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Author: Kyle Tankard

Just as recent El Niño storms have brought heavy rains to drought-stricken California, a new funding mechanism seeks to provide similar relief to cities, counties and water agencies across the state that have felt the heat over the course of the four-year drought. On December 14, the League of California Cities along with the California State Association of Counties (CSAC) and the Association of California Water Agencies (ACWA) filed a proposed constitutional amendment with the Attorney General’s office. The California Water Conservation, Flood Control and Stormwater Management Act seeks to provide local agencies with a new, alternative funding mechanism for stormwater management, flood control, and sewer and water supply services and projects, and also gives them the flexibility to establish usage rates that encourage conservation and reduce rates for low-income users.

The proposed ballot measure comes in the wake of an appellate court decision last spring, which ruled the tiered rates set out by the City of San Juan Capistrano violated Proposition 218, which exists as Article 13D of the California Constitution. The Court’s decision maintained that tiered rates, while legal under the state constitution, must be established based upon the actual cost of providing the service. The tiered system implemented by San Juan Capistrano charged a higher per-unit rate for heavier water use, which arguably exceeded the actual cost of providing water at that level of usage. Ultimately, the decision has diminished the ability of San Juan Capistrano and other water agencies to utilize the tiered pricing system as a tool to encourage conservation.

Although the proposed constitutional amendment provides local agencies the power and flexibility to establish a tiered system without the requirement that top rates be tied to cost of service, the amendment has been constructed in such a way that also protects taxpayers. Agencies must follow strict accountability requirements to provide transparency and ratepayer protections. Similar to procedures required by Proposition 218, a public hearing must be held and all rate payers must be notified beforehand. If a majority of written protests against the fee exists, then the fee or charge shall not be imposed. The proposed amendment requires that the fee or charge must “bear a fair or reasonable relationship to the fee payer’s burden or benefits received from the water service or sewer service”. Furthermore, an independent annual audit is required to show how the funds were spent and ensure that funds were used for the purpose they were imposed.

Despite recent El Niño storms, recovery from California’s historic drought requires much more co-operation from Mother Nature. Across the state, reservoir levels remain low, groundwater reserves remain depleted, and a full recovery may take several more years. This, coupled with the likelihood that climate change will continue to bring severe floods and droughts into the future, it is important that local agencies have the tools necessary to overcome these challenges. The proposed ballot measure is a step in the right direction in water policy and provides agencies an instrument to secure a more sustainable future in California. Stay tuned to see if this measure can make it on the ballot for November’s statewide election.