BILL ANALYSIS �
SB 1292
Page 1
Date of Hearing: July 2, 2014
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
SB 1292 (Hueso) - As Introduced: February 21, 2014
Policy Committee: Environmental
Safety and Toxic Materials Vote: 7-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill increases the maximum grant authorized by the Safe
Drinking Water State Revolving Fund (SDWSRF) from $3 million to
$5 million for construction grants to fund projects serving
severely disadvantaged communities.
FISCAL EFFECT
Unknown increased cost pressures, potentially in the millions of
dollars on the SDWSRF (special fund) for grant assistance.
In FY 2013-14, 61% of grant recipients served a severely
disadvantaged community. The total amount of grants issued is
capped in statute at 30% with the remaining 70% issued as loans.
This bill does not increase the 30% grant cap.
COMMENTS
1)Purpose. According to the author, construction, labor, and
equipment costs are high and have risen since the grant cap
was established in 2009. Local water utilities must make
costly investments to install, upgrade, or replace equipment
in order to deliver safe drinking water and protect public
health. The author further states that increasing the cap to
$5 million will ensure adequate funding for severely
disadvantaged communities with projects of high risk.
2)Heber Public Utility District . According to the author, the
Heber Public Utility District (HPUD), which serves 7,270
people within the author's district, is seeking funding
through the SDWSRF to make improvements to its water treatment
SB 1292
Page 2
and distribution plant to address recent trihalomethane
violations and to increase water treatment capacity.
Estimates for improvements to achieve compliance are $5.7
million. The author notes that Heber is a severely
disadvantaged community in which the median household income
is less than 60% of the statewide median household income. He
argues that the community of Heber already pays one of the
highest water rates in the County of Imperial and cannot
afford another increase to cover substantial new debt,
especially as the County faces the highest levels of
unemployment in the state.
3)Safe Drinking Water State Revolving Fund. DPH administers a
safe drinking water regulatory program for all publicly and
privately owned water systems of 15 or more service
connections. The department also administers the Safe Drinking
Water State Revolving Fund, which provides loans and grants to
local agencies for safe drinking water system upgrades. The
fund receives federal monies, for which the state must provide
a 20% match.
DPH reports the federal drinking water allocation will be
approximately $90 million for each of the next several years.
4)Drinking Water Reorganization. The recently enacted 2014-15
budget transfers the State's Drinking Water Program from DPH
to the State Water Resources Control Board (SWRCB) on July 1,
2014. In March 2014, after a three-month task force and
stakeholder process, the Secretary for Health and Human
Services and Secretary for Environmental Protection
published a Drinking Water Reorganization Transition Plan to
accomplish this reorganization. DPH and the SWRCB have
indicated that, once the reorganization is complete, the SWRCB
will consolidate the administration of the SDWSRF with the
Clean Water State Revolving Fund at the SWRCB.
The author may wish to amend this bill to conform to the
provisions in the consolidation.
Analysis Prepared by : Jennifer Galehouse / APPR. / (916)
319-2081
SB 1292
Page 3