Section 13458 Of Chapter 6.1. Water Conservation And Water Quality Bond Law Of 1986 From California Water Code >> Division 7. >> Chapter 6.1.
13458
. (a) The sum of seventy-five million dollars ($75,000,000) of
the money in the fund shall be deposited in the Water Conservation
and Groundwater Recharge Account and, notwithstanding Section 13340
of the Government Code, is appropriated for expenditure in the
1986-87 fiscal year for loans to local agencies to aid in the
acquisition and construction of voluntary, cost-effective capital
outlay water conservation programs and groundwater recharge
facilities and the purposes set forth in this section. Loans made in
the 1986-87 fiscal year may not be authorized sooner than 30 days
after notification in writing of the necessity therefor to the
chairperson of the committee in each house which considers
appropriations, to the policy committee of the Assembly as designated
by the Speaker of the Assembly and the policy committee of the
Senate designated by the Senate Rules Committee, and the Chairperson
of the Joint Legislative Budget Committee.
(b) Any contract entered into pursuant to this section may include
provisions as may be determined by the department. However, any
contract concerning an eligible, voluntary, cost-effective capital
outlay water conservation program shall be supported by or shall
include, in substance, all of the following:
(1) An estimate of the reasonable cost and benefit of the program.
(2) An agreement by the local agency to proceed expeditiously
with, and complete, the program.
(3) A provision that there shall be no moratorium or deferment on
payments of principal or interest.
(4) A loan period of up to 20 years with an interest rate set
annually by the department at 50 percent of the interest rate
computed by the true interest cost method on bonds most recently
issued pursuant to this chapter. The interest rate set for each
contract shall be applied throughout the contract's repayment period.
There shall be a level annual repayment of principal and interest on
the loans.
(5) A provision that the project shall not receive any more than
five million dollars ($5,000,000) in loan proceeds from the
department.
The department shall set priority for loans under this subdivision
on the basis of the cost effectiveness of the proposed project, with
the most cost-effective projects receiving the highest priorities.
(c) Any contract concerning an eligible project for groundwater
recharge shall be supported by or shall include, in substance, all of
the following:
(1) A finding by the department that the agency has the ability to
repay the requested loan, that the project is economically
justified, and that the project is feasible from an engineering and
hydrogeologic viewpoint.
(2) An estimate of the reasonable cost and benefit of the project,
including a feasibility report which shall set forth the economic
justification and the engineering, hydrogeologic, and financial
feasibility of the project, and shall include explanations of the
proposed facilities and their relation to other water-related
facilities in the basin or region.
(3) An agreement by the agency to proceed expeditiously to
complete the project in conformance with the approved plans and
specifications and the feasibility report and to operate and maintain
the project properly upon completion throughout the repayment
period.
(4) A provision that there shall be no moratorium or deferment on
payment of principal or interest.
(5) A loan period of up to 20 years with an interest rate set
annually by the department at 50 percent of the interest rate
computed by the true interest cost method on bonds most recently
issued pursuant to this chapter. The interest rate set for each
contract shall be applied throughout the contract's repayment period.
There shall be a level annual repayment of principal and interest on
the loans.
(6) A provision that the project shall not receive any more than
five million dollars ($5,000,000) in loan proceeds from the
department.
The department shall give priority under this subdivision to
projects of agencies located in overdrafted groundwater basins and
those projects of critical need, to projects whose feasibility
studies show the greatest economic justification and the greatest
engineering and hydrogeologic feasibility as determined by the
department, and to projects located in areas which have existing
water management programs.
(d) The department may make loans to local agencies, at the
interest rates authorized under this section and under any terms and
conditions as may be determined necessary by the department, for the
purposes of financing feasibility studies of projects potentially
eligible for funding under this section. No single potential project
shall be eligible to receive more than one hundred thousand dollars
($100,000), and not more than 3 percent of the total amount of bonds
authorized to be expended for purposes of this section may be
expended for this purpose. A loan for a feasibility study shall not
decrease the maximum amount of any other loan which may be made under
this section.