Statewide Safe Drinking Water Funding Solution

On July 24, 2019, Gov. Gavin Newsom signed SB 200 (Monning) into law, creating the Safe and Affordable Drinking Water Fund, which provides the legal structure and process for funding safe drinking water solutions for disadvantaged communities in California that currently do not have that access.

The California Legislature had previously passed the bill in early July 2019.

The governor’s signing of SB 200 follows the June 27 enactment of the 2019-’20 State Budget, which sets forth the first part of the funding solution.  The State Budget provides $130 million for Fiscal Year 2019-’20 for safe drinking water solutions in disadvantaged communities that do not have access to safe drinking water.

In the first year, Fiscal Year 2019-’20, the safe drinking water funding solution will be funded with $100 million from the Greenhouse Gas Reduction Fund (GGRF) and $30 million from the General Fund.

After the first year, the funding will be 5% of the GGRF continuously appropriated – capped at $130 million per year.  The agreement includes General Fund funding as a backstop if 5% of the GGRF is less than $130 million in any year.  The funding will sunset in 2030.

The solution does not include a water tax.

In addition to Gov. Newsom, many legislators on both sides of the aisle played key roles in making this agreement possible.  To name just a few of those, Senator Monning (D-Carmel) has championed this issue from the beginning.  Assembly Water, Parks and Wildlife Committee Chair Eduardo Garcia (D-Coachella) encouraged stakeholders to come forward with ideas for how to solve the problem.  Senator Anna Caballero (D-Salinas) authored the ACWA and California Municipal Utilities Association co-sponsored SB 669, which proposed a Safe Drinking Water Trust.  Discussions on that bill helped inform the broader discussion regarding solutions.

ACWA staff appreciate the guidance on this critical issue from the ACWA Board of Directors, the ACWA DAC Drinking Water Initiative Task Force, and the State Legislative Committee and its Safe Drinking Water Funding Working Group. ACWA also appreciates the tireless legislative outreach support from member agencies.

Why is there a need for safe drinking water funding in California?

  • Most Californians have access to safe drinking water, but some disadvantaged communities do not
  • Lack of access to safe drinking water is a public health issue the state must address
  • A funding gap exists for operations & maintenance (O&M) costs for community water systems that treat water
  • In general, O&M costs cannot be financed using existing state and federal drinking water funding sources
  • In some situations, consolidation of a community water system may be the most effective solution
  • A financial solution is needed for O&M and consolidation costs in disadvantaged communities that can complement existing federal and state funding sources for capital costs.

Why is a statewide water tax not the right approach?

  • It isn’t sound policy to tax a resource that is essential to life
  • A regressive statewide tax on local water bills is in conflict with keeping water affordable for all Californians
  • It would be highly inefficient to require more than 3,000 local water agencies to serve as tax collectors for the state
  • The combined local administrative costs would exceed the combined statewide water tax revenue collected with local water bills

Californians Oppose a Drinking Water Tax

Tulchin Research conducted a statewide poll in early 2018 based on a previous drinking water tax proposal. That poll showed that 73% of likely voters oppose a new tax on drinking water, both initially and even after hearing more information.

Additionally, 74% would prefer using existing funding sources rather than establishing a new tax on drinking water.

For more on the polling, please read the polling results memo or see our news release.

Tools & Resources

2019 ACWA & Coalition Letters

2019 Media Coverage

2018 Coalition Letters

Questions

For questions about the agreement or Conference Committee action, please contact ACWA Deputy Executive Director for Government Relations Cindy Tuck at (916) 441-4545.

For media inquiries, please contact ACWA Director of Communications Heather Engel at (916) 441-4545.

 

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