Bill Text: CA AB217 | 2019-2020 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Income taxation: credits: exclusions: federal conformity.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Failed) 2020-02-03 - Died on inactive file. [AB217 Detail]

Download: California-2019-AB217-Amended.html

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Amended  IN  Assembly  May 01, 2019

Amended  IN  Assembly  March 28, 2019

Amended  IN  Assembly  March 19, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill

No. 217

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Introduced by Assembly Member Eduardo Garcia
(Principal coauthor: Assembly Member Blanca Rubio)(Coauthors: Assembly Members Bonta, Bloom, Bonta, Carrillo, Chau, Chiu, Gipson, Holden, Quirk, Robert Rivas, Mark Stone, and Wicks)
(Coauthor: Senator Monning)

January 16, 2019

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An act to add Article 10.5 (commencing with Section 595) to Chapter 3 of Part 1 of Division 1 of, to add Article 6.5 (commencing with Section 14615) to Chapter 5 of Division 7 of, and to add Article 14.5 (commencing with Section 62215) to Chapter 2 of Part 3 of Division 21 of, and to repeal Section 14616 of, the Food and Agricultural Code, and to add Chapter 4.6 (commencing with Section 116765) to Part 12 of Division 104 of, to add Chapter 4.7 (commencing with Section 116774) to Part 12 of Division 104 of, and to repeal Article 5 (commencing with Section 116771) of Chapter 4.6 of Part 12 of Division 104 of, the Health and Safety Code, and to add Section 79724.5 to the Water Code, relating to water, and making an appropriation therefor.

LEGISLATIVE COUNSEL'S DIGEST

AB 217, as amended, Eduardo Garcia. Safe Drinking Water for All Act.

(1) 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 enact the Safe Drinking Water for All Act and would establish the Safe and Affordable Drinking Water Fund in the State Treasury and would provide that moneys in the fund are continuously appropriated to the board 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 bill would authorize the board to provide for the deposit into the fund of federal contributions, voluntary contributions, gifts, grants, and bequests. bequests, and settlements from parties responsible for contamination of drinking water supplies, and to contribute funding available from other sources related to water quality. The bill would require the board to expend moneys in the fund for grants, loans, contracts, or services to assist eligible applicants with certain projects. 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 authorize the board to distribute the funds through its drinking water regional offices in an unspecified manner and would prohibit the board from distributing more than 20% of the annual expenditures from the fund in this manner. By creating a new continuously appropriated fund, this bill would make an appropriation.

This bill would establish a statewide safe and affordable drinking water fee system charge in the amount of $0.50 per service connection per month on all public water systems. The bill would require each public water system to remit to the board the amount of the fee system charge for their public water system on July 1, 2020, and by July 1 annually thereafter. The bill would require these fees system charges to be deposited into the fund. The bill would authorize the board to allocate to each drinking water regional office sufficient funds to pay for the development and implementation of sustainable plans for restoring safe drinking water and would require the board to annually allocate 20% of the annual revenues originating in each of the Division of Drinking Water regions from the system charge to the region from which the revenues originate. The bill would require the Legislative Analyst to report to the Legislature and the board if the Legislative Analyst determines, on or before January 1, 2023, that at least $3,000,000,000 has been made available in an interest bearing account in the State Treasury with a goal of at least $100,000,000 in interest revenues per year available for the purposes of the Safe and Affordable Drinking Water Fund. The bill would make this reporting requirement and the requirement for the board to adopt fees imposition of the system charges inoperative upon the Legislative Analyst submitting the report, and would repeal them as of January 1, 1 of the year following that determination.

The bill would establish the Safe and Affordable Drinking Water Trust Fund and would require moneys held in the trust fund to be invested by the Treasurer, in consultation with the Director of Finance and the controller, as specified. The bill would transfer the investment income derived from the trust fund on January 1 of each year to the Safe and Affordable Drinking Water Fund. The bill would state that a transfer of $200,000,000 is to be made by the Legislature each year for 5 years for the purpose of establishing a $1,000,000,000 trust account to derive interest revenues to fund the Safe and Affordable Drinking Water 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. 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.

(2) Existing law requires every person who manufactures or distributes fertilizing materials to be licensed by the Secretary of Food and Agriculture and to pay a license fee that does not exceed $300. Existing law requires every lot, parcel, or package of fertilizing material to have a label attached to it, as required by the secretary. Existing law requires a licensee who sells or distributes bulk fertilizing materials to pay to the secretary an assessment not to exceed $0.002 per dollar of sales for all sales of fertilizing materials, as prescribed, for the purposes of the administration and enforcement of provisions relating to fertilizing materials. In addition to that assessment, existing law authorizes the secretary to impose an assessment in an amount not to exceed $0.001 per dollar of sales for all sales of fertilizing materials for the purpose of providing funding for research and education regarding the use of fertilizing materials. Existing law specifies that a violation of the fertilizing material laws or the regulations adopted pursuant to those laws is a misdemeanor.

This bill would require a licensee whose name appears on the label of bulk or packaged fertilizing materials, excluding compost, to pay to the secretary a fertilizer safe drinking water fee of $0.006 per $1.00 of sales for all sales of fertilizing materials. The bill would require these moneys to be deposited into the Safe and Affordable Drinking Water Fund. The bill would authorize the secretary to adopt regulations relating to the administration and enforcement of these provisions. Because a violation of these provisions or regulations adopted pursuant to these provisions would be a crime, the bill would impose a state-mandated local program.

This bill, during the 2020–34 calendar years, would require a licensee to pay to the secretary a fertilizer safe drinking water fee of $0.008 per dollar of sale for all sales of fertilizing materials intended for noncommercial use and $0.004 per dollar of sale for all sales of packaged fertilizing materials intended for noncommercial use. The bill, beginning in the 2035 calendar year, would reduce the fee to $0.004 per dollar of sale intended for noncommercial use and $0.002 per dollar of sale of packaged materials intended for noncommercial use. The bill, on and after January 1, 2035, would authorize the secretary to adjust the fee as necessary to meet but not exceed 70% of the anticipated funding need for nitrate in the most recent assessment of funding need adopted by the board or the sum of $7,000,000, whichever is less, and would authorize the secretary to adopt regulations relating to the administration and enforcement of these provisions. Because a violation of these provisions or regulations adopted pursuant to these provisions would be a crime, the bill would impose a state-mandated local program.

(3) Existing law regulates the production, handling, and marketing of milk and dairy products and requires every milk handler subject to that regulatory scheme to pay specified assessments and fees to the Secretary of Food and Agriculture to cover the costs of regulating milk. Existing law governing milk defines “handler” as any person who, either directly or indirectly, receives, purchases, or otherwise acquires ownership, possession, or control of market milk from a producer, a producer-handler, or another handler for the purpose of manufacture, processing, sale, or other handling. Existing law defines “market milk” as milk conforming to specified standards and “manufacturing milk” as milk that does not conform to the requirements of market milk. Existing law provides that a violation of that regulatory scheme or a regulation adopted pursuant to that regulatory scheme is a misdemeanor.

This bill would require, beginning January 1, 2022, each handler to deduct from payments made to producers for market and manufacturing milk the sum of $0.01355 per hundredweight of milk as a dairy safe drinking water fee. The bill would require the secretary to deposit these moneys into the Safe and Affordable Drinking Water Fund. The bill would authorize the secretary to take specified enforcement actions and would require the secretary to adopt regulations for the administration and enforcement of these provisions. Because a violation of these provisions or regulations adopted pursuant to these provisions would be a crime, the bill would impose a state-mandated local program.

(4) Existing law requires the Secretary of Food and Agriculture to enforce provisions governing livestock operations. Existing law generally provides that a violation of a provision of the Food and Agricultural Code is a misdemeanor.

This bill would require each producer owning a nondairy confined animal facility, as defined, beginning the 2021 calendar year to pay annually to the secretary a safe drinking water fee of $1,000 for the first facility and $750 per each facility thereafter owned by the same producer, not to exceed $12,000. The bill would require these moneys to be deposited into the Safe and Affordable Drinking Water Fund. Because a violation of these provisions would be a crime, the bill would impose a state-mandated local program.

(5)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 with regard to certain mandates no reimbursement is required by this act for a specified reason.

With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.

(5) Existing law, the Water Quality, Supply, and Infrastructure Improvement Act of 2014, a bond act approved by the voters as Proposition 1 at the November 4, 2014, statewide general election, authorizes the issuance of general obligation bonds to finance a water quality, supply, and infrastructure improvement program, as specified. Under the bond act, $520,000,000 is available, upon appropriation by the Legislature, for expenditures, grants, and loans for projects that improve water quality or help provide clean, safe, and reliable drinking water to all Californians. Of these funds, the bond act makes $260,000,000 available for grants and loans for public water system infrastructure improvements and related actions to meet safe drinking water standards, ensure affordable drinking water, or both, and requires that priority be given to projects that provide treatment for contamination or access to an alternate drinking water source or sources for small community water systems or state small water systems in disadvantaged communities whose drinking water source is impaired, as specified.

This bill, for purposes of an award of the $260,000,000 available from the bond act, would provide that priority is a preference and not a necessary element of funding.

(6) 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 no reimbursement is required by this act for a specified reason.

Digest Key

Vote: 2/3   Appropriation: YES   Fiscal Committee: YES   Local Program: YES  

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Bill Text

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

SECTION 1.

 This act shall be known, and may be cited, as the Safe Drinking Water for All Act.

SEC. 2.

 Article 10.5 (commencing with Section 595) is added to Chapter 3 of Part 1 of Division 1 of the Food and Agricultural Code, to read:

Article  10.5. Safe Drinking Water Fee for Nondairy Confined Animal Facilities

595.

 For purposes of this article, the following definitions apply:

(a) “Fee” means the safe drinking water fee for nondairy confined animal facilities.

(b) “Fund” means the Safe and Affordable Drinking Water Fund established by Section 116767 of the Health and Safety Code.

(c) (1) “Nondairy confined animal facilities” means bovine operations, poultry operations, swine operations, and other livestock operations, excluding dairies, where all of the following apply:

(A) Operations are designed to corral, pen, or otherwise enclose or hold domestic livestock.

(B) Feeding is exclusively by means other than grazing.

(C) Facilities are subject to annual fees for confined animal facilities adopted in accordance with Section 13260 of the Water Code.

(2) “Nondairy confined animal facilities” does not include facilities subject to Article 14.5 (commencing with Section 62215) of Chapter 2 of Part 3 of Division 21.

596.

 (a) Beginning in the 2021 calendar year, each producer owning a nondairy confined animal facility shall pay annually to the secretary a safe drinking water fee. The amount of the fee paid annually to the secretary shall equal one thousand dollars ($1,000) for a producer that owns a single nondairy confined animal facility. For a producer that owns more than one nondairy confined animal facility, the amount of the fee paid annually to the secretary shall equal one thousand dollars ($1,000) for the first facility and seven hundred fifty dollars ($750) per each facility thereafter owned by the same producer.

(b) Notwithstanding subdivision (a), the amount of the fee paid annually to the secretary by a producer that owns more than one nondairy confined animal facility shall not exceed twelve thousand dollars ($12,000) per year.

(c) The secretary may prescribe, adopt, and enforce regulations relating to the administration and enforcement of this article.

597.

 The secretary shall deposit all moneys received under this article into the fund.

SEC. 3.

 Article 6.5 (commencing with Section 14615) is added to Chapter 5 of Division 7 of the Food and Agricultural Code, to read:

Article  6.5. Fertilizer Safe Drinking Water Fee

14615.

 (a) It is the intent of the Legislature to require licensees of bulk fertilizing materials, and to authorize licensees of packaged fertilizing materials, to pass the fertilizer safe drinking water fee described in Section 14616 on to the end user of the fertilizer.

(b) For purposes of this article, the following definitions apply:

(1) “Bulk fertilizing material” has the same meaning as applies to “bulk material” in Section 14517.

(2)“Compost” has the same meaning as defined in Section 14525.

(3)

(2) “Fertilizing material” has the same meaning as defined in Section 14533.

(4)

(3) “Fund” means the Safe and Affordable Drinking Water Fund established by Section 116767 of the Health and Safety Code.

(4) “Noncommercial use” has the same meaning as defined in Section 14549.

(5) “Packaged” has the same meaning as defined in Section 14551.

14616.

 (a) In addition to the assessments provided in Section 14611, during calendar years 2020 to 2034, inclusive, a licensee whose name appears on the label of bulk or packaged fertilizing materials, not including compost, materials labeled for noncommercial use shall pay to the secretary a fertilizer safe drinking water fee of six four mills ($0.006) ($0.004) per dollar of sales for all sales of fertilizing materials. materials to be deposited into the fund.

(b) In addition to the assessments provided in Section 14611, during calendar years 2020 to 2034, inclusive, a licensee whose name appears on the label of fertilizing materials, excluding packaged fertilizing materials labeled for noncommercial use, shall pay to the secretary a fertilizer safe drinking water fee of eight mills ($0.008) per dollar of sales for all sales of fertilizing materials to be deposited into the fund.

(c) This section shall remain in effect only until January 1, 2035, and as of that date is repealed, unless a later enacted statute that is enacted before January 1, 2035, deletes or extends that date.

14617.

 (a) In addition to the assessments provided in Section 14611, beginning with calendar year 2035, a licensee whose name appears on the label of packaged fertilizing materials labeled for noncommercial use shall pay to the secretary a fertilizer safe drinking water fee of two mills ($0.002) per dollar of sales for all sales of fertilizing materials to be deposited into the fund.

(b) In addition to the assessments provided in Section 14611, beginning with calendar year 2035, a licensee whose name appears on the label of a fertilizing material, excluding packaged fertilizing materials labeled for noncommercial use, shall pay to the secretary a fertilizer safe drinking water fee of four mills ($0.004) per dollar of sales for all sales of fertilizing materials to be deposited into the fund.

(c) (1) The secretary may adjust the fertilizer safe drinking water fee through regular or emergency regulation as necessary to meet but not exceed 70 percent of the anticipated funding need for nitrate in the most recent assessment of funding need adopted by the State Water Resources Control Board pursuant to subdivision (b) of Section 116769 of the Health and Safety Code, or the sum of seven million dollars ($7,000,000), whichever is less. By October 1 of each year, the secretary shall notify all licensees of the amount of the fertilizer safe drinking water fee to be assessed in the following calendar year.

(2) An emergency regulation adopted pursuant to this subdivision shall be adopted by the secretary in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.  The adoption of these regulations is an emergency and shall be considered by the Office of Administrative Law as necessary for the immediate preservation of the public peace, health, safety, and general welfare. Any emergency regulations adopted by the secretary pursuant to this subdivision shall remain in effect until revised by the secretary.

(d) This section shall become operative on January 1, 2035.

14617.14618.

 (a) (1) A licensee whose name appears on the label who sells or distributes bulk fertilizing materials shall charge an unlicensed purchaser the fertilizer safe drinking water fee as a charge that is separate from, and not included in, any other fee, charge, or other amount paid by the purchaser. This fee shall be included on the bill of sale as a separate line item.

(2) (A) A licensee whose name appears on the label of packaged fertilizing materials may include the fertilizer safe drinking water fee as a charge that is separate from, and not included in, any other fee, charge, or other amount paid by the purchaser or may include the charge with the assessment collected pursuant to Section 14611 as a separate line item on the bill of sale and identified as the California Regulatory and Safe Drinking Water Assessment.

(B) Notwithstanding paragraph (1), a licensee whose name appears on the label who sells or distributes bulk fertilizing material may include the fertilizer safe drinking water fee with the assessment collected pursuant to Section 14611 as a separate line item on the bill of sale and identified as the California Regulatory and Safe Drinking Water Assessment.

(b) The secretary may prescribe, adopt, and enforce regulations relating to the administration and enforcement of this article.

(c)(1)Except as provided in paragraph (2), the secretary may retain up to 4 percent of the moneys collected pursuant to this article for reasonable costs associated with the implementation and enforcement of this article.

(2)

(c) Beginning July 1, 2022, the secretary may retain up to 2 5 percent of the moneys collected pursuant to this article for reasonable costs associated with the implementation and enforcement of this article.

14618.

 The secretary shall deposit all moneys received under this article into the fund.

SEC. 4.

 Article 14.5 (commencing with Section 62215) is added to Chapter 2 of Part 3 of Division 21 of the Food and Agricultural Code, to read:

Article  14.5. Dairy Safe Drinking Water Fee

62215.

 (a) It is the intent of the Legislature that the dairy safe drinking water fee described in Section 62216 be paid for all milk produced in the state, regardless of grade.

(b) For purposes of this article, the following definitions apply:

(1) “Fee” means the dairy safe drinking water fee.

(2) “Fund” means the Safe and Affordable Drinking Water Fund established by Section 116767 of the Health and Safety Code.

(3) “Manufacturing milk” has the same meaning as defined in Section 32509.

(4) “Market milk” has the same meaning as defined in Section 32510.

(5) “Milk” includes market milk and manufacturing milk.

62216.

 (a) Beginning January 1, 2022, each handler, including a producer-handler, shall deduct the sum of one cent and three hundred fifty-five mills ($0.01355) per hundredweight of milk from payments made to producers for milk, including the handler’s own production, as a dairy safe drinking water fee.

(b) The secretary shall adopt regulations necessary for the proper administration and enforcement of this section by January 1, 2022.

62217.

 (a) A handler shall pay the dairy safe drinking water fee to the secretary on or before the 45th day following the last day of the month in which the milk was received.

(b) The secretary shall deposit all moneys received under this article into the fund.

(c) (1) Except as provided in paragraph (2), the secretary may retain up to 4 percent of the total amount that is paid to the secretary pursuant to this article for reasonable costs of the secretary associated with the implementation and enforcement of this article.

(2) Beginning July 1, 2022, the secretary may retain up to 2 percent of the moneys collected pursuant to this article for reasonable costs of the secretary associated with the implementation and enforcement of this article.

(d) The secretary may require handlers, including cooperative associations acting as handlers, to make reports at any intervals and in any detail that the secretary finds necessary for the accurate collection of the fee.

(e) For the purposes of enforcing this article, the secretary, through the secretary’s duly authorized representatives and agents, shall have access to the records of every producer and handler. The secretary shall have at all times free and unimpeded access to any building, yard, warehouse, store, manufacturing facility, or transportation facility in which any milk or milk product is produced, bought, sold, stored, bottled, handled, or manufactured.

(f) Any books, papers, records, documents, or reports made to, acquired by, prepared by, or maintained by the secretary pursuant to this article that would disclose any information about finances, financial status, financial worth, composition, market share, or business operations of any producer or handler, excluding information that solely reflects transfers of production base and pool quota among producers, is confidential and shall not be disclosed to any person other than the person from whom the information was received, except pursuant to the final order of a court with jurisdiction, or as necessary for the proper determination of any proceeding before the secretary.

SEC. 5.

 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 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.

(l)It is in the interest of all Californians that when funding is available from other sources, including the General Fund, the fees necessary to enact this statute be reduced.

116765.5.116765.

 It is the intent of the Legislature that any interest revenues from the Safe and Affordable Drinking Water Trust Fund as well as revenue from fees deposited in the Safe and Affordable Drinking Water Fund be available annually for the purposes of this chapter.

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.

 (a) 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.

(b) The board shall report annually in the Governor’s budget fund revenues, including interest revenues, expenditures, and fund balances.

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 and low-income households served by a state small water system or a domestic well. households. 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, 2020, 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 that include, but are not limited to, the following:

(A) 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. 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.

(B) Operations and maintenance costs associated with consolidated water systems, extended drinking water services, or reliance on a substituted drinking water source.

(C) Creating and maintaining natural means and green infrastructure solutions that contribute to sustainable drinking water.

(D) Consolidating water systems.

(E) Extending drinking water services to other public water systems, domestic wells, or state small water systems.

(F) 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.

(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 in high-risk areas identified pursuant to Article 4 (commencing with Section 116770). Section 117211.

(5) The provision of administrative and managerial services under Section 116686.

(6) Provision of wastewater treatment plant operations and maintenance for areas in which polluted water originates from outside the state.

(c) The board may expend moneys from the fund for reasonable costs associated with administration of the fund. Beginning July 1, 2022, the board may expend no more than 5 percent of the annual revenues from the fund for reasonable costs associated with administration of the fund.

(d) The board may undertake any of the following actions to implement the fund:

(1) Provide for the deposit of any of the following moneys into the fund:

(A) Federal contributions.

(B) Voluntary contributions, gifts, grants, or bequests.

(C) Settlements from parties responsible for contamination of drinking water supplies.

(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) Contribute funding available from other sources related to water quality to the fund or combine funding from the other sources with money from the fund to support activities otherwise authorized by this article.

(6)

(7) Take additional action as may be appropriate for adequate administration and operation of the fund.

(e) In administering the fund, the board shall make reasonable efforts to ensure both all 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.

(3) That the total uncommitted amount in the fund does not exceed two times the anticipated funding need in the most recent assessment of funding need.

(f) In administering the fund, the board shall ensure that all moneys deposited into the fund from the safe drinking water fee for nondairy confined animal facilities pursuant to Article 10.5 (commencing with Section 595) of Chapter 3 of Part 1 of Division 1 of the Food and Agricultural Code, the fertilizer safe drinking water fee pursuant to Article 6.5 (commencing with Section 14615) of Chapter 5 of Division 7 of the Food and Agricultural Code, and the dairy safe drinking water fee pursuant to Article 14.5 (commencing with Section 62215) of Chapter 2 of Part 3 of Division 21 of the Food and Agricultural Code shall be used to address nitrate-related contamination issues.

(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 fees deposited into the fund have been appropriately expended.

(3) For community water systems that have received funding for 10 years or more and for which self-sufficiency has not been achieved, the actions that have been taken, the reasons why self-sufficiency has not been achieved, and, if available, ways in which the community water system may become self-sufficient.

(4) 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.

(i) (1) The board shall convene an environmental justice advisory committee, for the purposes of this section, consisting of at least three members, to advise it in conducting the public review and assessment pursuant to subdivision (g) and any other pertinent matter in implementing this chapter. The advisory committee shall be comprised of representatives from communities in the state with the most significant exposure to water pollution, including, but not limited to, communities with minority populations or low-income populations, or both.

(2) The board shall appoint committee members to the environmental justice advisory committee from nominations received from environmental justice organizations and community groups.

(3) The board shall provide reasonable per diem for attendance at environmental justice advisory committee meetings by committee members from nonprofit organizations.

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 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 in the board’s Safe Drinking Water State Revolving Fund Intended Use Plan 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). Section 117211. 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.

(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).

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, 2015, 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)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).

Article  5. Statewide Safe and Affordable Drinking Water Fee System Charge

116771.

 (a) There is hereby imposed a statewide safe and affordable drinking water fee system charge of fifty cents ($0.50) per service connection per month on all public water systems.

(b) (1) By July 1, 2020, and annually by each July 1 thereafter, each public water system shall remit to the board the amount of the fee system charge imposed pursuant to subdivision (a) for their public water system.

(2) To the extent that a public water system seeks to recover the costs of the system charge from its ratepayers, it shall incorporate the costs into its water rates and shall not impose a per-connection fee. A public water system may draw on other available financial resources to pay the system charge.

(c) (1) The board may adopt regulations to implement and enforce this article.

(2) The regulations adopted pursuant to this section, or any amendment to these regulations, the board shall adopt as emergency regulations in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. The adoption of these regulations is an emergency and the Office of Administrative Law shall consider the adoption of the regulations as necessary for the immediate preservation of the public peace, health, safety, and general welfare.

(3) The board shall adopt the initial regulations to implement this section in accordance with Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code and may not rely on the statutory declaration of emergency in paragraph (2).

(4) Any emergency regulations adopted by the board pursuant to this section shall not be subject to review by the Office of Administrative Law and shall remain in effect until revised by the board.

(d) The executive director of the board shall deposit all moneys received pursuant to this section in the fund. The board may expend moneys from the fund for reasonable costs associated with the implementation and enforcement of this section.

116772.

 (a) The Legislative Analyst shall report to the Legislature and the board if the Legislative Analyst determines, on or before January 1, 2023, that at least three billion dollars ($3,000,000,000) has been made available in an interest bearing interest-bearing account in the State Treasury with a goal of at least one hundred million dollars ($100,000,000) in interest revenues per year available for the purposes of the fund.

(b) (1) A report to be submitted pursuant to subdivision (a) shall be submitted in compliance with Section 9795 of the Government Code.

(2) Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2027.

(c) This article shall become inoperative upon the Legislative Analyst submitting a report pursuant to subdivision (a), and, as of January 1, 1 of the year following that determination, is repealed.

Article  6. Regional Distribution

116773.

 (a) The Legislature finds and declares as follows:

(1) Water quality problems occur in all areas of the state, including rural and urban areas.

(2) In particular, aging school infrastructure, including lead pipes, puts at risk thousands of children per year.

(b) It is the intent of the Legislature to establish a region specific region-specific program to address the purposes of this chapter.

(c)The board may distribute funds for any purpose of this chapter through its drinking water regional offices, as follows:

(1)____.

(c) (1) The board may allocate to each regional office sufficient funds to pay for the development of sustainable plans for restoring safe drinking water to the communities identified by the board as provided in Article 3 (commencing with Section 117220) of Chapter 8.

(2) The board may allocate funding to a regional office for implementation of an approved sustainable plan for restoring safe drinking water to an identified community.

(d) The board shall not distribute more than annually allocate 20 percent of the annual expenditures from the fund revenues originating in each of the Division of Drinking Water regions from the statewide safe and affordable drinking water system charge imposed pursuant to Article 5 (commencing with Section 116771) to the region from which the revenues originate pursuant to subdivision (c).

SEC. 6.

 Chapter 4.7 (commencing with Section 116774) is added to Part 12 of Division 104 of the Health and Safety Code, to read:

CHAPTER  4.7. Safe and Affordable Drinking Water Trust Fund

116774.

 (a) The Safe and Affordable Drinking Water Trust Fund is hereby established within the State Treasury. It is the intent of the Legislature that moneys in the trust fund remain for the purposes of the trust in perpetuity.

(b) Moneys held in the trust fund shall be invested by the Treasurer, in consultation with the Director of Finance and the Controller, in investments authorized by Section 16430 of the Government Code.

(c) Investment income derived from the trust fund is hereby transferred on January 1 of each year to the Safe and Affordable Drinking Water Fund, established by Section 116767 for the purposes of Chapter 4.6 (commencing with Section 116765).

116774.1.

 The sum of two hundred million dollars ($200,000,000) shall be transferred to the trust fund by the Legislature each year for five years for the purpose of establishing a one-billion-dollar ($1,000,000,000) trust fund to derive interest revenues to fund Chapter 4.6 (commencing with Section 116765).

SEC. 7.

No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution for certain costs that may be incurred by a local agency or school district because, in that regard, this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

However, if the Commission on State Mandates determines that this act contains other 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.

SEC. 7.

 Section 79724.5 is added to the Water Code, to read:

79724.5.

 Priority is a preference and not a necessary element for an award of funding available pursuant to Section 79724.

SEC. 8.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.