Bill Text: CA SB552 | 2015-2016 | Regular Session | Amended

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

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Bill Title: Public water systems: disadvantaged communities: consolidation or extension of service: administrative and managerial services.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2016-09-28 - Chaptered by Secretary of State. Chapter 773, Statutes of 2016. [SB552 Detail]

Download: California-2015-SB552-Amended.html

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BILL NUMBER: SB 552	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  MAY 17, 2016
	AMENDED IN ASSEMBLY  JULY 7, 2015
	AMENDED IN SENATE  APRIL 16, 2015

INTRODUCED BY   Senator Wolk

                        FEBRUARY 26, 2015

   An act to amend Sections 116681 and 116682  of 
 of, and to add Sec   tion 116686 to,  the Health
and Safety Code, relating to water.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 552, as amended, Wolk. Public water systems: disadvantaged
communities: consolidation or extension of  service.
  service: administrative and managerial services. 

   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 within a disadvantaged community, consistently fails to
provide an adequate supply of safe drinking water. The act authorizes
the state board to order the extension of service to an area 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. Existing law, for these purposes,
defines "disadvantaged community" to mean a disadvantaged community
that is in an unincorporated area or is served by a mutual water
company.
   This bill would  allow   make  a
community  to be a "disadvantaged community"  
disadvantaged for these purposes  if the community is in a
mobilehome park even if it is not in an unincorporated area or served
by a mutual water company. The bill would limit the authority of the
state board to order consolidation or extension of service  to
provide that authority  only with regard to a disadvantaged
community.
   The act requires the state board, before ordering consolidation or
extension of service, to hold at least one initial public meeting,
as specified, and to obtain written consent from any domestic well
owner for consolidation or extension of service. The act provides
that any affected resident within the consolidation or extended
service area who does not provide written consent is ineligible,
until consent is provided, for any future water-related grant funding
from the state, except as specified.
   This bill would provide that an initial public meeting is not
required for a potentially subsumed area that is served only by
domestic wells. The bill would  require any  
apply to the  domestic well owner, instead of  to  an
affected resident, within the consolidation or extended service area
 who does not provide   the  written
consent  to be ineligible for future  
requirement for eligibility for  water-related grant 
funding from the state.  funding. 
   The act requires the state board, upon ordering the consolidation
or extension of service, to adequately compensate the owners of a
privately owned subsumed water system for the fair market value of
the system as determined by the Public  Unities 
 Utilities  Commission for water corporations subject to the
commission's jurisdiction or the state board for all other systems.
The act prohibits a consolidated water system from increasing charges
on existing customers of the receiving water system solely as a
consequence of the consolidation or extension of service unless the
customer receives a corresponding benefit.
   This bill would instead authorize the Public Utilities Commission
or the state board to determine the fair market  value,
  value of a subsumed water system,  without regard
to whether the system is a water corporation subject to the
commission's jurisdiction. The bill would prohibit fees or charges
imposed on a customer of a subsumed water system from exceeding the
cost of consolidating the water system or the  cost of 
extension of service to the area. 
   The act exempts the consolidation or extension of service pursuant
to these provisions from the Cortese-Knox-Hertzberg Local Government
Reorganization Act of 2000, which governs the procedures for the
formation and change of organization of cities and special districts.
 
   This bill would instead exempt an action taken by the state board
pursuant to these provisions from the Cortese-Knox-Hertzberg Local
Government Reorganization Act of 2000.  
   This bill would authorize the state board, for the purpose of
providing affordable, safe drinking water to disadvantaged
communities and preventing fraud, waste, and abuse, to contract with
an administrator to provide administrative and managerial services to
a designated water system and to order the designated public water
system to accept those services. The bill would define designated
water system as a public water system that serves a disadvantaged
community and that the state board finds consistently fails to
provide an adequate and affordable supply of safe drinking water. The
bill would require the state board to provide a public water system
with notice, as specified, before determining that the public water
system is a designated public water system. The bill would authorize
the administrator of a designated public water system to expend
available moneys for capital infrastructure improvements that the
designated public water system needs to provide an adequate and
affordable supply of safe drinking water, to set and collect user
water rates and fees, and to expend available moneys for the
operation and maintenance costs of the designated public water
system. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated 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.   The   Except as provided in
paragraph (2) of subdivision (g) of Section 116686, the 
following definitions shall apply to this section and Sections
 116682 and 116684:   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.
   (g) "Extension of service" means the provision of service through
any physical or operational infrastructure arrangement other than
consolidation.
   (h) "Receiving water system" means the public water system that
provides service to a subsumed water system through consolidation or
extension of service.
   (i) "Safe drinking water" means water that meets all primary and
secondary drinking water standards.
   (j) "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) Where a public water system or a state small water
 system   system,  within a disadvantaged
 community   community,  consistently fails
to provide an adequate supply of safe drinking water, the 
State Water Resources Control Board   state board 
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 Water Resources Control Board
  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  State Water Resources
Control Board   state board  may set timelines and
performance measures to facilitate completion of consolidation.
   (b) Before ordering consolidation or extension of service as
provided in this section, the  State Water Resources Control
Board   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) 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.
   (A) During this period, the  State Water Resources Control
Board   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.
   (B) Upon a showing of good cause, the deadline may be extended by
the  State Water Resources Control Board   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.
   (7) 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.
   (8) (A) 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 Water Resources Control Board   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.
   (B) An initial public meeting shall not be required for a
potentially subsumed area that is served only by domestic wells.
   (c) Upon expiration of the deadline set by the  State
Water Resources Control Board   state board 
pursuant to paragraph (6) of subdivision (b), the  State
Water Resources Control Board   state board  shall
do the following:
   (1) Consult with the potentially receiving water system and the
potentially subsumed water system, if any.
   (2) Conduct a public hearing, in a location as close as feasible
to the affected communities.
   (A) The  State Water Resources Control Board 
 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.
   (B) 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.
   (C) The hearing shall provide an opportunity for public comment.
   (d) Before ordering consolidation or extension of service, the
 State Water Resources Control Board   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.
   (e) Upon ordering consolidation or extension of service, the
 State Water Resources Control Board   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 Water Resources
Control Board   state board shall provide
appropriate financial assistance for the infrastructure needed for
the consolidation or extension of service. The  State Water
Resources Control Board's   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 Water Resources Control Board-ordered
  st   ate 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 Water
Resources Control Board.   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, fees or charges imposed on a
customer of a subsumed water system shall not exceed the cost of
consolidating the water system with a receiving system or the
extension of service to the area.
   (g) Division 3 (commencing with Section 56000) of Title 5 of the
Government Code shall not apply to  the consolidation or
extension of service required   an action taken by the
state board  pursuant to this section.
   SEC. 3.    Section 116686 is added to the  
Health and Safety Code   , to read:  
   116686.  (a) (1) To provide affordable, safe drinking water to
disadvantaged communities and to prevent fraud, waste, and abuse, the
state board may do both of the following:
   (A) Contract with an administrator to provide administrative and
managerial services to a designated public water system to assist the
designated public water system with the provision of an adequate and
affordable supply of safe drinking water.
   (i) To fulfill the requirements of this section, the state board
may contract with more than one administrator, but only one
administrator may be assigned to provide services to a given
designated public water system.
   (ii) An administrator may provide administrative and managerial
services to more than one designated public water system.
   (B) Order the designated public water system to accept
administrative and managerial services, including full management and
control, from an administrator selected by the state board.
   (2) In performing its duties pursuant to paragraph (1), the state
board may use criteria from the policy handbook adopted pursuant to
Section 116760.43.
   (b) Before the state board determines that a public water system
is a designated public water system, the state board shall provide
the public water system with notice and an opportunity to show either
of the following:
   (1) That the public water system has not consistently failed to
provide an adequate and affordable supply of safe drinking water.
   (2) That the public water system has taken steps to timely address
its failure to provide an adequate and affordable supply of safe
drinking water.
   (c) The state board shall make financial assistance available to
an administrator for a designated public water system, as appropriate
and to the extent that funding is available.
   (d) An administrator may do any of the following:
   (1) Expend available moneys for capital infrastructure
improvements that the designated public water system needs to provide
an adequate and affordable supply of safe drinking water.
   (2) Set and collect user water rates and fees.
   (3) Expend available moneys for operation and maintenance costs of
the designated public water system.
   (e) A designated public water system shall not be responsible for
any costs associated with an administrator.
   (f) Administrative and managerial contracts pursuant to this
section shall be exempt from Chapter 2 (commencing with Section
10290) of Part 2 of Division 2 of the Public Contract Code and may be
awarded on a noncompetitive bid basis as necessary to implement the
purposes of this section.
   (g) For purposes of this section, the following terms have the
following meanings:
   (1) "Administrator" means a person that the state board has
determined is competent to perform the administrative and managerial
services of a public water system, as described in subdivision (d).
In determining competency, the state board may consider demonstrated
experience in managing and operating a public water system.
   (2) "Designated public water system" means a public water system
that serves a disadvantaged community, as defined in Section 79505.5
of the Water Code, and that the state board finds consistently fails
to provide an adequate and affordable supply of safe drinking water.