Amended  IN  Assembly  April 17, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 2501

Introduced by Assembly Member Chu
(Coauthor: Assembly Member Friedman)

February 14, 2018

An act to amend Sections 116681 and 116682 of the Health and Safety Code, relating to drinking water.


LEGISLATIVE COUNSEL'S DIGEST


AB 2501, as amended, Chu. Drinking water: consolidation and extension of service.
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.
Existing law, the California Safe Drinking Water Act, provides for the operation of public water systems and imposes on the State Water Resources Control Board various responsibilities and duties. The act authorizes the state board to order consolidation with a receiving water system where a public water system or a state small water system, serving a disadvantaged community, consistently fails to provide an adequate supply of safe drinking water. The act also authorizes the state board to order extension of service to an area within a disadvantaged community that does not have access to an adequate supply of safe drinking water so long as the extension of service is an interim extension of service in preparation of consolidation. The act defines “disadvantaged community” for these purposes to mean a disadvantaged community that is in an unincorporated area, is in a mobilehome park, or is served by a mutual water company or small public water system.
This bill would redefine “small public water system” “disadvantaged community” for these purposes as a system with 200 connections of less. to also include a disadvantaged community that is served by a state small water system or domestic well. The bill would authorize the state board to order consolidation with a receiving water system where a disadvantaged community is reliant on a state small water system, an individual domestic well, or an unregulated water system serving fewer than five connections. well that consistently fails to provide an adequate supply of safe drinking water. The bill would require authorize the state board to consider ordering consolidation of a water system with a receiving water system if develop and adopt a policy that provides a process by which members of a disadvantaged community served by the water system does not have an adequate supply of safe drinking water and at least 75% of the households in that community may petition the state board for to consider ordering consolidation. The bill would require the consolidation to occur within 6 months of the initiation of the extension of service.
Existing law requires the state board, before ordering consolidation or extension of service, to, among other things, hold at least one public meeting at the initiation of the process, as specified, but does not require an initial public meeting for a potentially subsumed area that is served only by domestic wells. Existing law requires the state board, before ordering consolidation or extension of service, to make certain findings, including that the capacity of the proposed interconnection needed to accomplish the consolidation is limited to serving the current customers of the subsumed water system.
This bill would repeal the exception excluding potentially subsumed areas served only by domestic wells from the initial public meeting requirement. The bill would expand the finding of the capacity of the proposed interconnection needed to also include vacant lots infill sites, as defined, within the community served by the subsumed water system and residents of a disadvantaged community in existence as of the date of consolidation and that are located within a certain distance of the community served by along the service line connecting the subsumed water system or infrastructure of the subsumed water system. and the receiving water system.
Existing law prohibits fees or charges imposed on a customer of a subsumed water system from exceeding the cost of consolidating the water system with a receiving water system or the extension of service to the area.
This bill would instead prohibit the ongoing service fees or charges from exceeding the cost of costs incurred to provide the drinking water service. The bill would prohibit a receiving water system from charging any fees to a customer of the subsumed water system that it does not otherwise charge to other new customers not subject to the consolidation and from imposing any conditions on a subsumed water system or customer of a subsumed water system that it does not otherwise impose on other water systems or new customers not subject to the consolidation.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 116681 of the Health and Safety Code is amended to read:

116681.
 Except as provided in paragraph (2) of subdivision (j) of Section 116686, the following definitions shall apply to this section and Sections 116682, 116684, and 116686:
(a) “Adequate supply” means sufficient water to meet residents’ health and safety needs.
(b) “Affected residence” means a residence within a disadvantaged community that is reliant on a water supply that is either inadequate or unsafe.
(c) “Consistently fails” means a failure to provide an adequate supply of safe drinking water.
(d) “Consolidated water system” means the public water system resulting from the consolidation of a public water system with another public water system, state small water system, or affected residences not served by a public water system.
(e) “Consolidation” means joining two or more public water systems, state small water systems, or affected residences not served by a public water system, into a single public water system.
(f) “Disadvantaged community” means a disadvantaged community, as defined in Section 79505.5 of the Water Code, that is in an unincorporated area, is in a mobilehome park, or is served by a mutual water company company, a state small water system, a domestic well, or a small public water system.
(g) “Domestic well” means a groundwater well used to supply water for the domestic needs of an individual residence or a water system that is not a public water system and that has no more than four service connections.

(g)

(h) “Extension of service” means the provision of service through any physical or operational infrastructure arrangement other than consolidation.

(h)“Individual domestic well” means a groundwater well used to supply water for the domestic needs of an individual residence or for a water system with four connections or less.

(i) “Infill site” means a site within the area served by a subsumed water system that, as of the date of consolidation, is adjacent on at least two sides to any of the following, or any combination of the following:
(1) A parcel that is developed for qualified urban uses.
(2) A navigable body of water.
(3) A park.
(4) A street or highway or other public right of way.
(j) “Qualified urban use” means any residential, commercial, public institutional, industrial, transit or transportation facility, or retail use, or any combination of those uses.

(i)

(k) “Receiving water system” means the public water system that provides service to a subsumed water system through consolidation or extension of service.

(j)

(l) “Safe drinking water” means water that meets all primary and secondary drinking water standards.

(k)

(m) “Small public water system” means a public water system with 200 connections or less. has the same meaning as provided in subdivision (b) of Section 116395.

(l)

(n) “Subsumed water system” means the public water system, state small water system, or affected residences not served by a public water system consolidated into or receiving service from the receiving water system.

SEC. 2.

 Section 116682 of the Health and Safety Code is amended to read:

116682.
 (a) (1) The state board, in circumstances described in either subparagraph (A) or (B), may order consolidation with a receiving water system as provided in this section and Section 116684. The consolidation may be physical or operational. The state board may also order the extension of service to an area within a disadvantaged community that does not have access to an adequate supply of safe drinking water so long as the extension of service is an interim extension of service in preparation for consolidation. The consolidation shall occur within six months of the initiation of the extension of service. The state board may set timelines and performance measures to facilitate completion of consolidation.
(A) A public water system or a state small water system, serving a disadvantaged community, consistently fails to provide an adequate supply of safe drinking water.
(B) A disadvantaged community is reliant on a state small water system, an individual a domestic well, or an unregulated water system serving fewer than five connections. well that consistently fails to provide an adequate supply of safe drinking water.
(2) The state board shall consider ordering consolidation of a water system with a receiving water system if a may develop and adopt a policy that provides a process by which members of a disadvantaged community served by the water system does not have an adequate supply of safe drinking water and at least 75 percent of the households in that disadvantaged community may petition the state board for to consider ordering consolidation.
(b) Before ordering consolidation or extension of service as provided in this section, the state board shall do all of the following:
(1) Encourage voluntary consolidation or extension of service.
(2) Consider other enforcement remedies specified in this article.
(3) Consult with, and fully consider input from, the relevant local agency formation commission regarding the provision of water service in the affected area, the recommendations for improving service in a municipal service review, and any other relevant information.
(4) Consult with, and fully consider input from, the Public Utilities Commission when the consolidation would involve a water corporation subject to the commission’s jurisdiction.
(5) Consult with, and fully consider input from, the local government with land use planning authority over the affected area, particularly regarding any information in the general plan required by Section 65302.10 of the Government Code.
(6) Consult with, and fully consider input from, all public water systems in the chain of distribution of the potentially receiving water systems.
(7) (A) Notify the potentially receiving water system and the potentially subsumed water system, if any, and establish a reasonable deadline of no less than six months, unless a shorter period is justified, for the potentially receiving water system and the potentially subsumed water system, if any, to negotiate consolidation or another means of providing an adequate supply of safe drinking water.
(B) During this period, the state board shall provide technical assistance and work with the potentially receiving water system and the potentially subsumed water system to develop a financing package that benefits both the receiving water system and the subsumed water system.
(C) Upon a showing of good cause, the deadline may be extended by the state board at the request of the potentially receiving water system, potentially subsumed water system, or the local agency formation commission with jurisdiction over the potentially subsumed water system.
(8) Obtain written consent from any domestic well owner for consolidation or extension of service. Any domestic well owner within the consolidation or extended service area who does not provide written consent shall be ineligible, until the consent is provided, for any future water-related grant funding from the state other than funding to mitigate a well failure, disaster, or other emergency.
(9) Hold at least one public meeting at the initiation of this process in a place as close as feasible to the affected areas. The state board shall make reasonable efforts to provide a 30-day notice of the meeting to the ratepayers, renters, and property owners to receive water service through service extension or in the area of the subsumed water system and all affected local government agencies and drinking water service providers. The meeting shall provide representatives of the potentially subsumed water system, affected ratepayers, renters, property owners, and the potentially receiving water system an opportunity to present testimony. The meeting shall provide an opportunity for public comment.
(c) Upon expiration of the deadline set by the state board pursuant to paragraph (7) of subdivision (b), the state board shall do the following:
(1) Consult with the potentially receiving water system and the potentially subsumed water system, if any.
(2) (A) Conduct a public hearing, in a location as close as feasible to the affected communities.
(B) The state board shall make reasonable efforts to provide a 30-day notice of the hearing to the ratepayers, renters, and property owners to receive water service through service extension or in the area of the subsumed water system and to all affected local government agencies and drinking water service providers.
(C) The hearing shall provide representatives of the potentially subsumed water system, affected ratepayers, renters, property owners, and the potentially receiving water system an opportunity to present testimony.
(D) The hearing shall provide an opportunity for public comment.
(d) Before ordering consolidation or extension of service, the state board shall find all of the following:
(1) The potentially subsumed water system has consistently failed to provide an adequate supply of safe drinking water.
(2) All reasonable efforts to negotiate consolidation or extension of service were made.
(3) Consolidation of the receiving water system and subsumed water system or extension of service is appropriate and technically and economically feasible.
(4) There is no pending local agency formation commission process that is likely to resolve the problem in a reasonable amount of time.
(5) Concerns regarding water rights and water contracts of the subsumed and receiving water systems have been adequately addressed.
(6) Consolidation or extension of service is the most effective and cost-effective means to provide an adequate supply of safe drinking water.
(7) The capacity of the proposed interconnection needed to accomplish the consolidation is limited to serving the current customers of the subsumed water system, vacant lots infill sites within the community served by the subsumed water systems and residents of disadvantaged communities in existence as of the date of consolidation and that are located within one-quarter mile of the community served by the subsumed water system or infrastructure of the subsumed water system. along the service line connecting the subsumed water system and the receiving water system.
(e) Upon ordering consolidation or extension of service, the state board shall do all of the following:
(1) As necessary and appropriate, make funds available, upon appropriation by the Legislature, to the receiving water system for the costs of completing the consolidation or extension of service, including, but not limited to, replacing any capacity lost as a result of the consolidation or extension of service, providing additional capacity needed as a result of the consolidation or extension of service, and legal fees. Funding pursuant to this paragraph is available for the general purpose of providing financial assistance for the infrastructure needed for the consolidation or extension of service and does not need to be specific to each individual consolidation project. The state board shall provide appropriate financial assistance for the infrastructure needed for the consolidation or extension of service. The state board’s existing financial assistance guidelines and policies shall be the basis for the financial assistance.
(2) Ensure payment of standard local agency formation commission fees caused by state board-ordered consolidation or extension of service.
(3) Adequately compensate the owners of a privately owned subsumed water system for the fair market value of the system, as determined by the Public Utilities Commission or the state board.
(4) Coordinate with the appropriate local agency formation commission and other relevant local agencies to facilitate the change of organization or reorganization.
(f) (1) For the purposes of this section, the consolidated water system shall not increase charges on existing customers of the receiving water system solely as a consequence of the consolidation or extension of service unless the customers receive a corresponding benefit.
(2) For purposes of this section, ongoing service fees or charges imposed on a customer of a subsumed water system shall not exceed the cost of costs incurred to provide the drinking water service.
(3) For purposes of this section, the receiving water system shall not charge any fees, including, but not limited to, connection fees, capacity fees, or impact fees, to customers of the subsumed water system that it does not otherwise charge to other new customers not subject to the consolidation with the receiving water system and shall not impose any conditions on a subsumed water system or customer of a subsumed water system that it does not otherwise impose on other water systems or new customers not subject to the consolidation with the receiving water system.
(g) Division 3 (commencing with Section 56000) of Title 5 of the Government Code shall not apply to an action taken by the state board pursuant to this section.