7_. Agenda Item No. ( )Yes(X)No. Resolution: SUBJECT: LEGISLATIVE AFFAIRS REPORT-MAY 2016

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1 - Resolution: AGENDA CONTRA COSTA WATER DISTRICT DOCKET FORM 7_. Agenda Item No. ( )Yes(X)No SUBJECT: LEGISLATIVE AFFAIRS REPORT-MAY 2016 SUMMARY: The Legislative Affairs Program monitors issues in the California Legislature and in the United States Congress that have the potential to affect the ability of Contra Costa Water District (District) to carry out its mission. Through the program the District seeks to impact legislation in response to positions adopted by the Board of Directors (Board). This report is focused on recent activity at the state and federal level and anticipated issues of interest for These positions are described in Attaclunent 1. Descriptions of state and federal bills of interest to the District are provided in Attaclunent 2. State Legislative Issues: State legislators have been busy in policy committee hearings to meet the May 27, 2016 deadline to get bills to the floor of their house. The May revise of the state budget is expected soon.-the deadline for the legislature to pass a budget is June 15, Some of the topics of bills of interest include: Endangered/threatened/invasive species (AB 2555); Land use related to secondary units (SB 1069); and Lead pipes (SB 1398). The District signed on to a letter with other California Urban Water Agencies (CUWA) m~mbers that encourages the administration and legislators to provide a $56 million in the FY state budget to advance the Human Right to Water state policy for disadvantaged communities. Other signatories include East Bay Municipal Utility District, Alameda County Water District, Metropolitan Water District, Los Angeles Depaiiment of Water and Power, and San Diego County Water Authority. On emergency and long-term conservation measures from the state, the Governor released his latest declaration, primarily focused on I0ng-te1m changes. The State Water Resources Control Board is considering staff recommendations on both emergency and long-term regulations. The District's drought program will reflect those changes. (Continued on Page 2) RECOMMENDED ACTION: Review update on legislative issues and adopt District positions for the following: AB 2555 (Assembly Water, Parks and Wildlife Committee) Fish and Wildlife Favor; SB 1069 (Wieckowski) Land Use: Zoning-Oppose; and SB 1398 (Leyva) Public Water Systems: Lead Pipes-Support. Director of Public Affairs JB/JA:ch Attaclunents: 1) Legislative Positions; 2) - May 2016

2 May 18, 2016 Page2 SUMMARY (Continued from Page 1): AGENDA DOCKET FORM Federal Legislative Issues: As previously reported, the District submitted its letter of support for Senator Feinstein's drought legislation (S. 2533). Staff are still expecting a markup of the bill in the next few weeks. The District raised concerns in its position letter to the Senator that there are seve1:al problematic areas of the House bill and that, in the interest of getting drought relief in place quickly, those areas should not be part of the final bill. Controversial pmiions of the House drought bill have been introduced as elements of the FYI 7 Appropriations bill which recently passed through the Energy and Water Subconm1ittee and will likely be discussed end of session. Legislation on the San Luis Drainage settlement continues to move and will likely go to a committee hearing this month. The District took a position of Oppose Unless Amended on Valadao's H.R and now Congressman Costa has introduced a new bill with the same language with some additions; the changes do not address the District's concerns. The committee is in the process of identifying individuals to testify on a panel.

3 Attachment 1 Contra Costu Wuter District Legislutive Positions Support (S) - legislation. Measure has substantial significance; District actively supports the proposed Support (llld Seek A111e11dme11ts (SIS) - Measure has substantial significance; District will actively support the proposed legislation while continuing to seek specific amendments. Support if Amended (SIA) -Measure has substantial significance; District will actively support the proposed legislation if it is amended to address specific sh01icomings identified by the District. Fuvor (F) - Legislation is generally beneficial to District; it will join with other organizations in suppo1i, but will not engage actively in advocacy for the measure. Fuvor if Ame11ded (FIA)-Legislation is generally beneficial to District; it will join with other organizations in support if legislation is amended to address specific sho1icomings identified by the District, but will not engage actively in advocacy for the measure. W utch (W) - Measures or general issues of potential significance to District, but have not been sufficiently defined for a formal position. Not Fuvor (NF) - Legislation is generally detrimental to District; it will join with other organizations in opposition, but will not engage actively in advocacy against the measure. Oppose U11less Amended (OIA) - Measure has substantial significance; District will actively oppose the proposed legislation unless it is amended to address specific sho1icomings. Oppose (0) - legislation. Measure has substantial significance; District actively opposes the proposed

4 Attachment 2 CONTRA COSTA WATER DISTRICT Staff Report DATE: TO: FROM: May 18, 2016 Board of Directors Jerry Brown SUBJECT: INTRODUCTION: The Legislative Affairs Program monitors issues in the California Legislature and in the United States Congress that have the potential to affect the ability of the Contra Costa Water District (District) to carry out its mission. Through the program, the District seeks to impact legislation in response to positions adopted by the Board of Directors. RECOMMENDED ACTION: Review update on legislative issues and adopt District positions for the following: AB 2555 (Assembly Water, Parks and Wildlife Committee) Fish and Wildlife Favor; SB 1069 (Wieckowski) Land Use: Zoning-Oppose; and SB 1398 (Leyva) Public Water Systems: Lead Pipes-Support. New District Positions: State Legislation: AB 2555 (Assembly Water, Parks and Wildlife Committee) Fish and Wildlife Recommended District Position: Favor ACWA Position: Favor Status: Senate Natural Resources and Water Committee This bill would extend the sunset date on several sections of the Fish and Game Code scheduled to sunset on January 1, The three provisions addressed in this bill include: 1) the process used by the Fish and Game Commission to evaluate adding or removing a species from the threatened or endangered lists, including the public hearings and comment period; and 2) requirement for Fish and Wildlife to develop and implement a recovery strategy pilot program for coho salmon; and 3) prohibition from possessing, shipping or transporting dreissenid mussels (i.e. quagga and zebra mussels). The first would be extended indefinitely and the second and third provisions would be extended to January I, The District should favor this bill specifically for the protection of waterways and water bodies from the spread of invasive quagga and zebra mussels. The extension of the provision related to the California Endangered Species Act is limited to the administrative procedures.

5 Page2 SB 1069 (Wieckowski, D Fremont) Land Use: Zoning Recommended District Position: Oppose ACWA Position: Oppose Status: Senate This bill would amend the Planning and Zoning Law to declare that accessory dwelling units (secondary units) in single-family or multi-family residential zones provide are impo1iant to providing reasonably affordable housing.. In order to help facilitate This would remove or provide exceptions to some existing requirements, including water meters and water service. The same exceptions would apply towards sewer, parking and other issues. The District should oppose this bill as it would ovel1"ide existing local policies, such as the District's, implemented to ensure that growth pays for growth and requires those putting new demand on the water system are not subsidized by existing customers. SB 1398 (Leyva, D Chino) Public Water Systems: Lead Pipes Recommended District Position: Support ACWA Position: Watch and Amend Status: Senate Appropriations Committee This bill would require a public water system to: 1) compile an inventory of lead pipes by July 1, 2018; and 2) provide a timeline for the replacement oflead pipes identified in the inventmy. The State Water Resources Control Board would also be required to develop best management practices for col1"osion control in water systems. Lead is an issue of high interest, and the District has actively participated in programs to ensure lead contamination is not an issue, even without lead pipes in the distribution system. The District should suppmi this bill. Adopted District Positions: The following are state and federal measures previously reviewed by the Board that are still active. State Legislation: AB 1589 (Mathis, R, Visalia) California Environmental Quality Act: Exemption District Position: Watch ACWA Position: Favor Status: Assembly Natural Resources Committee The California Enviromnental Quality Act (CEQA) requires lead agencies to prepare and celiify Enviromnental Impact Repmis for projects that would have significant enviromnental impacts or Mitigated Negative Declarations for projects that can be revised to avoid or mitigate for impacts. This bill is intended to provide CEQA exemptions for projects undertaken and approved by agencies to mitigate for impacts caused by drought, flood, or fire during a state of emergency declared by the Governor.

6 Page 3 AB 1647 (Waldron, R, Escondido) Environmental Quality: Water Storage Facilities District Position: Watch ACW A Position: Favor Status: Assembly Natural Resources Committee CEQA requires lead agencies to prepare and certify Environmental Impact Reports for projects that would have significant environmental impacts. This bill is intended to provide CEQA exemptions for water storage projects focused on expanding the storage capacity of an existing storage facility in certain specified circmnstances: supplies water for agricultural and nonagricultural purposes; expands the capacity by no mote than 25%; preserves operations of the facility; complies with existing safety guidelines; and addresses seismic concerns. AB 1649 (Salas, D, Bakersfield) Water Quality, Supply, and Infrastructure Improvement Act of 2014: Water Storage Projects District Position: Not Favor ACWA Position: Not Favor Status: Assembly Appropriations Committee The Water Quality, Supply, and Infrastructure Improvement Act of 2014 (Proposition 1) was approved by voters and appropriates $ billion to the California Water Commission (Commission) for public benefits associated with water storage projects. The Connnission is going through a public process to develop the guidelines for applications and awarding funds on a competitive basis to potential storage projects. This bill would make findings of the legislature that Temperance Flat and Sites Reservoirs will meet the statewide goals and provide the specified public benefits to the greatest extent. March 17, 2016 amendments would require the Connnission to prioritize funding oflocal Joint Powers Authorities surface water projects. AB 1713 (Eggman, D, Stockton) Sacramento-San Joaquin Delta: Peripheral Canal District Position: Watch ACWA Position: Oppose Status: Assembly Appropriations Committee This bill would prohibit the construction of a "peripheral canal" unless expressly authorized by an initiative voted on by California voters on or after January 1, The California WaterFix would fall under the definition of a peripheral canal in the bill. The bill also requires that the Legislative Analyst's Office complete a prescribed economic feasibility analysis prior to a vote to authorize construction. The bill also requires that the project not diminish or negatively impact water supply, water rights, or water quality of any water user in the delta. AB 1755 (Dodd, D, Napa) Open and Transparent Water Data Act District Position: Favor if Amended ACWA Position: Support if Amended Status: Assembly Appropriations This bill would require the Depmiment of Water Resourq)s (DWR) to establish a public benefits corporation that would create and manage a statewide water information accounting system to improve the ability of the state to meet growing demands for resources to meet water supply reliability and healthy ecosystems by integrating existing water data information into a uniform

7 Page4 clearinghouse. The intent is to provide a more useful infonnation clearinghouse that would help foster water transfers. The authors and sponsors of AB 1755 and AB 2304 are working closely with ACW A and other agencies to update language within both bills to provide a policy direction that will help facilitate improvements for water transfers. AB 2304 (Levine, D, San Rafael) California Water Market Exchange District Position: Favor if Amended ACW A Position: Support if Amended Status: Assembly Appropriations Committee This bill would establish a centralized water market platform online that provides ready access to information about water available for transfer or exchange. This would require data be submitted to the exchange and payment fee. The authors and sponsors of AB 1755 and AB 2304 are working closely with ACWA and other agencies to update language within both bills to provide a policy direction that will help facilitate improvements for water transfers. AB 2480 (Bloom, D, Santa Monica) Source Watersheds: Financing District Position: Watch ACWA Position: Not Favor Unless Amended Status: Assembly Appropriations Committee This bill would declare that source watersheds are recognized and defined as integral components of the state's water system. Maintenance and repair of those systems would be eligible for financing on an equivalent basis with other water collection and treatment infrastructure. AB 2550 (Patterson, R, Fresno) State Water Resources Control Board: Instream Flow Curtailments: Compensation District Position: Watch ACWA Position: None Yet Taken Status: Assembly Water Parks and Wildlife Committee Under existing law, the State Water Resources Control Board (Water Board) grants permits and licenses to divert water. This bill would require the Water Board to financially compensate a person that is unable to divert the full amount of water authorized under his or her permit or license due to a Water Board driven instream flow curtailment. AB 2583 (Frazier, D, Oakley) Sacramento-San Joaquin Delta Reform Act of 2009 District Position: Change from Watch to Support if Amended ACWA Position: Oppose Status: Assembly Water Parks and Wildlife Committee (failed passage) Existing law established the Delta Stewardship Council (Council) and the requirement for the development of the Delta Plan. The Delta Plan was to establish parameters for "covered actions" proposed within the boundaries of the Delta or Suisun Marsh. This bill would make changes to

8 Page 5 what constitutes a covered action under the Delta Plan and specifically includes the California WaterFix as a covered action. The District provided a letter to the author regarding the position taken by the Board. As the bill failed to pass out of committee, this bill will not move on, but language could always be introduced in another bill as an add-on or a gut and amend. SB 7 (Wolk, D Davis) Housing: Water Meters: Mnltiunit Structures District Position: Support ACWA Position: Watch Status: Pending Reconsideration This bill would authorize building standards that require the installation of water sub-meters in multiunit residential buildings by a licensed plumbing contractor. This bill outlines landlord and tenant responsibilities for the installation, maintenance, and reading of sub-meters. The bill also outlines how a landlord should handle billing tenants based on readings from the sub-meters. The bill also directs the Department of Housing and Community Development to develop requirements for installation of sub-meters, including specifications for when installation of sub-meters is not feasible. Health care facilities, low-income housing, residential care facilities, student dormitories, and time-share prope1ties would be exempt. Local utilities would not be required to install or maintain sub-meters; however, they would have to require that new mixed-use residential and commercial structures install sub-meters as a condition for service for applications submitted after Janumy 1, SB 554 (Wolk, D, Davis) Delta Levee Maintenance District Position: Support ACW A Position: Favor Status: Assentbly Existing law establishes a delta levee ntaintenance progrmn pursuant to which a local agency may request reimbursement for costs incurred in connection with the maintenance or improvement of levees in the Sacramento-San Joaquin Delta. Existing law declares legislative intent to reimburse eligible local agencies under this program, until July 1, 2018, in an amount not to exceed 75% of those costs that are incurred in excess of$1,000 per mile oflevee. Existing law, on and after July 1, 2018, declares the intent of the Legislature to reimburse eligible local agencies under this program in an amount not to exceed 50% of those costs that are incurred in any year for the maintenance and improvement of levees. This bill would remove the sunset date and declare legislative intent to continue to reimburse up to 75% of those costs incurred in any year for the maintenance or improvement oflevees in excess of$1,000 per mile oflevee and would authorize the board to advance funds in an amount that does not exceed 75% of the estimated state shm e to an eligible local agency.

9 Page6 SB 814 (Hill, D San Mateo) Drought: Excessive Water Use: Urban Retail Water Suppliers District Position: Oppose ACWA Position: Oppose Unless Amended Status: Assembly This bill would prohibit excessive use of water by residential customers during a period in which the Governor has issued a proclamation of a state of emergency based on drought conditions. This bill requires agencies to set a threshold for "excessive use" and make a violation of this prohibition punishable by a fine of up to $500 per unit of water used above that threshold. The bill also amends the Public Records Act to require that information be made available regarding residential customers that violate the prohibition, including name, address, and water use. The bill passed through the Senate with most comments focused on discouraging opportunities for individuals to "buy their way out of drought". The District will continue to provide input opposing this one-size-fits-all approach. SB 885 (Wolk, D, Davis): Public Works Indemnification District Position: Oppose ACWA Position: Not Favor CSDA Position: Oppose Status: Senate Floor This bill specifies, for construction contracts, that a design professional only has the duty to defend claims that arise out of, or pertain or relate to, negligence, recklessness, or willful misconduct of the design professional. This bill provides that a design professional would not have a duty to defend claims against any other person or entity arising from a construction project, except that person or entity's reasonable defense costs arising out of the design professional's degree of fault. The bill continues to be amended in committee and the District is monitoring amendments that are helpful or more harmful. Federal Legislation: H.R (Valadao, R Hanford) San Luis Unit Drainage Resolution Act District Position: Oppose Unless Amended ACWA Position: Favor Status: House Natural Resources Committee This bill would authorize a settlement between the Bureau of Reclamation and Westlands Water District regarding management of drainage through the San Luis Drain. This reflects the settlement language released last year with some changes.

10 Legislative Affairs Repo1t Page 7 S (Feinstein, D California) California Long-Term Provisions for Water Supply and Short-Term Provisions for Emergency Drought Relief Act District Position: Support ACWA Position: Support Status: Committee on Energy and Natural Resources The bill provides long-te1m and sh01t-term provisions to drought prone Califomia. The bill includes several elements and authorizes fonding for immediate assistance to drought-stricken communities, desalination, storage, recycling, conservation, groundwater recharge, and incentives for innovation in water treatment and monitoring. Many provisions in the bill reflect language introduced previously by the Senator, Congressman Valadao, and Congressman Huffman. This bill includes protection for existing environmental laws and regulations, and has softened the language of the prescriptive measures for operations that were included in the past. JB/JA:ch