Financial Assistance Programs - Grants and Loans

Proposition 204 Agricultural Drainage Subaccount

Article 4. Drainage Management California Water Code (Section 78640-78645.7)

• 78640. Unless the context otherwise requires, the following definitions govern the construction of this article:

  (a)

  (1) "Drainage water management units" means land and facilities for the treatment, storage, conveyance, reduction, or disposal of agricultural drainage water which, if discharged untreated, would pollute or threaten to pollute the waters of the state.

  (2) Drainage water management units shall include one or more of the following:

  (A) A surface impoundment that is designed to hold an accumulation of drainage water, including, but not limited to, holding, storage, settling, and aeration pits, and lagoons. A surface impoundment does not include a landfill, a land farm, a pile, an emergency containment dike, tank, injection well, evaporation pond, or percolation pond.

  (B) Conveyance facilities to the treatment or storage site, including devices for flow regulation.

  (C) Facilities or works to treat agricultural drainage water to remove or substantially reduce the level of constituents which pollute or threaten to pollute the waters of the state, including, but not limited to, processes utilizing ion exchange, desalting technologies such as reverse osmosis, and biological treatment.

  (D) Facilities or works to reduce the amount of agricultural drainage water discharged, including, but not limited to, source control projects.

  (E) Diked areas or cells that are

  (i) used for the purpose of water conservation, water management, or environmental mitigation and

  (ii) located within inland bodies of saline water in Imperial and Riverside Counties.

  (3) Any or all of the drainage water management units, including the land under the unit, may consist of separable features, or an appropriate share of multipurpose features, of a larger system, or both.

  (4) Drainage water management units do not include facilities for the direct discharge of agricultural drainage water to the bay-delta or Pacific Ocean.

(b) "Local agency" or "agency" means any city, county, district, joint powers authority, or other political subdivision of the state involved with water management.

(c) "Project" means drainage water management units.

(d) "Subaccount" means the Drainage Management Subaccount created by Section 78641.

• 78641. There is hereby created in the account the Drainage Management Subaccount. The sum of thirty million dollars ($30,000,000) is hereby transferred from the account to the subaccount for the purpose of implementing this article.
  
  
• 78642.

  (a) Notwithstanding Section 13340 of the Government Code, the sum of twenty-seven million five hundred thousand dollars ($27,500,000) in the subaccount is hereby continuously appropriated, without regard to fiscal years, to the board, for loans to local agencies to aid in the construction of drainage water management units for the treatment, storage, or disposal of agricultural drainage water, and for the purposes described in Section 78644. Priority shall be given to funding source reduction projects and programs.

• (b) Notwithstanding Section 13340 of the Government Code, the sum of two million five hundred thousand dollars ($2,500,000) in the subaccount is hereby continuously appropriated, without regard to fiscal years, to the board, for grants to local agencies for the purpose of providing the nonfederal share of the costs specified in Section 1101 of Public Law 102-575.

• 78643.

(a) The board may loan an agency up to 100 percent of the total eligible costs of design and construction of an eligible project.

(b) Any contract for an eligible project entered into pursuant to this article may include provisions as determined by the board to be necessary and shall include, but not be limited to, all of the following provisions:

(1) An estimate of the reasonable cost of the eligible project.

(2) An agreement by the agency to do all of the following:

(A) Proceed expeditiously with, and complete, the eligible project.

(B) Commence operation of the containment structures or treatment works upon completion and to properly operate and maintain the works in accordance with applicable provisions of law.

(C) Provide for payment of the agency's share of the cost of the project, including principal and interest on any state loan made pursuant to this article.

(D) If appropriate, apply for, and make reasonable efforts to secure, federal assistance for the state-assisted project.

(c) All loans made pursuant to this article are subject to all of the following provisions:

(1) Agencies seeking a loan shall demonstrate, to the satisfaction of the board, that an adequate opportunity for public participation regarding the loan has been provided.

(2) Any election held with respect to the loan shall include the voters of the entire agency except where the agency proposes to accept the loan on behalf of a specified portion, or portions, of the agency, in which case the election shall be held in that portion or portions of the agency only.

(3) Loan contracts may not provide a moratorium on payment of principal or interest.

(4) Loans shall be for a period of not more than 20 years. The interest rate for the loans shall be set at a rate equal to 50 percent of the interest rate paid by the state on the most recent sale of state general obligation bonds, to be computed according to the true interest cost method. If the interest rate so determined is not a multiple of one- tenth of 1 percent, the interest rate shall be set at the next higher multiple of one-tenth of 1 percent. The interest rate set for each contract shall be applied throughout the repayment period of the contract. There shall be a level annual repayment of principal and interest on loans.

(5) No single project may receive more than five million dollars ($5,000,000) in loan proceeds from the board under this act and the Water Conservation and Water Quality Bond Law of 1986 (Chapter 6.1 (commencing with Section 13450) of Division 7).

(d) The board may make loans to local agencies, at the interest rates authorized under this article and under any terms and conditions as may be determined necessary by the board, for purposes of financing feasibility studies of projects potentially eligible for funding under this article. No single 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 the purposes of this article may be expended for loans to finance feasibility studies. A loan for a feasibility study shall not decrease the maximum amount of any other loan which may be made under this article.

• 78644. The board may, by contract or otherwise, undertake plans, surveys, research, development, and studies necessary, convenient, or desirable to carry out subdivision (a) of Section 78642.
  
  
• 78645.

(a) Any unallocated money remaining in the Agricultural Drainage Water Account in the 1986 Water Conservation and Water Quality Bond Fund on November 6, 1996, and any unallocated money deposited into that account from the sale of any bonds that are sold after November 6, 1996, shall be transferred to the subaccount. For the purpose of this section "unallocated money" means money not committed or appropriated as of November 6, 1996, which is not less than six million one hundred seventy-seven thousand dollars ($6,177,000).

(b) Notwithstanding Section 13340 of the Government Code, any funds that are transferred pursuant to subdivision (a) to the subaccount are hereby continuously appropriated, without regard to fiscal years, to the Department of Food and Agriculture for programs to develop methods of using drainage water and reducing toxic materials in drainage water through reuse of the water and the use of the remaining salts. Priority shall be given to source reduction projects and programs.

• 78645.5. Not more than 3 percent of the total amount deposited in the subaccount for the use of the board may be used to pay for both of the following purposes:

(a) To pay the costs incurred by the board in connection with the administration of this article.

(b) For the purposes of Section 78644.

• 78645.7. Not more than 3 percent of the total amount deposited in the subaccount for the use of the Department of Food and Agriculture may be used to pay the costs incurred by that department in connection with the administration of this article.