BILL NUMBER: SB 1973 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 26, 2000
AMENDED IN SENATE MAY 31, 2000
AMENDED IN SENATE MAY 9, 2000
AMENDED IN SENATE MAY 1, 2000
AMENDED IN SENATE APRIL 13, 2000
INTRODUCED BY Senator Perata
FEBRUARY 25, 2000
An act to add Chapter 8.3 (commencing with Section 1450) to Part 1
of Division 1 of the Public Utilities Code, and to add Section
1811.5 to the Water Code, relating to public utilities
and to amend Section 26.1 and 26.2 of the Castaic Lake
Water Agency Law (Chapter 28 of the Statutes of 1962, First
Extraordinary Session), relating to water .
LEGISLATIVE COUNSEL'S DIGEST
SB 1973, as amended, Perata. Public Utilities
Commission: water conveyance: fair compensation
Water charges .
(1) Existing law prohibits the state or a regional or local public
agency from denying a bona fide transferor of water, as defined,
from using a water conveyance facility that has unused capacity for
the period of time for which that capacity is available, if fair
compensation is paid for that use and other requirements are met.
Existing law defines "fair compensation" to mean the reasonable
charges incurred by the owner of the conveyance system, as specified.
This bill would authorize any bona fide transferor to file a
petition with the Public Utilities Commission for an adjudication of
whether the determination of the amount of fair compensation, as
defined, made by a state, regional, or local public agency for the
proposed use of unused capacity in a water conveyance facility is
consistent with a specified definition and guidelines. The bill
would require that any determination by the commission regarding
certain facilities involving the Sacramento-San Joaquin Delta and the
San Francisco Bay include a certification, as prescribed. The bill
would provide that a water conveyance facilities owner and a bona
fide transferor are subject to the jurisdiction of the commission, as
specified, would make violations of these provisions a crime, and
would require these entities to provide information to the
commission, as prescribed, thereby imposing a state-mandated local
program. The bill would require the commission to remand the case to
the state, regional, or local public agency for a redetermination,
unless the commission determines that the public interest would be
impaired by a delay. In that case, the commission would be
authorized to determine the amount of fair compensation, as
prescribed.
(2) 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, including the creation of a State Mandates
Claims Fund to pay the costs of mandates that do not exceed
$1,000,000 statewide and other procedures for claims whose statewide
costs exceed $1,000,000.
This bill would provide that with regard to certain mandates no
reimbursement is required by this act for a specified reasons.
The Castaic Lake Water Agency Law prescribes the
powers and duties of the Castaic Lake Water Agency. The agency law
authorizes that agency to impose a prescribed facility capacity fee
and requires the agency to calculate the fee pursuant to a method and
basis where the fee is as nearly as reasonably practicable an amount
proportionate to the benefit to the land. The agency law provides
for the collection of delinquent and unpaid facility capacity fees.
This bill would require the fee to be based on the amount of water
actually supplied by the agency to the water user paying the fee.
The bill would allow the agency to impose the fee only upon the
completion of the retail water connection. The bill, for the
purposes of calculating the fee, would prohibit the agency from
considering the costs of supplying water to the water user from
sources other than the retail water distributor. The bill would
provide for a specified credit if the water user upon whom a facility
capacity fee is imposed has been required by the retail water
distributor, for the purposes of receiving a new retail connection,
to fund or construct any water storage or pumping facility, as
prescribed. The bill would revise certain provisions of agency law
relating to the collection of delinquent and unpaid facility capacity
fees to apply those provisions to those facility capacity fees that
are either uncontested or the subject of a final judgment as to their
validity.
(3) 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, including the creation of a State Mandates Claims Fund
to pay the costs of mandates that do not exceed $1,000,000 statewide
and other procedures for claims whose statewide costs exceed
$1,000,000.
This bill would provide that with regard to certain mandates no
reimbursement is required by this act for specified reasons.
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.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 8.3 (commencing with Section 1450) is added to
Part 1 of Division 1 of the Public Utilities Code, to read:
CHAPTER 8.3. DETERMINATION OF FAIR COMPENSATION FOR JOINT USE
OF CAPACITY IN WATER CONVEYANCE FACILITIES
1450. The Legislature finds and declares all of the following:
(a) In 1986, the Legislature enacted Article 4 (commencing with
Section 1810) of Chapter 10.5 of Part 2 of Division 2 of the Water
Code, commonly referred to as the wheeling statutes, declaring at
that time that it was the policy of the state to facilitate the
voluntary sale, lease, and exchange of water and to allow open access
to water conveyance facilities where there is unused capacity, if
fair compensation is paid.
(b) The purpose of a voluntary water market is to create greater
efficiencies and meet increasing demands for additional water
supplies while creating relatively equal opportunities for all market
participants.
(c) A functioning wholesale water market, which necessarily
includes the assurance of reasonable wheeling charges for unused
capacity, should provide voluntary sellers of water with the
opportunity to sell to more than one buyer, and should provide
voluntary buyers of water with the opportunity to buy from more than
one seller. By contrast, without the assurance of reasonable
wheeling charges, competition among voluntary buyers and sellers of
water will be reduced or eliminated. In addition, wholesale water
customers should benefit from the assurance of reasonable wheeling
charges because it should facilitate cost-effective options for
locating additional water supplies.
1451. (a) As used in this section, the terms "bona fide
transferor," "fair compensation," and "unused capacity" have the same
meanings as defined in Section 1811 of the Water Code.
(b) (1) Any bona fide transferor may file a complaint with the
commission concerning the determination of the amount of fair
compensation for the proposed use of unused capacity in a water
conveyance facility that a state, regional, or local public agency
establishes pursuant to Section 1812 of the Water Code for the
purposes of a wholesale water transfer .
(2) The commission may adjudicate complaints filed pursuant to
paragraph (1) as soon as the commission establishes and publishes the
guidelines on the meaning of "fair compensation" required by Section
1452.
(c) (1) The commission, upon the filing of a complaint pursuant to
subdivision (b), has the exclusive authority to adjudicate whether
the determination of the amount of fair compensation is consistent
with the definition of "fair compensation" as interpreted by the
guidelines established pursuant to Section 1452. If the commission
finds that the amount of fair compensation is not consistent with the
definition of "fair compensation" as interpreted by the guidelines
established pursuant to Section 1452, the commission, except as
authorized by paragraph (2), shall remand the case back to the state,
regional, or local public agency for a redetermination of the amount
of fair compensation.
(2) If the commission finds that remanding the case pursuant to
paragraph (1) would cause a delay that would impair the public
interest, the commission may determine the amount of fair
compensation based on the evidence in the complaint record.
(d) (1) For the purposes of this chapter, a water conveyance
facilities owner and a bona fide transferor shall provide the
commission access to its books, records, documents, and reports in
accordance with Sections 312 to 314, inclusive, and Sections 581 to
587, inclusive. A water conveyance facilities owner and a bona fide
transferor shall also be subject to the commission pursuant to
subdivisions (a) and (b) of Section 311.
(2) The commission may enforce the provisions of Chapter 11
(commencing with Section 2100) of Division 1, of Part 1
regarding violations against a water conveyance facilities
owner and a bona fide transferor, in the same manner as the
provisions are enforced against a public utility.
(3) Notwithstanding paragraphs (1) and (2), this section does not
grant the commission jurisdiction to regulate a water conveyance
facilities owner or a bona fide transferor other than as specifically
set forth in this chapter.
1452. The commission shall open a proceeding to establish
guidelines on the meaning of "fair compensation" as defined in
Section 1811 of the Water Code for the proposed use of unused
capacity in a water conveyance facility for the purposes of a
wholesale water transfer . The guidelines established by the
commission shall include, but not be limited to, a requirement that
any proposed transferee of water provide proof that it is in full
compliance with the provisions of Chapter 3 (commencing with Section
10620) of Part 2.6 of Division 6 of the Water Code, relating to urban
water management plans , and with the best management
practices for urban water conservation for the state. This proceeding
shall be opened on or before January 31, 2001, and shall be
completed on or before December 31, 2001.
1453. Any determination of the commission involving facilities
that control the inflow into the Sacramento-San Joaquin Delta and the
San Francisco Bay and that divert water from the delta shall include
a certification by the State Water Resources Control Board that the
proposed wheeling will not harm fish or wildlife, will not degrade
delta water quality, and will not reduce water levels so as to
interfere with diversions or navigation in the delta.
SEC. 2. Section 1811.5 is added to the Water Code, to read:
1811.5. (a) Pursuant to Section 1452 of the Public Utilities
Code, on or before December 31, 2001, the Public Utilities Commission
shall establish guidelines on the meaning of "fair compensation" as
defined in Section 1811.
(b) Any complaint as to a determination by a state, regional, or
local public agency with regard to fair compensation for the
proposed use of unused capacity in a water conveyance facility for
the purposes of a wholesale water transfer is subject to
Chapter 8.3 (commencing with Section 1450) of Part 1 of Division 1 of
the Public Utilities Code.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
SEC. 4. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because
this act provides for offsetting savings to local agencies or school
districts that result in no net costs to the local agencies or school
districts, within the meaning of Section 17556 of the Government
Code.
SEC. 3. Section 26.1 of the Castaic Lake Water Agency Law (Chapter
28 of the Statutes of 1962, First Extraordinary Session) is amended
to read:
Sec. 26.1. (a) In addition to the other powers provided in this
act, the agency may establish and impose a charge referred to as a
facility capacity fee, and which is in the nature of a connection
fee, for the right to make a new retail connection to the water
distribution system of any retail water distributor within the agency
that obtains all, or any portion, of its water supplies from the
agency. The necessity for the fee, and the amounts thereof, shall be
determined, established, imposed, collected, and used in the manner
provided in this section.
(b) If the board of directors determines that its existing water
importation, transportation, and delivery facilities and other
related works, property, and improvements are not adequate for the
purpose of receiving, importing, transporting, and delivering
additional needed quantities of water available from the State Water
Resources Development System or from other sources, the board of
directors may adopt and carry out a plan for any of the following
purposes:
(1) To obtain additional facilities, works, property,
improvements, and supplies of water.
(2) To increase or enlarge, as may be appropriate, its existing
capacity and facilities for obtaining, importing, transporting, and
delivering additional quantity of water to retail water distributors
within the agency which are in need of additional water supplies.
(3) To finance or reimburse the agency for advancing the cost of
acquiring facilities, works, property, improvements, and supplies of
water and to allocate that cost among lands within water service
areas of the agency which, by reason of new development or new
construction thereon, will need new water service and will be
benefited by making the additional supplies of agency water available
for purchase by the retail water distributors that will supply those
lands with water.
(c) (1) Prior to adopting any plans pursuant to subdivision (b),
the board of directors shall hold at least one public hearing, at
which oral or written presentations may be made, as part of a
regularly scheduled meeting to establish water service areas within
the agency.
(2) Notwithstanding any other notice requirements of this act,
notice of the time and place of the hearing and meeting, including a
general explanation of the matters to be considered, and a statement
that the data required by this subdivision is available, shall be
mailed at least 14 days prior to the hearing to any interested party
who files a written request with the agency for mailed notice of the
hearing on those plans and on allocation of the costs thereof. Any
written request for that mailed notice shall be valid only for one
year from the date on which it is filed with the agency unless a
renewal request is filed. Renewal requests for the mailed notices
shall be filed on or before April 1st of each year. The board of
directors may establish a reasonable annual charge for sending the
notices based on the agency's estimated cost of providing the
service.
(3) At least 10 days prior to the hearing, the agency shall make
available to the public data indicating the cost, or estimated cost,
to acquire, construct, and provide the water importation,
transportation, and delivery facilities and other works, property,
and improvements necessary to obtain and provide the additional water
to those retail water distributors who will serve water to the lands
on which the new developments and new construction will be located,
and the proposed method and basis for allocating the costs as among
those lands.
(d) (1) Following the public hearing or hearings, the board of
directors shall make both of the following determinations:
(A) The extent of the need for the additional property and
supplies of water to be supplied by the agency.
(B) Whether existing facilities and other works and improvements
of the agency are adequate to import, receive, transport, and deliver
those additional quantities of water.
(2) If the board of directors determines that there is a need or
that the agency's existing facilities, works, property, and
improvements are inadequate to serve that water, or both, the board
of directors shall adopt the plan or plans specified in subdivision
(b).
(e) (1) In making its determinations as to how to
allocate the costs of the plan or plans within water service areas of
the agency, the board of directors shall determine the amount of the
facility capacity fee to be imposed for and upon each new connection
to the delivery facilities of the retail water distributors that
will supply those lands with imported or local water. The facility
capacity fee shall be fixed and determined pursuant to a
method and basis whereby the fee is as nearly as reasonably
practicable an amount proportionate to the benefit to the land,
including consideration of the volume of water to be delivered to the
new retail connection based on the amount of water
actually supplied by the agency to the water user paying the facility
capacity fee. The agency may impose the fee only upon the
completion of the retail water connection.
(2) (A) For the purposes of calculating the facility capacity fee,
the agency shall not consider the costs of supplying water to the
water user from sources other than the retail water distributor.
(B) If a water user on whom a facility capacity fee is imposed
determines that the agency has estimated an amount of water that
exceeds that which will be required on an annual basis by the water
user from the retail water distributor, the water user, not later
than 30 days from the date on which the water user receives a copy of
that estimated amount, may inform the agency, in writing, as to the
maximum amount of water that the water user plans to use from the
retail water distributor on an annual basis. Upon receipt of that
notice, the agency shall calculate the facility capacity fee based on
that estimated annual amount of water, as determined by the water
user.
(C) If the amount of water required from the retail water
distributor exceeds the maximum annual amount estimated by the water
user pursuant to subparagraph (B) during the three-year period
commencing on the date of the imposition of the facility capacity
fee, the agency may impose an additional charge to reflect actual
water usage and may impose a penalty of 10 percent on that additional
charge.
(3) If a water user upon whom a facility capacity fee is imposed
has been required by the retail water distributor, for the purposes
of receiving a new retail connection, to fund or construct any water
storage or pumping facility with capacity to serve users in addition
to the water user subject to the fee, and the water storage or
pumping facility is not subject to a reimbursement agreement between
the water user and the retail water distributor, the agency shall
credit the amount paid by the water user for that facility against
any facility capacity fee otherwise required to be paid by the water
user to the agency .
(f) The board of directors may contract with the counties, or
cities on or after January 1, 1992, in which the agency is located
for the collection of the facility capacity fee along with building
permit fees or other fees related to the improvement of property, or
may contract for collection of the facility capacity fee by the
retail water distributor.
(g) The proceeds of the facility capacity fee imposed and
collected pursuant to this section shall be used exclusively by the
board of directors for the annual capital budget of the agency, as
described in Section 29.1, for purposes authorized by this section as
specified in the plans adopted pursuant to subdivisions (b), (d),
and (e).
(h) Any action taken by the board of directors pursuant to this
section shall be taken only by resolution.
(i) Any judicial action or proceeding to attack, review, set
aside, void, or annul any resolution imposing a facility capacity
charge of the agency, or a resolution modifying or amending an
existing charge imposed by the agency, shall be commenced within 120
days of the effective date of the resolution. Any action or
proceeding shall be brought pursuant to Chapter 9 (commencing with
Section 860) of Title 10 of Part 2 of the Code of Civil Procedure.
SEC. 4. Section 26.2 of the Castaic Lake Water Agency Law (Chapter
28 of the Statutes of 1962, First Extraordinary Session) is amended
to read:
Sec. 26.2. (a) The agency may prescribe, by rules and
regulations adopted by resolution or ordinance, that, when any
facility capacity fees adopted pursuant to Section 26.1 and Sections
29.1 to 29.5, inclusive, become due and are unpaid under and
in accordance with the rules and regulations concerning those fees
, and are either uncontested or the subject of a final
judgment as to their validity as imposed, the fees may be
secured and collected in accordance with the procedures specified in
Sections 26.3 and 26.4. The security and collection procedures set
forth pursuant to Sections 26.3 and 26.4 shall only be operative with
respect to facility capacity fees first becoming delinquent on or
after January 1, 1990.
(b) For the purposes of this section, a facility capacity fee is
contested if an administrative or judicial challenge is brought by
the party on whom the fee is imposed not later than 90 days from the
date on which the party receives written notice that specifies the
amount of the fee, the basis of the calculation of the fee, the means
by which a party may contest the fee during the 90-day period, and
the rules governing any administrative appeal pertaining to the
imposition of the fee.
SEC. 5. (a) No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB 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 XIIIB of the California Constitution.
(b) No reimbursement is required by this act pursuant to Section 6
of Article XIIIB of the California Constitution for certain costs
that may be incurred by a local agency or school district because in
that regard a local agency or school district has the authority to
levy service charges, fees, or assessments sufficient to pay for the
program or level of service mandated by this act, within the meaning
of Section 17556 of the Government Code.
(c) However, notwithstanding Section 17610 of the Government Code,
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. If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.