California Assembly Bill AB1588 Amended / Bill

 BILL NUMBER: AB 1588AMENDED BILL TEXT AMENDED IN SENATE JUNE 15, 2016 AMENDED IN ASSEMBLY MAY 31, 2016 AMENDED IN ASSEMBLY MARCH 16, 2016 AMENDED IN ASSEMBLY MARCH 9, 2016 AMENDED IN ASSEMBLY FEBRUARY 29, 2016 INTRODUCED BY Assembly Members Mathis and Alejo (Coauthors: Assembly Members  Chvez    and Lackey   Arambula,   Chvez,   Lackey,   and Olsen  ) (Coauthors: Senators Berryhill, Cannella, and Vidak) JANUARY 6, 2016 An act to add Chapter 6.6 (commencing with Section 13486) to Division 7 of the Water Code, relating to water, and declaring the urgency thereof, to take effect immediately. LEGISLATIVE COUNSEL'S DIGEST AB 1588, as amended, Mathis. Water and Wastewater Loan and Grant Program. Existing law, the Safe Drinking Water State Revolving Fund Law of 1997, establishes the Safe Drinking Water State Revolving Fund to provide grants or revolving fund loans for the design and construction of projects for public water systems that will enable those systems to meet safe drinking water standards. This bill would require the State Water Resources Control Board to establish a program to provide funding to counties to award low-interest loans and grants to eligible applicants for specified purposes relating to drinking water and wastewater treatment. This bill would authorize a county to apply to the board for a grant to award loans or grants, or both, to residents of the county, as prescribed. This bill would create the Water and Wastewater Loan and Grant Fund and provide that the moneys in this fund are available, upon appropriation by the Legislature, to the board to administer and implement the program. This bill would transfer to the Water and Wastewater Loan and Grant Fund $10,000,000 from the General Fund. This bill would declare that it is to take effect immediately as an urgency statute. Vote: 2/3. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. The Legislature hereby finds and declares as follows: (a) Many areas of the state are disproportionately impacted by drought because they are heavily dependent or completely reliant on groundwater from basins that are in overdraft and in which the water table declines year after year or from basins that are contaminated. (b) There are a number of state grant and loan programs that provide financial assistance to distressed communities to address drinking water and wastewater needs. Unfortunately, there is no program in place to provide similar assistance to individuals who are reliant on their own groundwater wells and who may not be able to afford conventional private loans to undertake vital water supply, water quality, and wastewater improvements. (c) The program created by this act is intended to bridge that gap by providing assistance to individual homeowners and renters to undertake actions necessary to provide safer, cleaner, and more reliable drinking water and wastewater treatment. These actions may include, but are not limited to, digging deeper wells, improving existing wells and related equipment, addressing drinking water contaminants in the individual's water, or connecting to a local water or wastewater system. SEC. 2. Chapter 6.6 (commencing with Section 13486) is added to Division 7 of the Water Code, to read: CHAPTER 6.6. WATER AND WASTEWATER LOAN AND GRANT PROGRAM 13486. (a) The board shall establish a program in accordance with this chapter to provide funding to counties to award low-interest loans and grants to eligible applicants for any of the following purposes: (1) Extending or connecting service lines from a water or wastewater system to the applicant's residence or plumbing. (2) Paying reasonable charges or fees for connecting to a water or wastewater system. (3) Paying costs to close abandoned septic tanks and water wells, as necessary, to protect health and safety as required by local or state law. (4) Deepening an existing groundwater well. (5) Improving an existing groundwater well, including associated equipment. (6) Installing a water treatment system if the groundwater exceeds a primary or secondary drinking water standard, as defined in Section 116275 of the Health and Safety Code. (b) The board may adopt any guidelines it determines are necessary to carry out the purposes of this chapter. A guideline adopted pursuant to this subdivision shall not be subject to the rulemaking requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. 13487. (a) The Water and Wastewater Loan and Grant Fund is hereby created in the State Treasury. The moneys in the Water and Wastewater Loan and Grant Fund are available, upon appropriation by the Legislature, to the board to administer and implement the program in accordance with this chapter. (b) Notwithstanding Section 16475 of the Government Code, any interest earned upon the moneys in the Water and Wastewater Loan and Grant Fund shall be deposited in the Water and Wastewater Loan and Grant Fund. 13487.5. (a) A county may apply to the board for a grant to award loans or grants, or both, to residents of the county in accordance with this chapter. (b) The board shall develop guidelines that determine how to apportion funds among the counties. (c) A county that receives funding pursuant to this chapter shall annually provide the following information to the board: (1) The number of loans and grants awarded. (2) The types of projects funded. (3) Project costs. (4) Whether there is demand for additional funding. 13488. (a) An eligible applicant for a loan shall meet all of the following criteria: (1) Have a household income below the statewide median household income. (2) Have an ownership interest in the residence. (3) Be unable to obtain financial assistance at reasonable terms and conditions from private lenders and lack the personal resources to undertake these improvements. (4) Demonstrate an ability to repay the loan. This requirement may be satisfied by having another party join the application as a cosigner. (b) Any loan granted shall be secured by a mortgage on the residence and repaid within 20 years in accordance with terms established by the board. The interest rate on the loan shall not exceed 1 percent. While any balance on the loan is outstanding, a loan recipient shall furnish evidence of and continually maintain homeowner's insurance on the security residence to protect the state' s interest in the residence. (c) The county may enter into a contract with a private financial institution to provide loans consistent with the purposes of this chapter. 13489. (a) An eligible applicant for a grant shall meet both of the following criteria: (1) Have a household income that is 80 percent or less of the statewide median household income. (2) Be unable to obtain financial assistance at reasonable terms and conditions from private lenders and lack the personal resources to undertake these improvements. (b) A grant recipient shall repay to the county the grant amount in full if that recipient sells the residence less than five years from the date that the grant agreement was signed. (c) A grant recipient shall repay to the county any unused grant funds.  13489.5. Funding provided pursuant to this chapter is not considered "water-related grant funding" for purposes of paragraph (7) of subdivision (b) of Section 116682 of the Health and Safety Code.  SEC. 3. Ten million dollars ($10,000,000) is hereby transferred from the General Fund to the Water and Wastewater Loan and Grant Fund. SEC. 4. This act is an urgency statute necessary for the immediate preservation of the public peace, health, or safety within the meaning of Article IV of the Constitution and shall go into immediate effect. The facts constituting the necessity are: In order to provide eligible households with access to safer, cleaner, and more reliable drinking water and wastewater treatment during California's prolonged drought, it is necessary that this act take effect immediately.