Restoration
Settlement.
Refuge water supply acquisition pursuant to
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the Central Valley Project Improvement Act.
Other multiparty settlement agreements in
effect as of January 1, 2014, including the Tahoe
Regional Planning Compact.
250 Mto the Natural Resources Agency to support projects of a
state conservancy, excluding the Delta Conservancy, as
provided in the conservancy's strategic plan.
Chapter 10. Groundwater Sustainability. This chapter would
provide, upon appropriation by the Legislature, $500 M in
funding or expenditures, grants, and loans for projects to
prevent or cleanup the contamination of groundwater that serves
or has served as a source of drinking water. Funds appropriated
pursuant to this section would be available for projects
necessary to protect public health by preventing or reducing the
contamination of groundwater that serves or has served as a
major source of drinking water for a community.
Projects would be prioritized based upon the following criteria:
The threat posed by groundwater contamination to the affected
community's overall drinking water supplies, including an
urgent need for treatment of alternative supplies or increased
water imports if groundwater is not available due to
contamination.
The potential for groundwater contamination to spread and
impair drinking water supply and water storage for nearby
population areas.
The potential of the project, if fully implemented, to enhance
local water supply reliability.
The potential of the project to maximize opportunities to
recharge vulnerable, high-use groundwater basins and optimize
groundwater supplies.
The project addresses contamination at a site for which the
courts or the appropriate regulatory authority has not yet
identified responsible parties, or where the identified
responsible parties are unwilling or unable to pay for the
total cost of cleanup.
The Legislature, by statute, would be required to establish both
of the following:
A requirement that the grantee repay grant funds in the event
of cost recovery from the parties responsible for the
groundwater contamination.
A requirement that the grantee make reasonable efforts to
attempt to recover the costs of cleanup from the parties
responsible for the contamination, except that a grantee shall
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not be required to seek cost recovery related to the costs of
response actions apportioned to responsible parties who are
insolvent or cannot be identified or located or when a
requirement to seek cost recovery would impose a financial
hardship on the grantee.
Other provisions include:
Projects would be selected by a competitive grant or loan
process with added consideration for those projects that
leverage private, federal, or local funding.
Projects would require a local cost share of not less than 50
percent of the total costs of the project. The cost-sharing
requirement could be waived or reduced for projects that
directly benefit a disadvantaged community or an economically
distressed area.
Any agency administering grants or loans would be required to
assess the capacity of a community to pay for the operation
and maintenance of the facility to be funded.
At least 10 percent of the funds available pursuant to this
chapter would be allocated for projects serving severely
disadvantaged communities.
Any agency administering funding from this chapter would be
required to operate a multidisciplinary technical assistance
program for small and disadvantaged communities and shall
provide funding for technical assistance to disadvantaged
communities.
Chapter 11. Water Recycling Program. This chapter would
provide, upon appropriation by the Legislature, $500 M in
funding for grants for water recycling and advanced treatment
technology projects, including all of the following:
Water recycling projects, including, but not limited to,
treatment, storage, conveyance, and distribution facilities
for potable and nonpotable recycling projects.
Contaminant and salt removal projects, including groundwater
and seawater desalination and associated treatment, storage,
conveyance, and distribution facilities.
Dedicated distribution infrastructure to serve residential,
agricultural, commercial, and industrial end-users to allow
the use of recycled water.
Pilot projects for new salt and contaminant removal
technology.
Groundwater recharge infrastructure related to recycled water.
Technical assistance and grant writing assistance for
disadvantaged communities.
Projects would require a local cost share of not less than 50
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percent of the total costs of the project. The cost-sharing
requirement could be waived or reduced for projects that
directly benefit a disadvantaged community or an economically
distressed area.
Projects would be selected on a competitive basis, considering
all of the following criteria:
Water supply reliability improvement.
Water quality and ecosystem benefits related to decreased
reliance on diversions from the Delta or instream flows.
Public health benefits from improved drinking water quality.
Cost effectiveness.
Energy efficiency and greenhouse gas emission impacts.
Reasonable geographic allocation to eligible projects
throughout the state, including both northern and southern
California and coastal and inland regions.
The program authorized by this chapter would be required to be
implemented consistent with water recycling programs established
under Proposition 13 (2000) or consistent with desalination
programs established under Proposition 50 (2002).
Other Provisions of the Bond:
Of the $9.45 B in bonds authorized in this measure, not $4.725
B could be sold by the Treasurer before July 1, 2019.
No more than 5 percent of the funds allocated for a program
could be used to pay the administrative costs of that program.
Up to 10 percent of funds allocated for each program could be
used to finance planning and monitoring necessary for the
successful design, selection, and implementation of the
projects authorized under that program.
Each state agency administering a bond funded competitive
grant program would be required to develop project
solicitation and evaluation guidelines. The guidelines could
include a limitation on the dollar amount of grants to be
awarded.
Exempts all bond funded programs, except those funded by
Chapter 8. Statewide Water System Operational Improvement for
Drought Preparedness, from Administrative Law review of
guidelines, funding criteria, etc.
Establishes the intent of the people that the investment of
public funds pursuant to this division will result in public
benefits.
The State Auditor would be required to conduct an annual
programmatic review and an audit of expenditures from the
fund. The State Auditor would report its findings annually on
or before March 1 to the Governor and the Legislature, and
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would make the findings available to the public.
The Legislature would be authorized to enact legislation
necessary to implement programs funded by this measure.
Bond funds may not be expended to support or pay for the costs
of environmental mitigation measures except as part of the
environmental mitigation costs of projects financed by this
bond. Funds provided by this division may be used for
environmental enhancements or other public benefits.
Funds provided by this division could not be expended to pay
the costs of the design, construction, operation, mitigation,
or maintenance of Delta conveyance facilities. Those costs
would be the responsibility of the water agencies that benefit
from the design, construction, operation, or maintenance of
those facilities.
Eligible applicants would be public agencies, public utilities
and nonprofit organizations. A public agency could use funding
authorized by this division to benefit recipients of water
from mutual water companies that operate a public water system
if the funding provides public benefits. To be eligible for
funding under this division, a project proposed by a public
utility would be required to have a clear and definite public
purpose, benefit its customers, and comply with Public
Utilities Commission rules on government funding for public
utilities.
ARGUMENTS IN SUPPORT
According to a number of water agencies, "SB 1250 would
authorize critically needed funding to achieve the coequal goals
of a more reliable water supply for California and improved
ecosystem health in the Delta. The measure proses appropriate
levels of funding for water storage, Delta sustainability,
groundwater cleanup and other local programs such as water
conservation and recycling that are essential to the state's
water future."
"The need for a comprehensive water bond has never been more
urgent. California remains locked in a severe drought, and
public awareness and concern about water are at an all-time
high. Now is the time to act and place a responsible bond
before voters this November."
ARGUMENTS IN OPPOSITION: None received
COMMENTS
Funding Categories and Geographic Equity. This bond would
provide more than half it's funding to support the Delta and
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create more storage. These funds would not benefit those parts
of the state outside of the Central Valley that are not served
by the Central Valley Project or State Water Project; namely,
the Central and North Coasts. This bond also does not provide
specific funding for stormwater capture and use projects.
Amendments Required To Resolve Fundamental Issues
1.Identifying Agencies. Previous resources bonds have, for most
of the programs authorized by those bonds, designated which
specific state agency would be responsible for managing and
disbursing the funds for each program. This practice has been
continued both in the current 2014 bond and in the other water
bonds introduced this year. In contrast, SB 1250 has
generally not designated which specific state agency would be
responsible for managing and disbursing funds for each
program. This would mean such decisions would need to be
resolved through the annual budget process.
From a practical perspective, this means each year the
Governor would propose which state agency would manage the
bond funds appropriated that year, placing the Legislature in
a purely reactive stance.
Additionally, not designating in the bond which agency is to
manage the bond program imposes administrative challenges on
the program managing agencies as well. If, for example, the
State Water Board knew that it would manage the entire $500 M
proposed for the water recycling program, it could at the
outset plan on having, say, one round of planning grants and
two rounds of projects grants. It could also work with the
stakeholder community to tentatively plan the timing of those
grant cycles.
Similarly, conservancies often work on very long timelines.
Knowing that a set amount of funds would be available over
time allows them to more effectively plan their acquisition
and restoration activities.
Amendment 1 amends the bill as follows:
Designates specific agencies to receive and manage funds
for each bond funded program authorized in this bill,
consistent with existing program authorities and practice.
For Chapter 6 regarding water supply reliability and
drought preparedness, designates DWR to manage the regional
program, with project awards to be made in collaboration
with the State Water Board.
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For Chapter 7 regarding Delta sustainability, designates
DWR to manage Delta levee improvement programs and the
Delta Conservancy to manage all the rest.
For Chapter 9 regarding watershed activities, changes
the funding from a regional allocation to specific
allocations to the various state conservancies, Wildlife
Conservation Board, and Ocean Protection Council, in rough
proportion to that in SB 848 as it passed out of this
committee.
2.Continuous Appropriation. This bill provides that funds for
water storage projects would be continuously appropriated to
the California Water Commission. As noted in the committee
background for our September 25, 2013 informational hearing,
continuous appropriations eliminate one of the Legislature's
key checks on the powers of the executive branch, namely, the
power to appropriate funds.
Amendment 2 amends the bill as follows:
Makes all bond funds, including those authorized for
water storage projects, subject to appropriation by the
Legislature.
3.Regional Watershed - Who put the Natural Resources Agency
(NRA) in charge? This bill proposes that the NRA develop a
statewide natural resource protection plan, and further
requires all conservancies and agencies expending watershed
fund provide by this bond to advance the priorities set forth
in that plan.
Since at least the Wilson administration, Secretaries of NRA
have wanted to exert more influence on the operations of the
state's many conservancies and related agencies. To date,
they have received little if any Legislative support in their
efforts. This is in large part because the Legislature
created most conservancies because the local or regional
citizenry believed they were being ill-served by programs run
out of Sacramento. In response, the Legislature has created a
number of conservancies and other agencies to develop and run
regional watershed and resource conservation programs to
reflect the regions' priorities. Indeed, one of the reasons
Conservancies are supported by local citizenry is because
there are usually a large number of locally appointed
representatives on the conservancies' boards.
If it is in fact desirable to create a more centralized
structure for overseeing conservancies, a policy bill would be
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a more appropriate vehicle.
Amendment 3 amends the bill as follows:
Deletes the requirement for the NRA to develop a
statewide natural resource protection plan.
4.Regional Watershed - What's wrong with regional priorities
being developed regionally? This bill makes numerous
references to conservancies expending funds consistent with
undefined statewide priorities. As noted above, one of the
main reasons for having regional conservancies was so their
programs and projects would reflect regional priorities.
Amendment 4 amends the bill as follows:
Deletes references to statewide priorities in Chapter 9
and instead authorizes funds to be used for "projects that
protect and improve California watersheds, wetlands,
forests, and floodplains."
Deletes the requirement for conservancies to provide
biennial reports to the NRA regarding how expenditures
conform to statewide priorities.
5.BDCP - There is a general sense a successful bond would have
no direct connection to the Bay-Delta Conservation Plan. The
often repeated phrase is that a bond needs to be BDCP neutral.
This bill would include language in Delta provisions that
explicitly make eligible for funding "[p]rojects for the
development and implementation of the Bay Delta Conservation
Plan ?"
Amendment 5 amends the bill as follows:
Deletes the reference to BDCP in Chapter 7.
Amendments Required To Solve Policy Concerns
6.Compliance. The background observed that while each bond
proposal made grants contingent on complying with specific
statutes, proposals were not consistent regarding which
statutes are prerequisite. This measure does not require DWR
to certify that IRWMP applicants are compliant with the Urban
Water Management Planning Act, Agricultural Plans, or
Groundwater Management plan requirements. Instead, DWR would
likely continue its current practice of having agencies
self-certify that they are compliant.
While this may seem efficient, committee staff is aware of a
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number of instances where agencies have in fact not been fully
compliant with statutory requirements and yet received bond
funds. Staff of the Delta Stewardship council have made
similar observations. If a requirement is important enough
for the Legislature to put it in statute, it is important
enough for the bond managing agencies to ensure full
compliance with that statute.
Amendment 6 amends the bill as follows:
Adds a requirement that DWR certify that IRWMP
applicants are compliant with the Urban Water Management
Planning Act, Agricultural Plans, or Groundwater Management
Plan requirements, as appropriate.
Makes other technical and conforming changes to the bill
regarding compliance with existing statutes.
7.Regional Watershed - Multibenefit watershed projects for water
supply and other purposes? This bill proposes to provide
$250M to the NRA for projects to support projects consistent
with a conservancy's strategic plan. This is in addition to
the other funds provided to conservancies by this bond.
Instead of providing the NRA with money to fund more of the
same types of projects the conservancies were likely to fund
anyway, to use these funds for stormwater capture and use
projects.
Amendment 7 amends the bill as follows:
Deletes the provisions providing $250 M to the NRA for
projects to support projects consistent with a
conservancy's strategic plan and instead makes the funds
available for stormwater capture and use projects.
8.Matching Rates. This bill requires a 50 percent cost share
for most grant programs, which can be reduced or waived for
disadvantaged communities. Some complain the 50% share is
difficult for smaller, though not disadvantaged, communities
to afford.
Amendment 8 amends the bill as follows:
Reduces matching rates to 25 percent that can be reduced
or waived for disadvantaged communities.
Amendments Necessary To Address Other Issues
9.Studies? The committee background for our September 25, 2013
informational hearing observed that none of the proposals
included funding for studying the feasibility of additional
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surface storage projects. An amendment is needed to provide
$25 M to DWR for studying the feasibility of additional
surface storage projects.
10.Watersheds of statewide interest - Refuge water supply? This
bond would provide $500 M to fulfill the obligations of the
state in complying with specific settlements and other
obligations. Included in this list is "Section 3406(d) of
Title 34 of Public Law 102-575." This is a provision in the
federal law, the Central Valley Project Improvement Act, which
calls for California to fund 25 percent of the costs to
provide water for federal wildlife refuges. Funding annual
purchases of water with bond funds would not be consistent
with good debt financing policy. On the other hand, it would
be appropriate to use bond funds to purchase permanent sources
of supplies. An amendment is needed to ensure that bond funds
used by this and related programs are consistent with
generally accepted bond financing principles.
11.Storage - Emergency response? The bill provides that bond
funds can only be used to fund the public benefits of storage,
and further provides that "emergency response" is one of the
fundable public benefits. How would the emergency response
program work? Would we hold water in storage for emergencies?
If so, that water would likely provide little to no benefit in
most years, years where that water might be more beneficially
used elsewhere. Moreover, while it might be useful to have
funds to acquire water for emergency actions, those funds
should likely be available for acquiring water from any
available reservoir. However, that does not appear to be a
sufficient reason for additional public funds to construct a
new reservoir. An amendment is needed to delete emergency
response as a criteria for selection and fundable public
benefit for storage and instead make purchases of and
reimbursements for the water necessary to respond to a
declared emergency an eligible use of bond funds.
12.Storage - Recreation? By including recreation and emergency
supplies as public benefits, and further, by using the value
of public benefits as the criteria for selecting projects, it
appears that only the large surface storage projects could
truly compete for the storage funding. Indeed, it is
difficult to imagine what the recreational benefits of a
groundwater recharge basin might be. An amendment is needed to
delete recreation as a criteria for selection and fundable
public benefit for storage.
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13.Storage - Measurable improvements to the Delta? This bill,
along with the current 2014 bond and SB 848 include a
provision a storage project is ineligible for funding "unless
it provides measurable improvements to the Delta ecosystem or
to the tributaries to the Delta." This requirement
effectively eliminates funding for projects outside the
Central Valley. An amendment is needed to clarify that
projects within the Delta watershed need to provide measurable
improvements to the Delta ecosystem.
14.Bond Sales - This bill would provide that only half of the
bonds authorized by this measure could be sold by the
Treasurer before July 1, 2019. To the extent this provision
is somehow intended to slow the initiation of bond funded
programs or to reserve some portion of bond funds for
appropriation in later years, it is focused at the wrong point
in the bond financing process. As was discussed in this
committee's informational hearing on "Overview of California's
Debt Condition: Priming the Pump for a Water Bond," the
Treasurer sells bonds after funds have been appropriated,
grants have been awarded, and some of the work has been done.
Only once bills need to be paid does the Treasurer sell bonds.
Placing a time constraint on the sale of bonds does not put
an effective constraint on the appropriation or use of bond
funds. An amendment is needed to delete the restriction on
the Treasurer's ability to sell bonds before July 1, 2019.
14.Other issues - There are a number of other amendments needed
to address minor, technical, or other policy consistency
issues. These include:
Clarifying that implementing agencies can use existing
bond funding guidelines if those guidelines conform to the
requirements of this bond.
Revising the storage language to ensure Temperance Flat
and Los Vaqueros could be funded by this bond should they
prove feasible.
Reinstating the local match requirements for conjunctive
use and reservoir reoperation projects.
Add sediment removal, in addition to the current seismic
improvements, to the list of projects eligible for storage
funds.
Removing the covert earmark in Chapter 7 Delta
Sustainability for improvements to the Sacramento Regional
County Sanitation District's wastewater treatment plant.
Correcting the definition of the Delta to include Suisun
Bay.
Clarifying that all expenditures shall be consistent
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with the Delta Reform Act, where applicable.
Clarifying that Native American Tribes are eligible for
bond programs.
Clarifying the use of CCC members whenever feasible.
Other minor, technical and clarifying amendments.
Related Measures:
SB 848 (Wolk) - would repeal the water bond currently on the
November 2014 and would replace it with the Safe Drinking
Water, Water Quality, and Water Supply Act of 2014, a $6.825 B
general obligation bond to finance a variety of water
resources related programs and projects. (Passed SNR&W 6-0)
SB 927 (Cannella and Vidak) - would amend the water bond
currently on the November 2014, reducing the authorized amount
from $11.14 B to $9.217 B, and rename the measure the Safe,
Clean, and Reliable Drinking Water Supply Act of 2014.
(Failed SNR&W 3-6)
SB 1370 (Galgiani) would repeal the water bond currently on
the November 2014 the Reliable Water Supply Bond Act of 2014,
a $5.1 B general obligation bond to finance surface water
storage projects. (Held in SNR&W)
AB 1445 (Logue) - would repeal the water bond currently on the
November 2014 and would replace it with the California Water
Infrastructure Act of 2014, a $5.8 B general obligation bond
to finance public benefits associated with water storage
projects.
AB 1331 (Rendon) - would repeal the water bond currently on
the November 2014 and would replace it with the Clean and Safe
Drinking Water Act of 2014, a $8.0 B general obligation bond
to finance a variety of water resources related programs and
projects. (Passed with committee amendments 7-2)
AB 2043 (Bigelow and Conway) - would repeal the water bond
currently on the November 2014 and would replace it with the
Safe, Clean, and Reliable Drinking Water Supply Act of 2014, a
$7.935 B general obligation bond to finance a variety of water
resources related programs and projects.
AB 2554 (Rendon) - would repeal the water bond currently on
the November 2014 and would replace it with the California
Water Infrastructure Act of 2014, a $8.5 B general obligation
bond to finance public benefits associated with water storage
projects.
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AB 2686 (Perea) - would repeal the water bond currently on the
November 2014 and would replace it with the Clean, Safe, and
Reliable Water Supply Act of 2014, a $9.25 B general
obligation bond to finance a variety of water resources
related programs and projects.
Referred to Environmental Quality Committee. This analysis does
not address issues within the purview of the Senate
Environmental Quality Committee. Issues likely to be raised by
that committee include:
Definitions of "disadvantaged community," "severely
disadvantaged community," and "economically distressed
community."
The structure of the grant and loan program for public water
system infrastructure improvements.
The provision of funds for private well owners.
Whether to provide funds to State Parks to comply with
drinking water and wastewater requirements.
Other water quality related issues raised in the committee
background for the September 25, 2013 joint hearing.
Referred to Governance and Finance Committee. This analysis
does not address issues within the purview of the Senate
Governance and Finance Committee. Issues likely to be raised by
that committee include:
The potential effect of this measure on the state's bonded
indebtedness.
The requirements for establishing loan programs authorized by
this bond.
Other issues associated with the authorization of general
obligation debt.
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SUPPORT
American Pistachio Growers
Angiola Water District
Association of California Egg Farmers
Association of California Water Agencies
Browns Valley Irrigation District
California Bean Shippers Association
California Chamber of Commerce
California Citrus Mutual
California Cotton Ginners Association
California Cotton Growers Association
California Grain and Feed Association
California Latino Water Coalition
California Pear Growers Association
California Rice Industry Association
California Seed Association
California State Council Of Laborers
City of Corona
City of Sacramento
Cucamonga Valley Water District
Dublin San Ramon Services District
Elsinore Valley Municipal Water District
Friant Water Authority
Imperial Irrigation District
Indian Wells Valley Water District
Metropolitan Water District of Southern California (If Amended)
Mojave Water Agency
Monte Vista Water District
Rialto Road Water District
Scotts Valley Water District
South Tahoe Public Utility District
Southwest California Legislative Council
The Tehama Colusa Canal Authority
Three Valleys Municipal Water District
Valley Center Municipal Water District
West Valley Water District
Western Agricultural Processors Association
Western Municipal Water District
Westlands Water District
Wheeler Ridge Maricopa Water Storage District
Wilbur Reclamation District #825
OPPOSITION: None Received
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