Currently, there are two bond measures that are working their way through the legislative process. Senator Lois Wolk has introduced SB 42 that would replace the current 2014 bond with the $6.475 billion “Safe Drinking Water, Water Quality, and Flood Protection Act of 2014.” Assemblymember Anthony Rendon has introduced AB 1331, which would replace the current 2014 bond with the $6.5 billion “Climate Change Response for Clean and Safe Drinking Water Act of 2014.”
Both legislators presented the details of their competing bond measures at a joint legislative hearing held on September 24th with the Senate Committee on Environmental Quality and the Senate Committee on Natural Resources and Water Committee titled “Setting the Stage for a 2014 Water Bond: Where Are We and Where Do We Need To Go?”
It was the third in a series of hearings related to the water bond, beginning with a hearing in February which looked at the state fiscal condition and bond indebtedness, and in March, there was a hearing that highlighted unanticipated developments that occurred since the drafting of the 2014 bond.
“Three quarters of the Assembly wasn’t around in 2009 and frankly they don’t care what we did in 2009,” said Senator Fran Pavley, Chair of the Senate Natural Resources and Water Committee. “We try to remind them, but somehow they are brand new, they have their own views of the world.”
Senator Pavley explained that the purpose of the hearing was to hear from both Senator Wolk and Assemblymember Rendon on their different bond proposals. The measures are similar, and both are close to $6.5 billion, considerably less than the $11.14 billion bond proposed in 2009. “This is scaled back and tailored to meet today’s needs and goals,” said Senator Pavley. “This is not just to say that a couple of years from now there won’t be a different water bond, but this is serving today’s need. It’s not frankly the mitigation for the tunnels; in fact, in my mind, it is a very separate discussion. Regardless of what happens with that project, there’s a lot of water needs relating to water quality, access to safe, clean drinking water, focus on regional solutions, concerns about what’s happening in the Delta and all over the state that need to be addressed now.”
Senator Jerry Hill, Chair of the Senate Environmental Quality Committee, said that the committee heard at least six bills in the last year and many more previously that attempted to change the way funds were allocated to ensure limited funded went to the most needy communities in California. “It’s clear to me that California’s water quality needs to be the best, and it needs to get our attention, and certainly with this hearing and with the bond proposals, it will get our attention,” he said. “At least 97% of Californians as we know have clean drinkable water; that means there are still nearly 1 million people in CA that may not have clean drinkable water.”
“From the Senate Environmental Committee’s perspective, the hope is that the next bond that goes before the California’s voters will address the current and future quality needs of our state, maximize local, federal and private investment in a strong drinking water infrastructure, and provide a comprehensive plan for regional solutions,” Mr. Hill said.
Senator Pavley noted that both bills are in the Senate, and in January, both will go through both the Senate Natural Resources Committee and the Senate Environmental Quality Committee. And with that, Senator Wolk was given the floor to discuss her water bond, SB 42.
SB 42: SENATOR WOLK
“The existing bond is unlikely to gain voter support in its current state and yet we know that communities and watersheds throughout California need funding to address critical water needs,” began Senator Lois Wolk. “Simply put, I think that the legislature should provide voters with a sensible, realistic and supportable bond. And SB 42, in my view, provides a fresh take on the water bond discussion.”
“It’s essentially a do-over,” Ms. Wolk continued. “It focuses on broadly supported solutions to our most critical funding needs including developing reliable regional water supplies throughout the state, addressing critical drinking water needs statewide and in particular for disadvantaged communities, community-supported ecosystem restoration and levee enhancement in the Delta, replenishment of watershed and ecosystem funding throughout the state, and groundwater and surface water storage to the extent that those facilities will provide public benefit as well as flood protection and stormwater treatment in key areas of the state.”
Senator Wolk explained why SB 42 is different than the bond that is currently on the ballot: “It’s realistic, it focuses on water needs for the next ten to fifteen years in the state, and avoids the most controversial projects that are likely to kill any bond on the ballot. SB 42 is also responsible; there are no earmarks in this bond,” said Ms. Wolk, noting that her bond retains legislative oversight, including the money allocated for water storage. “It provides incentives that will help permanently reduce reliance on the state’s most stressed watersheds while directing funding to the development of water supplies that are regional and must be resilient to climate change. SB 42 has been and will continue to be developed in a transparent process with all the appropriate hearings that should happen on a bond of this importance.”
Senator Wolk said that where feasible, funding is directed to programs such as IRWMP; in other cases, the funding is directed to existing agencies with well defined strategic plans and significant participation of the public. SB 42 also tasks the Delta Conservancy granting Delta habitat and sustainability funding, she noted.
“Importantly, SB 42 has been designed to maximize support for consensus projects rather than funding controversial projects that I believe will result opposition on the ballot,” she said. “One of the primary reasons that the current bond is not viable is that it is strongly opposed by the Delta community, the environmental community, and the environmental justice community. I’m happy to report that SB 42 has been developed in consultation with those communities and thus far has been positively received by those communities,” she said, adding that many of the unique features of her bill are intended to address concerns raised by these communities as well as to ensure compliance with existing statewide policy and to direct funding to those projects that are priorities and broadly supported.
“SB 42 includes specific provisions that address concerns raised by the Delta community including the primary role of the Delta Conservancy in dealing with habitat restoration,” said Ms. Wolk. “It prohibits eminent domain and it requires coordination in partnership with a Delta city or county – the local community in which the project is being implemented. A local partner is essential. It requires grant applications to address the economic impacts and mitigation including ag land mitigation, and it prohibits the funding of construction, mitigation, or operation of the tunnels or BDCP.”
“These measures are critical to ensuring that habitat restoration in the Delta will be successful because it follows the pattern that has been set nationwide for major restoration projects,” said Ms. Wolk. “No eminent domain. Local partnership. These are critically important.”
Ms. Wolk noted that SB 42 has support from many environmental and environmental justice groups, and contains specific provisions to address their concerns. She said her objective now is to work with the Senate committee, the water community and other stakeholder groups to further refine and improve the measure.
“We’re going to have challenges in front of us, both Assembly member Rendon and I,” said Ms. Wolk. “We need to really keep the focus on investing in projects that can make a difference in the next 5 to 10 years, and not let the controversy over other projects that aren’t ready to go inhibit our ability to implement effective water solutions now.”
“We’re also going to need to avoid the temptation to inflate the bond even further,” she continued. “There are many deserving projects but they can’t all be funded by this bond. And it will be hard to restrain the natural inclination to put more into the bond, but we really do need to do that. We aren’t yet out of the recession to the extent that we would like.”
“We need to respect the need for consensus,” said Ms. Wolk. “Any significant opposition to any particular part of it will be a problem. And that’s always difficult, so I look forward to working with my colleagues to further refine SB 42 – that’s why it’s out there. Let’s all take a look at it statewide, ensure that it can be supported by the legislature, by the governor, and by the voters in 2014.”
AB 1331: ASSEMBLY MEMBER ANTHONY RENDON
“Your hearings last winter kicked off the legislature’s activity in this area,” said Assemblymember Anthony Rendon. “Since then, the Assembly has done some work on the water bond and we appreciate the Senate again stepping up to consider the progress we have made and the next steps needed towards replacing the water bond on the ballot that voters will approve.”
“Today California stands at a precipice facing a water crisis with climate change as the key driver for fundamentally different conditions for California,” he said. “The federal government has declared a drought emergency in many California counties. Our reservoirs stand at record lows. California needs a water bond to address the impending water crisis and adapt our water infrastructure to climate change that already has arrived,” and he noted that a recent PPIC poll showed that Californians recognize the threat of climate change and support taking immediate actions.
“In the coming decade, California needs to invest billions of dollars in water infrastructure and we will need to figure out how to pay for it,” said Mr. Rendon. “Water bond funding is one part of that equation. A 2014 water bond or at least a water bond that voters will support is an even smaller part of that overall equation.”
Realizing the current bond would fail due to extensive public criticism and lack of voter confidence, Mr. Rendon said the Assembly Water Working Group decided to start over on crafting a water bond. “We identified the most urgent priorities and not surprisingly, some of the same needs as before rose as top priorities,” he said.
The Assembly Water Bond Working Group’s process is important, said Mr. Rendon. “Polling shows that bond approval requires some voter confidence in the legislature and its process, so gaining voter support starts with a clean and open process,” he said, noting that the working group started with briefings and discussions, the Committee has held hearings, taken into account comments received, and developed a framework on which the water bond is based. After putting the bond language in print, comments were received and consensus amendments were made. “Those amendments include additional measures to improve accountability such as reporting and auditing requirements,” he said. “AB 1331 already adopted the accountability measures in the 2009 bond and we would welcome additional ideas from the Senate on how to ensure accountability for the use of funds in this bond.”
“Ensuring accountability is central to gaining voter support and it’s a centerpiece of my service here in the Legislature,” said Mr. Rendon. “I come from a district made up of 8 cities, half of those cities have former council members in jail, so accountability and transparency are central to the work that I do and that my office does.”
“We need to earn the voters trust so they will continue to support water bonds in the future,” said Mr. Rendon, noting that the US EPA has estimated California’s need for drinking water infrastructure improvements for the next 20 years at $40 billion. “In the decades ahead, we may need to return to the voters for support to build and maintain a water system for the 21st century.”
“AB 1331’s findings are more comprehensive than the 2009 bond in order to lay the foundations for voters on the threats to our water system from climate change and why this funding is so urgent, and those were more recently informed by the PPIC poll that I cited,” said Mr. Rendon. “With respect to broad availability, the working group decided early on to make the bonding funding available to any state agency to ensure legislative oversight and accountability for the funding. If an agency performs well, then it deserves the legislature’s support in appropriations from bond funding; if not, then we should not be constrained to continue appropriating funds to that agency. We are committed to doing more active legislative oversight and this decision reflects that commitment.”
“With respect to clean and safe drinking water, the number one priority for the water working group in this area was taking care of disadvantaged communities, so we worked with Clean Water Action and other environmental justice groups to use the language from SB 42 to address this need,” he said, noting that Senator Wolk’s work with advocates for drinking water in disadvantaged communities made an important contribution to the discussion on this issue.
AB 1331 has specific allocations of $250 for all conservancies allocated to Natural Resources Agency and $500 million for meeting certain existing obligations the state has made in order to resolve water conflicts, he said.
There is funding for IRWM with allocations for each region; in addition, $500 million is allocated for water recycling above the regional allocations. “When you look at very recent public opinion polls, the statistics on water recycling in terms of public approval are staggering, and I mean staggering in a good way,” said Mr. Rendon. “The recent amendments allow some regional plans beyond IRWM that reflect a regional strategy for incorporating recycling into the region’s water supply portfolio.”
There’s no specific allocation of funding for the Delta in the AB 1331, but the bond has conditions that apply to all Delta funding, he said. “First, the money cannot be used for eminent domain; second, funded projects must have a local Delta partner as defined.”
The water storage chapter includes much of the same language on storage as the 2009 bond and it remains one of the chapters that need continuing work, he said.
“I’d like to close by emphasizing that our water future will depend on greater regional self reliance,” said Mr. Rendon. “We have built the most sophisticated water storage and water conveyance systems in the world. Our regions have become interdependent for our water. We are not going to walk away from that investment or that interdependence, but looking ahead to the future and the challenges of water contamination, the growing population and economy and climate change, we need to increase our regional self reliance. That is a strategy for a most successful water future.”
“What does that look like? In my region of Southern California, it means more effective regional management of groundwater. It means capturing rainwater and stormwater to replenish our aquifers. It means pervasive deployment of recycled water to our landscaping and recharged aquifers,” said Mr. Rendon, noting Water Replenishment District’s effort to recharge the groundwater basin with local sources.
“Improving regional self reliance is the kind of strategy that the next water bond should support,” said Mr. Rendon. “Reducing reliance on the Delta and increasing regional self reliance is California’s water future.”
Senator Monning asked about the allocation for the Central Coast region and how the region was geographically defined. “We have communities suffering from non-drinkable water, we have polluted water systems … “
“The Central Coast is extremely important to the success of this bond,” responded Senator Wolk. “That is absolutely clear, just as the support of the Delta is, and I think it’s really important that those issues that you raised be addressed.” She said they were working to figure out how best to target funds for disadvantaged communities. “We tend to think of the drinking water issue being primarily a south-Central Valley issue. It is not. It is not at all. It is also a rural issue, it is broader than that … Drinking water needs are not simply in one portion of the state or another. The definition is really important and I look forward to working with you on that,” she said, noting that there would also be watershed funding and IRWMP monies available to the Central Coast.
“The question is a logical one for people in other parts of the state,” said Senator Monning. “How do we benefit if we put up our vote for this? I think the other part of the positioning of the evolution of this would be to show the nexus between the quality of the Delta and some of the economies on the Central Coast, like the salmon fishing and other habitat issues. We are an integrated state in terms of our waterways, and the impacts of pollution at one part of the state can impact economies in another part of the state.”
“Your question was specific to the Central Coast but it could be asked about any region of the state,” said Assemblymember Rendon. “Water supply and water quality problems exist throughout the state as Senator Wolk mentioned, from rural areas to urban areas, north to south. In respect to water quality, my district has the City of Maywood which has famously bad water quality. Watsonville, Salinas have very bad water quality problems. Fresno has water quality problems. You see it throughout the Central Valley, so I think funding needs to depend not only on population and size, but also on the specific needs relative to the community and also the water assets and liabilities in those communities.”
The competitive grants outlined in AB 1331 would be made available to regions throughout the state, said Mr. Rendon. “That being said, we often know there may be inherently an unlevel playing field with respect to competitive grants, so there are specific allocations and preference given to disadvantaged communities.”
Monning asked Senator Wolk how the regional allocations were determined – by population size or some other index? Senator Wolk said the same formula that has been used in the past.
“There were set numbers, but jiggled because of population,” said Senator Pavley, “and that’s something we’re wrestling with. Percentage of allocations- geography versus population versus need, and how it relates to the goal which is access to safe drinking water.”
Senator Hill noted that both bonds were similar in dollar amount, and asked how that was determined. He also noted the different distribution of funds throughout the state, and asked how the regional amounts and priorities were determined.
“The most recent PPIC poll shows that $5 to $7 billion seems to be the safe zone for most California voters,” responded Mr. Rendon. “I know that the speaker recently said that he believes that a bond around $7 to $8 billion is passable, which isn’t that far off. ACWA believes that a bond of about $8.2 billion is doable, but everything is significantly below $11.14 billion.”
The water working group agreed there was a need to avoid earmarks and that was established at the outset, said Mr. Rendon. “I think it was largely because of the criticism that the original bond grew to $11.14 billion. That being said, the definition of earmarks can get somewhat metaphysical or epistemological. The categories that exist – safe drinking water and those types of broad categories – we didn’t regard those as earmarks. We regard those as categories that seem to be standard to any discussion of any water bond.”
“The challenge will be keeping the bond figure where it is or below,” said Ms. Wolk. “I haven’t seen data on what will pass and what won’t pass but I do know that the history of water bonds is that they don’t’ enjoy tremendous support. The key is not having an organized opposition … The most important thing is consensus projects and keeping the controversy separate and apart from this bond if we can. … As long as we keep thinking about the critical needs for the next 10 to 15 years and achieving consensus, the actual numbers are less important, but I think that’s a tremendous challenge. Getting the numbers right won’t matter if there is no consensus and the figure is overall too high.”
Senator Pavley asked about the inclusion of flood management funds in SB 42. “I think it’s essential that there be funding for levees in the bond,” said Senator Wolk. “The condition of our levees is directly related to the water supply over the next 10 years in the Delta as well as habitat issues,” noting that encouraging multi-benefit multi-use projects in the Delta has been the direction for many years. “Not only is water supply and the strength of the Delta levees maintained, but we can also have habitat as well, so I think there are a lot of benefits to making sure that the levee system remains strong.”
“In the Delta section, we have overall $1.1 billion,” said Senator Wolk. “$600 million is for the Delta ecosystem restoration issues, $500 million for water quality and watershed protection of statewide significance outside the Delta; that’s all in the water quality and watershed protection, $2.1 billion category,” noting that there are also funds for flood control and stormwater management, which is extremely important, both to the Delta and to the rest of the state. Ms. Wolk said there was a separate category for Delta levees, pointing out that the subventions program is an important expenditure that is a minor amount compared to the overall need.
Senator Pavley asked about continuous appropriation for storage project, noting that it was controversial in 2009 because it was put in to leverage the two-thirds vote. “Why under storage should or should there not be continuous appropriation or is the jury still out there?” she asked.
“The water working group reflected a statewide diversity of different opinions, including advocates for continuous appropriation and advocates for additional storage,” said Mr. Rendon. “AB 1331’s preference for continuous appropriation is simply where we stand at this point.”
Senator Wolk said that SB 42 removes the continuous appropriation. “The real issue for us is accountability for the $1 billion of funds,” said Senator Wolk. “Continuous appropriation removes sufficient legislative oversight. If there is a way of assuring legislative oversight while still allowing projects to move forward that have the appropriate studies and feasibility behind them, that’s a good thing to do, and I would be willing to look at that … ”
“The staff also raised the fact that the projects that were called out in the 2009 bond were a particular set of projects; certain projects that fell below a certain yield of water I believe were excluded from that,” said Ms. Wolk. “Maybe smaller, maybe more realistic, maybe more achievable, I don’t really know, but I do think that one of the changes in the storage area should be to look once again at those other storage projects that may in fact be more doable and may in fact happen.”
The legislators discussed at length discussed disadvantaged communities and the challenges of determining which communities would qualify as well as the difficulty in raising matching funds, and funding for operations and maintenance, acknowledging that that there’s not enough money to do everything.
Senator Wolk said the targeting of funds needs to be defined. She said that SB 42 allows the agency involved to reduce the matching fund requirement, and in the Delta, the local match is removed. “We have removed the 50% match for a good reason. There will never be a 50% match if we want to see habitat improved in the Delta. It’s the same with the kind of communities we are dealing with. These are communities that will not be able to afford a match at the levels that could be required from other areas, so that’s really critical.” She noted that funding operations & maintenance and assuring best practices is going to be difficult.
Assembly member Anthony Rendon said that clean drinking water was a number one priority for the Water Working Group, and in the water quality area, the number one priority was working with disadvantaged communities. “We use a pre-existing definition of what that means … the need to define all of our variables is essential to the grant. We made some progress for example; we defined economically distressed areas in 1331 to meet a number of conditions … because of the accountability issue and the earmark issue, there was concern in the water working group about O&M funding and the public perception from that, but it is part of an ongoing discussion.”