SB 1370, as introduced, Galgiani. Reliable Water Supply Bond Act of 2014.
(1) Existing law creates the Safe, Clean, and Reliable Drinking Water Supply Act of 2012, which, if approved by the voters, would authorize the issuance of bonds in the amount of $11,140,000,000 pursuant to the State General Obligation Bond Law to finance a safe drinking water and water supply reliability program. Existing law provides for the submission of the bond act to the voters at the November 4, 2014, statewide general election.
This bill would repeal these provisions.
(2) Under existing law, various measures have been approved by the voters to provide funds for water supply programs.
This bill would enact the Reliable Water Supply Bond Act of 2014, which, if adopted by the voters, would authorize the issuance of bonds in the amount of $5,100,000,000 pursuant to the State General Obligation Bond Law to finance surface water storage projects.
The bill would provide for the submission of the bond act to the voters at the November 4, 2014, statewide general election.
(3) This bill would declare that it is to take effect immediately as an urgency statute.
Vote: 2⁄3. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Division 26.7 (commencing with Section 79700)
2of the Water Code, as added by Section 1 of Chapter 3 of the
3Seventh Extraordinary Session of the Statutes of 2009, is repealed.
Division 26.7 (commencing with Section 79700) is
5added to the Water Code, to read:
6
9
This division shall be known and may be cited as the
13Reliable Water Supply Bond Act of 2014.
14
The Legislature finds and declares all of the following:
18(a) The snowpack’s statewide water content is at about 20
19percent of average for this time of year, which is a mere 7 percent
20of the average April 1 measurement when the snowpack normally
21is at its peak before melting into streams and reservoirs to provide
22one-third of the water used by California’s cities and farms.
23(b) 2013 had the lowest rainfall amounts on record in many
24areas.
25(c) The Department of Water Resources estimates it will be able
26to deliver only 5 percent of the slightly more than 4 million
27acre-feet of State Water Project water requested for the calendar
28year 2014
by the 29 public agencies that collectively supply water
29to more than 25 million Californians and nearly a million acres of
30irrigated farmland.
31(d) The irrigation-dependent San Joaquin Valley farms and
32some other areas will be hard hit if we have another dry year
33without the reservoir storage.
P3 1(e) Many farmers are feeling the effects of the drought, and are
2forced to irrigate orchards during a time of year that water is not
3usually required.
4
The proceeds of bonds issued and sold pursuant to this
8division shall be deposited in the Reliable Water Supply Bond
9Fund of 2014, which is hereby created in the State Treasury.
10
(a) For the purposes of this chapter, “account” means
14the Water Storage Development Account created by subdivision
15(b).
16(b) The Water Storage Development Account is hereby created
17in the fund.
18(c) The sum of five billion one hundred million dollars
19($5,100,000,000) is hereby transferred from the fund to the account.
20Notwithstanding Section 13340 of the Government Code, the funds
21in the account are hereby continuously appropriated to the
22Department of Water Resources, without regard to fiscal years,
23for the design, acquisition, and construction of surface water
24storage projects. The following surface water storage projects
25identified by the department in the CALFED Bay-Delta
26
Programmatic Record of Decision, dated August 28, 2000, are
27eligible for funding pursuant to this chapter:
28(1) Sites Reservoir located in the Counties of Colusa and Glenn,
29as identified in the North-of-the-Delta Offstream Storage
30Investigation Initial Alternatives Information Report, dated May
312006.
32(2) Temperance Flat Reservoir located in the Counties of Fresno
33and Madera, as identified in the Upper San Joaquin River Basin
34Storage Investigation Initial Alternatives Information Report, dated
35June 2005.
36(3) Expansion of Los Vaqueros Reservoir located in the County
37of Contra Costa, as identified in the Los Vaqueros Expansion
38Investigation Initial Alternatives Information Report, dated
39September 2005.
(a) Bonds in the total amount of five billion one
4hundred million dollars ($5,100,000,000), or so much thereof as
5is necessary, not including the amount of any refunding bonds
6issued in accordance with Section 79730 may be issued and sold
7to provide a fund to be used for carrying out the purposes expressed
8in this division and to reimburse the General Obligation Bond
9Expense Revolving Fund pursuant to Section 16724.5 of the
10Government Code. The bonds, when sold, shall be and constitute
11a valid and binding obligation of the State of California, and the
12full faith and credit of the State of California is hereby pledged
13for the punctual payment of both principal of, and interest on, the
14bonds as the principal and interest become due and payable.
15(b) The Treasurer shall sell the bonds authorized by the
16committee pursuant to this section. The bonds shall be sold upon
17the terms and conditions specified in a resolution to be adopted
18by the committee pursuant to Section 16731 of the Government
19Code.
The bonds authorized by this division shall be prepared,
21executed, issued, sold, paid, and redeemed as provided in the State
22General Obligation Bond Law (Chapter 4 (commencing with
23Section 16720) of Part 3 of Division 4 of Title 2 of the Government
24Code), and all of the provisions of that law apply to the bonds and
25to this division and are hereby incorporated in this division as
26though set forth in full in this division, except subdivisions (a) and
27(b) of Section 16727 of the Government Code.
(a) Solely for the purpose of authorizing the issuance
29and sale pursuant to the State General Obligation Bond Law
30(Chapter 4 (commencing with Section 16720) of Part 3 of Division
314 of Title 2 of the Government Code) of the bonds authorized by
32this division, the Water Supply Reliability Finance Committee is
33hereby created. For purposes of this division, the Water Supply
34Reliability Finance Committee is “the committee” as that term is
35used in the State General Obligation Bond Law. The committee
36consists of the Director of Finance, the Treasurer, the Controller,
37the Director of Water Resources, and the Secretary of the Natural
38Resources Agency, or their designated representatives. The
39Treasurer shall serve as chairperson of the committee. A majority
40of the committee may act for the committee.
P5 1(b) For purposes of the State General Obligation Bond Law, the
2Department of Water Resources is designated the “board.”
The committee shall determine whether or not it is
4necessary or desirable to issue bonds authorized pursuant to this
5division in order to carry out the actions specified in this division
6and, if so, the amount of bonds to be issued and sold. Successive
7issues of bonds may be authorized and sold to carry out those
8actions progressively, and it is not necessary that all of the bonds
9authorized to be issued be sold at any one time.
There shall be collected each year and in the same
11manner and at the same time as other state revenue is collected,
12in addition to the ordinary revenues of the state, a sum in an amount
13required to pay the principal of, and interest on, the bonds each
14year. It is the duty of all officers charged by law with any duty in
15regard to the collection of the revenue to do and perform each and
16every act that is necessary to collect that additional sum.
Notwithstanding Section 13340 of the Government
18Code, there is hereby appropriated from the General Fund in the
19State Treasury, for the purposes of this division, an amount that
20will equal the total of the following:
21(a) The sum annually necessary to pay the principal of, and
22interest on, bonds issued and sold pursuant to this division, as the
23principal and interest become due and payable.
24(b) The sum necessary to carry out Section 79726, appropriated
25without regard to fiscal years.
For the purposes of carrying out this division, the
27Director of Finance may authorize the withdrawal from the General
28Fund of an amount not to exceed the amount of the unsold bonds
29that have been authorized by the committee to be sold for the
30purpose of carrying out this division less any amount borrowed
31pursuant to Section 79729. Any amounts withdrawn shall be
32deposited in the fund. Any money made available under this section
33shall be returned to the General Fund from proceeds received from
34the sale of bonds for the purpose of carrying out this division.
All money deposited in the fund that is derived from
36premium and accrued interest on bonds sold shall be reserved in
37the fund and shall be available for transfer to the General Fund as
38a credit to expenditures for bond interest, except that amounts
39derived from premium may be reserved and used to pay the cost
40of bond issuance prior to any transfer to the General Fund.
Pursuant to Chapter 4 (commencing with Section
216720) of Part 3 of Division 4 of Title 2 of the Government Code,
3the cost of bond issuance shall be paid out of the bond proceeds,
4including premium, if any. To the extent the cost of bond issuance
5is not paid from premiums received from the sale of bonds, the
6cost shall be shared proportionally by each program funded through
7this division by the applicable bond sale.
The board may request the Pooled Money Investment
9Board to make a loan from the Pooled Money Investment Account,
10in accordance with Section 16312 of the Government Code for the
11purpose of carrying out this division less any amount withdrawn
12pursuant to Section 79726. The amount of the request shall not
13exceed the amount of the unsold bonds that the committee, by
14resolution, has authorized to be sold for the purpose of carrying
15out this division. The board shall execute any documents required
16by the Pooled Money Investment Board to obtain and repay the
17loan. Any amounts loaned shall be deposited in the fund to be
18allocated in accordance with this division.
The bonds issued and sold pursuant to this division
20may be refunded in accordance with Article 6 (commencing with
21Section 16780) of Chapter 4 of Part 3 of Division 4 of Title 2 of
22the Government Code, which is a part of the State General
23Obligation Bond Law. Approval by the voters of the state for the
24issuance of the bonds under this division shall include the approval
25of the issuance of any bonds issued to refund any bonds originally
26issued under this division or any previously issued refunding bonds.
Notwithstanding any other provision of this division,
28or of the State General Obligation Bond Law, if the Treasurer sells
29bonds pursuant to this division that include a bond counsel opinion
30to the effect that the interest on the bonds is excluded from gross
31income for federal tax purposes, under designated conditions or
32is otherwise entitled to any federal tax advantage, the Treasurer
33may maintain separate accounts for the investment of bond
34proceeds and for the investment of earnings on those proceeds.
35The Treasurer may use or direct the use of those proceeds or
36earnings to pay any rebate, penalty, or other payment required
37under federal law or take any other action with respect to the
38investment and use of those bond proceeds required or desirable
39under federal law to maintain the tax exempt status of those bonds
P7 1and to
obtain any other advantage under federal law on behalf of
2the funds of this state.
The proceeds from the sale of bonds authorized by this
4division are not “proceeds of taxes” as that term is used in Article
5XIII B of the California Constitution, and the disbursement of
6these proceeds is not subject to the limitations imposed by that
7article.
Section 2 of Chapter 3 of the Statutes of 2009, Seventh
9Extraordinary Session, as amended by Section 1 of Chapter 74 of
10the Statutes of 2012, is repealed.
Section 1 of this act shall be submitted to the voters at
12the November 4, 2014, statewide general election, instead of the
13November 6, 2012, statewide general election, in accordance with
14provisions of the Government Code and the Elections Code
15governing the submission of a statewide measure to the voters.
Section 2 of this act shall be submitted to the voters
17at the November 4, 2014, statewide general election in accordance
18with provisions of the Government Code and the Elections Code
19governing the submission of a statewide measure to the voters.
Section 2 of this act shall take effect upon the approval
21by the voters of the Reliable Water Supply Bond Act of 2014, as
22set forth in that section at the November 4, 2014, statewide general
23election.
This act is an urgency statute necessary for the
25immediate preservation of the public peace, health, or safety within
26the meaning of Article IV of the Constitution and shall go into
27immediate effect. The facts constituting the necessity are:
28In order to fund a surface water storage program at the earliest
29possible date, it is necessary that this act take effect immediately.
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