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SB-200 Safe and Affordable Drinking Water Fund.(2019-2020)

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Date Published: 03/11/2019 09:00 PM
SB200:v98#DOCUMENT

Amended  IN  Senate  March 11, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill No. 200


Introduced by Senator Monning
(Principal coauthor: Assembly Member Eduardo Garcia)

January 31, 2019


An act to add Chapter 4.6 (commencing with Section 116765) to Part 12 of Division 104 of the Health and Safety Code, relating to water. water, and making an appropriation therefor.


LEGISLATIVE COUNSEL'S DIGEST


SB 200, as amended, Monning. Safe and Affordable Drinking Water Fund.
Existing law, the California Safe Drinking Water Act, requires the State Water Resources Control Board to administer provisions relating to the regulation of drinking water to protect public health. Existing law declares it to be the established policy of the state that every human being has the right to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes.
This bill would establish the Safe and Affordable Drinking Water Fund in the State Treasury and would provide that moneys in the fund are available, upon appropriation by the Legislature, continuously appropriated to the board board. The bill would require the board to administer the fund to provide a stable source of funding to secure access to safe drinking water for all Californians, while also ensuring the long-term sustainability of drinking water service and infrastructure. The bill would authorize the board to provide for the deposit into the fund of federal contributions, voluntary contributions, gifts, grants, and bequests. The bill would require the board to expend moneys in the fund for grants, loans, contracts, or services to assist eligible applicants with projects relating to the provision of safe and affordable drinking water. The bill would require the board, working with a multistakeholder advisory group, to adopt a fund implementation plan and policy handbook with priorities and guidelines for expenditures of the fund. The bill would require the board annually to prepare and make available a report of expenditures from the fund. The bill would require the board to adopt annually, after a public hearing, an assessment of funding need that estimates the anticipated funding needed for the next fiscal year to achieve the purposes of the fund. The bill would require, by January 1, 2021, the board, in consultation with local health officers and other relevant stakeholders, to make available a map of aquifers that are used or likely to be used as a source of drinking water that are at high risk of containing contaminants and to make available a map of residential areas that are at high risk of containing contaminants at the tap that exceed health standards. For purposes of the map, the bill would require local health officers and other relevant local agencies to provide all results of, and data associated with, water quality testing performed by certified laboratories to the board, as specified. By imposing additional duties on local health officers and local agencies, the bill would impose a state-mandated local program. By creating a new continuously appropriated fund, this bill would make an appropriation.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.
Vote: MAJORITY   Appropriation: NOYES   Fiscal Committee: YES   Local Program: NOYES  

The people of the State of California do enact as follows:


SECTION 1.

 Chapter 4.6 (commencing with Section 116765) is added to Part 12 of Division 104 of the Health and Safety Code, to read:
CHAPTER  4.6. Safe and Affordable Drinking Water
Article  1. Legislative Findings and Declarations

116765.
 The Legislature finds and declares all of the following:
(a) Section 106.3 of the Water Code declares that it is the policy of the state that every human being has the right to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes.
(b) For all public water systems, the operation and maintenance costs to supply, treat, and distribute potable water that complies with federal and state drinking water standards on a routine and consistent basis may be significant.
(c) All community water systems are currently required to set, establish, and charge a schedule of rates and fees that are sufficient to recover the operation and maintenance costs required to supply, treat, and distribute potable water that complies with federal and state drinking water standards on a routine and consistent basis.
(d) Hundreds of community water systems in the state cannot charge rates and fees that are affordable and sufficient to recover the full operation and maintenance costs required to supply, treat, and distribute potable water that complies with federal and state drinking water standards on a routine and consistent basis due to a combination of low income levels of customers, high treatment costs for contaminated water sources, and a lack of economies of scale that result in high unit costs for water service. Many schools that serve as their own regulated public water systems and have contaminated water sources cannot afford the full operation and maintenance costs required to provide water that meets federal and state drinking water standards.
(e) Nearly all state or federal drinking water project funding sources prohibit the use of that funding for long-term operation and maintenance costs, and as a result, those systems that cannot afford required operation and maintenance costs are unable to access funding for capital projects to meet federal and state drinking water standards.
(f) As a result, hundreds of thousands of Californians, particularly those living in small disadvantaged communities, may be exposed to unsafe drinking water in their homes and schools, which impacts human health, household costs, and community economic development.
(g) A significant number of California residents rely on state small water systems and domestic wells to provide their drinking water.
(h) The state small water systems and individual domestic wells face a serious threat of contamination because they often draw their water from shallow groundwater sources and have fewer or no chemical monitoring requirements.
(i) To ensure that the right of every Californian to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes is protected, it is in the interest of the State of California to identify where Californians are at high risk of lacking reliable access to safe drinking water or are known to lack reliable access to safe drinking water, whether they rely on a public water system, state small water system, or domestic well for their potable water supply.
(j) Long-term sustainability of drinking water infrastructure and service provision is necessary to secure safe drinking water for all Californians and therefore it is in the interest of the state to discourage the proliferation of new, unsustainable public water systems and state small water systems, to prevent waste, and to encourage consolidation and service extension when feasible.
(k) It is in the interest of all Californians to establish a fund with a stable source of revenue to provide financial support, particularly for operation and maintenance, necessary to secure access to safe drinking water for all Californians, while also ensuring the long term sustainability of drinking water service and infrastructure.

Article  2. Definitions

116766.
 For the purposes of this chapter:
(a) “Administrator” has the same meaning as defined in Section 116686.
(b) “Board” means the State Water Resources Control Board.
(c) “Community water system” has the same meaning as defined in Section 116275.
(d) “Disadvantaged community” has the same meaning as defined in Section 116275.
(e) “Domestic well” means a groundwater well used to supply water for the domestic needs of an individual residence or water systems that are not public water systems and that have no more than four service connections.
(f) “Eligible applicant” means a public water system, including, but not limited to, a mutual water company; a public utility; a public agency, including, but not limited to, a local educational agency that owns or operates a public water system; a nonprofit organization; a federally recognized Indian tribe; a state Indian tribe listed on the Native American Heritage Commission’s California Tribal Consultation List; an administrator; or a groundwater sustainability agency.
(g) “Fund” means the Safe and Affordable Drinking Water Fund established pursuant to Section 116767.
(h) “Fund implementation plan” means the fund implementation plan adopted pursuant to Section 116769.
(i) “Groundwater sustainability agency” has the same meaning as defined in Section 10721 of the Water Code.
(j) “Low-income household” means a household with an income that is less than 80 percent of the statewide median household income.
(k) “Public water system” has the same meaning as defined in Section 116275.
(l) “Replacement water” includes, but is not limited to, bottled water, vended water, point-of-use, or point-of-entry treatment units.
(m) “Safe drinking water” has the same meaning as defined in Section 116681.
(n) “Service connection” has the same meaning as defined in Section 116275.
(o) “State small water system” has the same meaning as defined in Section 116275.
(p) “Vended water” has the same meaning as defined in Section 111070.

Article  3. Safe and Affordable Drinking Water Fund

116767.
 The Safe and Affordable Drinking Water Fund is hereby established in the State Treasury. Notwithstanding Section 13340 of the Government Code, all moneys in the fund are continuously appropriated to the board without regard to fiscal years, in accordance with this chapter. Moneys in the fund at the close of the fiscal year shall remain in the fund and shall not revert to the General Fund. Moneys in the fund shall not be available for appropriation or borrowed for use for any purpose not established in this chapter unless that use of the moneys receives an affirmative vote of two-thirds of the membership in each house of the Legislature.

116768.
 (a) The board shall administer the fund for the purposes of this chapter to provide a source of funding to secure access to safe drinking water for all Californians, while also ensuring the long-term sustainability of drinking water service and infrastructure. The board shall prioritize the use of this funding to assist disadvantaged communities served by a public water system and low-income households served by a state small water system or a domestic well. The board shall consider and prioritize, where appropriate, the use of funding for consolidation or extension of service or both. In order to maximize the use of other funding sources for capital construction projects when available, the board shall prioritize use of this funding for costs other than those related to capital construction costs, except for capital construction costs associated with consolidation and service extension to reduce the ongoing unit cost of service and to increase sustainability of drinking water infrastructure and service delivery. Beginning January 1, 2021, an expenditure from the fund shall be consistent with the annual fund implementation plan.
(b) In accordance with subdivision (a), the board shall expend moneys in the fund for grants, loans, contracts, or services to assist eligible applicants with any of the following:
(1) The provision of replacement water, as needed, to ensure immediate protection of health and safety as a short-term solution.
(2) The development, implementation, and sustainability of long-term drinking water solutions, including, but not limited to, technical assistance, planning, construction, repair, and operation and maintenance costs associated with replacing, blending, or treating contaminated drinking water, or with fixing failing water systems, pipes, or fixtures; operation and maintenance costs associated with consolidated water systems, extended drinking water services, or reliance on a substituted drinking water source; creating and maintaining natural means and green infrastructure solutions that contribute to sustainable drinking water; consolidating water systems; extending drinking water services to other public water systems, domestic wells, or state small water systems; and the satisfaction of outstanding long-term debt obligations of public water systems where the board determines that a system’s lack of access to capital markets renders this solution the most cost-effective for removing a financial barrier to the system’s sustainable, long-term provision of drinking water. Technical assistance and planning costs may include, but are not limited to, analyses to identify, and efforts to further, opportunities to reduce the unit cost of providing drinking water through organizational and operational efficiency improvements, system consolidation and service extension, implementation of new technology, and other options and approaches to reduce costs.
(3) Identifying and providing outreach to Californians who are eligible to receive assistance from the fund.
(4) Testing the drinking water quality of domestic wells serving low-income households, prioritizing those in high-risk areas identified pursuant to Article 4 (commencing with Section 116770).
(5) The provision of administrative and managerial services under Section 116686.
(c) Notwithstanding Section 11019 of the Government Code, the board may make advance payments as necessary to implement the purposes of this chapter.
(d) The board may expend moneys from the fund for reasonable costs associated with administration of this section. Beginning July 1, 2023, the board may expend no more than 5 percent of the annual revenues of the fund for reasonable costs associated with administration of this section.
(e) The board may undertake any of the following actions to implement the fund:
(1) Provide for the deposit of both of the following moneys into the fund:
(A) Federal contributions.
(B) Voluntary contributions, gifts, grants, or bequests.
(2) Enter into agreements for contributions to the fund from the federal government, local or state agencies, and private corporations or nonprofit organizations.
(3) Provide for appropriate audit, accounting, and fiscal management services, plans, and reports relative to the fund.
(4) Direct portions of the fund to a subset of eligible applicants as required or appropriate based on funding source and consistent with the annual fund implementation plan.
(5) Direct moneys deposited into the fund described in subparagraph (B) of paragraph (1) towards a specific project, program, or study.
(6) Take additional action as may be appropriate for adequate administration and operation of the fund.
(f) In administering the fund, the board shall make reasonable efforts to ensure both of the following:
(1) That funds are used to secure the long-term sustainability of drinking water service and infrastructure, including, but not limited to, requiring adequate technical, managerial, and financial capacity of eligible applicants as part of funding agreement outcomes. Funding shall be prioritized to implement consolidations and service extensions when feasible, and administrative and managerial contracts or grants entered into pursuant to Section 116686 where applicable. Funds shall not be used to delay, prevent, or avoid the consolidation or extension of service to public water systems where it is feasible and the least-cost alternative. The board may set appropriate requirements as a condition of funding, including, but not limited to, a system technical, managerial, or financial capacity audit, improvements to reduce costs and increase efficiencies, an evaluation of alternative treatment technologies, and a consolidation or service extension feasibility study. As a condition of funding, the board may require a domestic well with nitrate contamination where ongoing septic system failure may be causing or contributing to contamination of a drinking water source to conduct an investigation and project to address the septic system failure if adequate funding sources are identified and accessible.
(2) That funds are not used to subsidize large-scale nonpotable use.
(g) At least once every 10 years, the board shall conduct a public review and assessment of the fund to determine all of the following:
(1) The effectiveness of the fund in securing access to safe drinking water for all Californians, while also ensuring the long-term sustainability of drinking water service and infrastructure.
(2) If the moneys deposited into the fund have been appropriately expended.
(3) What other actions are necessary to carry out the purposes of this chapter.
(h) Neither the board nor any employee of the board may be held liable for any act that is necessary to carry out the purposes of this chapter. The board or any authorized person shall not be deemed to have incurred or to be required to incur any obligation to provide additional funding or undertake additional action solely as a result of having undertaken an action pursuant to this chapter.

116769.
 By July 1 of each year, the board shall do all of the following:
(a) Prepare and make available a report of expenditures from the fund.
(b) Adopt, after a public hearing, an assessment of funding need, based on available data, that includes all of the following:
(1) Identification of systems and populations potentially in need of assistance, including, but not limited to, all of the following:
(A) A list of systems that consistently fail to provide an adequate supply of safe drinking water. The list shall include, but is not limited to, all of the following:
(i) Any public water system that consistently fails to provide an adequate supply of safe drinking water.
(ii) Any community water system that serves a disadvantaged community that must charge fees that exceed the affordability threshold established by the board in order to supply, treat, and distribute potable water that complies with federal and state drinking water standards.
(iii) Any state small water system that consistently fails to provide an adequate supply of safe drinking water.
(B) A list of programs that assist, or that will assist, households supplied by a domestic well that consistently fails to provide an adequate supply of safe drinking water. This list shall include the number and approximate location of households served by each program without identifying exact addresses or other personal information.
(C) A list of public water systems and state small water systems that may be at risk of failing to provide an adequate supply of safe drinking water.
(D) An estimate of the number of households that are served by domestic wells or state small water systems in high-risk areas identified pursuant to Article 4 (commencing with Section 116770). The estimate shall identify approximate locations of households, without identifying exact addresses or other personal information, in order to identify potential target areas for outreach and assistance programs.
(E) A list of programs that assist, or that will assist, households and schools whose tap water contains contaminants, such as lead or other secondary contaminants, at levels that exceed recommended standards. This list shall include the number and approximate location of households served by each program without identifying exact addresses or other personal information.
(2) An analysis of anticipated funding, per contaminant, needed for known projects, services, or programs by eligible applicants, consistent with the fund implementation plan, including any funding needed for existing long-term funding commitments from the fund. The board shall identify and consider other existing funding sources able to support any projects, services, or programs identified, including, but not limited to, local funding capacity, state or federal funding sources for capital projects, funding from responsible parties, and specialized funding sources contributing to the fund.
(3) An estimate of the funding needed for the next fiscal year based on the amount available in the fund, anticipated funding needs, other existing funding sources, and other relevant data and information.
(c) (1) Adopt, after a public hearing, a fund implementation plan and policy handbook with priorities and guidelines for expenditures of the fund.
(2) The board shall work with a multistakeholder advisory group to establish priorities and guidelines for the fund implementation plan and policy handbook. The multistakeholder advisory group shall be open to participation by all of the following:
(A) Representatives of entities paying into the fund.
(B) Public water systems.
(C) Technical assistance providers.
(D) Local agencies.
(E) Nongovernmental organizations.
(F) Residents served by community water systems in disadvantaged communities, state small water systems, and domestic wells.
(G) The public.
(3) The adoption of a fund implementation plan and policy handbook and the implementation of the fund pursuant to the policy handbook are not subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

116769.5.
 The board may expend moneys from the fund for reasonable costs associated with the administration of Section 116769 and Article 4 (commencing with Section 116770). Beginning July 1, 2023, the board shall not expend more than 3 percent of the annual revenue of the fund for the reasonable costs of administering Section 116769 and Article 4 (commencing with Section 116770).

Article  4. Information on High-risk Areas

116770.
 (a) (1) By January 1, 2021, the board, in consultation with local health officers and other relevant stakeholders, shall use available data to make available a map of aquifers that are at high risk of containing contaminants and that exceed primary federal and state drinking water standards that are used or likely to be used as a source of drinking water for a state small water system or a domestic well. The board shall update the map at least annually based on any newly available data.
(2) The board shall make the map of high-risk areas, as well as the data used to make the map, publicly accessible on its internet website in a manner that does not identify exact addresses or other personal information and that complies with the Information Practices Act of 1977 (Chapter 1 (commencing with Section 1798) of Title 1.8 of Part 4 of Division 3 of the Civil Code). The board shall notify local health officers and county planning agencies of high-risk areas within their jurisdictions.
(b) (1) By January 1, 2021, a local health officer or other relevant local agency shall provide to the board all results of, and data associated with, water quality testing performed by certified laboratories for a state small water system or domestic well that was collected after January 1, 2014, and that is in the possession of the local health officer or other relevant local agency.
(2) By January 1, 2022, and by January 1 of each year thereafter, all results of, and data associated with, water quality testing performed by a certified laboratory for a state small water system or domestic well that is submitted to a local health officer or other relevant local agency shall also be submitted directly to the board in electronic format.
(c) By January 1, 2021, the board, in consultation with local health officers and other relevant stakeholders, shall use available data to make available a map of residential areas that are at high risk of containing contaminants at the tap that exceed health standards, including, but not limited to, lead and secondary contaminants. The board shall update the map at least annually based on any newly available data.
(d) A map of high-risk areas developed pursuant to this article is not subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

SEC. 2.

 If the Commission on State Mandates determines that this act contains costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code.
SECTION 1.Chapter 4.6 (commencing with Section 116765) is added to Part 12 of Division 104 of the Health and Safety Code, to read:
4.6.Safe and Affordable Drinking Water
116765.

The Legislature finds and declares all of the following:

(a)Section 106.3 of the Water Code declares that it is the policy of the state that every human being has the right to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes.

(b)For all public water systems, the operation and maintenance costs to supply, treat, and distribute potable water that complies with federal and state drinking water standards on a routine and consistent basis may be significant.

(c)All public water systems are currently required to set, establish, and charge a schedule of rates and fees that are sufficient to recover the operation and maintenance costs required to supply, treat, and distribute potable water that complies with federal and state drinking water standards on a routine and consistent basis.

(d)Hundreds of public water systems in the state cannot charge rates and fees that are affordable and sufficient to recover the full operation and maintenance costs required to supply, treat, and distribute potable water that complies with federal and state drinking water standards on a routine and consistent basis due to a combination of low-income levels of customers, high treatment costs for contaminated water sources, and a lack of economies of scale that result in high unit costs for water service. Many schools that serve as their own regulated public water systems and have contaminated water sources cannot afford the full operation and maintenance costs required to provide water that meets federal and state drinking water standards.

(e)Nearly all state or federal drinking water project funding sources prohibit the use of that funding for operation and maintenance costs, and as a result, those systems that cannot afford required operation and maintenance costs are unable to access funding for capital projects to meet federal and state drinking water standards.

(f)As a result, close to one million Californians, particularly those living in small disadvantaged communities, may be exposed to unsafe drinking water in their homes and schools, which impacts human health, household costs, and community economic development.

(g)A significant number of California residents rely on state small water systems and domestic wells to provide their drinking water.

(h)State small water systems and individual domestic wells face a serious threat of contamination because they often draw their water from shallow groundwater sources and have fewer or no chemical monitoring requirements.

(i)State small water systems and domestic wells are not currently subject to any comprehensive federal or state requirements for chemical water quality monitoring. Many local agencies do not require any monitoring beyond what is required by state law and there are wide discrepancies among local jurisdictions in well monitoring programs.

(j)To ensure that the right of every Californian to safe, clean, affordable, and accessible water adequate for human consumption, cooking, and sanitary purposes is protected, it is in the interest of the State of California to identify where Californians are at high risk of lacking reliable access to safe drinking water or are known to lack reliable access to safe drinking water, whether they rely on a public water system, state small water system, or domestic well for their potable water supply.

(k)Long-term sustainability of drinking water infrastructure and service provision is necessary to secure safe drinking water for all Californians and therefore it is in the interest of the state to discourage the proliferation of new, unsustainable public water systems and state small water systems, to prevent waste, and to encourage consolidation and service extension when feasible.

(l)It is in the interest of all Californians to establish a fund with a stable source of revenue to provide financial support, particularly for operation and maintenance, necessary to secure access to safe drinking water for all Californians, while also ensuring the long-term sustainability of drinking water service and infrastructure.

116766.

The Safe and Affordable Drinking Water Fund is hereby established in the State Treasury. Moneys in the fund shall be available to the State Water Resources Control Board, upon appropriation by the Legislature, for the purposes of this chapter to provide a stable source of funding to secure access to safe drinking water for all Californians, while also ensuring the long-term sustainability of drinking water service and infrastructure.