BILL ANALYSIS                                                                                                                                                                                                    




           ----------------------------------------------------------------- 
          |SENATE RULES COMMITTEE            |                       SB 1262|
          |Office of Senate Floor Analyses   |                              |
          |(916) 651-1520    Fax: (916)      |                              |
          |327-4478                          |                              |
           ----------------------------------------------------------------- 


                                   THIRD READING 


          Bill No:  SB 1262
          Author:   Pavley (D) and Wieckowski (D)
          Amended:  5/11/16  
          Vote:     21 

           SENATE NATURAL RES. & WATER COMMITTEE:  7-2, 3/29/16
           AYES:  Pavley, Allen, Hertzberg, Hueso, Jackson, Monning, Wolk
           NOES:  Stone, Vidak

           SENATE GOVERNANCE & FIN. COMMITTEE:  5-2, 4/20/16
           AYES:  Hertzberg, Beall, Hernandez, Lara, Pavley
           NOES:  Nguyen, Moorlach

           SENATE APPROPRIATIONS COMMITTEE:  Senate Rule 28.8

           SUBJECT:   Water supply planning


          SOURCE:    Author

          DIGEST:   This bill revises requirements that new developments  
          must meet in order to demonstrate that its water supplies are  
          sufficient to include consideration of provisions of the  
          Groundwater Sustainability Act.

          Senate Floor Amendments of 5/11/16 clarify how to address  
          groundwater in land use planning.

          ANALYSIS: 
          
          Existing law:

          1)Requires, pursuant to the California Water Code, every  
            large-scale development project - 500 new residential  
            connections or an equivalent size for other uses - to have a  








                                                                    SB 1262  
                                                                    Page  2



            water supply assessment prepared according to the following  
            process:


             a)   A city or county, at the time that it determines that a  
               development is subject to the California Environmental  
               Quality Act (CEQA), must identify any water system that may  
               supply water for the project.


             b)   A water supply assessment must identify any existing  
               water supply entitlements, water rights, or water service  
               contracts relevant to the identified water supply for the  
               proposed project, and describe the quantities of water  
               received in prior years by the public water system or the  
               city or county through its water rights or other sources.  


             c)   If the project relies in whole or in part on  
               groundwater, the water supply assessment must include  
               additional information, including a description of any  
               groundwater basins that will supply the project, the court  
               or State Water Resources Control Board (SWRCB or State  
               Board) order if the basin is adjudicated, and an analysis  
               of the sufficiency of the groundwater from the basin or  
               basins.


          2)Requires that, under CEQA, whenever a city or county  
            determines that a large-scale project, as defined in the  
            California Water Code (above), is subject to CEQA, it must  
            comply with the water supply assessment requirements triggered  
            by that determination.


          3)Requires, under the Subdivision Map Act, cities and counties  
            to demonstrate that a sufficient water supply is available as  
            a condition in their approval of a tentative map for a  
            subdivision with more than 500 dwelling units.


             a)   Sufficient water supply is defined as the total water  








                                                                    SB 1262  
                                                                    Page  3



               supplies available during normal, single-dry, and  
               multiple-dry years within a 20-year projection that will  
               meet the projected demand associated with the proposed  
               subdivision, in addition to existing and planned future  
               uses. In determining sufficient water supply, all of the  
               following factors shall be considered:


               i)     The availability of water supplies over a historical  
                 record of at least 20 years.


               ii)    The applicability of an urban water shortage  
                 contingency analysis that includes actions to be  
                 undertaken by the public water system in response to  
                 water supply shortages.


               iii)   The reduction in water supply allocated to a  
                 specific water use sector pursuant to a resolution or  
                 ordinance adopted, or a contract entered into, by the  
                 public water system.


               iv)    The amount of water that the water supplier can  
                 reasonably rely on receiving from other water supply  
                 projects, such as conjunctive use, reclaimed water, water  
                 conservation, and water transfers.


             b)   Proof of sufficient water must be based on a written  
               verification from the applicable public water system. In  
               order to be sufficient, the water supply must be able to  
               meet the demands of existing and future planned uses in  
               addition to the subdivision's demand over the next 20  
               years.  


             c)   The public water system's written verification of its  
               ability or inability to provide a sufficient water supply  
               to meet the projected demand associated with the proposed  
               subdivision must be supported by substantial evidence. The  








                                                                    SB 1262  
                                                                    Page  4



               substantial evidence may include, but is not limited to,  
               any of the following:


               i)     The public water system's most recently adopted  
                 urban water management plan.


               ii)    A water supply assessment that was completed  
                 pursuant to the California Water Code (above).


               iii)   Other information relating to the sufficiency of the  
                 water supply that contains analytical information that is  
                 substantially similar to the assessment required for  
                 urban water management plans.


          4)Specifies that the Sustainable Groundwater Management Act  
            (SGMA), among other provisions, directs the Department of  
            Water Resources (DWR) to categorize the state's groundwater  
            basins into high, medium, low, and very low priorities, based  
            on factors such as the population overlying the basin, number  
            of wells in the basin, and overlying irrigated acreage.  DWR  
            must also identify basins subject to critical overdraft.


             a)   Under SGMA, basins designated as high or medium priority  
               must be managed by a groundwater sustainability agency.   
               That agency must develop a groundwater sustainability plan  
               (GSP) to ensure that by 2040, the basin is in a sustainable  
               condition-there can be no undesirable results (such as land  
               sinking) from use of the basin. 


             b)   A GSP must include, among other things, a description of  
               the consideration given to the applicable county and city  
               general plans and a description of the various adopted  
               water resources-related plans and programs within the basin  
               and an assessment of how the GSP may affect those plans.










                                                                    SB 1262  
                                                                    Page  5



             c)   If a basin does not have a groundwater sustainability  
               agency by July 1, 2017, or the agency fails to adopt or  
               implement a GSP pursuant to SGMA, the State Board may  
               designate the basin as "probationary" and can develop a  
               plan to achieve sustainability for the basin. 


          This bill:


          1)Revises the groundwater requirements for a water supply  
            assessment under the California Water Code to include, for  
            high- and medium-priority basins, information regarding the  
            following:


             a)   Whether the DWR has identified the basin as being  
               subject to critical overdraft.


             b)   Whether the State Board has designated the basin as a  
               probationary basin.


             c)   If a groundwater sustainability agency has adopted a GSP  
               or has an approved alternative, a copy of that alternative  
               or plan.


          2)Excludes from consideration as a source of water under the  
            water supply assessment:


             a)   Hauled water.


             b)   Groundwater from a basin designated by the board as a  
               probationary basin. This exclusion does not apply to  
               groundwater from any portion of a basin excluded from  
               probationary status.










                                                                    SB 1262  
                                                                    Page  6



          3)Adds to the factors for determining sufficient water supply  
            under the Subdivision Map Act, if the subdivision relies in  
            whole or in part on groundwater, the following:


             a)   For a basin for which a court or the State Board has  
               adjudicated the rights to pump groundwater, the order or  
               decree adopted by the court or the State Board.


             b)   For a basin that has not been adjudicated, as follows:


               i)     For a basin designated as high- or medium-priority,  
                 the most recently adopted or revised adopted GSP or  
                 approved alternative. If there is no adopted GSP or  
                 approved alternative, information as to whether DWR has  
                 identified the basin or basins as overdrafted or has  
                 projected that the basin will become overdrafted if  
                 present management conditions continue.


               ii)    For a basin designated as low- or very low priority,  
                 information as to whether DWR has identified the basin or  
                 basins as overdrafted or has projected that the basin  
                 will become overdrafted if present management conditions  
                 continue.


          4)Adds to list of supporting materials for the determination of  
            substantial evidence an adopted GSP or alternative approved  
            pursuant to SGMA.


          5)Excludes from the determination of sufficient water supply  
            under the Subdivision Map Act, groundwater from a basin  
            designated by the board as a probationary basin. This  
            exclusion does not apply to groundwater from any portion of a  
            basin excluded from probationary status.


          Background








                                                                    SB 1262  
                                                                    Page  7





          Show Me the Water.  In response to local land use decisions  
          adversely affecting local water supply agencies, the Legislature  
          enacted SB 610 (Costa, Chapter 643, Statutes of 2001) and SB 221  
          (Kuehl, Chapter 642, Statutes of 2001).  Often referred to as  
          the "show-me-the-water" bills, together these two bills formally  
          linked land use planning with water use planning, and vice  
          versa.  SB 1262 amends those bills.


          Comments


          Correcting an Oversight.  The SGMA legislation in 2014  
          introduced necessary changes to the local land use planning  
          laws, but inadvertently omitted conforming changes to the  
          "show-me-the-water" legislation.  SB 1262 provides the necessary  
          updates to harmonize new development approvals with the  
          requirements of SGMA.


          Definition of a Project.  This bill does not change the  
          definition of a project subject to the "show-me-the-water"  
          bills.  However, there seems to be interest in exploring that  
          option.  


          A coalition of environmental justice groups write  
          "Unfortunately, this legislation lets stand the definition of a  
          subdivision (500 or more connections) which effectively  
          precludes most development from this sensible review process. We  
          urge the authors and the committee to consider a substantial  
          reduction in this number in order to protect new communities and  
          ensure that the state will not have to share the burden of  
          supporting them in future droughts."  


          The California Association of Local Agency Formation Commissions  
          similarly writes, "While we have no magic bullet number to offer  
          in terms of what is the "right size" for a project, we believe a  
          threshold of 500 units for projects at the zoning level (water  








                                                                    SB 1262  
                                                                    Page  8



          supply assessment pursuant to SB 610) probably captures less  
          than half of the growth, and therefore, less than half of the  
          demand. The 500 unit threshold for subdivisions (written  
          verification pursuant to SB 221) probably captures a very small  
          percentage of subdivision activity. Most projects are  
          considerably smaller. ?  We do feel it is best that thresholds  
          should change."  Moreover, "We believe if there was a lower  
          trigger number for a project, the concern regarding phased  
          development and the demand for water required to adequately  
          supply those new phases will be addressed."


          The author has indicated that she is willing to explore a  
          different definition as this bill moves forward.


          Related Legislation


          SB 1263 (Wieckowski/Pavley) strengthens the permitting process  
          for new public water systems to create greater environmental,  
          public health, and financial sustainability of drinking water  
          supplies.




          FISCAL EFFECT:   Appropriation:    No          Fiscal  
          Com.:YesLocal:   Yes


          SUPPORT:   (Verified5/13/16)


          Clean Water Action
          Community Water Center
          Desert Water Agency
          Leadership Counsel for Justice and Accountability
          Planning and Conservation League
          Sierra Club California
          Valley Ag Water Coalition









                                                                    SB 1262  
                                                                    Page  9




          OPPOSITION:   (Verified5/13/16)


          California Apartment Association
          California Association of Realtors
          California Building Industries Association
          California Business Properties Association
          California Chamber of Commerce
          California Independent Petroleum Association


          ARGUMENTS IN SUPPORT:  According to the author, "California has  
          a number of interconnecting laws that together attempt to ensure  
          that water supply availability is given proper consideration  
          when making land use decisions, and vice versa.  Among those  
          laws are 2002's SBs 610 (Costa) and 221 (Kuehl), also known as  
          the 'show me the water bills.' When we passed the Sustainable  
          Groundwater Management Act (SGMA) in 2014, we updated some water  
          and land use planning laws to reflect SGMA, but not the show me  
          the water bills.


          "SB 1262 (Pavley/Wieckowski), in conjunction with SB 1263  
          (Wieckowski/Pavley), builds on the administration's Affordable  
          Safe Drinking Water Initiative to update the show me the water  
          bills as follows:


           Integrates groundwater sustainability agencies and  
            consideration of groundwater sustainability plans into water  
            supply and land use planning.


           Prohibits use of groundwater to supply new development if the  
            groundwater basin has been deemed out of compliance with SGMA  
            (i.e., is 'probationary').


           Prohibits the use of hauled water to comply with show me the  
            water bills."









                                                                    SB 1262  
                                                                    Page  10




          ARGUMENTS IN OPPOSITION:     A coalition of building, real  
          estate, and other business interests write, "While we agree that  
          water supply and quality issues in the state deserve critical  
          attention, we are concerned with several provisions in the bill:


           SB 1262 takes a project-by-project approach as a way to solve  
            issues that are endemic to entire basins. This approach draws  
            a litigation target on greatly needed new housing and  
            employment centers while ignoring the impact of the basin's  
            conditions on other water supply demands. These issues are  
            best dealt with in a plan-based, programmatic way that creates  
            a more level playing field through changes to urban water  
            management plans.


           New construction projects do not have authority or the  
            responsibility to develop, approve and maintain legally valid  
            groundwater sustainability plans. Those duties and the  
            punishment for failing to comply with those duties -  
            designation of the basin as 'probationary' - should fall on  
            the agencies charged with responsibility - not on much-needed  
            new housing.


          For these reasons, we oppose SB 1262."


          Prepared by:Dennis O'Connor / N.R. & W. / (916) 651-4116
          5/13/16 13:47:48


                                   ****  END  ****