Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
This chapter shall be known and may be cited as the California Safe Drinking Water Bond Law of 1986.
Chapter 10.7 - California Safe Drinking Water Bond Law of 1986
California Water Code — §§ 13895-13898.5
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Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
The Legislature hereby finds and declares all of the following:
(a)The State Department of Health Services has discovered toxic chemicals in 126 of California’s large public drinking water systems.
(b)Many of the chemical contaminants in California’s drinking water supplies are known or suspected of causing cancer, birth defects, and other serious illnesses.
(c)Following the passage of the California Safe Drinking Water Bond Law of 1984, the State Department of Health Services received 1,359 requests for eight hundred twenty-five million dollars ($825,000,000) to improve public drinking water systems. The department has determined that an additional five hundred million dollars ($500,000,000) is needed immediately for public water systems to correct deficiencies which pose a health hazard to enable hundreds of systems to meet mininum health standards.
(d)New monitoring programs for small public water systems are expected to identify many new toxic contamination problems. It is unlikely that these problems can be solved without financial assistance from the State of California.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
The Legislature further finds and declares that the protection of the health, safety, and welfare of the people of California requires that water supplied for domestic purposes be at all times pure, wholesome, and potable, and that it is in the interest of the people that the State of California provide technical and financial assistance to the end that the people of California are assured a safe, dependable, and potable supply of water for domestic purposes and that water is available in adequate quantity at sufficient pressure for health, cleanliness, and other domestic purposes.
Amended by Stats. 1996, Ch. 1023, Sec. 444. Effective September 29, 1996. Note: This section was added by Stats. 1986, Ch. 410, and approved in Prop. 55 on Nov. 4, 1986.
The Legislature further finds and declares that it is the intent of the Legislature to provide for the upgrading of domestic water supply systems to assure that all domestic water supplies at least meet minimum domestic water supply standards established under Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
The State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code) is adopted for the purpose of the issuance, sale, and repayment of, and otherwise providing with respect to, the bonds authorized to be issued pursuant to this chapter, and the provisions of that law are included in this chapter as though set out in full in this chapter, except that notwithstanding anything in the State General Obligation Bond Law, the bonds authorized hereunder shall bear the rates of interest, or maximum rates, as may, from time to time, be fixed by the Treasurer, with the approval of the committee, and the maximum maturity of bonds shall not exceed 50 years from the date of the bonds, or from the date of each respective series. The maturity of each respective series shall be calculated from the date of the series.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
As used in this chapter, and for purposes of this chapter as used in the State General Obligation Bond Law (Chapter 4 (commencing with Section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), the following terms shall have the following meanings:
(a)“Committee” means the Safe Drinking Water Finance Committee created by Section 13895.6.
(b)“Department” means the Department of Water Resources.
(c)“Domestic water system” means a system for the provision to the public of piped water for human consumption, if the system has at least five service connections or regularly supplies water to at least 25 individuals. The term includes any water supply, treatment, storage, and distribution facilities under the control of the operator of the system.
(d)“Fund” means the California Safe Drinking Water Fund.
(e)“Supplier” or “supplier of water” means any person, partnership, corporation, association, or other entity or political subdivision of the state which owns or operates a domestic water system.
(f)“Federal assistance” means funds available, or which may become available, to a supplier either directly or through allocation by the state from the federal government as grants or loans for the improvement of domestic water systems.
(g)“Treatment works” means any devices or systems used in the treatment of water supplies, including necessary lands, which render water supplies pure, wholesome, and potable for domestic purpose.
(h)“Project” means proposed facilities for the construction, improvement, or rehabilitation of the domestic water system, and may include water supply, treatment works, and all or part of a water distribution system, if necessary to carry out the purpose of this chapter.
(i)“Public agency” means any city, county, city and county, district, joint powers authority, or other political subdivision of the state which owns or operates a domestic water system. For purposes of this chapter, Chapter 10.2 (commencing with Section 13810), Chapter 10.5 (commencing with Section 13850), and Chapter 10.6 (commencing with Section 13880), a political subdivision of the state may be any public agency.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
The Safe Drinking Water Finance Committee is hereby created. The committee shall consist of the Governor, the Treasurer, the Director of Finance, the Director of Water Resources, and the State Director of Health Services or their designated representatives. A majority of the committee may act for the committee.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
There is in the State Treasury the California Safe Drinking Water Fund, which fund is hereby created.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
The committee may create a debt or debts, liability or liabilities, of the State of California, in an aggregate amount of one hundred million dollars ($100,000,000) in the manner provided in this chapter. The debt or debts, liability or liabilities, shall be created for the purpose of providing the money to be used for the objects and works specified in Section 13895.9.
Amended by Stats. 1996, Ch. 1023, Sec. 445. Effective September 29, 1996. Note: This section was added by Stats. 1975, Ch. 1008, and approved in Prop. 3 on June 8, 1976.
(a)An aggregate amount of one hundred million dollars ($100,000,000) of the moneys in the fund are hereby continuously appropriated and shall be used for the purposes set forth in this section and Section 13898.
(b)The department may enter into contracts with suppliers having authority to construct, operate, and maintain domestic water systems, for loans to suppliers to aid in the construction of projects that will enable the supplier to meet, at a minimum, safe drinking water standards established pursuant to Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code.
(c)Any contract entered into pursuant to this section may include provisions as agreed by the parties thereto, and the contract shall include, in substance, all of the following provisions:
(1)An estimate of the reasonable cost of the project.
(2)An agreement by the department to loan to the supplier, during the progress of construction or following completion of construction as agreed by the parties, an amount that equals the portion of construction costs found by the department to be eligible for a state loan.
(3)An agreement by the supplier to repay the state over a period not to exceed 50 years, (A) the amount of the loan, (B) the administrative fee as described in Section 13897, and (C) interest on the principal, that is the amount of the loan plus the administrative fee.
(4)An agreement by the supplier, (A) to proceed expeditiously with, and complete, the project, (B) to commence operation of the project upon completion thereof, and to properly operate and maintain the project in accordance with the applicable provisions of law, (C) to apply for, and make reasonable efforts to secure, federal assistance for the project, (D) to secure approval of the department and of the State Department of Health Services before applying for federal assistance in order to maximize and best utilize the amounts of that assistance available, and (E) to provide for payment of the supplier’s share of the cost of the project, if any.
(d)Bond proceeds may be used for a grant program in accordance with this chapter, with grants provided to suppliers that are political subdivisions of the state that are otherwise unable to meet minimum safe drinking water standards established pursuant to Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code. The total amount of grants made pursuant to this chapter shall not exceed twenty-five million dollars ($25,000,000).
(e)Notwithstanding any other provision, the proceeds of any bonds authorized to be issued under the California Safe Drinking Water Bond Law of 1976 (Chapter 10.5 (commencing with Section 13850)), and the California Safe Drinking Water Bond Law of 1984 (Chapter 10.2 (commencing with Section 13810)) that are unissued and uncommitted on the effective date of this chapter, shall be used for loans and grants to suppliers in accordance with the terms, conditions, and purposes of this chapter. Loans made after November 6, 1984, pursuant to Chapter 10.2 (commencing with Section 13810) shall carry an interest rate calculated as prescribed in Section 13897.3.
Amended by Stats. 1996, Ch. 1023, Sec. 446. Effective September 29, 1996. Note: This section was added by Stats. 1975, Ch. 1008, and approved in Prop. 3 on June 8, 1976.
(a)The department may make state grants to suppliers that are political subdivisions of the state, from moneys in the fund available for that purpose pursuant to subdivision (d) of Section 13895.9, to aid in the construction of projects that will enable the public agency to meet, at a minimum, safe drinking water standards established pursuant to Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code. A grant may be made by the department only upon the specific approval of the Legislature, by an act enacted after the receipt of a report filed pursuant to Section 13896.2.
(b)Any contract for a grant entered into pursuant to this chapter may include provisions as agreed by the parties thereto, and the contract shall include, in substance, all of the following provisions:
(1)An estimate of the reasonable cost of the project.
(2)An agreement by the department to grant to the public agency, during the progress of construction or following completion of construction as agreed by the parties, an amount that equals the portion of construction costs found by the department to be eligible for a state grant.
(3)An agreement by the public agency, (A) to proceed expeditiously with, and complete, the project, (B) to commence operation of the project upon completion thereof, and to properly operate and maintain the project in accordance with the applicable provisions of law, (C) to apply for, and make reasonable efforts to secure, federal assistance for the project, (D) to secure approval of the department and of the State Department of Health Services before applying for federal assistance in order to maximize and best utilize the amounts of that assistance available, and (E) to provide for payment of the public agency’s share of the cost of the project, if any.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
Applications for grants under this chapter shall be made to the department in the form and with the supporting material as prescribed by the department.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
The department shall prepare a report on each grant application pursuant to this chapter. The report shall be filed with the Legislature, if it is in session or, if it is not in session, with the Joint Rules Committee. The department shall be authorized to make the grant only upon the specific approval of the grant by the Legislature, by an act enacted after the receipt of the report from the department.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
(a)Loans and grants may be made only for projects for domestic water systems. The State Department of Health Services may make reasonable allowance for future water supply needs and may provide for additional capacity when excessive costs would be incurred by later enlargement. The loans and grants may be made for all, or any part, of the cost of constructing, improving, or rehabilitating any system when, in the judgment of the State Department of Health Services, improvement or rehabilitation is necessary to provide pure, wholesome, and potable water in adequate quantity at sufficient pressure for health, cleanliness, and other domestic purposes. The State Department of Health Services shall determine and notify applicants of eligibility of components requested to be included in the proposed project. The department shall use this determination as a basis for disbursing funds. No single public agency shall receive grants pursuant to this chapter totaling more than four hundred thousand dollars ($400,000). Loans may be made to provide for the purchase of a water system or the purchase of watershed lands. No loan to an individual supplier shall exceed the sum of five million dollars ($5,000,000), unless the Legislature by an act raises the limit specified in this section.
(b)Upon receipt of an application for a grant or loan pursuant to this chapter, the department shall propose to the applicant improvements to the applicant’s water development, distribution, and utilization system which will conserve water in a cost-effective manner. These improvements may include, but need not be limited to, leak detection and repair programs, valve repair and replacement, meter calibration and replacement, physical improvements to achieve corrosion control, distribution and installation of water conservation devices and fixtures, and other capital improvements which can be demonstrated to conserve water in a cost-effective manner. The department and applicant may agree to include these capital improvements in the grant or loan. Failure by the applicant to include water conservation capital improvements in the grant or loan application shall not be sufficient cause for the department to refuse to make the grant or loan.
Amended by Stats. 1996, Ch. 1023, Sec. 447. Effective September 29, 1996. Note: This section was added by Stats. 1975, Ch. 1008, and approved in Prop. 3 on June 8, 1976.
An application for a grant pursuant to this chapter shall not be approved by the department, unless the department determines that the public agency is otherwise unable to meet minimum safe drinking water standards established pursuant to Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code.
No grant shall be made by the department except upon approval by the State Department of Health Services of project plans submitted by the applicant and upon written approval by the State Department of Health Services that the proposed project is consistent with Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
First priority for grants shall be granted to public agencies having immediate health related problems, as certified by the State Department of Health Services. Additional high priority shall be granted to projects to correct immediate problems, as opposed to grants for construction of projects to meet future growth needs.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
First priority for loans shall be given to suppliers with the most critical public health problems. Priority for loans shall also be given to suppliers which have a lesser capability to reasonably finance system improvements.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
Preliminary design work, including a cost estimate for the project, shall be completed before a loan or grant is awarded. Operation and maintenance costs shall be the responsibility of the supplier and may not be considered as part of the project cost. Costs for planning and preliminary engineering studies may be reimbursed following the receipt of a loan or grant, subject to approval by the department and the State Department of Health Services.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
No application for a grant may be made pursuant to this chapter unless the public agency has also applied for a loan pursuant to this chapter. A public agency shall be eligible for a grant only to the extent that the department finds that the agency is found unable to repay the full costs of a loan.
If the department has determined that the applicant is unable to repay the full costs of a loan, the applicant may also file for a grant. Upon receipt of a grant application, the department shall determine that portion of the full costs that the applicant is capable of repaying. Grant funds shall only be provided for that portion that the applicant is not capable of repaying.
Added by Stats. 1986, Ch. 410, Sec. 1. Approved in Proposition 55 at the November 4, 1986, election.
Grant funds shall be expended by the public agency within three years of the making of the grant. No grant funds may be expended by the public agency unless the public agency is able to demonstrate to the department, within one year of the making of the grant, supported by an acceptable bid, that the amount to be expended for the project will be within 20 percent of the public agency’s cost estimate for the project.
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