Chapter 10.6. California Safe Drinking Water Grant Program of California Water Code >> Division 7. >> Chapter 10.6.

The purpose of this chapter is to authorize the use of moneys in the California Safe Drinking Water Fund for a grant program for public agencies owning or operating domestic water systems, as authorized pursuant to the provisions of the California Safe Drinking Water Bond Law of 1976. The Legislature hereby finds and declares that it is necessary to establish a grant program to aid public agencies in the construction of projects for domestic water systems, and that certain public agencies owning or operating domestic water systems will be 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.

As used in this chapter:
  (a) "Department" means the Department of Water Resources.
  (b) "Domestic water system" means a system for the provision to the public of piped water for human consumption, if such system has at least 15 service connections or regularly supplies water to at least 25 individuals. Such term includes any water supply, treatment, storage, and distribution facilities under the control of the operator of such system.
  (c) "Fund" means the California Safe Drinking Water Fund created pursuant to Section 13859.
  (d) "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 such inclusions are necessary to carry out the purpose of this chapter.
  (e) "Public agency" means any city, county, district, or other political subdivision of the state which owns or operates a domestic water system.
  (f) "Treatment works" means any devices or systems used in the treatment of water supplies, including necessary lands, which render such supplies pure, wholesome, and potable for domestic purpose.

(a) The department, subject to the requirements of this chapter, is authorized to make state grants to public agencies from moneys in the fund available for that purpose pursuant to subdivision (d) of Section 13861, to aid in the planning and 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. Any grant in excess of one hundred thousand dollars ($100,000) 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 13884.
  (b) Any contract for a grant pursuant to this chapter may include provisions as may be agreed upon by the parties thereto, and the contract shall include, in substance, the following provisions:
  (1) An estimate of the reasonable cost of the project, that may include planning costs.
  (2) An agreement by the department to grant to the public agency, during the progress of construction or following completion of construction as may be agreed upon by the parties, an amount that equals the portion of construction and planning costs found by the department to be eligible for a state grant.
  (3) An agreement by the public agency, (i) to proceed expeditiously with, and complete, the project, (ii) 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, (iii) to apply for and make reasonable efforts to secure federal assistance for the project, (iv) 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 the assistance available, and (v) to provide for payment of the public agency's share of the cost of the project, if any.

Applications for grants under this chapter shall be made to the department in such form and with such supporting material as may be prescribed by the department.

The department shall prepare a report on each application pursuant to this chapter for a grant in excess of one hundred thousand dollars ($100,000). The report shall be filed with the Legislature, if it is in session, or if it is not in session, with the Rules Committee of the Assembly and Senate. The department shall be authorized to make a grant in excess of one hundred thousand dollars ($100,000) only upon the specific approval of the grant by the Legislature, by an act enacted after the receipt of such report from the department.

Grants may be made only for projects for domestic water systems. The department may make reasonable allowance for future water supply needs and may provide for additional capacity when excessive costs would be incurred by later enlargement. Such grants may be made for all or any part of the cost of constructing, improving, or rehabilitating any such system when, in the judgment of the State Department of Health Services, such improvement or rehabilitation is necessary to provide pure, wholesome, and potable water available in adequate quantity at sufficient pressure for health, cleanliness, and other domestic purposes. No single public agency shall receive grants pursuant to this chapter totaling more than four hundred thousand dollars ($400,000). The total amount of grants made pursuant to this chapter shall not exceed thirty million dollars ($30,000,000), of which up to fifteen million dollars ($15,000,000) may be used for grants for projects for the construction, improvement, or rehabilitation of domestic water systems which have become contaminated by organic or inorganic compounds (such as nitrates, DBCP (dibromochloropropane), TCE (trichloroethylene), and arsenic), or radiation, in such amounts as to render the water unfit or hazardous for human consumption.

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 issuance to the public agency of a permit or amended permit as specified in Chapter 4 (commencing with Section 116275) of Part 12 of Division 104 of the Health and Safety Code.

First priority for grants shall be afforded to public agencies having immediate health related problems, as certified by the State Department of Health Services. Additional high priority shall be afforded to projects to correct immediate problems, as opposed to grants for construction of projects to meet future growth needs.

Preliminary design work, including a cost estimate for the project, shall be completed before the grant is awarded. Operation and maintenance costs shall be the responsibility of the public agency and may not be considered as part of the project cost.

No application for a grant may be made pursuant to this chapter unless the public agency has also applied for a loan pursuant to the California Safe Drinking Water Bond Law of 1976. No public agency whose loan application has been rejected on the basis of lack of financial need shall be eligible for a grant. 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.

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.

For the purpose of administering the provisions of this chapter, the total expenditures of bond proceeds by the department and the State Department of Health Services in any fiscal year may not exceed 3 percent of the total of the grants awarded in such fiscal year pursuant to this chapter.

The department, after public notice and hearing and with the advice of the State Department of Health Services, shall adopt rules and regulations necessary to carry out the purposes of this chapter. Such rules and regulations shall be transmitted to the Legislature within 60 days after the effective date of this chapter.